Prize is a term used in admiralty law to refer to equipment, vehicles, vessels, and cargo captured during armed conflict. The most common use of prize in this sense is the capture of an enemy ship and its cargo as a prize of war. In the past, it was common that the capturing force would be allotted a share of the worth of the captured prize. Nations often granted letters of marque which would entitle private parties to capture enemy property, usually ships. Once the ship was secured on friendly territory, it would be made the subject of a prize case, an in rem proceeding in which the court determined the status of the condemned property and the manner in which it was to be disposed of.
History and sources of prize law 
In his book The Prize Game, Donald Petrie writes, "[a]t the outset, prize taking was all smash and grab, like breaking a jeweler's window, but by the fifteenth century a body of guiding rules, the maritime law of nations, had begun to evolve and achieve international recognition." Grotius's seminal treatise on international law published in 1604 called De Iure Praedae Commentarius (Commentary on the Law of Prize and Booty) (of which Chapter 12, "Mare Liberum" inter alia founded the doctrine of freedom of the seas) was an advocate's brief justifying Dutch seizures of Spanish and Portuguese shipping. In defending the practice of taking prizes as not merely traditional or customary but on examination, just, Grotius's Commentary points out that the etymology of the name of the Greek war god Ares was the verb "to seize" and that the law of nations had deemed looting enemy property legal since the beginning of Western recorded history in Homeric times.
Prize law reached its fullest development in the period from the Seven Years War of 1756-63 to the American Civil War of 1861-65, which largely coincides with the last century of fighting sail and includes the Napoleonic Wars, the American and French Revolutions, and America's Quasi-War with France of the late 1790s. Much of Anglo-American prize law derives from 18th Century British precedents, in particular a compilation called the 1753 Report of the Law Officers authored by William Murray, 1st Earl of Mansfield (1705–93) said to be the most important exposition of prize law published in English, and the subsequent High Court of Admiralty decisions of William Scott, Lord Stowell (1743–1836). American Justice Joseph Story, the leading United States judicial authority on prize law, drew heavily on the 1753 report and Lord Stowell's decisions, as did Francis Upton, who wrote the last major American treatise on prize law, his Maritime Warfare and Prize. While the Anglo-American common law case precedents are the most accessible description of Prize Law, it is important to bear in mind that in prize cases courts construe and apply international customs and usages, the Law of Nations, and not the laws or precedents of any one country.
Fortunes in prize money were to be made at sea as vividly depicted in the novels of C. S. Forester and Patrick O'Brian. During the American Revolution the combined American naval and privateering prizes totaled nearly $24 million; in the War of 1812, $45 million. This at a time when $200 was a generous year's wages for a sailor; his share of a single prize could fetch ten or twenty times his yearly pay, and taking five or six prizes in one voyage was common. With so much at stake prize law attracted some of the greatest legal talent of the age, including John Adams, Joseph Story, Daniel Webster and Richard Henry Dana, Jr. author of Two Years Before the Mast.
Prize cases were among the most complex of the time, as the disposition of vast sums turned on the fluid Law of Nations, and difficult questions of jurisdiction and precedent. One of the earliest U.S. cases for instance, that of the Active, took fully 30 years to resolve "who's in charge?" jurisdictional disputes between state and federal authorities. A captured American privateer captain, 20-year-old Gideon Olmsted, shipped aboard the British sloop Active in Jamaica as an ordinary hand in an effort to get home. Olmsted organized a mutiny, commandeered the sloop, but on its way to America a Pennsylvania privateer took the Active. Olmsted and the privateer disputed ownership of the prize, and in November 1778 a Philadelphia prize court jury came to a split verdict awarding each a share. Olmsted with the assistance of then American General Benedict Arnold appealed to the Continental Congress Prize Committee, which reversed the Philadelphia jury verdict and awarded the whole prize to Olmsted. But Pennsylvania authorities refused to enforce the decision, asserting the Continental Congress could not intrude on a state prize court jury verdict. Olmsted doggedly pursued the case for decades until he won, in a U.S. Supreme Court case in 1809 which Justice Stanley Matthews later called "the first case in which the supremacy of the Constitution was enforced by judicial tribunals against the assertion of state authority."
