How Did Prize Money Work in the Union Navy?

Pat Young

Brev. Brig. Gen'l
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I just finished reading Union Jacks, a book that is sort of a naval equivalent of "Billy Yank." Author Michael J. Bennett says that some joined the navy in hopes of getting prize money for captured ships. He says most were very disappointed.

Anyone know how prize money worked in the Civil War or how much sailors made from it?
 
In a nutshell, a captured vessel was taken to a prize court, and evidence was heard for and against the legality of its seizure; if the vessel was found to be improperly taken (for instance, if it was found to be legally the property of a true neutral party), it would be released back to its owners. If the prize was "condemned" ("found guilty"), then it and its cargo was sold at auction. The proceeds from the sale were divided in two; half went to the Navy, which was used to fund the Naval Asylum/Old Sailor's Home (and possibly similar programs); the other half was paid out to the sailors in on the capture by a rather intricate formula. Some lucky officers and crewmen made some nice money, but most did not.

(It helped to be on a fast ship with a smart captain off a busy port.)
 
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Another source answers the question of what the "small part of the proceeds" was:

http://deadconfederates.com/2012/05/18/to-be-divided-between-robert-smalls-and-his-associates/#_ftn1
Endnote credits this information to: Rodman L. Underwood, Waters of Discord: The Union Blockade of Texas During the Civil War (Jefferson, North Carolina: McFarland & Co., 2003), 35

"After deductions for expenses, one-half of the money went straight to the government. Five percent went to the commander of the regional blockading squadron (in this case, the South Atlantic Blockading Squadron), and a further 1% went to the local squadron commander. These shares combine to account for 56% of the value of the prize.

The remaining 44% was divided among the officers and crew of the capturing vessel(s). This amount was split into 20 equal shares, with the captain taking 3 shares, the officers and midshipmen taking 10 shares, and the enlisted men dividing up the remaining 7 shares between them"
 

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Credit where it's due -- Mark pointed me toward the original prize law of 1800 that helped govern the distribution. I have a chapter on prize money in the WGBS in the book, that highlights some of the big hauls and in-fighting that went on over prize money, but as a general rule Bennett is correct -- the typical Union bluejacket saw little prize money, and even then it often came months or years late.

The case of Robert Smalls and his small group that absconded with the steamer Planter in 1862 was a little different, as they were not U.S. Navy personnel, and so were not eligible under normal prize rules. The U.S. Congress ordered the Navy to condemn (i.e., sell) the prize and turn over half the proceeds to Smalls and his crew. The total ultimately shared between the eight men and two "unprotected" women was $4,584, which amounted to a great deal for them individually, but (IMO) is much lower than it should have been because the total valuation of that particular capture ($9,168) was scandalously low.
 
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"Proceeds of the sale of captures made as prize by authority of the United States. Vessels and their cargoes captured as prize must be sent into port for an adjudication in a prize-court in the manner prescribed by law. If condemned, the property is sold by the U. S. Marshal, and the proceeds, when the capture was by a vessel or vessels of the navy, disposed of according to the decree of the court. If the prize was of equal or superior force to the vessel or vessels making the capture, the whole of the net proceeds will be decreed to the captors; and when of inferior force, one-half will be decreed to the United States and the other half to the captors. The prize-money adjudged to captors it distributed in the following proportions:

First. To the commander of a fleet or squadron, one-twentieth part of all prize-money awarded to any vessel or vessels under his immediate command.

Second. To the commander of a division of a fleet or squadron, on duty under the orders of the commander-in-chief of such fleet or squadron, a sum equal to one-fiftieth of my prize-money awarded to a vessel of the division under his command, to be paid from the moiety due the United States, if there be such moiety; if not, from the amount awarded to the captors. This fiftieth part is not awarded in addition to the share he would be entitled to as commander of a single ship making a capture, and he may elect which he will receive.

Third.' To the fleet-captain, one-hundredth part of all prize-money awarded to any vessel of the fleet in which he is serving, except where the capture is made by the vessel on board of which he is serving, in which case ho will share, in proportion to his pay, "with the other officers and men on board such vessel.

Fourth. To the commander of a single vessel, 'one-tenth of all the prize-money awarded to the vessel, if such vessel at the time of the capture was under the command of the commanding officer of a fleet or a division, and three-twentieths if his vessel was acting independently of such superior officer.

Fifth. After the foregoing deductions, the residue is distributed among all others doing duty on board, and borne upon the books of the ship, including the fleet-captain, in proportion to their respective rates of pay.

