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(Inclosure 27 in No. 17.1
Gorernor Bayley to Commander Hickley.

GOVERNMENT HOUSE, Nassau, June 17, 1862. Sir: I have the honor to acknowledge, and the pleasure of thanking you for your letter dated the 16tb instant, in reply to my letter of the same date.

I can assure you I am perfectly sensible of the zealous activity which you bave exhibited in your attempts to preserve the neutrality of the harbor, in accordance with the law of England and the avowed policy of Her Majesty's government. And I ain quite certain that in every case where your services may be required to protect either the peace or the neutrality of the harbor I may rely upon your prompt and hearty cooperation.

I felt it my duty in my letter of yesterday to express to you unreservedly my opinion on the case of the Oreto, and the doubts which I entertained respecting the legality and policy of preventing her from leaving the harbor.

These doubts were much increased by the strong opinion expressed by the law-officer of the Crown who discharges the covjoint duties of Queen's advocate and attorney general in this colony.

In deference to the views entertained by that officer and myself, you have, I dow understand, removed the officers and crew who were in charge of the Oreto, and thereby given her the option of leaving the harbor.

But in the letter which announces this proceeding you repeat the expression of your own and your officers' conviction that “the Oreto is a vessel of war which can be equipped in twenty-four hours for battle.” And in your brief conversation with me

this morning you stated that, though the Oreto had discharged some of her [27] suspected *cargo here, still she was not leaving the port empty. A professional

opinion coming from an officer of your character and rank cannot fail to have its due weight with me. On the one hand I am unwilling to place any restraint on a vessel which has not as yet been formally proved to have violated the law or impugned the neutrality of the harbor by any overt act. I am equally unwilling to place any limit on the rights of hospitality usually accorded to vessels of all nations in English harbors. I am most unwilling to strain the law to the prejudice of any vessel seeking that hospitality. But at the same time I cannot fail to recognize the great importance of the testimony which may be brought forward by yourself and your crew; nor can I fail to see the grave consequences which might result if a vessel equipped and fitted as you represent for the purposes of war were quietly allowed to take a crew here, and quit the harbor with the intention of fighting on the side of one of two belligerent states with each of whom Great Britain is at peace.

To the doubts which this dilemma creates, I can see only one solution. The equipment of the Oreto, the object of her voyage hither, the intent of her voyage hence, the nature of her crew and the purpose of their enlistment, are all the fair subjects of judicial investigation. We cannot detain or condemn her on mere suspicion ; nor, when suspicion has been so generally aroused, can we permit her to depart unexamined and unabsolved.

Under every aspect, therefore, of the case, I think the best course which can be taken in the interests of yourself, the colouy, and the government, will be to seize the Oreto, and at once submit the question of her condemnation to the local court of vice-admiralty; and I am glad to see that you abandon the idea of carrying her before the court of any other colony. If, on the evidence which you adduce, the court condemn her, you will have the satisfaction of having prevented, certainly an illegal, and probably a disastrous, voyage. If the court do not condemn her, you will have the satisfaction of having discharged your duty under circumstances of anxious doubt and difficulty. the solution of which will hereafter smooth the course of others placed in situations equally trying and embarrassing.

My opinion is that an appeal to the decision of the local vice-admiralty court is the best expedient which could be embraced by all the parties interested in the matter. I will give the necessary instructions to the Queen's advocate.

I have, &c.,
(Signed)

C. J. BAYLEY.

Inclosure 28 in No. 17.)

Gorernor Bayley to the Duke of Newcastle.
GOVERNMENT HOUSE, NASSAU, NEW PROVIDENCE,

Bahamas, June 26, 1862. MY LORD DUKE: I have the honor to inclose copies of a letter addressed to Captain Hickley, royal navy, commanding Her Majesty's ship Greyhound, by the consul of the United States at this port, and of Captain Hickley's reply to that letter.

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I have, in my dispatch, so fully entered into the details of the Oreto affair that it vould be superfluous to trouble your grace with any reply to the criticisms which Mr. Consul Whiting has been pleased to pass upon the conduct of this government.

I leave it to your grace's superior judgment to decide whether the attention of the minister of the United States should not be drawn to the irregular proceedings of the consul, and making a gratuitous compliment to one of Her Majesty's naval officers, the vehicle of an equally gratuitous sneer at Her Majesty's principal civil officer in the colony to which he is accredited.

I hare, &c.,
(Signed)

C. J. BAYLEY.

[2]

*[Inclosure 29 in No. 17.)
Wr. Whiting to Commander Hickley.

UNITED STATES Coxsı'LATE,

Nassau, June 24, 1862. Sir: I feel it is due to you that I, as the representative of the United States Government at Nassau, should express to you my hearty thanks for the activity and energy you have manifested in causing the detention, if not the condemnation, of the rebel privateer Oreto.

