Fishing licenses are now issued by the government of Prince Edward's Island at the following places and by the under-mentioned persons: Charlottetown, the colonial secretary; Cascumpeque, James Forsyth; Richmond bay, Benjamin Beansto; Georgetown, William B. Aitkin. I have the honor to be. with the highest consideration, sir, your most obedient, humble servant, Hon. WILLIAM H. SEWARD, &c, &c., &c. FREDERICK W. A. BRUCE. Sir F. Bruce to Mr. Seward. WASHINGTON, July 25, 1866. SIR The existing contract with the Messrs. Cunard for the conveyance of the mails between Great Britain and America will cease on the 1st of January, 1868, and it is the opinion of her Majesty's post office authorities that other and better arrangements can be made, which will supersede the necessity of a new contract. In order to carry out these new arrangements, it will be necessary to terminate the existing post office convention between the United States and Great Britain, as provided by article 22 of that instrument, and I am accordingly instructed by her Majesty's government to give the requisite notice of the intention to determine the convention on the 1st of January, 1868, simultaneously with the expiration of the Cunard contract. At the same time I am directed to express the readiness of her Majesty's government to enter into negotiations for a new convention, such negotiations to be carried on directly between the post offices of the two countries, and the convention to be concluded and signed by the heads of the respective offices. new I enclose, confidentially, an extract of a letter on the subject, addressed by the post office authorities to the foreign office, which points out the advantages, it is hoped, may be derived from the new arrangements which it is contemplated to make. I have the honor to be, with the highest consideration, sir, your most obedient, humble servant, Hon. WILLIAM H. SEWARD, &c., §x., &c. FREDERICK W. A. BRUCE. Mr. Hill to Mr. Hammond. GENERAL POST OFFICE, June 22, 1866. SIR: I am directed by the postmaster general to request that you will state to the Earl of Clarendon that the contract concluded on the 24th June, 1858, with Messrs. Cunard, Burns, and MacIver, for the North America and Bahamas mail packet service, can be terminated on the 1st January, 1868, provided twelve months' notice be previously given to the contractors, and that it is the intention of her Majesty's government to give such notice and to terminate the contract accordingly. The postmaster general does not propose to enter into a new contract for the continuance of a mail service like that now existing between this country and North America, as he is of opinion that without any such contract the numerous steamships now plying afford the means of maintaining a rapid and frequent postal communication with the United States. In his lordship's opinion, arrangements may advantageously be made with the owners of wellappointed ships, leaving this country on stated days weekly, for the conveyance of mails to New York, in consideration of a payment equal to the whole sea-postage if the voyage be performed within a certain time, and equal to a smaller sum, according to a fixed scale, where that time is exceeded. A similar course might be pursued by the United States post office with regard to the des patch of mails to this country, and it seems probable, looking at the great commercial inter course between the two countries, that after a time under such a plan a daily mail might be established in each direction. Under this arrangement all necessity for the post office of one country to send to that of the other instructions respecting the transmission of its mails, a necessity giving rise to much trouble, would be avoided. As respects the outward mails, each office would have the sole direction. Each office thus undertaking to provide the means for the despatch of the outward mails, the postmaster general would propose that the despatching office should retain all the postage charged on the international correspondence, and that the office to which the mails are sent should make no charge on the delivery of such correspondence. To accomplish this object, however, and to effect other improvements in the postal intercourse of the two countries, it will be necessary to terminate the existing postal convention between the United Kingdom and the United States signed at London on the 15th December, 1848, and to conclude a new convention, and the lords commissioners of the treasury have authorized the postmaster general to adopt that course. The 22d article of the existing convention provides that it may be annulled after the expiration of a year's notice given by one government to the other, and I am directed by the postmaster general to request that the Earl of Clarendon will be good enough to intimate to the government of the United States that it is the desire of her Majesty's government that the convention should cease to have effect on the 1st January, 1868, simultaneously with the termination of the Cunard contract. If Lord Clarendon sees no objection, Lord Stanley of Alderby would propose, in accordance with what is now the general rule, that the negotiations for a new convention should be carried on directly between the post offices of the two countries, and that the convention should be concluded and signed by the heads of the respective offices. By such a proceeding much trouble is saved, and facilities are given for modifications from time to time in the convention. In a letter addressed to the Postmaster General of the United States, on the 29th May, 1962, Lord Stanley of Alderby pointed out that although prevented at that time by the great loss sustained by this department in the maintenance of the North America mail line of packets from acquiescing in the proposal to reduce the total charge on a single international letter conveyed between the two countries from one shilling, or twenty-four cents, to sixpence, or twelve cents, he trusted that when that service terminated it would be