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In the late 16th century Thomas Sutton, merchant and "richest commoner in England", decided to found a charitable institution to provide shelter for elderly gentlemen in reduced circumstances and an education for poor boys. His original idea was to build this hospital on part of his own land at Hallingbury Bouchers, Essex (Little Hallingbury). In 1611, however, the year of his death, he purchased the former Carthusian monastery near Smithfield, and decided instead to found his institution there.
The monastery had, like all Carthusian houses, been named after the site of the original abbey, at Chartreuse, and this had become corrupted in English to Charterhouse. After the dissolution of the monasteries the building was used as an aristocratic mansion until Thomas Sutton's purchase.
Sutton's Hospital was granted letters patent by James I in 1611, under its full title "The Hospital of King James founded at Charterhouse in the County of Middlesex, at the humble petition and only costs and charges of Thomas Sutton Esquire".
The rules of the charity were that any single or widowed gentleman, of good character and over the age of 60 (later 50) years, could apply to one of the governors for nomination if he was no longer in a position to support himself financially. Once nominated and accepted by the hospital, the pensioners or 'Poor Brothers' as they were known, would be given a room in Charterhouse, meals and a small pension. Poor scholars were nominated in the same way at about 11 years of age and provided with a basic education. At the end of this period they were either apprenticed to a trade or given an exhibition to one of the universities.
In 1872 the school outgrew its Charterhouse site and moved to new, purpose-built premises in Godalming, Surrey. The Hospital's revenue comes largely from its extensive land holdings. On his death Thomas Sutton bequeathed to the governors most of his own lands in Essex, Wiltshire and Lincolnshire. They also owned Sutton's Cambridgeshire estates at Balsham and Castle Camps.
After Sutton's death the governors purchased further estates, to be used for the purpose of generating income for apprenticing scholars and providing exhibitions. These estates comprised the manors of Hartland, Devon; Higney, Huntingdonshire; Blacktoft, Yorkshire; Bockleton, Shropshire; Fulstow and Tetney, Lincolnshire.