Although Letters of Marque and Reprisal sometimes issued before a formal declaration of war, as happened during the American Revolution when the rebelling colonies of Massachusetts, Maryland, Virginia, and Pennsylvania all commenced granting Letters of Marque months before the Continental Congress's official Declaration of Independence of July 1776, by the turn of the 19th century it was generally accepted that a sovereign government first had to declare war. The "existence of war between nations terminates all legal commercial intercourse between their citizens or subjects," wrote Francis Upton in Maritime Warfare and Prize, since "[t]rade and commerce presuppose the existence of civil contracts . . . and recourse to judicial tribunals; and this is necessarily incompatible with a state of war."  Indeed each citizen of a nation "is at war with every citizen of the enemy," which imposes a "duty, on every citizen, to attack the enemy and seize his property, though by established custom, this right is restricted to such only, as are the commissioned instruments of the government. . . . "
The formal commission bestowed upon a naval vessel, and the Letter of Marque and Reprisal granted to private merchant vessels converting them into naval auxiliaries, qualified them to take enemy property as the armed hands of their sovereign, and to share in the proceeds.
Capturing a prize 
When a privateer or naval vessel spotted a tempting vessel—whatever flag she flew or often enough flying none at all—they gave chase. Sailing under false colors was a common ruse, both for predator and prey. The convention was a vessel must hoist her true colors before firing the first cannon. Firing under a false flag could cost dearly in prize court proceedings, even result in restitution to the captured vessel's owner.
Often a single cannon shot across the bow was enough to persuade the prey to heave-to, but sometimes brutal hours and even days of cannonading ensued, along with boarding and hand-to-hand fighting with cutlasses, pistols, and boarding pikes. No matter how furious and bloody the battle, once it was over the victors had to collect themselves, put aside anger and exercise forbearance, treating captives with courtesy and civility to the degree prudence allowed. Officers restrained the crew to prevent pillaging defeated adversaries, or pilfering the cargo known as breaking bulk. Francis Upton's treatise on Maritime Warfare cautioned:
Embezzlements of the cargo seized, or acts personally violent, or injuries perpetrated upon the captured crew, or improperly separating them from the prize-vessel, or not producing them for examination before the prize-court, or other torts injurious to the rights and health of the prisoners, may render the arrest of the vessel or cargo, as prize, defeasible, and also subject the tort feasor for damages therefore.
Taking the prize before a prize court might be impractical for any number of reasons like bad weather, shortage of prize crew, dwindling water and provisions, or the proximity of an overpowering enemy force, in which case a vessel might be ransomed. That is, instead of destroying her on the spot as was their prerogative, the privateer or naval officer would accept an I.O.U. for an agreed sum as ransom from the ship's master. On land this would be extortion and the promise to pay unenforceable in court, but at sea it was accepted practice and the I.O.U.'s negotiable instruments.
On occasion a seized vessel would be released to ferry home prisoners, a practice which Lord Stowell said "in the consideration of humanity and policy" Admiralty Courts must protect with the utmost attention. While on her mission as a cartel ship she was immune to recapture so long as she proceeded directly on her errand, promptly returned, and did not engage in trading in the meantime.
Usually, however, the captor put aboard a prize crew to sail a captured vessel to the nearest port of their own or an allied country, where a prize court could adjudicate the prize. If while sailing en route a friendly vessel re-captured the prize, called a rescue, the right of postliminium declared title to the rescued prize restored to its prior owners. That is, the ship did not become a prize of the recapturing vessel. However, the rescuers were entitled to compensation for salvage, just as if they had rescued a crippled vessel from sinking at sea.
Admiralty Court process 
The prize that made it back to the capturing vessel's country or that of an ally which had authorized prize proceedings would be sued in Admiralty Court in rem meaning "against the thing," against the vessel itself. For this reason decisions in prize cases bear the name of the vessel, such as The Rapid (a U.S. Supreme Court case holding goods bought before hostilities commenced nonetheless become contraband after war is declared) or The Elsebe (Lord Stowell holding that Prize Courts enforce rights under the Law of Nations rather than merely the law of their home country). A proper prize court condemnation was absolutely requisite to convey clear title to a vessel and its cargo to the new owners and settle the matter. "Even after four years' possession, and the performance of several voyages, the title to the property is not changed without sentence of condemnation," says Upton's treatise.
The agent of the privateer or naval officer brought a libel, accusing the captured vessel of belonging to the enemy, or carrying enemy cargo, or running a blockade. Prize commissioners took custody of the vessel and its cargo, and gathered the ship's papers, charts, and other documents. They had a special duty to notify the prize court of perishable property, to be sold promptly to prevent spoilage and the proceeds held for whoever prevailed in the prize proceeding.
