Announcing the Auction of. the first commonwealth banknote. 23 march 2006 hotel intercontinental sydney australia NOBLE

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1 Announcing the Auction of the first commonwealth banknote 23 march 2006 hotel intercontinental sydney australia NOBLE N U M I S M A T I C S P T Y L T D

2 The first Commonwealth banknote Foreword We are immensely pleased to be offering Australia s first Commonwealth banknote, Ten Shillings M000001, at our forthcoming auction March 2006 in Sydney. The offering is unprecedented in Australian numismatic auction history and with a pre-sale estimate of $1.2 million the note is by far the most valuable of any Australian numismatic object offered at auction. For these reasons we decided to produce this special booklet in addition to our usual catalogue to explore and disseminate the history and importance of the note. For information on viewing the note or to arrange a confidential consultation please refer to the details on page 8. Thanking you for your attention, Jim Noble (Managing Director) The time has arrived NATIONAL LIBRARY OF AUSTRALIA, NLA.PIC-AN The origins of the first Commonwealth note issue can be found in the Australian Constitution, enacted at Westminster in Section 51 (xii) granted parliament the power to legislate with respect to currency, coinage and legal tender. Support for Commonwealth paper currency began soon after federation. The existing system of private bank and Queensland Government issues was perceived as detrimental for a variety of reasons, including its impediment to the free flow of commerce due to cross-border exchange Rt Hon Andrew Fisher c.1910 costs. Additionally, the banking crisis of saw many banks close their doors with a resultant depreciatory effect on paper. A bill proposed in 1907 with the view to authorising a Commonwealth issue of notes payable on demand was dropped after confidential consultation with the banks raised unequivocal opposition. It was the Labor Prime Minister, Andrew Fisher, who revived the concept in a policy speech at Gympie, Queensland on 30 March 1909 and reported in The Argus the following day. In his address Fisher declared The time has arrived when the Commonwealth should have a note issue of its own. To Fisher it was clear the young Commonwealth required a stable, unified federal paper currency to facilitate its economic growth. Wildcat money a Confederate States of America fifty dollars The first Commonwealth banknote 2 To be offered at auction 23 March 2006

3 Early resistance Labor s victory in the election of 1910 delivered to the party a majority in both houses of Parliament and saw Australia s (and the world s) first majority federal Labor government. Fisher s previous statement of policy was brought to action in the form of the Australian Notes Bill, which was read and debated in parliament following the election. Opponents were fuelled partly by the common perception of Labor s naivety in matters of finance. An editorial in The Argus on 20 July 1910 alleged whenever Governments have issued paper money they have never known where to stop, and disaster has followed in every case and described the thirst for legal tender notes as alcoholism in the body politic. The bad paper money of wild-cat republics in Spanish-America, the Confederate States One pound superscribed on Bank of Victoria form of America and the Romanov monarchy were all cited as historic precedents. Australian Notes Act Despite opposition, the Australian Notes Act was proclaimed on 1 November The act banned state-issue currency and authorised the Treasury to issue Australian notes in denominations of 10s, 1, 5, 10 and any other multiple of ten pounds. An obligation to hold a gold reserve of not less than one fourth of the total value of issued notes was put upon the Treasury. Then, in order to force out existing currency, the Bank Notes Tax Act was assented on 10 October 1910 and stipulated a tax of ten percent per annum on private bank notes not redeemed. The strength of the measure coupled with the Commonwealth s unpreparedness to effectively circulate a currency issue meant proclamation was deferred until 11 July The Superscribed issues The first Australian notes circulated on 1 December 1910 were not original designs but rather Government superscriptions printed on private bank forms. The denominations of sixteen different private banking institutions were used resulting in dozens of varieties. As an aside, it is a curiosity that the Government relied heavily on private banks to circulate its own legal tender issue, and in doing so sought to destroy the banks existing currency. The Empire s first paper ten shillings Adding to this note s legend is its status as the first paper ten shillings to be produced by authority within the British Empire (the Bank of England s first paper ten shillings was issued in 1928). Where banknotes were hitherto the domain of society s wealthy, the ten shillings denomination, approximate to an anverage day s wages, greatly expanded potential circulation. Opposition to the new egalitarian notes was voiced by some concerned citizens who feared the note s wider exposure, particularly to sordid elements, would lead to a small-pox outbreak among those normally insulated from the lower classes. This reaction expresses the levelling effect of the new, lower denomination. Criticisms also took the old line of gold being preferable to paper. An editorial in The Argus (5 September 1913) stated No man is likely to throw half a sovereign (a gold coin) into the fire, mistaking it for his tailor s bill; but he might easily do this with the 10/- note. His feelings would be painful when he next found the bill and realised he had 10/- less to pay it with. The first Commonwealth banknote 3 To be offered at auction 23 March 2006

