Seizing the Gold of Spain: the Action off CapeSanta Maria
“He [Spanish Rear-admiral Jose de Bustamante y Guerra] wished to know if I considered the Spanish ships as prizes, and if I would hoist English colours on board of them when we arrived in England. I told him my orders went to detaining them; that I had no orders to make prizes; that his own flag, and the Spanish colours, should be hoisted when we met the fleet, or arrived in England ; and that the rest would depend on the orders of the government.”
— Captain Graham Moore’s journal, October 1804.
Considered an act of piracy by Spain and ‘a necessity of war’ by the United Kingdom , the Anglo-Spanish fight off Portugal ’s Cape Santa Maria on 5 October 1804 was one of the most controversial naval engagements of the Napoleonic Wars. The action – which led to the loss of four Spanish frigates carrying a New World treasure – generated anti-British feelings in Spain ; the government of King Carlos IV finally declared war against the United Kingdom on 12 December.
The officer in command of the treasure-ships, Rear-admiral Jose de Bustamante y Guerra (born Ontaneda 1 April 1759 – died Madrid 10 March 1825), was not held completely accountable by King Carlos IV for the loss. As the seizure of the Spanish cargo took place in peacetime, Bustamante y Guerra had no reason to suspect the Royal Navy was planning to intercept his squadron.
Bustamante y Guerra was one of the most experienced officers in the Spanish Navy. From 1789 to 1794, he served as the captain of the Atrevida, one of the two ships of the Alejandro Malaspina scientific expedition. Bustamante y Guerra was promoted to ‘Brigadier de la Real Armada’ (Rear-admiral of the Royal Navy) in 1794 after he returned to Spain . 
On 13 September 1796, Carlos IV appointed Bustamante y Guerra to the Governorship of Montevideo. The out-going governor, Antonio Olaguer y Feliu Heredia Lopez y Donce, was officially replaced on 11 February 1797. The next year, the new governor married Maria del Pilar Azlor de Aragon.
In 1804, Bustamante y Guerra was himself replaced by Pascual Ruiz de Huidobro (1752-1813) and left Montevideo to return to Spain . He embarked on the frigate Medea – one of four treasure-ships leaving for Cadiz in August.
‘Dollars and ingots of gold’: the Treasure Ships
The Spanish squadron was composed of four frigates: Fama (which replaced the frigate Nuestra Senora de la Asuncion), Medea (the flagship), Nuestra Senora de Las Mercedes, and Santa Clara. Fama (34 guns; Captain Miguel de Zapiain y Valladares) had been launched in 1795 at Cartagena; Medea (40 guns) had been launched in 1797 at Ferrol; Santa Clara (40 guns) and Nostra Senora de Las Mercedes (36 guns) had been launched in 1780 and 1786 at Habana, Cuba . 
The warships had been assigned to transport and protect a valuable cargo of gold, silver and commercial commodities. Spanish government documents say 4,736,153 pesos of bullion was loaded aboard the four frigates: 1,269,669 pesos in gold and 2,158,850 pesos in silver for private individuals, along with 1,307,634 pesos in silver for the King’s government.
The total value of the squadron’s cargo was, by 1804 standards, considerable. After seizing and selling the remaining three-quarters of the cargo, the British government received almost a million pounds (900,000 pounds sterling – or $4,095,000 at the 1804 exchange rate of $4.55 for one pound sterling):
“The cargoes of the three captured frigates consisted of Vidona [vicuna] wool, cascarilla, ratina, seal-skins, seal-oil, bars of tin, pigs of copper, dollars and ingots of gold, a netted very little short of a million sterling. Therefore, as the Mercedes was similarly freighted, the total value of what had been shipped on board the squadron probably amounted to nearly a third of a million more.”
The 1804 sale generated about $72,150,000 (in 2006 dollars) for the British government.
As the cargo was sold soon after it was seized, the value of the gold and silver aboard these frigates pales in comparison to modern estimates of unsalvaged treasure wrecks (the Spanish treasure-ship Nuestra Senora de Deliverance, for example, was lost on 1 November 1755 with a cargo estimated in 2003 at $3.2-billion US). However, a useful comparison might be made with the 34-gun Spanish frigate Juno, which left Veracruz, Mexico in 1750 with a cargo of 700,000 silver coins, estimated in 2003 to be worth 357-million pounds sterling (she sank in a storm off Virginia). 
The four frigates left Montevideo on 7 August 1804, under the command of Bustamante y Guerra. The original commander, Rear-admiral Thomas de Ugarte y Liano, was ill in Montevideo and unable to make the voyage.
His Majesty’s Captains: Moore, Hamond, Gore and Sutton
Unknown to the Spanish, the Royal Navy had made plans to intercept the squadron before it could reach Cadiz. Four frigates under the command of Captain Graham Moore were detached from Channel Fleet and ordered to patrol between Gibraltar and Cadiz. The Royal Navy squadron consisted of HMS Indefatigable (44 guns; Captain Moore), HMS Medusa (32 guns; Captain Gore), HMS Amphion (32 guns; Captain Sutton) and HMS Lively (38 guns; Captain Hamond).
