784 E X G E X C other. The peculiarities of this very ancient common law conveyance or assurance were (1) equality of estates, not in value or in subject matter, but in legal right of owner ship ; (2) the use of the word exchange (excambium, e.g., in Domesday book, hanc terram camliavit Hugo, &c.); (3) that, though formal delivery of seisin was not required, possession or entry was required to complete the transaction by mak ing it notorious; (4) that, in the case of incorporeal heredita ments, and where the lands lay in different counties, a deed was required ; (5) an implied condition of re-entry on the lands of him whose title failed (Coke on Littleton, 50 a ; Blackstone by Sweet, ii. p. 323), the liability to re-entry affecting an alienee, but the right to re-enter being per sonal to the exchanger and his heirs. This condition, how ever, did not long survive the statute Quia emptores ; and exchanges are now generally effected by mutual conveyances with the usual covenants for title, which the Act 8 and 9 Viet. c. 106 declares not to imply any condition, whether the word " exchange " be used in the testatum or not. Ex changes are also very frequently made, by order of the in- closure commissioners, under the various Acts of Parliament for the inclosure, exchange, and improvement of lands, from 8 and 9 Viet. c. 118 to 31 and 32 Viet. c. 89 (see Cooke On Indosures). In these cases, the property taken is simply impressed with the title of the property given in exchange. So also statutory exchanges are made under the Acts for the Sale and Exchange of Chanty Estates, the Chari table Trust Acts, from 16 and 17 Viet. c. 137 to 32 and 33 Viet. c. 110, which now apply to Roman Catholic charities, formerly under 23 and 24 Viet. c. 134. There are also statutes enabling ecclesiastieal corporations to ex change, with the approval of the church estate commis sioners. Powers of exchange are generally given to trustees under English settlements, and these are exercised by revo cation of the original uses and appointment of new uses, all ancillary powers being given by implication under 23 and 24 Viet. c. 145 (see Davidson s Precedents in Conveyancing, vols. ii., iii., and v.). In what may be called international conveyancing, the exchange of territories is accomplished by treaties, of which there is no fixed style. A well-known example is Art. XII. of the Treaty of Nimeguen, "Les terres en- clave es seront exchangees contre d autres qui se trouveront plus proches et a la bienseance," &,c. The Italian duchies and islands have very frequently been exchanged. Thus, in the Quadruple Alliance of 1720, Philip V. exchanged a reversionary title to Sicily for a reversionary title to Sardinia. The exchange of prisoners in war is often regulated by documents called cartels, which specify a certain agreed on value for each rank of prisoners. The transference of prisoners is often carried out by cartel ships, which, though prohibited from carrying cargo or passengers, are entitled to certain privileges. It was in the 17th century that this practice (which seems to have been unknown to Grotius) superseded the older one of ransom at the end of the war. See Wheaton s Elements of International Law, Lawrence s edi tion, p. 590, and App. A. in Robinson s Adm. Rep., vol. iii. The early law of military exchange will be found discussed by Albericus Gentilis, De Jure Belli, cap. xvi., "De permutationibus et libera- tionibus." (W. C. S.) EXCHANGE. The system by which commercial nations discharge their debts to each other has been termed " Ex change, " or " the Exchanges." It has been subject of much study both by merchants and bankers who have to deal with its phenomena in the course of business, and by economista desirous to discover the causes of the phenomena, and to ex plain the laws or method of their operation. In rude times the people of neighbouring countries brought their staple or surplus produce to common fairs, where one kind of goods was valued and bartered for another; and the dealers brought a little gold and silver with them to settle the small balances. But this, though a rough type of international trade still, is a wholly different affair from modern com merce, with its transactors multiplied a millionfold, and con ducting their transactions far apart in widely distant coun tries. Money itself does little to obviate the difficulties arising from this multiplicity of crossing and recrossing currents; and whoever, therefore, was the first introducer of the idea of " Exchange " is entitled to a high place in the commercial annals of the world whether it was the stranger mentioned by Isocrates, who came to Athens with some cargoes of corn, and gave an order on a town on the Euxine where money was owing to him, with recourse on an Athenian merchant in the event of the order being dis honoured; or Cicero, in paying for the studies of his son at Athens by an assignment from a creditor in Rome on his debtor in the Greek city ; or the pope, whose lending merchants of Siena and Florence drew upon Henry III., or rather on the prelates and abbots of England, with some English merchants as remitters, for the expenses of depos ing Manfred, king of Sicily, in which act of deposition Henry was an interested and obligant party thus avoid ing in these various cases the difficulty and risk of trans porting coin. The idea, wherever first exemplified, was too good to be lost. It was early developed into a system in Venice, later in Amsterdam, and is now of world-wide application. It is well to observe, first, what is exchanged values of commodities exported and sold from one place or country to another, debts thereby owing, interest, profits of capital invested abroad, foreign loans and subsidies, freights, bank ing and other commissions, expenses of foreign residence or travel, and, in short, claims of payment of every kind on one part, having their relative obligations of remittance on the other, and originally denominated, as the contract or the occasion may have been, in the money either of the places from which the claims proceed or of those where they are payable. Secondly, the means must be noticed by which the exchange is effected pieces of paper, bearing express calculation to secure what is exactly due between debtor and creditor. A bill of exchange is an order drawn for a specified and definite sum, in favour of a person who is the buyer and becomes the " remitter " of the order, upon a third person, the " drawee," who is indebted for this sum to the drawer, and on presentation of the order becomes the "acceptor." The person or company in whose favour the order is drawn may pass it into other hands, and these, by writing their names on the back, become " indorsers." On much the same model there are " inland " and " foreign " bills of exchange. The whole system of exchange has its foundation in the drawing of the creditor on the debtor ; for, as in every country there are both creditors and debtors of other countries, the debtors find it to their advantage to take up the drafts of the creditors in order to avoid direct remittances in cash. Inland exchange is simpler in character and more easily Ink comprehended than foreign exchange, but in reality presents ex ~ the same phenomena and the same sequence of cause and c a effect as the other, so far as the circumstances of any country allow these to come into operation. Mr M Culloch, in the article on " Exchange." in former editions of the present work, gave a familiar exposition of inland exchange, which it would be difficult to improve : " If the debts reciprocally due by London and Glasgow be equal, whether they amount to 100,000, 500,000, or any other sum, they may be discharged without the intervention of money, and the price of bills of exchange will be at Par; that is, a sum of 100 or 1000 in Glasgow will purchase a bill for 100 or 1000 payable in London, and vice versa. But if these cities be
not mutually indebted in equal sums, then tlie price of bills will be