The commissioners took testimony from witnesses on standard form written interrogatories. Admiralty Courts rarely heard live testimony. The commissioners' interrogatories sought to establish the relative size, speed, and force of the vessels, what signals were exchanged and what fighting ensued, the location of the capture, the state of the weather and "the degree of light or darkness," and what other vessels were in sight. That was because naval prize law gave assisting vessels, defined as those that were "in signal distance" at the time, a share of the proceeds. The written interrogatories and ship's papers established the nationality of the prize and her crew, and the origin and destination of the cargo: the vessel was said to be "confiscated out of her own mouth."
One considerable difference between prize law and ordinary Anglo-American criminal law is the reversal of the normal onus probandi or burden of proof. While in criminal courts a defendant is innocent until proven guilty, in prize court a vessel is guilty unless proven innocent. Prize captors need show only "reasonable suspicion" that the property is subject to condemnation; the owner bears the burden of proving the contrary.
If all was in order, the prize court ordered the vessel and its cargo condemned and sold at auction. But the court's decision became vastly more complicated in the case of neutral vessels, or a neutral nation's cargo carried on an enemy vessel. Different countries treated these situations differently. By the close of the 18th century, Russia, Scandinavia, France, and the United States had taken the position that "free ships make free goods": that is, cargo on a neutral ship could not be condemned as a prize. But Britain asserted the opposite, that an enemy's goods on a neutral vessel, or neutral goods on an enemy vessel, may be taken, a position which prevailed in 19th Century practice. Donald Petrie observed in The Prize Game: "The ingenuity of belligerents in evading the penalties of the law of nations through pretended neutrality, false papers, quick title transfers, and a myriad of other devices, make up the principal business of the prize courts during the last century of fighting sail."
Neutral vessels could be subject to capture, if they ran a blockade. The blockade had to be effective to be cognizable in a prize court, that is, not merely declared but actually enforced. Neutrals had to be warned of it. If so then any ships running the blockade of whatever flag were subject to capture and condemnation. However passengers and crew aboard the blockade runners were not to be treated as prisoners of war, as Upton's Maritime Warfare and Prize enjoins: "the penalty, and the sole penalty . . . is the forfeiture of the property employed in [blockade running]." Persons aboard blockade runners could only be temporarily detained as witnesses, and after testifying, immediately released.
The legitimacy of an adjudication depended on regular and just proceedings, and departures from internationally accepted standards of fairness risked ongoing litigation by disgruntled shipowners and their insurers, often protracted for decades. For example, during America's Quasi-War with France of the 1790s, corrupt French Caribbean prize courts (often sharing in the proceeds) resorted to pretexts and subterfuges to justify condemning neutral American vessels. They condemned one for carrying alleged English contraband because the compass in the binnacle showed an English brand; another because the pots and pans in the galley were of English manufacture. Outraged U.S. shipowners and their descendants continually challenged these French colonial kangaroo court decisions of the 1790s, litigation called the French Spoliation Cases which lasted well over a century, until 1915. Together with Indian tribal claims for 18th century treaty breaches, the French Spoliation Cases enjoy the dubious distinction of figuring among the longest-litigated claims in U.S. history.
Privateering came to an end in the mid-19th Century, when signatories to the Paris Declaration Respecting Maritime Law of 1856 at the conclusion of the Crimean War renounced granting Letters of Marque. The United States however, was not a signatory. During the American Civil War, Confederate privateers cruised against Union merchant shipping. Likewise the Union (though refusing to recognize the legitimacy of Confederate Letters of Marque) allowed its Navy to take Confederate vessels as prizes. Under US Constitution Article 1 Section 8, it is still theoretically possible for Congress to authorize Letters of Marque, but in the last 150 years it has not done so.
Commerce raiding by private vessels ended with the American Civil War, but Navy officers remained eligible for prize money a little while longer. The United States continued paying prizes to naval officers in the Spanish-American War, and only abjured the practice by statute during World War I. The U.S. prize courts adjudicated no cases resulting from its own takings in either World War I or World War II (although the Supreme Court did rule on a German prize - the Appam - that was brought to and held at Hampton Roads). Likewise Russia, Portugal, Germany, Japan, China, Romania, and France followed the United States in World War I, declaring they would no longer pay prize money to naval officers. On November 9, 1914, the British and French governments signed an agreement establishing government jurisdiction over prizes captured by either of them. The Russian government acceded to this agreement on March 5, 1915, and the Italian government followed suit on January 15, 1917.
Shortly before World War II France passed a law which allowed for taking prizes, as did Holland and Norway, a prospect to which the Nazi invasion quickly put an end. Britain formally ended the eligibility of naval officers to share in prize money in 1948.
