Penhallow v. The Lusanna: 1777

Libelants: John Penhallow and Jacob Treadwell, representing 15 Portsmouth merchants who owned the privateer McClary, and George Wentworth, acting as agent for the ship's crew
Claimants: Elisha Doane, owner of the Lusanna, Isaiah Doane (son), and James Shepherd
Lawyer for the Libelants: Sewall (no other name listed)
Lawyers for the Claimants: John Adams, John Lowell, and Oliver Whipple
Dates of Trial: Circa December 16-20, 1777
Place of Trial: Portsmouth, New Hampshire
Judge of Admiralty: Dr. Joshua Brackett
Verdict: For the libelants

SIGNIFICANCE: Throughout its 18-year history, this case highlighted the controversy of federal vs. state jurisdiction.

Privateering was a kind of legal piracy by which warring countries preyed on each other's shipping. An authorized ship of Country A would capture a ship belonging to Country B, tow it to a port, then petition a court to "libel" the seized ship. If granted, the ship and cargo were auctioned and the proceeds divided, depriving Country A of resources.

When British authorities closed Boston's port, merchant Elisha Doane, with whale oil to sell and credits due him being held in London, moved to safeguard his financial affairs. Doane sent his son-in-law Shearjashub Bourne to England with the oil. Due to the volatile state of political affairs, Bourne had great discretion in making whatever decisions seemed necessary. Actions, taken to safeguard investors' interests, would be used in court as evidence of loyalist sympathies.

En route, Doane's ship, the Lusanna, was damaged by a storm. While in Halifax for repairs, the ship was seized twice by British authorities, then released. The second release was on condition the Lusanna be re-registered in Halifax. Later in London, Bourne would re-register the ship in his own name and sail for Gibraltar.

Upon returning to London, Bourne tried to reclaim a cargo of Doane's seized from the brigantine Industry. Bourne, in the guise of a loyal subject, submitted a memorial to the Treasury of England. His request was rejected when a former member of the Massachusetts Bar, Daniel Leonard, insisted Bourne had no true interest in the cargo and the owners probably planned to take military supplies to the rebels. The memorial, but not Leonard's refutation, would be used as evidence in the Lusanna trial.

Heading for Halifax on her return trip, the Lusanna was captured by the American privateer McClary on October 30, 1777. At Portsmouth, New Hampshire, the Lusanna was "libeled" in the state's Court Maritime on November 11. On December 1, attorney John Lowell filed claims on behalf of the owners to recover the ship and her cargo.

The libelants claimed that the ship and cargo belonged to inhabitants or subjects of Great Britain and the Lusanna was carrying supplies to the enemy's "Fleet or Army" in Halifax. The libelants also tried to claim:

Cause of Condemnation viz. that the Brig made a Voyage to Gibralter with King's Stores in the Year 1776, tho this Cause is not set forth in the Libel.

Based on depositions, invoices, and the ship's register, the libelants maintained Bourne was a loyalist, and that Bourne, not Elisha Doane, owned the ship and much of the cargo. Records showed that government, possibly military, stores were part of Lusanna's cargo to Gibralter. However, witnesses testified Bourne had refused to let the ship to the military transport service.

The claimants, too, had documents and depositions contradicting various allegations. But Bourne's testimony was needed. Under 18th-century rules of evidence, "interested" witnesses could not testify. Bourne conveyed to Isaiah Doane any interests he had in the cargo. His testimony was still barred.

It fell to the claimants' lawyers to argue that Bourne's actions were reasonable. John Adams pointed out that unless contradicted by law, a man could transport his property by whatever methods he chose. Moreover, a ship's registration did not convey property and the practice of altering registrations to protect property was common. Adams also insisted:

there was no Law or Resolution of Congress that prohibited a Voyage to Gibralter, the Troops and Fleet not coming within the Meaning of the Law ie, Enemies acting against the United States of America.

Furthermore, Bourne would not have been cleared to leave London unless headed for a British, rather than an American, port.

The jury found for the libelants. The court decreed the Lusanna and her cargo forfeit. An appeal to Congress was denied on grounds the appeal could only be heard by the state's superior court. In September 1778, the claimants lost their appeal although they had amassed much evidence to justify Bourne's actions. This court, too, refused an appeal to Congress and on September 18, 1778, the Lusanna and her cargo were auctioned.

Elisha Doane petitioned Congress to review the case. Congress' Court of Congressional Commissioners of Appeals had recently reversed a decree of the Pennsylvania Admiralty Court. The Philadelphia court had refused to obey the reversal and suspended activities. After pondering the controversy, on March 6, 1779, Congress resolved that: its war powers enabled it to try prize appeals based on questions of fact and law; right of appeal could not be denied by state law; and the commissioners could make the final decree. New Hampshire voted for the resolution.

In June 1779, the commissioners ruled they had jurisdiction in the Lusanna affair, then delayed continuing the case until New Hampshire could react to Congress' March resolution. The case was heard September 11—13, 1783. (Elisha Doane was dead.) In 1780, the Congress had established a Court of Appeals in Cases of Capture which, on September 17, 1783, reversed the lower courts and ordered the claimants' property restored.

The libelants petitioned Congress, insisting the commissioners lacked jurisdiction. A congressional committee agreed. The Congress as a whole did not.

To have the court of appeals decree enforced, the claimants filed in Massachusetts where eventually its Supreme Judicial Court decided the court of appeals had no jurisdiction and declared the New Hampshire decree to be final. In March 1786, the claimants filed suit in Philadelphia's Court of Common Pleas to attach a ship belonging to a libelant. In 1787, that court decided it lacked jurisdiction in admiralty cases and discontinued the attachment.

The case languished until the Constitution was ratified and a federal court system established. In March 1792, administrators for Doane's estate asked the U.S. District Court in New Hampshire to execute the decree. Because the judge had once acted for the libelants, the case was moved to Circuit Court. There, Justice John Blair found for the administrators and asked for a report ascertaining damages. The report was submitted a year later. On October 24, 1794, Judge William Cushing awarded the claimants $38,518.69.

In 1795, the McClary's owners appealed to the U.S. Supreme Court, on writ of error, to no avail. However, adjustments were made about damages.