An Eminent Ancestor: Part 3

Joseph C. M. Cowan: His Circumstances Changed

I have previously mentioned how Essendon was swept up in the land boom of the 1880s and the depression of the 1890s that followed. Wikipedia provides a brief explanation:

During the 1880s, there had been a speculative boom in the Australian property market. The optimistic climate was fostered by the commercial banks, and also led to the proliferation of non-bank institutions such as building societies. Operating in a free banking system, there were few legal restrictions on their operations, and there was no central bank or government-provided deposit guarantees. The banks and related bodies lent extravagantly, for property development in particular, but following the collapse of the land boom after 1888, a large number of enterprises that had borrowed money began to declare bankruptcy.

Joseph Cowan was one of many men caught up in the boom. One of the many building societies that sprung up was the Doutta Galla, of which Joseph was listed as the valuator when it was launched in May 1888, just as the boom was about to end. He had also bought up land with George Groube, notably the Maribyrnong Estate in Ascot Vale (between Epsom Road, the Showgrounds and the Maribyrnong River, a sale of which was advertised in the papers in October 1888. But of course while he rode the wave of the boom, so he was hit hard by the bust. Below I reproduce excerpts of an article written by Marilyn Kenny called 'Circumstances So Changed – Secret Compositions in Essendon 1893:

In the 1880s land fever swept the Colony, speculative developments were pursued, railways and tramways built or proposed. Politicians, civic leaders and businessmen were drawn into gambling with other people's money. By 1890 the edifice could no longer stand and depression followed. One after another the pressures multiplied and land companies and banks toppled. In eight months in 1891-1892 120 public companies were wound up, British investment was withdrawn, overdrafts called in and calls were made on partly paid up shares. In 1892 the number of bankruptcies increased by two-thirds. On 1 May 1893 most banks suspended payment after a “run”. Over 1891-1893, the population of the colony dropped by 50,000, and 12,000 houses stood empty. Uncountable thousands were unemployed. In Essendon a Mayors relief fund was established [by Joseph Cowan as mentioned in Part 2], stores offered free food to the poor and the Essendon/Bullarto settlement was founded for unemployed families. The property and employment market did not recover until the late 1890s.

Michael Cannon's The Land Boomers revealed the manipulations, crimes, speculations and subsequent personal and financial disasters that brought about the boom and bust. One of Cannon's revelations was the matter of secret compositions. In an unusual provision in Victorian law debtors could make a deed of arrangement with their creditors.

“Three quarters of creditors, in number and value, could force a composition of any amount upon all, no matter what the conduct of the insolvent. The original intention was to enable debtors whose livelihood would be jeopardised by adverse publicity to meet their creditors privately. The exposure of public insolvency proceedings was avoided. A professional man’s position could be preserved, as only a small group would be involved. However creditors meetings could be packed with friends and relatives put down for fictitious loans in order to gain the majority. Providing the law was complied with, the court had to register the deed and the debtor was freed from obligations without the stigma of bankruptcy”.

The debtor could incur fresh debts the day of the meeting! The Court could not enquire into conduct or compulsorily acquire property. The fact that these were secret shook business confidence. No-one knew whose credit was good. It was not until 1896 that Isaac Isaacs' Companies Act abolished secret compositions.

Joseph Cowan was one who made use of these secret compositions in 1893, as Kenny goes on to reveal:

The Scot Joseph Charles Martin Cowan was a self-educated architect. He lived in Moonee St, Ascot Vale with an office on Mt Alexander Rd. He became a Councillor for the Ascot Vale ward in 1889, served as Mayor 1891-92 and was the Council representative on the MMBW. He designed many of the area’s villas and cottages as well as public buildings like Ovens Bakery, Junction Hotel and the Masonic Hall. He was an ardent Freemason and Vice-President of the Essendon Football Club [Essendon Town, not the forerunner of the current AFL team, as I outlined in Part 2]. In 1897 Cowan persuaded Council to improve the Moonee Ponds Reserve (the mud hole) and rename it Queens Park for the Queen’s Jubilee.

He died suddenly in 1900, aged 52, leaving a widow and seven [actually eight] children aged 15 to one year. In tribute, a public subscription of £500 was raised to purchase and hold in trust his house and give a purse to Mrs Cowan. It was noted the cheerful and frank Cowan had been “one of the numerous financial sufferers of the land boom” and “never recovered his losses though the tide was turning”. In 1894 at the establishment of the Ascot Vale unemployed fund, Cowan described how during his Mayoralty his house became a “type of labour bureau, a job he would not take again for £l000”. This was a telling statement as Cowan had lodged his deed in May 1893. 

There were debts of £8,787 on land mortgaged with frontages to Newson, Stanford, Maribyrnong Rd and Mt Alexander Rd. There was a promissory note £268 dated 1892 to George Parsons, wheelwright, of Mt Alexander Rd, Moonee Ponds and a bank overdraft of £3,225 secured with mortgage on Moonee St/Mt Alexander Rd. Owing to Mrs Isabella Ramsey £614 lent on mortgage and rent due to William Fleming, The Avenue, £23. Downing's Beehive Stores was owed £1-6-10 for stationery. His “modest and frugal home” had furniture valued at £30. He had 50 shares in the Masonic Hall, Maribyrnong Rd, value £18-15 and joint with Matthew Henry Robertson [this was Joseph's half-brother, also an architect] office furniture at £5. Debts for professional services provided to local residents were £39. There was a deficiency of £4,629 and Cowan composed for ninepence in the pound. His application was made jointly with George Groube, surveyor, of Maribyrnong St, Ascot Vale.

Cowan resigned from council for "business reasons" on June 5 1893 - just days after his deed was lodged, clearly at a time when financial matters were at their worst for him. Perhaps he felt it was the right thing to do, but the electorate must not have held it against him, as he was re-elected unopposed just 8 days later. As he looked to regain financial stability, Joseph must have been on the lookout for new ventures to make money. In November 1894 a notice appeared in The Argus for a Memorial of Registration for the 'Red and Black Gold Mining Company' (named of course for the colours of the football team), whose place of operation was to be at Bullengarook near Gisborne - Joseph Cowan was listed as Manager. The company ran for over two years before accepting a takeover bid in July 1897, but as there had been some modest success the members kept a third of the shares. Still hopeful, in February 1898 Joseph formed another company: the Ascot Vale Gold Mining Company, whose operations would be based at Shepherds Flat, Majorca. It is not known how well this turned out, but only two years later Joseph had of course passed away, leaving behind relatively modest real estate worth £425 and a personal estate of £40. Hopefully the money raised by the Essendon residents (outlined by Kenny above), was enough to provide his wife and children with the quality of life that the family of such a man deserved.

References
Aldous, Grant. The Stop-Over that Stayed: A History of Essendon. Moonee Ponds: City of Essendon, 1979.
Kenny, Marilyn. Circumstances So Changed – Secret Compositions in Essendon 1893. Essendon Historic Society, date unknown.
Wikipedia, s.v. "Australian Banking Crisis of 1893",

https://en.wikipedia.org/wiki/Australian_banking_crisis_of_1893.