Under contemporary international law and treaties, nations may still bring enemy vessels before their prize courts, to be condemned and sold. But no nation now offers a share to the officers or crew who risked their lives in the capture. Petrie's book The Prize Game observes:
Self-interest was the driving force that compelled men of the sea to accept the international law of prize . . . [including merchants] because it brought a valuable element of certainty to their dealings. If the rules were clear and universal, they could ship their goods abroad in wartime, after first buying insurance against known risks. . . . On the other side of the table, those purchasing vessels and cargoes from prize courts had the comfort of knowing that what they bought was really theirs. The doctrine and practice of maritime prize was widely adhered to for four centuries, among a multitude of sovereign nations, because adhering to it was in the material interest of their navies, their privateersmen, their merchants and bankers, and their sovereigns. Diplomats and international lawyers who struggle in this world to achieve a universal rule of law may well ponder on this lesson. --Donald A. Petrie, The Prize Game, p. 145-46.
See also 
- Alabama claims--international arbitration and damages awarded against Great Britain for outfitting Confederate privateer
- Commerce raiding
- Confederate privateer
- Blockade runners of the American Civil War
- Letter of marque
- War trophy
- Prize of war
- Petrie, The Prize Game p. 4-5 (on the evolving prize rules in international law).
- Grotius, De Iure Praedae Commentarius (Commentary on the Law of Prize and Booty) p. ix (introductory notes describing Grotius's purpose).
- Grotius, De Iure Praedae Commentarius (Commentary on the Law of Prize and Booty) p. 43 (considering property seizure as a species of warfare).
- Petrie, The Prize Game p. 5
- Petrie, The Prize Game p. 7
- The Elsebe in Colombos, A Treatise on the Law of Prize p. 21 (Lord Stowell noting that prize law is matter of international law, not the law of any one nation.)
- While the calculation is complex and inexact, adjusted for inflation according to the Consumer Price Index $24 million in the dollars of 1800 computes to approximately $450 million today.
- Maclay, A History of American Privateers, Preface p. ix (totaling captured vessels and prize proceeds).
- A History of American Privateers p.10-11 (comparing prize awards with pay officers and crew)
- The Journal of Gideon Olmsted Forward pp. vii to xv (discussing Olmsted's harrowing adventures at sea, followed by a 30 year ordeal in the courts on land).
- J.C. Bancroft Davis, United States Reports, Cases Adjudged in the October Term, 1888, vol. 131 (New York: Banks & Brothers 1889) app., p. xxxiv n. (quoting U.S. Supreme Court Justice Stanley Matthews on the significance of the Active case) see also Prize Cases Decided in the United States Supreme Court, Introduction at 5-6 (discussing the Active).
- Prize Cases Decided in the United States Supreme Court, Introduction at 2-7(detailing confusion of early state prize courts competing with, and denying the appellate authority of, the Continental Congress's prize court)
- Upton, Maritime Warfare and Prize, p. 16-17 (discussing cessation of business when war declared).
- Upton, Maritime Warfare and Prize, p. 16-17 (discussing implications of state of war).
- Petrie, The Prize Game at 7
- Uptown, Maritime Warfare and Prize p. 421-22 (citing The Peacock, 4 Rob. 185, a British case involving restitution and allocation of expenses after firing under false colors)
- Upton, Maritime Law and Prize, p. 445 (citing the federal district court case of the Louisa Agnes which noted indecorous treatment like putting the captured crew in irons might well be defensible as necessary, under the circumstances).
- Upton, Maritime Law and Prize, p. 445 (quoting the Louisa Agnes ruling that tort claims for cruelty would require more than just bare affidavit allegations, but pleadings, proof, and opportunity of defense).
- Petrie, The Prize Game 13-30 (discussing ransoming of whaleship Eliza Swan).
- Colombos, Law of Prize p. 168 (quoting Lord Stowell on cartel ships)
- Upton, Maritime Warfare and Prize 13-30 (treating of cartel immunity, noting the case of the ship Venus condemned as a prize for having taken a cargo on board after delivering prisoners to France as a cartel ship ).
- Upton, Maritime Law and Prize, p. 234-35 (discussing postliminium and salvage).
- Prize Case Decisions of the United States Supreme Court p. 130 (reprinting the 1796 decision in The Mary Ford that American rescuers who found a wrecked and abandoned French prize adrift without sails or rigging could not condemn her as a prize, but were entitled as salvors to the judge's estimate of fair compensation for time lost, labor, risk taken, and mental and physical suffering, to induce mariners to undertake the peril and expense of rescue at sea).
