Lord Lyons to Mr. Seward.

Sir: With reference to the conversation which we had yesterday, on the subject of the note which, in pursuance of instructions from her Majesty’s government, I addressed to you on the 1st instant respecting the case of the “Sir William Peel,” I do myself the honor to transmit to you herewith certified copies of the depositions and decrees in court, in the case, up to the 9 the of January last. You will find among these documents a copy of the order of the court granting time to procure further evidence in the cause.

I trust that the information thus supplied will suffice to enable you to come to a decision on the case, without incurring the delay which would be occasioned by a reference to New Orleans.

I have also the honor to transmit to you a copy, taken from the New York Times of the 29th November last, of the intercepted letter from Commander Rolando to Captain Fox.

I beg you to be so good as to send back to me the copy of this intercepted letter, as well as the copies of the depositions and decrees of court.

I have the honor to be, with the highest consideration, sir, your most obedient, humble servant,

LYONS.

Hon. William H. Seward, &c., &c., &c.

The case of the Sir William Peel.An interesting letter from Captain Rolando, of the Seminole.

The Richmond Enquirer publishes the following correspondence, premising that “this Henry Rolando is a South Carolinian by birth, and disappointed his friends very much by remaining with the enemies of his country. He was with Captain Pegram in the expedition against the Chinese pirates, and behaved very gallantly. Before the war his word would have stood against the oath of any [Page 540] Englishman, but the amount of lying done by his brother Yankee officers during the war makes it rather doubtful whether his word will pass now among gentlemen. Such is the effect of association.”

Mr. Magruder to Mr. Mallory.

Sir: I have the honor to forward for your information a letter from Captain Rolando, commanding United States steamer Seminole, to Mr. G. V. Fox, Assistant Secretary United States Navy. This letter was in the mail-bag of the Seminole, which, with that of the Cayuga, were intrusted to the captain of a blockade runner, who deceived the federals into the belief that he was bound for New Orleans, and on leaving them at Sabine Pass, ran into Calcasieu, and delivered the mails to an officer there, who transmitted them to these headquarters. The original has been sent to Mr. Mason, in London, for publication, one copy to the British admiral commanding in the gulf, and one to the Mexican authorities at the Rio Grande.

I am, very respectfully, your obedient servant,

J. BANKHEAD MAGRUDER, Major General Commanding.

Hon. S. R. Mallory, Secretary of the Navy.

Mr. Rolando to Mr. Fox.

My Dear Fox: I am sorry that I have been ordered by the commodore to blockade off this place, as I felt I could have been of more service at the Rio Grande, where I seized the Sir William Peel, on the 11th of September.

I could understand the hocus-pocus of those Englishmen there; they were in open daylight landing cargoes of contraband, with the connivance of the Mexicans, and sending into Texas everything they could which would aid the rebellion. I knew it, but could not detect the act, and consequently had to keep quiet until I had sufficient grounds for making the seizure I did.

The Sir William Peel is about three hundred and forty feet long on deck, and has splendid engines, all below the water-line, and built for a man-of-war, iron stanchions and knees fore-and-aft on her main deck, and could be converted into a privateer on very short notice.

I expected to find guns on board, but did not, with the exception of two iron 18-pound guns. Of contraband articles I found about one hundred and fifty axles for gun-carriages, and two casks of iron rings for artillery harness.

The vessel is perfectly ventilated with air-ports, and would be comfortable for a crew of four hundred men. She will make us a splendid single-decked sloop with pivot-guns, razee the spar-deck.

No one knows, who has not been to the Rio Grande, the immense value that river is to the southern confederacy. Steamers are constantly landing cargoes—contraband—which go to Texas in the small steamers and barges which are towed up the river, and landed; on returning bringing cargoes of confederate cotton, just as bad as contraband, as it buys the arms and munitions of war.

