PRIZE MONEY. (Hansard, 11 March 1915)

THE MARQUESS OF CREWE
My Lords, the answer to the noble Earl's first Question is in the affirmative. The Prize Claims Committee has been set up, with my right hon. friend the Attorney-General as its chairman and my noble friend Lord Desart as its vice-chairman; and I ought to add that on it are representatives of the Admiralty and of the Treasury and also of financial and shipping interests. Its functions are to look into claims which may be made by either British or neutral firms in respect of ships or cargoes condemned by Prize Courts. In numbers of cases claims have been made either upon the ships or upon the cargoes by banks and other people. This Prize Claims Committee examines the validity of those claims, and there its functions stop. There has been, of course, in a sense a departure from the old practice in which prizes at sea were regarded as the actual booty of the particular ship that made the capture. It is now intended that Prize Money in the strict sense, should be ultimately allocated among the Navy as a whole. But that, of course, is a question apart from the case, say, of an advance which a British banker has made on shipping documents which have been handed to him as security and as to which he puts in a claim.
The Committee does not pretend to decide from what funds or in what manner the claims should be met. Its functions are simply concerned with the determination and examination of the validity of the claim itself. Suppose, say, that a ship has been captured with a cargo worth £20,000 717 upon which some financier has made an advance of £10,000. It becomes a matter of policy to consider whether the proceeds of the cargo when sold should be handed over in their entirety to the Navy, or whether the claim of the lender should by some means or other be met. But the Prize Committee does not offer an opinion as to how the money is to be found, supposing it to be assumed that the holder of security has an equitable claim for some consideration. All a Prize Court does is to determine the ownership of the property without any respect to the claims on the property. I take it that that is the immemorial function of a Prize Court.
I conceive that the noble Earl opposite, as a former First Lord of the Admiralty, has in mind the interests of the Navy in this matter, and is desirous that the Navy should not suffer. It is not possible, if the principle is adopted of regarding as admissible a question of prize claim, to make an immediate distribution of the proceeds of the sale of the ship or the cargo; and it, of course, becomes much more impossible when the distribution is to be made to the Navy as a whole and not to the actual capturers of the ship. But that in no way prevents the allocation, either at present or at any time during the war or at the close of the War, of such a sum in the form of prize bounty as it may be decided the Navy is entitled to. As regards the particular sums of money produced by the sale of prizes, it is impossible at this moment to regard the Navy as strictly entitled to more than the net proceeds as distinct from the gross; but that, of course, does not prejudice the actual amount of money which in the long run the Navy may receive, because it is a matter for the country to decide how far it is the duty of the taxpayers to indemnify the person who has made the advances on the cargo as well as to reward the seamen and the officers for the capture of the ship. Therefore the whole matter has to stand over in that sense until the end of the war. I must not be taken as expressing an opinion that when a prize of this kind is sold a certain proportion of the proceeds ought to belong to those who have some kind of lien on the cargo or on the ship, and a certain other proportion to the Navy. But, as I think the noble Earl will see, the change which has been made in the whole principle of distribution of Prize Money prevents the immediate 718 I allocation to the particular persons and crew of a particular ship of their share of the proceeds of a particular capture.

THE EARL OF DESART
My Lords, I want to say a word, rather more to explain the position than anything else. The noble Earl who asked this Question, I think, feels some uneasiness because he thinks Prize Money has been dealt with by this Committee. Of course my colleagues and I are not responsible for the policy, and at the present moment the Committee are not dealing with money at all. It would be unwise for them to go into these claims and make awards when they have no means of giving effect to them, and there is at present no means of giving effect to them. Therefore as long as the matter is under consideration the Committee cannot tell whether it will be out of this or that fund that the money will ultimately come, and have not in fact made any awards. I think there may arise a feeling amongst those interested that the Committee ought to do something, and that some sort of decision ought to be arrived at as soon as may be. I rose merely to state how the thing stood, and to say that the noble Earl need not be under any uneasiness that money has up to now been paid out of this or any other fund.

THE MARQUESS OF CREWE
May I ask the noble and learned Earl for an explanation? As he says, the actual money is not available for distribution. But why does that prevent the allocation of claims?

THE EARL OF DESART
It was very carefully considered, and it was decided that it would be better to postpone action rather than that witnesses should be examined and people put to expense until we knew how awards will be met.