All vessels of the navy within signal-distance of the vessel making the capture, and in such condition as to be able to render effective aid if required, will share in the prize. Any person temporarily absent from his vessel may share in captures made during his absence. The prizecourt determines what vessels shall share in a prize, and also whether the prize was of superior, equal, or inferior force to the vessel or vessels of the captors. The Secretary of the Navy determines what persons are entitled to share in the prize-money awarded a vessel, and transmits their names to the Fourth Auditor, who ascertains, according to the above rules of distribution, the correct amount of each person's share. On application the Auditor will issue a certificate payable to the person entitled, provided Congress ims authorized the payment by an appropriation. See Bounty Job Destruction Ok Enemy's Vessels.

The share of prize-money awarded to the United States is set apart forever as a fund for the payment of pensions to naval officers, seamen, and marines entitled to pensions; and, if more than sufficient for that purpose, the surplus is applied to the making provision for the comfort of disabled officers, seamen, and marines. The Secretary of the Navy is trustee of the naval pension fund, and the fund is invested in securities of the United States bearing 8 per cent, interest. See Navy Pension Fund.​

Source: A Naval Encyclopaedia: Comprising a Dictionary of Nautical Words and Phrases, Biographical Notices, and Records of Naval Officers, Special Articles on Naval Art and Science 1880


So even if a capture was adjudicated as a prize and sold, the amount trickling down to the crew could be quite small. However the squadron commanders could do quite nicely. Porter, for example, made out quite well on prize money - $90,000+ during the war.
 
However the squadron commanders could do quite nicely. Porter, for example, made out quite well on prize money - $90,000+ during the war.
David Dixon Porter, for a time, had landing parties from the Mississippi River Squadron rounding up cotton bales from barns and groves miles from the river, and shipping it north as "prizes" to be adjudicated as if it had been captured on the high seas. Reason No. 1,283 the guy was a bit of a d1ck.
 
Credit where it's due -- Mark pointed me toward the original prize law of 1800 that helped govern the distribution.

The case of Robert Smalls and his small group that absconded with the steamer Planter in 1862 was a little different, as they were not U.S. Navy personnel, and so were not eligible under normal prize rules. The U.S. Congress ordered the Navy to condemn (i.e., sell) the prize and turn over half the proceeds to Smalls and his crew. The total ultimately shared between the eight men and two "unprotected" women was $4,584, which amounted to a great deal for them individually, but (IMO) is much lower than it should have been because the total valuation of that particular capture ($9,168) was scandalously low.

I read in Smalls' biography (Gullah Statesman) that he attempted several times to have that situation addressed through Congressional action; I think he eventually succeeded, though not without some cost to his reputation (since he was a Congressman pushing for his own remuneration).
 
David Dixon Porter, for a time, had landing parties from the Mississippi River Squadron rounding up cotton bales from barns and groves miles from the river, and shipping it north as "prizes" to be adjudicated as if it had been captured on the high seas. Reason No. 1,283 the guy was a bit of a d1ck.

Porter's fleet sent marines and sailors miles inland up and down Red River in search of cotton in 1864. They were equiped with stencils that enabled them to quickly mark bales "C.S.A." and confiscate them as enemy property. There's even stories of said marines and sailors ginning and bailing the stuff themselves! What a racket.
 
It was definitely a bit of a gray area. The situation of a large Navy force that far inland was a novel one; a chance at prize money had been a historical perq of serving aboard a man-of-war (and wasn't abolished till well after the Civil War; I can't recall if it was in force in the Spanish-American War or not).
 
More examples, from the blockade running book cited above:

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There were not a great many lucrative prizes to be found off the Texas coast, but over the course of the war, the Union navy snatched up prizes on a regular basis. Most of these were small sailing vessels carrying a few tons of assorted cargo inbound or fifty to seventy-five bales of cotton outbound. Typical of these was the British schooner Fanny, captured off the mouth of the Brazos River by USS Owasco in April 1864. Fanny was sent with a prize crew to New Orleans, where the schooner and her cargo of assorted goods were condemned by the court and auctioned for a total of $10,317.61. After deductions for court expenses, payment of half the remaining proceeds to the disabled seamen’s fund and the senior officers’ cut, some $4,044.46 remained to be divided among Owasco’s officers and crew. Under the prize regulations, the blockader’s commanding officer, Lieutenant Commander E.W. Henry, would have collected a share of just over $600, while the ordinary seamen and Marines aboard Owasco would have eventually pocketed about $10 each.


