On 22 January 1783 Hussar sighted the French 32-gun frigate Sybille. The Sybille, commanded by Monsieur le Comte de Kregarou de Soemaria. The French ship had been engaged three weeks previously with the 32-gun British frigate HMS Magicienne under Captain Thomas Graves. Both ships had fought until they had both been dismasted and were forced to disengage. Sybille made for a French port under a jury rig and was then caught in a violent storm. Due to this unfortunate series of events Kregarou had been obliged to throw twelve of his guns overboard. When she sighted the Hussar, Kregarou ordered the English flag hoisted over the French, the recognised signal of a prize, and at the same time, in the shrouds, another English flag, union downwards, the internationally recognised signal of distress. Accordingly, Russell, bore down to her assistance, but as the two ships drew near, Russell became suspicious and bore away. Seeing this, Kregarou fired his broadside causing some damage but not as much as he could have done had Russell not turned away. Kregarou then attempted to board and overwhelm the Hussar whilst still flying false colours and the distress flag. The Hussar's crew managed to repel the boarding party. The battle continued with both sides taking damage until a large ship came in sight. She proved to be the 74-gun HMS Centurion and another smaller vessel, HMS Terrier, also appeared over the horizon. At the approach of two further enemies, Sybille surrendered. The rules of war that were accepted at the time were that a ship might fly a country's flag other than its own in order to escape or lure an enemy but that before the engagement commenced they must remove the decoy flag and replace it with that of their own. Alongside this, ships were expected to only fly a distress flag if they were actually in distress. Luring enemies into a trap using a distress flag was an unacceptable ruse de guerre. The French captain had therefore broken two of the fundamental rules of sea warfare. Kergarou came aboard the Hussar to surrender his sword. the Count handed Russell his sword and complemented the Captain and his crew on the capture of his vessel. Russell took the sword and reportedly said:
"Sir, I must humbly beg leave to decline any compliments to this ship, her officers, or company, as I cannot return them. She is indeed no more than a British ship of her class should be. She had not fair play; but Almighty God has saved her from the most foul snare of the most perfidious enemy. - Had you, Sir, fought me fairly, I should, if I know my own heart, receive your sword with a tear of sympathy. From you, Sir, I receive it with inexpressible contempt. And now, Sir, you will please observe, that lest this sword should ever defile the hand of any honest French or English officer, I here, in the most formal and public manner, break it."
Russell stuck the blade into the deck and broke the blade in half and threw it to the deck. He place the Count under close arrest. The crew of the Hussar discovered £500 in valuables aboard the Sybille which the French officers claimed as theirs and Russell permitted them to keep even though it would have reduced his and his crew's prize money.