In admiralty law prizes are 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 her cargo as a prize of war. In the past, the capturing force would commonly be allotted a share of the worth of the captured prize. Nations often granted letters of marque that would entitle private parties to capture enemy property, usually ships. Once the ship was secured on friendly territory, she 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 the property was to be disposed of.
History and sources of prize law
In his book The Prize Game, Donald Petrie writes, "at 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 called De Iure Praedae Commentarius (Commentary on the Law of Prize and Booty), published in 1604—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. Grotius defends the practice of taking prizes as not merely traditional or customary, but just. His Commentary claims 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 fully developed between the Seven Years' War of 1756–1763 and the American Civil War of 1861–1865. This period 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 (1705–1793). It was said to be the most important exposition of prize law published in English, along with 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, 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. Such huge revenues were earned when $200 were 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.