Aaron Bartholomew and Sharon Yamen, J.
It is difficult to conceive of a legal rule as unique and axiomatic to legal practice in the United States as the American Rule.
The rule has applied in nearly every civil case brought before the bar of American courts for 220 years, and yet has humble beginnings in a colonial America that rejected the pomp and ceremony of contemporary English legal practice and was captured as a fifty-three word, almost-afterthought in one of the earliest decisions of the United States Supreme Court in 1796: We do not think that this charge ought to be allowed. The general practice of the United States is in opposition to it; and even if that practice were not strictly correct in principle, it is entitled to respect of the court, till it is changed or modified, by statute.
Arcambel v. Wiseman, 3 U.S. 306, 3 Dall. 306, 306 (1796).
That language memorializes what we now know as the American Rule and was the then-institutionalized custom of the colonial and early-American courts: “the cost of retaining counsel could not be included as part of a damage award,” The Documentary History of the Supreme Court of the United States, 1789–1800, Vol. 7, Cases: 1796–1797, 750 (Maeva Marcus. 2003), and does not allow a prevailing litigant to recover an attorney fee from the losing litigant except to the extent prescribed by the legislature. John Leubsdorf, Toward a History of the American Rule on Attorney Fee Recovery, 47 Law & Contemp. Probs. 7 (1984).
“With very few exceptions, the principle that each side must bear its own legal expenses has been followed consistently since the Court first announced it in 1796, and, over time, it has come to be accepted as the ‘American Rule.’” Marcus, The Documentary History of the Supreme Court of the United States, supra at 754. The history of the American Rule is long and complicated and pre-dates Marbury v. Madison, 5 U.S. (1 Cranch) 137, 2 L.Ed. 60 (1803). To refresh your American legal history, the American Rule’s origins date to well before the doctrine of judicial review, defined as “[a] court’s power to review the actions of other branches or levels of government; esp., the courts’ power to invalidate legislative and executive actions as being unconstitutional.” Black’s Law Dictionary 349 (Pocket ed. 1996), and just a few years after the final ratification of the United States Constitution.
How did we get this rule? Why do we still have successful litigants bearing most of the expenses of vindicating themselves? Considering we find our legal roots in the common law, why is this practice such a departure from our European counterparts? It all stems from that ruling two sentences long as an ancillary footnote to a lawsuit about privateering, Arcambel v. Wiseman, 3 U.S. 305, 3 Dall. 306, 306 (1796). The lasting significance of this case established an important precedent that we now use today.
The facts from Arcambel are less widely known and understood than its legacy would imply; outside of legal academia, it is a case that no one knows, but it is a keystone to the way we practice law in America.
Arcambel and Origins of the American Rule
The Spanish merchant vessel Nuestra Señora del Carmen arrived in Newport, Rhode Island, on August 19, 1795, as a vessel and cargo captured at sea by force during the war between France and Spain by the Brutus, a French privateer ship, commanded by Jean Antoine Gariscan, and therefore liable to be condemned or appropriated as enemy property. See Black’s Law Dictionary 502 (Pocket ed. 1996) (defining “prize”); Marcus, The Documentary History of the...