Each of the British captains was a highly-experienced officer (in later years, all of them reached flag-rank and one of them, briefly, became an Admiral of the Fleet).
Captain (later Admiral Sir) Graham Moore (born Glasgow 14 September 1764 – died Cobham 25 November 1843) was the younger brother of Lieutenant-General Sir John Moore, who was killed on 16 January 1809 at Corunna, Spain . He joined the Royal Navy in 1777, reaching the rank of Post-Captain on 2 August 1794. Moore took command of HMS Indefatigable in July, 1803. Promoted to Rear-admiral on 12 August 1812 and Vice-admiral on 12 August 1819, he later served at the Admiralty. Moore reached the rank of full Admiral in 1837. 
The commander of HMS Medusa, Captain (later Vice-admiral Sir) John Gore (born County Kilkenny, Ireland 9 February 1772 – died Datchet 21 August 1836) began his naval career in 1781 aboard the 74-gun HMS Canada. He was advanced to Post-Captain on 12 November 1794 and given the command of the 98-gun HMS Windsor-Castle. Knighted in 1805, Gore was promoted to Rear-admiral on 4 December 1813 and ended the Napoleonic Wars commanding the blockade of Venice. He was promoted to the rank of Vice-admiral of the Blue on 27 May 1825 and later commanded in the East Indies. 
Captain (later Rear-admiral) Samuel Sutton (1760-1832) began his naval career in 1777 as a midshipman on the 74-gun HMS Monarch. He was promoted to Post-Captain on 27 June 1797. Sutton briefly commanded HMS Victory under Vice-admiral Nelson. Later posted to HMS Amphion, Sutton was promoted to Rear-Admiral of the Red in 1821.
The commander of HMS Lively, Captain (later Admiral of the Fleet Sir) Graham Eden Hamond (30 December 1779 – 20 December 1862), had served at the Battle of Copenhagen in 1801. He succeeded to his father’s 1783 baronetcy in 1828. His promotion to Rear-admiral came on 22 July 1830. Nominated to the Order of the Bath on 13 September 1831, Hamond was promoted to the rank of Vice-admiral of the Red on 10 January 1837, full Admiral on 22 January 1847 and Admiral of the Fleet on 10 November 1862 – a month before his death. 
‘A tremendous explosion’: Nuestra Senora de Las Mecedes blows up
Captain Moore’s squadron was cruising off the coast of Portugal when it intercepted Bustamante y Guerra’s squadron. Moore’s journal for 5 October begins:
“On the morning of the 5th, at seven o’clock, the Medusa made the signal for seeing four sail bearing west by south. I immediately threw out the signal for a general chase, and the squadron instantly made all sail. We were at this time about nine leagues south-west from Cape St. Mary. We soon perceived them to be a squadron of four large Spanish frigates. They formed in line of battle ahead, as we drew near; the van-ship bearing a commodore’s broad pennant; the next being the largest, and a beautiful frigate, carried a rear-admiral’s flag. They carried a press of sail on the wind, steering in for Cadiz.” 
The Spanish ships were sailing in the following order: Fama, Medea, Nuestra Senora de Las Mercedes, and Santa Clara. Bustamante y Guerra, aboard Medea, was no doubt surprised to see the British squadron closing on his ships:
“At 9:05 am, the Medusa placed herself within half pistol-shot, on the weather-beam of the Fama. Presently the Indefatigable took a similar station by the side of the Medea; and the Amphion and the Lively, as they came up, ranged alongside the Mercedes and Clara, the Amphion judiciously running to leeward of her opponent.”
Moore then sent a boat with a lieutenant over to the Spanish flagship. The lieutenant asked Bustamante y Guerra to ‘shorten sail’ (reduce speed) and have his ships taken by the Royal Navy without loss of life. The rear-admiral refused and the lieutenant’s boat returned. Moore later recalled what happened next:
“At this moment I observed the Admiral’s second astern, fire into the Amphion. The Admiral had fired a shot against us. I made the signal for close action, and in an instant, we were engaged from van to rear.”
The fighting commenced about 0958. At half pistol-shot range, the damage done by the experienced British gunners was terrible. The Spanish ships returned fire, but:
“At about the end of nine minutes, the Mercedes blew up alongside of the Amphion with a tremendous explosion [the Indefatigable’s log records this at 1007]. In a minute or two afterwards, the Fama struck her colours; but, on the Medusa’s ceasing her fire, rehoisted them and attempted to make off. The Medusa immediately bore up under the Spanish frigate’s stern, and poured in a heavy fire, but the Fama continued her course to leeward. Having sustained, during 17 minutes, the Indefatigable’s heavy broadsides, and finding a new opponent in the Amphion, who had advanced on her starboard quarter, the Medea surrendered [the Indefatigable’s log records this at 1017]. In another five minutes the Clara did the same, and the Lively was left at liberty to aid the Medusa in her pursuit of the Fama.
