Eugen Peter Schwiedland on Bubenik’s Die Technik des Giroverkehrs (1888)

Eugen Peter Schwiedland’s review examines Franz Bubenik’s account of giro transactions at the Austro-Hungarian Bank, linking the economic significance of its newly extended transfer network to the contractual rules governing cheques. Bubenik, the bank’s secretary, supplies both a historical retrospect and a commentary on current regulations. Schwiedland moves from this institutional setting through the benefits and obstacles of giro banking to its technical and legal machinery, concluding with the book’s value for legal practitioners.

The immediate occasion is the introduction, on 2 January 1888, of interlocal giro services across the bank’s principal and branch establishments. Local accounts permit cheque payments even to non-account-holders, whereas transfers between places must credit another account. The enormous volume of comparable transfers in Germany provides Schwiedland with a measure of the Austrian reform’s potential importance.

His account of Bubenik’s economic argument emphasizes the concentration of cash-handling in trained bank staff, improved business cash management, and the mobilization of otherwise idle funds. Customers gain administrative economies; the bank gains interest-free use of deposits, including an agreed minimum balance. Yet adoption depends on established habits: convenient paper circulation and attachment to physically held representations of value impede giro banking. Schwiedland adds that direct possession can offer security during disruptions, while secure custody and gaps in local banking provision favor the new network.

The review’s decisive conceptual move is to read the bank’s operating regulations as contractual law:

Die „Bestimmungen“ der Bank regeln aber deren technische und hauptsächlich deren juristische Seite, indem sie die Bedingungen, das heisst den Vertrag enthalten, auf Grund dessen sie mit ihren Contrahenten in einen Giroverkehr tritt, dessen Anweisungen honorirt oder nicht-anerkennt, und in diesem Sinne enthalten sie für uns ein Stück Checkrecht.

English translation: The "Provisions" of the bank, however, regulate its technical and chiefly its juridical side, in that they contain the conditions, that is to say the contract, on the basis of which it enters into giro business with its contracting parties and honours or does not recognise their orders; and in this sense they contain for us a piece of cheque law.

The technical detail therefore establishes more than payment procedure: it defines the conditions under which the bank recognizes an instruction. Account-holders must domicile their acceptances at the bank or a bank in regular clearing relations with it. White cheques serve cash withdrawals or settlement at the account-holding establishment; red cheques transfer funds to an account elsewhere. The system requires the bank’s own forms and excludes cheques honored without cover:

Es besteht ein Zwang zur Benützung der Blanquette der Bank, welche einen sogenannten Credit-Check, d. i. einen solchen, dessen Honorirung auch ohne Deckung erfolgt, nicht-kennt.

English translation: There is a compulsion to use the bank's blank forms, which do not recognise a so-called credit cheque, that is, one whose honouring takes place even without cover.

Schwiedland follows these restrictions into the formal requirements of cheque validity: the payment instruction, available balance, cheque designation and number, signature, date, and absence of a deferred payment term. He also notes a revealing tension concerning the minimum balance: although customers are expected to leave it untouched, the discussion allows that honoring a cheque may encroach upon it.

Bearer status exposes the interaction between banking convenience and commercial custom. A white cheque names a payee and may contain an order clause, yet the bank refuses payment if its printed bearer wording is struck out:

Dieser wird auf einen Remittenten, demnach auf Namen gestellt und kann auch die Ordreclausel tragen, wenn aber der Zusatz „oder Ueberbringer“, welcher auf den weissen Check gedruckt ist, durchstrichen wird, so verweigert die Bank (um sich der Prüfung der Legitimation zu entheben) die Honorirung.

English translation: This is made out to a remittee, and accordingly to a named person, and may also bear the order clause; but if the addition "or bearer", which is printed on the white cheque, is struck through, the bank refuses honouring (in order to relieve itself of the examination of legitimation).

The bank thereby avoids examining the presenter’s entitlement, while retaining a named-payee form familiar to merchants. Schwiedland’s legal differentiation culminates in treating the white cheque as analogous to a commercial payment instruction and the red cheque more precisely as a bookkeeping mandate.

The final assessment praises Bubenik’s commercial and legal expertise, clarity, and appended forms. Its strongest claim to practical relevance rests on the bank’s distinctive legal position:

Es hat aber auch eine grosse Wichtigkeit für den Richter und Advocaten oder Notar, weil es mit der nothwendigen Rücksicht auf die Privilegialrechte, auf das in vieler Hinsicht sehr bedeutsame und im Allgemeinen zu wenig gekannte jus speciale der österreichisch-ungarischen Bank gearbeitet ist.

English translation: But it also has a great importance for the judge and the advocate or notary, because it is worked out with the necessary regard to the rights of privilege, to the in many respects very significant and in general too little known jus speciale of the Austro-Hungarian Bank.

For Schwiedland, the expanding giro network makes knowledge of these special privileges newly consequential. The book’s contribution lies in showing how economic modernization operates through particular contractual forms and institution-specific legal powers.