4 Creating new notes Prior to the introduction of Superscribes, however, planning was already underway for original design banknotes. A public competition for designs was announced in the Commonwealth of Australia Gazette on 5 November Despite several winning entries being selected and prizes of 50 paid, none were deemed suitable and the task was contracted to the world-renowned engravers Bradbury Wilkinson & Co of London. The selected location of physical infrastructure for printing and storing banknotes was King s Warehouse, Flinders Street Extension, Melbourne. Preparation, including the installation of machinery and security devices, was carried out during the years that followed. Presentation of ten shillings M000001, 1 May 1913 Commemorating the first issue A ceremony to commemorate the first distinct Commonwealth issue took place at King s Warehouse at 3.00pm on 1 May The gathering included many of Australia s most eminent public figures, including Governor General Denman and family, Prime Minister Andrew Fisher, Minister for Customs (Mr. Tudor), Acting Post-Master-General (Senator Findley), Vice-President of the Executive Council (Senator McGregor), Melbourne s Lord Mayor (Mr Matthews) and Governor of the Commonwealth Bank (Mr Denison Miller). Once the printing process had been demonstrated and a batch of ten shillings notes prepared, the task of numbering the notes by machine-press was handed over to the assembly. Printing banknotes, May 1913 Governor-General Denman s young daughter Judith was given the honour of numbering the first note, pulling the lever and impressing the red serial M The note was then presented to little Miss Denman by the Prime Minister. Approximately equal to a day s wages, ten shilling was a generous souvenir, even for the relatively privileged Judith. To this day, the note is found together with an envelope inked Judith s 10/-. NATIONAL LIBRARY OF AUSTRALIA, NLA.PIC-AN V The first Commonwealth banknote 5 To be offered at auction 23 March 2006

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6 The Denman provenance Judith Denman, recipient of ten shillings M000001, was the fortunate daughter of Australia s fifth Governor General, Thomas Denman ( ). His tenure began after arriving from England in July 1911, at a time when the role of the Queen s Australian representative was significantly different to that of the present. The Governor-General was duly treated with great ceremony and formal accord a visit to Sydney in 1913 was a front-page affair. The political closeness between Australia and Britain also strengthened the esteem of the position. As the most politically liberal of Australia s Governor-Generals of the period, Denman was particularly cordial with the Labor Party and its leader Andrew Fisher. His tenure is probably best remembered for the role played in the political instability of 1914, when Cook s Liberal government was hamstrung by Labor s retention of the senate. A double dissolution lifted the crisis however the pressures of the job coupled with his wife s homesickness saw him resign and return to England later that year. Remaining a firmly committed liberal, Denman could and newspaper baron. In 1903 Gertrude married the politically sympathetic Thomas, allowing her husband to enter politics by way of his new found wealth and influence. When Thomas was appointed Governor-General, Gertrude joined him travelling to Australia with their two small children. As part of her official duties she named Canberra at a ceremony on 12 March Following her return to England Gertrude kept active as a public figure. From she held the post of President of the National Federation of Women s Institutes. Other important posts included first Chairperson of the Family Planning Association, President of the Ladies Golf Union, a Trustee of the Carnegie United Kingdom Trust, and a Director of the Westminster Press and the Women s Land Army. Ten Shillings M remained in the possession of the Denman descendants in England until 1999 when the decision was made to part with the item. It was subsequently sold privately for $1 million to the current owner, a private Sydneybased businessman. Thomas Denman (left) and Gertrude Denman at the naming of Canberra, 1913 hence not attain further office in England and led a relatively quiet life. His successor as Governor-General was Sir Ronald Munro-Ferguson. Judith s mother, Lady Gertrude Mary Denman (née Pearson) ( ) was born into a wealthy family; her father Weetman Pearson (later Baron Cowdray) was an oil magnate NATIONAL LIBRARY OF AUSTRALIA, NLA.PIC-AN V Goulburn Weir: Reverse design of the first ten shillings issue The scene on the reverse of the note depicts Goulburn Weir, Victoria, which is still in use today. The Goulburn River (Aboriginal name Bayunga ), on which the weir is situated, is Victoria s largest river, flowing north-west from the Great Dividing Range near Mount Singleton to meet the Murray at Echuca. The weir s necessity came about as a result of agricultural development in the Shepparton region and several droughts between 1877 and The first official proposal for a timber weir was dated 27 September 1880 and authored by the Water Conservancy Board. Problems with cost and construction saw progress stall and it was not until 1887, subsequent to a Royal Commission, that a masonry weir construction contract was signed. Stuart Murray oversaw the advanced engineering project, which involved hauling massive quantities of granite from Mount Black (24km distant) by dray and required importation of all concrete from England. The weir was finally completed in 1889, allowing an extensive irrigation system and greatly improving agricultural efficiency. At 212 metres in length, 16 metres high and costing 104,862, the Goulburn Weir represented one of the great, and most expensive, engineering achievements of Colonial Australia. In the context of other early Australian note designs, the ten shillings follows a consistent theme of agriculture and mining, underlining the importance of these commodity based industries to the Australian economy. The first Commonwealth banknote 6 To be offered at auction 23 March 2006

