3839. Is it a common practice for the fish-curer to advance the money for a boat, or to supply the boat to the men and receive payment from them by instalments?-It is generally the understanding, that if a crew get a new boat, they pay up for it in three years. In some cases they are able to pay up for it in one year when there is a good fishing. I may mention one case in Dunrossness, the year before last, where six mem came to us and wanted a boat and lines. We gave them the advance, fitted them out, and supplied their families during the season, and at the end of the season they had earned with that boat and lines 200. The agreement was, that they were to pay for the boat in one year if they could; and if not, they were to get credit for three years. They paid up for this boat and lines clear, and had money to get at the end of the season.
3840. When an arrangement of that sort is entered into, is a certain sum deducted from the men"s earnings at the end of the year in respect of the boat?-There is an account kept for the boat. If they pay one-third share the first year, it is taken off as a whole, and not taken off each individual.
3841. They are jointly and severally liable for the price of the boat?-Yes; they have a company account. The boat is charged to that account; and when they settle, there are two-thirds carried down to the debit of each man, and the rest is paid up.
3842. Then, in every case of that kind, there is a boat account separate from the accounts of the individual members of the crew?-Yes.
3843. And if any of the men have gone away from the country, or have got deep in debt before the boat is paid up, the other members of the crew remain liable for the whole amount?-They are liable in point of law, but it is very seldom they pay anything beyond their own share.
3844. When that comes to be paid out of the share of a man who has an individual account, is his share of what remains due on the boat generally entered to his debit in his own account each year?- No, not separately. We keep an account against the boat and the crew, and we give them credit for the whole of their fish when we come to settle with them. Then we take off one-third the price of the boat, along with the cost of any other supplies they may have had in company, and divide the balance and enter it to each separate man"s credit, leaving two-thirds of the price of the boat at the debit of the boat account.
3845. The balance that remains in favour of the men after that comes into their separate accounts?-Yes.
3846. So that the boat account has a priority in the settlement over the individual accounts of the men?-Yes.
3847. Where such a boat account exists, is it the case that the individual men are generally, or always, dealing at the shop of the merchant who advances the boat?-I cannot say. The men are at liberty to deal where they like. Getting an advance of a boat does not compel them to take their supplies from the same merchant.
3848. But is there any understanding or practice according to which the men do deal at the merchant"s shop?-I cannot say.
The men that we deal with are at liberty to take their supplies either from us or from any other shop in the country.
3849. Are your shopkeepers allowed to make any intimation to the men that they are expected to deal at your shop?-They are never told to do so, and they never do it, so far as I am aware.
3850. Would they be checked or reprimanded if they did it?-We never had occasion to reprimand them, because we never said a word about it ourselves. Our shopkeepers never did it by our orders, and I don"t think they ever did it of their own accord.
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3851. In agreeing to open a boat account with men in that way, is any preference given to men who deal at your shops, or who undertake to deal there? Would you more readily agree to open an account with such men than with others who did not deal with you?-That is never taken into consideration at all.
3852. But when a boat account is opened, are they always expected to deliver their fish to you until it is paid off?-That is always part of the understanding, that they shall fish to us as long as they"re due a balance on the boat.
3853. And when the balance is paid, then they are free?-Yes; they are at liberty to renew the agreement with us, or to go anywhere else they like.
3854. Do you find that, at the end of the period when the balance is paid off, the men are generally ready to continue to fish for you?-Sometimes they fish for us, and sometimes they shift and go to another curer.
3855. There is no general rule about that?-No.
3856. You say in your statement, that the men are quite safe with the arrangement to get the current price at the end of the season for their fish: "They know the compet.i.tion between curers all over the islands is so keen, that they are secured to get the highest possible, price that the markets can afford. Any curer that can offer a little advantage to the fishermen over the others is certain to get more boats the following year; and this is carried so far, that men with limited capital, in their endeavours to obtain a large share of the trade by giving credit and gratuities, in one way and another leave nothing to themselves, and the end come to grief:" is that a common thing in the islands?-It is not common, but it does happen occasionally.
3857. Has that any connection with a statement which was made in the evidence given in Edinburgh, about the necessity which a merchant was under, to have a large amount of bad debts in order to succeed in business?-I daresay it has.
3858. I suppose that refers to the same sort of dealers men with limited capital, who push their business by giving the fishermen an advantage in that way, and who were said to come to grief from having too few bad debts?-Yes.
3859. Do you suppose the gentleman who gave evidence to that effect, and which you have criticised in another part of your statement, was referring to the same cases that you are there referring to?-I am not referring to any particular case in that statement. It is only afterwards that I mention evidence. In this case, I say that a man with small capital who gives too large advances to the fishermen, which they cannot repay, is very likely to be unable to pay his own creditors.
3860. When you speak of him giving too large advance, do you mean in the shape of supplies of going out of his shop?-Yes; and giving too many gratuities to the fishermen, so that they have all the profit, and he has none.
3861. What do you mean by gratuities to fishermen?-Fees, and other inducements to fish, besides the regular current price.
3862. Is that both in the home and Faroe fishing?-Not in the Faroe fishing. I refer to the home fishing only.
3863. Then in the home fishing there is sometimes an arrangement to give fees to the fishermen in addition to the current price?- Yes. For instance, the skipper of a boat, being the most experienced man of the crew, generally gets a small fee; and there are other gratuities paid, which differ at different stations.
3864. These gratuities are given in order to secure the fish of a large number of fishermen?-Yes.
3865. Have you cases in your mind at present, which these gratuities, and the excessive advances in goods, have led to the failure of people entering into the trade for the first time?-In making this statement I had particular cases before my mind; but such do happen occasionally through the islands.