The final phase of the battle developed into a stern-chase between the fleeing Fama and the pursuing HMS Medusa and HMS Lively. It took almost three hours for the two British ships to overhaul Fama:
“About 45 minutes past noon the Lively, being an admirable sailer, got near enough to fire her bow guns at the Fama; and at 1:15 pm this, the only remaining Spanish frigate, struck to the two British frigates in chase of her.”
The action had cost the Royal Navy 10 casualties: two men killed and four wounded in HMS Lively; three men wounded on HMS Amphion. The loss for the Spaniards amounted to 388 casualties: two men killed and 10 men wounded in Medea, 11 killed and 50 wounded in Fama; seven killed and 20 wounded in Santa Clara; 238 killed in the explosion of Nuestra Senora de Las Mercedes.
The remaining three frigates were taken to Gibraltar and then to Plymouth (which they reached on 19 October). Their cargo was off-loaded and the captured frigates were retained for service by the Royal Navy.
Medea was renamed HMS Imperieuse and later served in the Atlantic and in the Mediterranean. She was de-commissioned in 1815 and sold in 1838. Fama – ‘Fame’ in Spanish – became HMS Fama. She probably retained her original name because the Royal Navy was building a new 74-gun HMS Fame at Deptford. She was sold in 1812.
Santa Clara was renamed HMS Leocadia. The choice of her Royal Navy name is interesting; two previous 34-gun frigates in the Spanish Navy had possessed the name Santa Leocadia. The first Santa Leocadia (launched in 1777) was captured by Captain Sir George Collier in the 74-gun HMS Canada on 1 May 1781. The second Santa Leocadia, launched ten years later, was wrecked on the coast of Ecuador on 16 November 1800– carrying 2,100,000 pesos of gold and silver coins.
Taken prisoner by the Royal Navy, Bustamante y Guerra returned to Spain the next year. Subsequently promoted to ‘Teniente-General de la Real Armada’ [Vice-admiral of the Royal Navy], Bustamante y Guerra was again posted to the Americas .
On 4 March 1811, he replaced Antonio Gonzalez Mollinedo y Saravia as Captain-General of Guatemala ( Spain ’s New World possessions included four captain-generalships: Guatemala , Venezuela , Cuba and Chile ). Bustamante y Guerra’s term lasted until 1818, when he handed over the captain-generalship to Carlos de Urrutia y Montoya, a former governor of Santo Domingo. 
In October 2007, news reports suggested the wreck of the Nuestra Senora de Las Mercedes had been found and some of her treasure salvaged. The American company involved, Odyssey Marine Exploration Inc., denied the claim – although it did say it was in the process of salvaging the cargo of another ship. The treasure aboard the Nuestra Senora de Las Mercedes – often wrongly identified in news reports as a Spanish galleon – was estimated at $500-million.
Print Sources from http://www.google.books.com/:
a) James, William, The Naval History of Great Britain (Volume 3), London, 1859
b) Gardiner, Sir Robert, Memoir of Admiral Sir Graham Moore, London, 1844.
c) Urban, Sylvanius, ‘The Gentleman’s Magazine’ (Volume 21), London 1844.
d) Urban, Sylvanius, ‘The Gentleman’s Magazine’ (July, 1832), London, 1832.
e) The Annual Biography and Obituary (Vols. 17: 1833 and 21: 1837), London
f) Dodd, Charles R., The Peerage, Baronetage and Knightage of Great Britain and Ireland , London 1846.
 Gardiner, Sir Robert, The Memoir of Admiral Sir Graham Moore, p. 33.
 http://koti.mbnet.fi/felipe/Spain/spain.html and http://www.todoababor.es/datos_docum/hist_fr.htm. The Santa Clara was the second frigate to bear this name. The first, launched in 1773 at Cartagena, was wrecked on 27 July 1777 on English Bank in the Rio de La Plata.
 James, William, The Naval History of Great Britain , p. 289.
 Launched and commissioned in 1804, HMS Lively was the newest ship of Moore’s squadron.
 The Annual Biography and Obituary (1844), pp. 317-319.
 The Annual Biography and Obituary (1837), pp. 258-264.
 Urban, Slyvanius, ‘The Gentleman’s Magazine’, July 1832, p. 83-84.
 Dodd, Charles R., The Peerage, Baronetage and Knightage of Great Britain and Ireland , p. 190.
 Gardiner, Sir Robert, The Memoir of Admiral Sir Graham Moore, p. 30.
 James, William, The Naval History of Great Britain , p. 287.
 Gardiner, Sir Robert, The Memoir of Admiral Sir Graham Moore, p. 31.
 Ibid, p. 288.
 Ibid, p. 288.