The prize game was nothing if not fickle, though; just three weeks later, on the very same stretch of water, Owasco’s sister ship Chocura made a double capture that proved to be one of the most lucrative involving sailing runners on the Texas coast. Late on the evening of May 2, 1864, Chocura was anchored off the mouth of the Brazos, watching for runners trying to move in or out of the river. Around 11:40 p.m., the lookouts reported a strange sail standing out to sea, and Chocura’s captain, Bancroft Gherardi, ordered his crew to slip the anchor cable and give chase. He caught up with the schooner in about thirty-five minutes; a boarding party discovered the vessel to be the British schooner Agnes, loaded with cotton. No sooner had Gherardi begun transferring a prize crew to the schooner than his lookout reported seeing a light farther to the south. Chocura quickly cast off from the first prize and began churning southward into the darkness in pursuit of the second vessel. Gherardi caught up with her about twenty-five miles offshore. She proved to be the Prussian schooner Frederic the Second, loaded with 114 bales of cotton, which had run out of the Brazos along with Agnes. Gherardi put a second prize crew aboard Frederic the Second and sent both schooners off to New Orleans for adjudication.

Gherardi and his crew were lucky in capturing two cotton-laden schooners within the space of a few hours, but they were luckier still in the timing of their prize case. When the prize court ruled in favor of Chocura’s seizure and ordered Agnes, Frederic the Second and their cargoes to be auctioned in the fall of 1864, speculation and other factors had driven the price of cotton at New Orleans to a record high of a dollar or more per pound. The two schooners and their contents together fetched a remarkable $131,295.28. After deductions for court costs and the usual division of funds, Bancroft Gherardi would have collected just over $8,000.00, while the lowliest ship’s boy probably received around $225.00, nearly a year’s pay for an ordinary seaman. . . .

As a regional squadron commander, Farragut himself stood to gain substantially from the 5 percent share on all prizes taken by the squadron, but he repeatedly expressed his displeasure with what he saw as a tendency for some captains under his command to abandon a chase to stop and pick up what he termed “waif cotton”—bales that had been thrown overside from runners trying to lighten their ships. Union ships picking up this cotton often claimed it under the rules of civilian salvage, as if it had randomly appeared in their path, with an unknown origin—hence the term “waif.” This legal fiction would entitle them to all of the proceeds rather than having to share them with the government and their senior officers. In May 1864, Farragut issued a general order to all ships in his command, reminding them that “all cotton or other merchandise picked up at sea or on shore must be taken into port and delivered up to the United States courts for adjudication, as though it had been captured, in order that the judicial authorities may distribute it as prize or award salvage to the captors.” The admiral might have had in mind an egregious case that occurred in the squadron the previous summer, when the U.S. bark William G. Anderson captured the schooner America north of the Rio Grande. The prize capsized and sank while under tow, and Anderson’s commander, Lieutenant Frederic S. Hill, reported recovering thirteen bags of cotton. That was not true; Hill’s crew had recovered forty additional bales, amounting to something like ten tons of dry cotton, which they quietly sent to New York for sale though civilian channels. Lieutenant Hill was court-martialed and convicted of “scandalous conduct tending to the destruction of good morals,” but his sentence amounted to a reprimand and a relatively small fine. That lenient punishment suggests that the court did not find his transgression to be too serious and that actions like Hill’s may have been more commonplace than was generally acknowledged.

The individual payments listed above are estimates, based on (1) the known proceeds of each prize, (2) the formula for prize money distribution, and (3) an estimate of the capturing vessel's crew size.
 
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Porter's fleet sent marines and sailors miles inland up and down Red River in search of cotton in 1864. They were equiped with stencils that enabled them to quickly mark bales "C.S.A." and confiscate them as enemy property. There's even stories of said marines and sailors ginning and bailing the stuff themselves! What a racket.
It's called entrepreneurship:giggle:
Leftyhunter
 
A FAMILY BUSINESS. The first skipper of the Chocura (sometimes Chocorua) was Thomas Harman Patterson (1820-1889). Born in New Orleans son of Commodore Daniel Todd Patterson. T. H. was the brother in law of Admiral David Dixon Porter. Farragut was the foster brother of Porter. They had all been sailing the Gulf Coast waters and the Mississippi for years and had relatives in NOLA. Although the relatives really didn't speak to them after the capture.
 
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