Mr. Seward to Mr. Stuart.

Sir: I have the honor to acknowledge the receipt of your note of the 24th instant, relative to the case of the Labuan. In reply, I have to acquaint you that it is true that this government has deemed it necessary to make further inquiry at Matamoras, with a view to ascertain the grounds for the large damages claimed in that case. In adopting this course, however, there was no intention to disregard the rights of the claimants. With a view to remove any unfavorable impression upon the subject, a copy of the correspondence between the department and the United States attorney at New York in regard to it is herewith transmitted.

I have the honor to be, sir, your very obedient servant,

WILLIAM H. SEWARD.

Hon. William Stuart, &c., &c., &c.

Mr. Smith to Mr. Seward.

Sir: I have the honor to transmit herewith a copy of a letter this day mailed by me to the United States consul at Matamoras, in reference to the case of the Labuan.

As stated in one of your letters to me, it is a matter of importance to the government that evidence, such as is mentioned in my letter to the consul, should be obtained. I take the liberty of asking that, if it be deemed proper, the department will instruct the consul to use diligence in procuring and transmitting to me the required affidavits, and will authorize him to incur any expense necessary for that purpose.

I am, sir, with great respect, your obedient servant,

E. DELAFIELD SMITH, United States District Attorney.

Hon. William H. Seward, Secretary of State.