found practicable to achieve so desirable an object. Relieved from the burden caused by the contract now about to expire, his lordship will readily agree, in entering into a new convention, to the proposed reduction of postage on international letters, and he will also readily agree to the establishment of low transit rates for letters passing through either country, whether the ordinary or enclosed mails. I am, &c., The Right Honorable E. HAMMOND. F. HILL. Mr. Seward to Sir F. Bruce. DEPARTMENT OF STATE, SIR: I have the honor to invite your attention to the enclosed extract of a communication of the 19th instant, which the United States consul at Toronto addressed to this department, regarding the arrest and imprisonment at that place of three American citizens, who are charged with participating in the recent Fenian movement against Canada. I have the honor to be, with the highest consideration, sir, your obedient servant, WILLIAM H. SEWARD. The Hon. Sir FREDERICK W. A. BRUCE, &c., &c., &c. Among the Fenians arrested in Canada on suspicion of being engaged in the Fenian raid in June last, are several American citizens. Many of these persons have placed in my hands affidavits of their innocence and testimonials of their character, which I have forwarded through the Crown officers to the government of Canada. One of these parties was released at my request some days ago. There are three persons now in jail for whom I have placed before the government of Canada the most unquestionable proof of their innocence. The names of these parties are Thomas Ellis, James Dillon, and Carney, citizens of Buffalo. So convincing was the evidence to the clerk of the peace here, Mr. John McNabb, that he did not hesitate, after examining the same, to send his report to Mr. R. A. Harrison, Crown agent at Toronto, that they be forthwith discharged. On the 5th of July Mr. Harrison made his report, and, as I understand, recommended the discharge of these men. On the 13th instant, hearing nothing further from the government in relation to their discharge or trial, I addressed a letter to Mr. Harrison, herewith enclosed, which he at once transmitted to Ottawa. On the same day I telegraphed to the Hon. Mr. McDougall, which is also enclosed, together with the answer received. On the 17th instant I telegraphed to the honorable attorney gen eral, asking, from the evidence submitted to him, that these parties be at once discharged. I received no answer until yesterday afternoon, when the enclosed answer was received. These parties, arrested on the charge of being engaged in a raid on Canada on the 1st of June, have been in confinement in the old jail in Toronto ever since. They are most respectable persons, living at Buffalo, and, as the testimony submitted to the government of Canada proves, they went over to Fort Erie after the battle, the boat in which they crossed was stolen, and they were arrested sitting on the banks, with no arms or offensive weapons found on them. That parties in Fort Erie saw them when they landed, and to some of those persons they told the object of visiting Fort Erie at that time, which was to see the Fenians and the battle-ground. The government of Canada have not determined whether to try the whole number arrested by military tribunal or by the civil courts. In the mean time they are deprived of their liberty, and no amount of evidence, conclusively proving their entire innocence, seems to have any effect to hasten the government action in their case. I have made all the demand that I felt authorized to make, and I now refer these particular cases to the department for instruction. There are several other parties, claiming to be American citizens, in prison here, for whom I have transmitted certain evidence of their innocence of any complicity with the Fenian raid. The proof submitted to the government, however, is not full and complete, and I am waiting further evidence to enable me to press their claims for discharge or immediate trial. In the case of Ellis, Dillon, and Carney, I beg to say that I have had every assistance from the county clerk, John McNabb, esq., who has arranged all the proof received, and, with his comments on the same, has transmitted it to the government, with strong recommendation that they should be discharged at once. The general feeling among the law officers of the government at Toronto is that they should be discharged, and I respectfully ask that some action may be had in their behalf by the department at once. D. THURSTON, United States Consul. With great respect, I am, sir, your obedient servant, Hon. WILLIAM H. SEWARD, &c., &c., &c. Letter sent to Mr. Harrison. UNITED STATES CONSULATE, Toronto, July 13, 1866. DEAR SIR: I trust you will pardon any seeming importunity on my part when I again ask if Ellis, Dillon, and Carney are to be released. The proof, so clear and full, would, I am confident, satisfy any one of their entire innocence, and I most respectfully ask that the government be requested to discharge them at once. I know their families are suffering, and, in view of the excessive hot weather, it would seem nothing more than justice that they be discharged at once. I am, sir, very truly, yours, R. A. HARRISON, Esq., Toronto. D. THURSTON, United States Consul. Telegram sent to Hon. William McDougall. TORONTO, July 13, 1866. Hon. WILLIAM MCDOUGALL, Provincial Secretary, Ottawa, C. W.: Is there any reason why Ellis, Dillon, and Carney should not be discharged at once? The evidence of their innocence is certainly conclusive, and has been before your government for a week. D. THURSTON, United States Consul. Telegram received from Hon. William McDougall. D. THURSTON, American Consul, Toronto, C. W.: OTTAWA, July 13, 1866. The prisoners having been taken by the military authorities as persons engaged in a piratical attack upon this province, can only be discharged after acquittal by the proper legal tribunal. WILLIAM MCDOUGALL. Telegram sent to John A. MacDonald, Esq. TORONTO, July 17, 1866. Hon. JOHN A. MACDONALD, Attorney