When I took the Peel she had steam up, and I thought she was going to run [Page 541] for it; so I took her at anchor, which I would not have preferred, as I feared the Englishman would cry out neutrality, as he did; but I informed him that he was in error; that I had the advantage; he was on my side of the line; he was quite near the line, but a little to the. northward.

I did not take any bearings myself of the position, as my instructions to the master are general, that “he should always take bearings when we stopped near the land.” He did so while I was on board the Peel, as I seized her myself, and the day after the seizure I found that in the log was noted the bearing of the river Rio Grande, west by south, at the time of the seizure, which puts us a little in American waters. I am glad it was done by the master, as I felt some delicacy about a point of so much interest, personally.

It galled me to have a scoundrel of an Englishman crying out neutrality, when he knew as well as I did that he had been trafficking in the blood of my countrymen and making money out of our misfortunes. That he had landed arms and contraband of every kind before my arrival, (I was only ten days at the Rio Grande,) and had started with the intention of being a privateer, and had so boasted in Matamoras, is well known; but the miserable Mexicans who are helping the trade, and yet will no doubt sustain a claim of neutrality which they themselves are violating, for the Hawkins, the Celt, Lebannon, and Peel had all discharged their cargoes, which were contraband and forwarded to Texas by Mexican authorities in the custom-house.

When it is so palpable to any one of our statesmen that Mexicans are hourly, through the custom-house at the Rio Grande, violating their neutrality by assisting and giving aid and comfort to the enemy, I think it devilish hard that any plea for the observance of a neutrality which they don’t observe themselves should be listened to by our government; and I hope Mr. Seward will remind them of what they are now doing and have done in the way of violating neutrality by sending to Texas contraband cargoes through the Rio Grande; it is so easy, as the river at the mouth is about three hundred yards wide, with four feet water on the bar, and grows narrower as you go up. I think the government should sustain my course without listening to any plea of neutrality from either English or Mexicans.

The ship will condemn herself, for you know her cargo from information from abroad and what she must have landed. The Mexicans are themselves violating neutrality, as it is the duty of a neutral to show favor to neither side, but be an honest friend to both belligerents.

I can take good care of my position, when the fight comes, on neutrality, as the course I have taken is fully sustained by my officers and the master who placed the ship, by bearings, in our own waters; so you see my reckoning is all right and I can rebut the English version. You saw from that English Captain Hood’s despatch how the drift would be. The d—d puppy; I wonder if he recollected how his consul, Mr. Bunch, and some of his brother officers, raised the blockade off Charleston by an imaginary line of horizon. I suppose the boundary* of Texas and Mexico is one of the same to him; but I have one of Blunt’s compasses, which give a blunter line than theirs.

I hope Mr. Seward will assume a higher law if the case comes before him, as Mexico and England are violating neutrality themselves, and what is meted out by them to us they should be made to feel in a similar way.

There is not enough doing here to keep one alive; I have been here about two weeks and have not seen anything but what is in Sabine Pass, which the rebels are fortifying, and piling across the channel.

I do not anticipate anything in the way of a fight here, unless the Clifton, Sachem, and the cotton boats in the Pass come out and make one. The Clifton is in working order. I can’t get near them, as there is only seven feet water at the entrance of the Pass. The army will attack, I suppose, from some other point than the Pass, as it is stronger now than ever.

[Page 542]

I trust, my dear Fox, you will drop me a line and tell me how the course I have pursued as regards the Peel is appreciated by the department; for I am really quite anxious at the responsibility I have assumed, particularly when I think of Hunter, who I have understood was charged with violating neutrality. The Englishmen will do any amount of swearing, and the Mexicans likewise, from complicity. My consciousness of having acted to the best of my ability for the interest of my country and its cause, the belief that the vessel was in American waters, and the corroborating testimony of the master and log-book, are the comforts I have in my anxiety, and on which I rest my defence.

Drop me a line soon, and believe me your friend,

HENRY ROLANDO.

A true copy:

W. A. ALSTON, Captain, A. A. General.