From the evidence in my hands of the warlike character and designs of that vessel, I am astonished that the colonial government should have made it vecessary for your interference in the matter. I am safe in assuring you that your prompt and decisive action in regard to this ship will meet with the high approval of the civilized world, and the sincere thanks of the Government I have the honor to represent.

I shall take pleasure in communicating your noble action in this matter to my Gorernment as soon as possible.

I have, &c.,
(Signed)

SAML. WHITING,

United States Consul.

[Inclosure 30 in No. 17.) Commander Hickley to Mr. Whiting.

GREYHOUND, Nassau, June 25, 1862. Sir: I have the houor to acknowledge the receipt of your letter of yesterday, in which, as the representative of the United States Government at Nassau, you “express your hearty thanks as due to me, for the detention, if not the condemnation, of the rebel privateer Oreto." And whilé expressing my sense of such communication from the representative of a foreign government in a British port, I must at the same time acquaint you that, co-operating as commander of Her Majesty's ship Greyhound with his excellency the governor of the Bahamas for the protection of the harbor of Nassau, I have deemed it expedient to arrest a vessel called the Oreto, under British colors, supposed to be acting in contravention to the foreign enlistment act, and that in so doing I have acted quite in harmony with the local government.

As to the astonishment which you express," that the colonial government should have made it necessary for me to interfere," I have to inform you that in this affair I have performed only an executive duty in reporting to the governor the fittings and equipment of the Oreto, and suggesting to his excellency the propriety of placing her in the almiralty court for adjudication, as it is only by a naval officer's knowledge and expwrience in such inatters that the government conld be guided, and only on his professioual opinion that it could act.

I have, &C.,
(Signed)

H. D. HICKLEY.

No. 18.
Earl Russell to Mr. Stuart.

FOREIGN OFFICE, August 2, 1862.
Sir: You are no doubt aware that the British vessel Oreto, which
formed the subject of my dispatches to Lord Lyons of the
29th of March and 12th of April last, has been seized in the ed to l'nited States
port of Nassau, by Commander Hickley, of Her Majesty's
ship Greyhound, acting in concert with the governor of that colony.

Explanation ford.

Governinent,

No. 21.

Approval of seizure.

Mr. Layarıl to the secretary to the admiralty.

FOREIGN OFFICE, August 9, 1862. SIR: I have laid before Earl Russell your letter of the 4th instant,

inclosing copies of a correspondence respecting the seizure

of the steamer Oreto, by Captain Hickley, of Her Majesty's ship Greyhound; and I am to request that you will state to the lords commissioners of the admiralty, in reply, that Captain Hickley should, in Lord Russell's opinion, be secured from all costs and damages for this very proper act.

I am, &c.,
(Signed)

A. H. LAYARD.

No. 22.

Opinion of

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officers.

The law-officers of the Crown to Earl Russell.

TEMPLE, August —, 1862. (Received August 12.) MY LORD: We are honored with your lordship's commands signified

in Mr. Layard's letter of the 22d instant, stating that he

was directed by your lordship to transmit to us the accompanying letter and its inclosures from the Colonial Office, respecting the seisure of the vessel Oreto at the Bahamas on the suspicion of having

on board stores intended for the use of the Confederate States. [31] * Mr. Layard was also pleased to state that he inclosed a letter

addressed to the Colonial Office, from which we should see that this vessel is to be detained until further instructions are sent to the governor of the Bahamas, and that he was directed by your lordship to request that we would take these papers into our consideration, and furnish your lordship with our opinion as to the form of prosecution to be adopted in this case, whether proceedings should be instituted under the provisions of the foreign-enlistment act or for a violation of the law of nations, and with any other observations which we might have to offer on the matter.

Mr. Layard was further pleased to state that he also inclosed for our information a previous correspondence respecting this vessel when she was being fitted out at Liverpool.

In obedience to your lordship's commands we have taken these papers into our consideration, and have the honor to report

That it appears to us to be proper, in the first instance, to correct a misapprehension which is to be found in Mr. Layard's letter, and also in that of Sir F. Rogers of the 31st July. The seizure is therein described as the “seizure of the vessel Oreto at the Bahamas on the suspicion of having on board stores intended for the use of the Confederate States," whereas the seizure in reality took place, and can only be justified on ihe ground of a violation of the foreign-enlistment act by those in charge of the Oreto, by reason of her having been "equipped, furnished, fitted out, or armed for the purpose of being employed in the conduct of hostilities against” the Government of United States. A merchant-ressel under the British flag, lying at the Bahamas, and having for her cargo " stores intended for the use of the Confederate States,” even though such stores were military or naval stores, would not be guilty of a breach of the foregn-enlistment act, or of any other provision in the municipal law of this country; though, by the laws of war, she would be liable to capture on the high seas by cruisers of the United States, as carrying contraband, or sailing with an express intent to violate an existing effective blockade.