3866. You don"t think the existence of such cases inconsistent with your denial of Mr. Walker"s statement with regard to bad debts?-I have referred to his statement on that subject, simply for the purpose of pointing out the absurdity of it.
3867. Of course if you speak of the debts as being absolutely bad debts, the statement is absurd, as you point out but suppose that a man starting business in Shetland gets a number of fishermen into his debt to a certain amount, has he not a hold, over these fishermen, so as to compel them to deliver their fish to him in future?-He has no hold over them whatever for that purpose. He has just this hold over them that if he chooses, he can go into the court with them and prosecute them; but after they have fished to him for some time, and find that they can get no further supplies from him, they are very likely to go away and offer their services to some one else.
3868. But suppose that at the end of the season a merchant has 100 fishermen who are in debt to him to the extent of 2 or 3 or 4, and whom he can prosecute at once for recovery of that money, do you think the fishermen have no inducement to continue to deliver their fish to him, rather than allow him to prosecute?-It may induce some of them to do so, but some of them may be frightened and leave him, in case he were to prosecute them. We generally find that when a man gets into debt, to us, we never see him again.
3869. Do you mean in debt to that extent, or to larger extent?- When he gets into our debt to the extent of 6 or 8, he very soon leaves us, and we never see him again. In many cases they know very well that the prosecutor might have to pay the law expenses and would get no return.
3870. May that not arise from the fact that you deal more leniently with your debtors than other merchants?-I don"t think we do. I think other merchants carry on their businesses on much the same principles as ourselves.
3871. Does it not strike you that the statement you are contradicting about the value of bad debts to a Shetland business, although it might be exaggerated in the terms which it is put, has nevertheless a certain amount of truth in it?-I know quite well, that if a man with small capital lays out that capital in buying goods to supply fishermen, and delivers these goods to the fishermen, and then has to pay for the goods and has nothing to pay them with, he must shut his shop and become bankrupt.
3872. But if he has sufficient money to carry on for a little,-or if he gets his bills renewed for a certain time, and manages to get the fishermen bound to him by the fact that they are in his debt, and by the fear of being prosecuted for that debt,-may he not have a very good season next year, and be able to get a large supply of fish, which he can sell at a profit, and so gradually make his way?- Fish are not like ready money. You may have a pretty large number of men fishing to you, but you cannot convert their fish into money until perhaps the end of twelve months. You only get your fish sold once a year, and you won"t get any person in the south to give you goods on credit for twelve months. Besides, a fish-curer must always have a certain amount of debts standing in his books against fishermen, and stock which he cannot make available.
3873. Do you mean shop goods?-Yes, he must have shop goods, and he must have debts in his books to a pretty large amount before he can carry on extensively.
3874. I am a.s.suming always that the man, although his capital may be limited, has a certain amount of capital which will carry him on for a couple of years?-Well, then the end would be sure to come.
3875. But he may manage to make a good business, and to carry it on successfully; if he gets a certain number of fishermen under an obligation to fish for him; or if he can induce them by offering premiums and gratuities to fish for him rather than for others,- can he not?-But in the meantime he is giving them supplies; and while they may have got into his debt to the extent of 5 or 6 each man this year, on the understanding [Page 94] that they are to fish to him next year and pay off their debt, yet when he comes to settle with him he may find that they have not only not paid up their old debt, but that there is something more added to it, as he has been giving them supplies all the time.
3876. But, in a case of that sort the fish-merchant will probably try to keep the supplies which he gives to his people down to as low a point as possible; and if the season has been a good one for agricultural produce, they may not require very extensive supplies in the second season?-Perhaps so; but generally men who have got into debt the first year, require supplies afterwards; and if you stop the supplies at any time after the fishing has begun, the man stops work, and when one man in a boat"s crew stops work it throws the whole idle.
3877. Therefore you think the fact of men getting into your debt has no effect in securing their services as fishermen to you for the future?-No. It is a certain way of throwing away money, and getting rid of their services.
3878. Have you had any experience as to the mode of settling with men who go to the herring fishing?-Yes.
3879. Is your firm engaged in that fishery?-It has been quite a failure here for the last two or three years.
3880. What is the mode of dealing with the fishermen there? Is it the same system that is pursued at Wick?-The herring fishing here, for the most part, is carried on in the same small open boats as are used at the haaf. At Wick they have large boats for the purpose. Here each man has a certain number of nets of his own, and they use their own boats and nets.
3881. When is the bargain made about the division of the produce; or are the men engaged upon wages?-For the past few years the herring fishing here has been so trifling, that scarcely any person took the trouble to make a bargain with the men about it. If they caught any herrings and delivered them, they generally made a bargain for them about the time they commenced.
3882. Were they to get so much per cran?-Yes.
3883. Is that the same practice that is followed at Wick?-The same practice, I think. At Uyea Sound I think there were as many as sixty small boats that went to that fishing; but for the last two or three years they have not cured a single cran of herrings, so that the thing was not worth our attention.
3884. Are you aware what the general arrangement between the fishermen and the curer in the herring fishing is-I don"t speak of Shetland alone, but at other places?-I understand the boats and nets at Wick and other places belong to the fishermen; but the men there are largely indebted to the fish-curers, who have to make large advances to them before they can carry on the fishing.
3885. But the bargain made at the beginning of the season is for a price per cran?-Yes.
3886. And that is due when?-It is not settled, believe, until the end of the fishing.
3887. But the price is fixed at the beginning?-Yes.