General, West Ottawa, C. W.: Is there any reason why Ellis, Carney, and Dillon, in prison here as Fenians, are not discharged? The evidence of their innocence is conclusive, and the report of Mr. Harrison in favor of their release. I would respectfully ask that they be discharged at once. D. THURSTON, United States Consul. Telegram from John A. Mac Donald, Esq. OTTAWA, July 18, 1866. D. THURSTON, Toronto, C. W.: The cases of all the prisoners at Toronto are now under the consideration of the government. JOHN A. MACDONALD. Sir F. Bruce to Mr. Seward. WASHINGTON, July 28, 1866. SIR: I have the honor to forward herewith copies of a despatch from his excellency the governor general of Canada, together with its enclosure, respecting the arrest of a deserter named John Chapell from the Canadian gunboat Michgan within the territory of the United States. The intention of Lord Monck to have replaced this man within the jurisdiction of the United States has been frustrated by his having deserted a second time. It appears he is now in Detroit. Lord Monck, in expressing his regret at the violation of the United States territory, which was not contemplated by the officer in command of the Michigan— the boat having been lowered to pick up the man, who was supposed to have fallen overboard—has taken occasion to point out to the officer in command that the man ought to have been delivered up without waiting for any remonstrance from the authorities of the United States, and has given instructions which, I trust, will effectually prevent the repetition of such acts. I trust the government of the United States will be satisfied with the manner in which this case has been dealt with, and will see in the instructions issued a proof of the desire of her Majesty's authorities in Canada to respect the jurisdiction of the United States, and to act in that spirit of comity and respect for international obligations in which her Majesty's government is anxious that the relations of Great Britain with the United States should be carried on. I have the honor to be, with the highest consideration, sir, your most obedient and humble servant, Hon. WILLIAM H. SEWARD, &c., &c., &c. FREDERICK W. A. BRUCE. GOVERNMENT HOUSE, Ottawa, July 23, 1866. SIR Referring to your despatch of the 14th instant, and enclosure, I have the honor to transmit for communication to the Secretary of State of the United States a copy of a report from Lieutenant Heron, royal navy, commanding the Canadian gunboat Michigan, respecting the circumstances under which the arrest of John Chapell on United States territory took place. I think it is plain from this report that there was no intention on the part of this officer to infringe the territorial rights of the United States; indeed he asserts that the party by whom the man was arrested were beyond his control at the time the arrest took place. I regret very much that even under such circumstances any act should have been committed by persons in her Majesty's service, of which the government of the United States has a just right to complain; and if John Chapell were still on board the Michigan, or within my control, I should feel it my duty to order that he should be immediately replaced within the bounds of the United States territory. I have caused a letter to be written to Lieutenant Heron, pointing out to him that, as soon as he found that the crew of the boat sent in pursuit of John Chapell had exceeded their duty by pursuing and arresting him on United States territory, he should, without waiting for remonstrance from the authorities of the United States, have immediately ordered the liberation of the prisoner so illegally arrested, and I have desired the officer to be admonished to be very careful in future not to infringe the territorial rights of the United States. As it appears that John Chapell has since a second time deserted, and is now supposed to be at Detroit, I trust the Secretary of State will accept my expression of regret at the affair as a sufficient reparation, and will be satisfied, from what I have stated, that I will use every exertion to prevent a repetition of the occurrence. I have, &c., &c., The Hon. Sir F. BRUCE, G. C. B., &c, &c., &c. MONCK. H. M. GUNBOAT MICHIGAN, Windsor, C. W., July 20, 1866. SIR: I have the honor to acknowledge the receipt of a letter, dated July 18, regarding the capture of John Chapell, royal marine light infantry, from American territory, by some men of her Majesty's gunboat Michigan. I have the honor to forward particulars as regards said capture. On June 27th, whilst proceeding through the river St. Clair, the man John Chapell, royal marine light infantry, did jump overboard, a little below an American town called Newport, and swam to the shore. I sent a boat immediately after him, under the impression that he had fallen overboard by accident, but afterwards found, by his confession and other evidence, that he was under the influence of liquor, and did not know what he was doing at the time. A boat with one man came out from the American shore, picked him up, and, after pulling towards the ship for a short time, suddenly turned and made for the shore. The boat from this ship followed, and the men landed and chased the deserter. I was not able to recall them, as I only had one boat, and too far distant to hail them. Chapell got about one hundred yards ashore; they arrested him and brought him back. No objection was made at the time to the result, nor have the men from this ship arms of any description. The man in question deserted again on July 9, of which I duly acquainted the mayor of this town, Mr. S. M. McDonnell, and he informed the district attorney of Detroit, who said all proceedings on the subject would be stopped. John Chapell is, I am told, in Detroit at this moment. I have, &c., &c., SIR: I have the honor to acknowledge the receipt of your communication of the 28th of July, in reply to my note to you of the 12th of the same month, upon the subject of the arrest within the United States of John Chapell, a de |