United States v. Schooner Peggy (1801) 1 Cranch 103, the Peggy was seized pursuant to a Presidential Commission to capture any armed French vessel found on the high seas.
The Schooner Peggy, 5 U.S. at 103. Proceedings were begun to condemn the ship and its cargo as prize. Id. at 104.
The circuit court reversed the district court and found The Peggy lawful prize. Id. at 105-106. While the case was pending before the Supreme Court, the President ratified the Friendship and Commerce Treaty between France and the United States, providing, among other things, for mutual return of "property captured, and not yet definitively condemned."
The Court stated that "the Constitution of the United States declares a treaty to be supreme law of the land," and that it places an obligation on our courts. Id. at 109.
No issue of retroactivity of application arose. The Peggy could not be lawful prize.
In Peggy, while an appeal was pending from a decision of the lower court in a prize case, the United States entered into a treaty with France, which if applicable would have required reversal. The treaty explicitly contemplated that it would be applicable to seizures that had taken place prior to the treaty's ratification where litigation had not been terminated prior to ratification. On the basis of the new treaty, the Supreme Court reversed the decision of the lower court. In the opinion of Mr. Justice Marshall, it was said:
It is in the general true that the province of an appellate court is only to inquire whether a judgment when rendered was erroneous or not. But if, subsequent to the judgment, and before the decision of the appellate court, a law intervenes and positively changes the rule which governs, the law must be obeyed, or its obligation denied. If the law be constitutional, . . . I know of no court which can contest its obligation. It is true that in mere private cases between individuals, a court will and ought to struggle hard against a construction which will, by a retrospective operation, affect the rights of parties, but in great national concerns, where individual rights, acquired by war, are sacrificed for national purposes, the contract making the sacrifice ought always to receive a construction conforming to its manifest import; and if the nation has given up the vested rights of its citizens, it is not for the court, but for the government, to consider whether it be a case proper for compensation. In such a case the court must decide according to existing laws, and if it be necessary to set aside a judgment, rightful when rendered, but which cannot be affirmed but in violation of law, the judgment must be set aside. (United States v. Schooner Peggy, supra, 1 Cranch at 109.)
Peggy may be interpreted in two ways: Under a narrow interpretation the Court held only that, where the law changes between the decision of the lower court and an appeal, the appellate court must apply the new law if, by its terms, it purports to be applicable to pending cases. The decisional process, under this interpretation, requires the appellate court to examine the intervening law and to determine whether it was intended to apply to factual situations which transpired prior to the law's enactment. Since the treaty in Peggy explicitly applied to situations where the controversy was still pending, it followed that the statute should be applied in deciding the case. Certainly the facts of Peggy and much of the language of the opinion of Mr. Justice Marshall support this interpretation. By a broader interpretation, Peggy may be considered to hold that where the law has changed between the occurrence of the facts in issue and the decision of the appellate court and where the controversy is still pending, the appellate court must apply the new law, unless there is a positive expression that the new law is not to apply to pending cases.
In United States v. The Schooner Peggy, 5 U.S. 103, 1 Cranch 103, 2 L.Ed. 49 (1801), the Supreme Court first set forth the principle in the following language:
"One form of limited retroaction which differs somewhat from the type discussed above is that which was established in United States v. Schooner Peggy. 1 Cranch 103, 2 L.Ed. 49 (1801)"