Mr. Seward to Lord Lyons.

My Lord: Adverting to my note of the 7th instant, relative to the case of the schooner Mont Blanc, in which it was stated that the Secretary of the Navy would designate some person at or near Key West to confer with such person as her Majesty’s authorities may appoint, to ascertain and agree upon the damage to be paid in that case, I now have the honor to enclose to you the copy of a letter of the 18th instant, addressed to this department by Mr. Welles, naming Acting Rear-Admiral Theodorus Bailey for the purpose.

I avail myself of this opportunity to renew to your lordship the assurance of my high consideration.

WILLIAM H. SEWARD.

Right Hon. Lord Lyons.

Mr. Welles to Mr. Seward.

Sir: Agreeably to the conversation during our interview of Saturday last, that the affair of the Mont Blanc be disposed of by referring it to some person at or near Key West to consider and dispose of the whole subject without an appeal to the court, as the amount involved is small, I would name Acting Rear-Admiral Theodorus Bailey for the purpose. Should this suggestion be acceptable, necessary orders shall be given to Acting Rear-Admiral Bailey. It can be left to Lord Lyons to associate some one with Acting Rear-Admiral Bailey, if he wishes.

Very respectfully, your obedient servant,

GIDEON WELLES, Secretary of the Navy.

Hon. William H. Seward, Secretary of State.