As regards the manner in which this vessel ought now to be dealt with, we concur in the views expressed by Governor Bayley that the question of condemnation ought to be submitted to the local court of vice-admiralty. The act, section seven, directs that the prosecution of the ves. sel to condemnation is to be “in such courts in which ships or vessels may be prosecuted and condemned for any breach of the laws made for the protection of the revenues of customs or excise, or of the laws of trade and navigation.” We think that the facts warranted the seizure, but we must add that it is very important that, on the trial, evidence should be adduced of what occurred at Liverpool, as regards the building and fitting out, and the alleged ownership and destination of the Oreto; and also that, if possible, the circumstances under which she took on board the shot, shells, and ammunition which she is said to have discharged into some other vessel when off Nassau, should be ascertained and proved. This, coupled with the subsequent career of the vessel, strengthens the conclusion that she was destined and "equipped” in her structure and otherwise for taking part in the war against the United States.

We hare &c.,
(Signed)

WM. ATHERTON.
ROUNDELL PALJER.

No. 23.

Nr. Layard to Sir F. Rogers.

FOREIGN OFFICE, August 14, 1862. Sir: With reference to my letter of the 2d instant respecting the gun-boat Oreto, I am directed by Earl Russell to transmit to you, to be laid before the Duke of Newcastle, a copy of the opinion of the law, oflicers of the Crown as to the proceedings to be adopted in this case. I am further to transmit to you for his grace's information a copy of a letter which has been sent to the treasury, suggesting the propriety of directions being given to the commissioners of customs to send to Nassau a custom-house officer from Liverpool, who can give evidence of the facts with regard to the Oreto which occurred there.

I am, &c., (Signed)

A. H. LAYARD.

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Mr. Layou'd to the secretary to the treasury.

FOREIGN OFFICE, August 14, 1862. SIR: With reference to the correspondence which took place between this department and the treasury in the early part of this year respecting the gun-boat Oreto, which was asserted to com have been fitted out at Liverpool for the service of the so- entences

Proposal to send

Liverpool to give

I No. 12.

styled Confederate States of North America, I am directed by Earl Russell to state to you that it appears froin reports which have reached Her Majesty's government that this vessel has been seized at Nassau by Commander Hickley, of her Majesty's ship Greyhound, on the ground that she was fitting there as an armed vessel for the service of the Confederate States, in contravention of the Queen's proclamation of the 13th May, 1861, and the provisions of the foreign enlistment act, and that the case is to be tried before the vice-admiralty court of that colony.

I am to transmit to you a copy of an opinion of Her Majesty's advocate and solicitor general as to the proceedings to be adopted in this case;' and I am to request that, in laying the same before the lords commissioners of Her Majesty's treasury, you will suggest to their lordships the propriety of giving directions to the commissioners of customs to send to Nassau a custom-house officer from Liverpool, who can give evidence of the facts with regard to the Oreto which occurred tbere.

I am, &c.,
(Signed)

A. HI, LAYARD.

No. 25.

Ur. llamilton to Mr. Hammonil.

TREASURY, August 20, 1862. (Received August 20.) ) SIR: I am commanded by the lords commissioners of Her Majesty's treasury to acquaint you, for the information of Earl Russell, that they have caused Mr. Layard's letter of the 14th instant, with its inclosure on the subject of the proceedings to be adopted in the case of the gun-boat Oreto, which has been seized by Her Majesty's ship Greyhound at Nassau, Bahamas, for an alleged violation of the foreign enlistment act, to be communicated to the commissioners of customs, with a request to that board to take the necessary steps for sending to Nassau some gentle. man connected with their department who is competent to afford the information required in this matter, putting him in communication with the under-secretary of state for foreign affair's previously to his departure for Nassau.

My lords desire me to suggest for the consideration of Earl Russell, whether it would not be advisable that the customs officer should have an interview with the law-officers of the Crown previously to starting for Nassau, in order that it may be ascertained whether the information he possesses is that which will be conducive to the object in view.

I am, &c.,
(Signed)

GEO. A. HAMILTOX.

No. 26.

Mr. Layard to the secretary to the treasury.

FOREIGN OFFICE, August 20, 1862. SIR: I am directed by Earl Russell to request that you will state to the lords commissioners of Her Majesty's treasury that his lordship concurs in the suggestion, contained in your letter of to-day's date, that

IN c. 22.

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