ON the face of it, the mills on the Skerne in the centre of Darlington were highly successful.

By the middle of the 19th Century they employed 1,000 "hands" who made the highest quality textiles.

All the flags that fluttered a welcome to the world's visitors to the 1851 Great Exhibition in London's Crystal Palace were made by the Peases in their Priestgate mills.

During the Franco-Prussian War of 1870-1, the braid on the Prussian Guards' uniforms was made at Peases Mill.

On the face of it, the mills were so successful that just after that war, the Peases embarked on a huge building programme.

Their old Low Mill, on the opposite bank to St Cuthbert's Church, was closed and its 200 hands transferred to a new mill on the north side of Priestgate (where the JJB Sports store is today).

The new mill was steam-powered. It was five storeys high, had seven boilers, a 250- horsepower engine and a 180ft chimney.

It was formally opened on December 28, 1874, with all hands and their families attending a celebratory meal in Central Hall (now part of the Dolphin Centre).

Sir Joseph Whitwell Pease, MP for South Durham and Barnard Castle for 40 years and the head mill owner, was in the chair.

But despite the festive season and the nature of the occasion, Sir Joseph's words were strangely downbeat.

"He did not say that these mills had been altogether unsuccessful," reported The Northern Echo.

"They had had years of profit, but they had following years of very heavy losses."

In fact, Sir Joseph admitted he had once suggested to his family that the mills should close, but "kinder and wiser heads" had overruled his "pecuniary counsels".

Sir Joseph was not the first to utter such sky-shattering thoughts.

In 1842, his grandfather, Edward "the Father of the Railways" Pease, had wondered along the same lines.

He, though, had concluded that "the distress it would cause the poor, and the loss of £3,000 to £4,000 to the family, appear to render it prudent to try again".

It was not only the poor who would suffer - the Peases' electoral fortunes would, too. Making so many voters redundant would not have assisted the family's quest to occupy most of the town's council seats and most of the county's Parliamentary seats.

And Sir Joseph was not the last to utter such thoughts. In 1882, his brother, Alfred, argued passionately for the closure of "this dreadful sink which swallows up an overdraft of £7,000-a-year" (many hundreds of thousands of pounds today).

Alfred's treacherous thoughts came after a disastrous decade, which may have been worsened by the opening of the new mill.

The Priestgate mill created the yarn which the Peases' other mill - the Railway Mill - in Northgate wove into cloth. A dreadful dispute between the two meant the Railway bought in yarn from outside while Priestgate stood idle - at a cost of £50,000.

The 1870s ended in severe economic depression. In the autumn of 1879, mill wages were reduced by between five and ten per cent.

"Considerable discontent has in consequence been brewing for some time," reported The Northern Echo on February 2, 1880, as at least 40 women walked out on strike.

"They marched around the mills threatening those at work. At ten o'clock a large number of townspeople assembled expecting to witness a collision, but owing no doubt to the timely arrival of a few police constables, everything passed off quietly." The Echo, based only metres from the mill, had been started ten years earlier by the Peases to act as their mouthpiece.

For a mouthpiece to be using phrases such as "considerable discontent" to describe the atmosphere in the mill, industrial relations must have been poor.

The Echo's assertion that "everything passed off quietly" was not correct.

The strikers returned to work a week later - still on reduced wages - and then the rival weekly newspaper the Darlington and Stockton Times reported on "a number of prosecutions arising out of the disturbances by strikers at Priestgate mills".

Still, on the face of it the mills were a great success.

At an exhibition in Bradford in 1882, Darlington cloth won the Gold Medal of the Clothworkers' Company of the City of London, and the Peases had the honour of manufacturing dress material for Princess Alexandra, the future Queen.

With losses mounting, in 1884, the Peases called in outside help.

They remained as directors, but leased the mills to Edward Clarke, of Ripon, and William Smith, of Helensburgh, near Glasgow.

The new management did not bring about a change of fortune, as soon one of the biggest fires that Darlington has ever seen engulfed the mill - but that is a story for another day.