7 A unique opportunity Australia s record-breaking note When sold privately in 2000 for $1 million (Sydney Morning Herald, 1 Feb 2000) this banknote set a new record for any Australian numismatic item. It is now to be offered at auction for the first time. As such, it presents an unprecedented opportunity to acquire the premier Australian banknote. World-class rarity Further underlining the note s rarity is the fact that very few first national notes from other countries have survived and even fewer are in private hands. Australia, as one of the world s oldest democracies, is particularly fortunate to have retained such an important part of its economic history. National significance The condition of the note has remained practically unchanged since its production over 90 years ago. Crisp, flat and with good colour, its pristine countenance is a fitting distinction for this national treasure. Banknotes as an investment Banknotes have for some time been recognised as a solid investment. Access Economics Asset Price Survey revealed Australian banknotes as the top performer of any category during the period (see below). Recent price movements indicate this trend has not abated. The strong demand for Australian banknotes can be attributed to a variety of factors, including the guarantee of limited supply and, to a large extent, increasing general cultural awareness with concomitant interest in objects of Australian heritage. Consider, for example, the Bank of New South Wales ten shillings of 1817 which was purchased for a few dollars in the 1970s and sold at our November 2005 auction for $283,095. Access Economics Asset Price Survey Australian Banknotes Australian Wine International Shares Melbourne Houses Ten shillings M is indisputably the most important Australian currency item and therefore stands among the most prized objects of Australiana. To own the first of literally billions of banknotes produced since 1913 by the Commonwealth assures the successful buyer an acquisition of the highest prestige. For further information or to arrange a confidential consultation with one of our experts, please refer to the information on the rear of this booklet. A notable record 0 100% 300% 500% COURTESY ACCESS ECONOMICS The illustration below shows another record-breaking banknote; the United States one thousand dollars Grand Watermelon (one of three known in private hands), which sold at a Lyn Knight Currency Auction in November 2005 for a record USD 1,092,000 (or AUD 1,480,000). Information in this booklet extensively referenced from the definitive source on Australian paper currency: Michael Vort-Ronald, Australian Banknotes, 1979, Adelaide COURTESY LYN KNIGHT CURRENCY AUCTIONS (USA) The first Commonwealth banknote 7 To be offered at auction 23 March 2006

8 Auction of the first Commonwealth banknote Important Australian and World Coins, Medals & Banknotes Our forthcoming auction of Important Australian & World Coins, Medals & Banknotes is highlighted by the first issued Commonwealth banknote, Ten Shillings M The auction will also feature over 4,000 other lots of rare and important coins, medals and banknotes. This important sale will be staged at Hotel InterContinental, Sydney from March 2006 and we are anticipating a record attendance for the Thursday evening session (commencing 7.30pm) which will feature the highlight banknote. catalogues / enquiries Catalogues available online or printed ($45 each) Sydney Melbourne public viewing On 15th-17th & 20th-21st March 2006 From 10.00am to 5.30pm each day At Ground Floor, 169 Macquarie Street, Sydney auction Sydney (02) Melbourne (03) On 22nd, 23rd & 24th March 2006 From 9.30am each day At Hotel InterContinental, Macquarie St, Sydney Auctioneers & Valuers of Coins, Medals & Banknotes Since 1976 Noble Numismatics was originally a wholly owned subsidiary of Spink & Son Ltd of London, founded The company was established in Sydney as Spink & Son Australia in 1976 by the current managing director, W. James Noble. A Melbourne office was later opened in Since opening Noble Numismatics has conducted eighty major public auctions, realising in excess of $150 million and achieving numerous Australian and world auction records. The company has handled many of the country s most important collections and deceased estates. The firm s expertise is backed by an experienced staff and its Sydney office is home to one of the world s major numismatic libraries. Noble Numismatics has also acted as valuator for the Australian Museum, the Museum of Victoria, numerous universities and several government departments at state and federal level. The company is also sole Australian member of the world leading numismatic association, The International Association of Professional Numismatists. Today the company continues its strong tradition by offering the highest standard of service. Ground Floor, 169 Macquarie Street, Sydney 2000 Fax (02) Level 7, 350 Collins Street, Melbourne 3000 Fax (02) NOBLE N U M I S M A T I C S P T Y L T D