Prize money

Prize money refers in particular to naval prize money, usually arising in naval warfare, but also in other circumstances. It was a monetary reward paid in accordance with the prize law of a belligerent state to the crew of a ship belonging to the state, either a warship of its navy or a privateer vessel commissioned by the state. Prize money was most frequently awarded for the capture of enemy ships or of cargoes belonging to an enemy in time of war, either arrested in port at the outbreak of war or captured during the war in international waters or other waters not the territorial waters of a neutral state. Goods carried in neutral ships that are classed as contraband, being shipped to enemy-controlled territory and liable to be useful to it for making war, were also liable to be taken as prizes, but non-contraband goods belonging to neutrals were not. Claims for the award of prize money were usually heard in a prize court, which had to adjudicate the claim and condemn the prize before any distribution of cash or goods could be made to the captors.

Other cases in which prize money has been awarded include prize money for the capture of pirate ships, slave ships after the abolition of the slave trade and ships trading in breach of the Navigation Acts, none of which required a state of war to exist. Similar monetary awards include military salvage, the recapture of ships captured by an enemy before an enemy prize court has declared them to be valid prizes (after such ships have been condemned, they are treated as enemy ships), and payments termed gun money, head money or bounty, distributed to men serving in a state warship that captured or destroyed an armed enemy ship. The amount payable depended at first on the number of guns the enemy carried, but later on the complement of the defeated ship.

Certain captures made by armies, called booty of war, were distinct from naval prize because, unlike awards under naval prize legislation, the award of booty was only made for a specific capture, often the storming of a city; the award did not set a precedent for other military captures in the same war, and did not require adjudication by a prize court. When the British army and navy acted together, it was normal for instructions to say how any prizes and booty should be shared, and the shares allocated. In this case, combined naval and military force to be dealt with under naval prize law rules.

Although prize law still exists, the payment of prize money to privateers ceased in practice during the second half of the 19th century and prize money for naval personnel was abolished by those maritime states that had provided it at various times in the late 19th century and the first half of the 20th century.

The two roots of prize law and the consequent distribution of prize money are the medieval maritime codes, such as the Consolato Del Mare and Rolls of Oleron, which codified the customary laws that reserved legal rights over certain property found or captured at sea, in harbour or on the shore for the rulers of maritime states, and the 16th and 17th century formulation of international law by jurists such as Hugo Grotius. These jurists considered that only the state could authorise war, and that goods captured from an enemy in war belong as of right to its monarch. However, it was customary for the state to reward those who that assisted in making such captures by granting them part of the proceeds.

In various 17th century states, the crown retained from one-tenth to one-fifth of the value of ships and cargoes taken by privateers but up to half of the value of those captured by the state's navy. Grotius also recorded the practices that, for a prize to be effective, the ship must either be brought to port or retained for 24 hours, and that no distribution of prize money or goods could made without due court authorisation.

Most European maritime states, and other maritime states that adopted laws based on European models, had codes of prize law based on the above principles that allowed for monetary rewards for captures. However, details of prize money law and practice are known for relatively few of these. They include English rules from the 17th century, which formed the basis for the rules for Great Britain and the United Kingdom in the 18th, 19th and 20th centuries, those of France from the 17th to 20th centuries, the Dutch Republic, mainly for the 17th century, and the United States for the 18th and 19th centuries. The smaller navies of maritime states such as Denmark and Sweden, had little chance of gaining prize money because they had few opportunities to capture enemy ships in wartime, both because, after the Great Northern War, they were rarely involved in naval wars and, when they were, their fleets were much weaker than their major opponents.

Booty of war, also termed spoils of war is the movable property of an enemy state or its subjects which can be used for warlike purposes, in particular its soldiers' arms and equipment, captured on land, as opposed to prize which is hostile property captured at sea. It is legally the property of the victorious state, but all or part of it (or its value) may be granted to the troops that capture it. In British practice, although the Crown may grant booty and to specify its distribution, this was done by a special proclamation relating to a specific capture which did not set a precedent, not a general measure dealing with all captures made during a war, as were naval prize acts. Instances of it being granted include the Siege of Seringapatam, 1799, the capture of Bordeaux, 1814 and the Siege of Delhi, 1857. Although the United States and France had allowed their soldiers to profit from booty on a basis similar to Britain, they abolished the practice in 1899 and 1901 respectively. The Third Geneva Convention now only allows the arms, military equipment and military documents of prisoners of war to be seized and prohibits the award of booty.