Mr. Seward to Mr. Adams.

No. 736.]

Sir: I enclose a copy of a letter, of the 13th instant, addressed to the department by the Secretary of the Navy, and of the contract to which it refers between certain agents of the insurgents for the delivery of naval stores at St. George, Bermuda, to be thence introduced into the United States in violation of the blockade.

You will bring this to the notice of Earl Russell as a measure which, if carried into effect, seems to us to be a violation of the spirit, at least, of the Queen’s proclamation, and as requiring such instructions to the authorities in Bermuda as would prevent those islands being made a place of deposit for the purpose referred to.

I am, sir, your obedient servant,

WILLIAM H. SEWARD.

Charles Francis Adams, Esq., &c., &c, &c.

Mr. Welles to Mr. Seward.

Sir: I have the honor to enclose herewith a copy of an original contract in the possession of this department, entered into on the 28th of August, 1863, at Richmond, Va., between George R. Ghiseling, of Kentucky, and John H. Maddox, of Louisiana, under the name and style of George R. Ghiseling & Co., of the first part, and John de Bree, paymaster of the so-called confederate navy, for and in behalf of the navy department of the so-called Confederate States, of the second part, having for its object the procuring from abroad, for the use of the insurgent government, certain naval forces, and looking to the establishment of a depot for such stores at the port of St. Georges, Bermuda.

The schedule referred to in the contract, and forming a part of it, did not come into the possession of this department.

My object in furnishing you with this extraordinary paper is for the purpose of suggesting that the attention of Lord Lyons be called to the proposed violation of the neutrality of Great Britain by making use of one of her Majesty’s ports as a depot of naval stores intended for the insurgent government, which has been recognized by Great Britain as a belligerent, and under a contract made under the authority of said government.

In connexion with this contract, it may not be amiss to state that one of the parties to it, Joseph H. Maddox, was early in the rebellion confined at Fort Lafayette upon a charge of illicit traffic and violence of the blockade, and was released on entering into an engagement, under oath, that he would not enter any of the States in insurrection against the authority of the government of the United States, nor hold any correspondence or other communication with persons residing therein, during the present hostilities, without permission, nor do any act hostile or injurious to the government of the United States.

Very respectfully, &c,

GIDEON WELLES, Secretary of the Navy.

Hon. William H. Seward, Secretary of State.

[Page XVIII]

Copy of contract.

This contract, made and entered into this 28th day of September, A. D. 1863, “between George R. Ghiseling, of Kentucky, and Joseph H. Maddox, of Louisiana, under the name and style of George R. Ghiseling & Co., of the first part, and John de Bree, paymaster confederate navy, for and in behalf of the navy department of the Confederate States, witnesseth: That the said party of the first part undertakes and agrees to deliver to the designated agent of the Confederate States navy department, at a port of the Confederate States, east of the mouth of the Mississippi river, in the possession and control of the Confederate States government, within six (6) months from the first (1st) day of October, 1862, all in good merchantable order, the naval stores as set forth in the schedules hereto annexed, marked A, B, C, D, and E, respectively, which schedules are hereby declared to belong to and become part of this contract.

And said party of the first part further stipulates and agrees to purchase or otherwise procure one or more fast and light-draught steamers, and to freight and despatch the same from some foreign port with all the haste possible; said steamers to remain under the exclusive control of said party of the first part during the continuance of this contract, and to be used only in its execution.

And it is understood and agreed that if at any time the said party of the second part shall so direct any part or the whole of deliveries under said schedules A, B, C, D, and E, or under any other hereafter sent, shall be made at the port of St. Georges, Bermuda, excepting such portions thereof as shall already have been actually shipped before the receipt of such order by the party of the first part.

And in consideration of the stipulations by the party of the first part, as hereinbefore set forth, the party of the second part covenants and agrees to pay to the party of the first part, his attorney or assigns, upon certified bills or invoices approved by the agent of the Confederate States at the port whence shipped, the full amount of each and every delivery, with the addition of twenty-five (25) per cent, thereon if delivered in a port of the Confederate States, and with an addition of ten (10) per cent. thereon if delivered at the port of St. Georges, Bermuda, and with the addition, in either case, of the actual cost of transportation, to include the outlay for coal, hire and subsistence of the crew and officers, wharfage, lightage, and labor of loading only: Provided, That, in the case of deliveries at a port of the Confederate States, such charges for transportation shall not exceed and may be covered by the payments to the party of the first part of twenty-five (£25) pounds sterling for each and every ton so delivered.

And the party of the second part further covenants and agrees to pay the party of the first part an additional premium of ten (10) per cent, upon all bills or invoices, certified to as above, if delivered at a port of the Confederate States within forty (40) days from the tenth (10) day of October, 1863, there being no premium to be paid upon any charges for freight or transportation.

And the party of the first part agrees and stipulates to receive for all payments to be made to him, at the option of the Confederate States navy department, either sterling bills of exchange, or cotton at sixpence (6d.) sterling per pound, delivered at a port of the Confederate States in the possession and control of the Confederate States government: Provided, That said party of the first part may be allowed to convert such bills of exchange into cotton, and to ship all cotton in either way obtained by them without any impressment of or interference with the same during its transportation to or detention at such port; and that it is distinctly understood and agreed that no part of said cotton shall be used for any other purpose than to purchase naval stores under this contract, until all the provisions of the same shall have been carried out and executed; and that no part of said cotton shall at any time be shipped to or sold in any [Page XIX] port belonging to or in possession of the United States of America, under the penalty of forfeiture of all dues and payments to the said party of the first part by the Confederate States navy department.

And, finally, it is understood and agreed that all schedules that may be sent by the party of the second part after the signing of this contract shall become part of it, and be in full force for all the provisions of the same, from the date of their receipt by the party of the first part, and that this contract may be extended beyond the time hereinbefore set forth, both parties thereto concurring: Provided, also. That if, by the act of God or of the public enemy, there shall be any unavoidable delay or detention in the deliveries under this contract, the time hereinbefore stated shall be extended, so as to allow the party of the first part the time necessary to carry out the stipulations of the same.


GEORGE R. GHISELING.

J. H. MADDOX.

JOHN De BREE, Paymaster, in charge.

Signed, sealed, and delivered in presence of—

J. P. McCorkle.

Charles J. Ost.

Approved.

S. R. MALLORY, Secretary of the Navy.