- As cited by Upton, Maritime Warfare and Prize, p. 23 (citing The Rapid, 8 Cranch 155,)
- Colombos, A Treatise on the Law of Prize p. 21 (citing Lord Stowell in The Elsebe)
- Upton, Maritime Law and Prize, p. 238 (describing the uniform requirement of a sentence of condemnation.)
- Upton, Maritime Warfare and Prize, p. 454
- Upton, Maritime Warfare and Prize (appendix)(reproducing standard form interrogatories for the United States District Court).
- Colombos, A Treatise on the Law of Prize p. 356 (quoting Sir James Marriott on using a vessel's own papers to condemn her)
- Colombos, A Treatise on the Law of Prize p. 361 discussing onus probandi)
- Brown v. United States, reprinted in Prizes Cases in the United States Supreme Court p. 459 (observing it is "a well known rule of the prize court that the onus probandi is on the claimant"—he must prove his own good title before contesting a prize).
- Colombos, A Treatise on the Law of Prize p. 361-62 (observing claimant must show the property is not subject to confiscation, a reversal of the usual presumption of innocence)
- Petrie, The Prize Game p.161
- Petrie, The Prize Game p. 161-2(discussing the international difference of opinion over cargo carried by neutrals)
- Lord Russell, The French Privateers, p. 195-6 (reviewing contemporary practice on cargo of enemy vessels)
- Petrie, The Prize Game p. 163
- Petrie, The Prize Game p. 163 (discussing blockade of Charleston and capture and condemnation of blockade runners).
- Upton, Maritime Warfare and Prize p. 441 (noting naval captors operating under a "misapprehension" have sometimes treated blockade runners as prisoners of war, which is in error.)
- Jock Yellott, Not-Quite Justice After Never-Was War: A French Spoliation Case from the Quasi-War, Sea History Vol. 113 p.16 (Winter 2005-2006)
- Yellott, Not-Quite Justice After Never-Was War, p. 19.
- Lord Russell of Liverpool, The French Corsairs, p. 197(reciting several anti-privateering provisions in the Declaration and their effect)
- Petrie, The Prize Game p. 145 (discussing the Convention of 1856 which ended privateering).
- Maclay, A History of American Privateers p. xxiii (noting the US and Spain declined to sign, though both in effect renounced privateering by subsequent actions even if not in words)
- Maclay, History of American Privateers p. xxiii (observing the point of privateering is to destroy commerce, which now is a task assigned to the navy)
- Colombos, A Treatise on the Law of Prize p. 21 (noting that in the US all captures now inure to the state, but none adjudiated in either World War I or II).
- Convention Relating to Prizes Captured during the Present European War
- Text of Russian letter of accession
- Text of Italian letter of accession
- Colombos, A Treatise on the Law of Prize p. 338 (noting abolition of prize money for British naval officers in the Prize act of 1948).
- Petrie, The Prize Game 142 (discussing current state of prize law).
- James Scott Brown (ed.), Prize Cases Decided in the United States Supreme Court (Oxford: Clarendon Press 1923)
- Colombos, A Treatise on the Law of Prize (London: Longmans, Green & Co. Ltd. 1949)
- Gawalt & Kreidler, eds., The Journal of Gideon Olmsted (Washington DC: Library of Congress 1978)
- Grotius, De Iure Praedae Commentarius (Commentary on the Law of Prize and Booty)(Oxford: Clarendon Press 1950)
- Edgar Stanton Maclay, A History of American Privateers (London: S. Low, Marston & Co. 1900)
- Donald Petrie, The Prize Game: lawful looting on the high seas in the days of fighting sail (Annapolis, Md.: Naval Institute Press, 1999)
- Theodore Richard, Reconsidering the Letter of Marque: Utilizing Private Security Providers Against Piracy (April 1, 2010). Public Contract Law Journal, Vol. 39, No. 3, pp. 411-464 at 429 n.121, Spring 2010. Available at SSRN: http://ssrn.com/abstract=1591039
- William Morrison Robinson, Jr., The Confederate Privateers (Columbia, S.C.: University of South Carolina Press, 1928)
- Lord Russell of Liverpool, The French Corsairs (London: Robert Hale, 2001)
- Carl E. Swanson, Predators and Prizes: American Privateering and Imperial Warfare, 1739-1748 (Columbia, SC: U. South Carolina Press, 1991)
- Francis Upton, Upton's Maritime Warfare and Prize (New York: John Voorhies Law Bookseller and Publisher, 1863)
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