Mr. Merry to Mr. Hay.

[Telegram.]

Entered into arrangement Mosquito Territory customs duties by payment to British consul, subject to decision the Government of the United States and the Mcaraguan Government, as to de facto government, of which you will have unquestionable proof. Request leave of absence one month, consul of the United States at San Juan del Norte to make a report to Department of State. Reply by telegraph San José. Mosquito Territory quiet at present. British war ship probably remains until ours has returned.

Merry.