Hammond to Under-Secretary of State

I have laid before Lord Stanley Your Letter and it's
enclosure of the 5th Instant respecting certain occurences at
the Island of San Juan, and I am to request that you will state to
the Duke of Buckingham that it appears to Lord Stanley that Governor
Seymour has taken the best course both as regards the American
Tariff and as regards the Deserter from the Marine Force in the Island;
but that the demand made by the Commander of that Force on the
Commander of the American Force for the surrender of the man
was most injudicious, and wholly unwarranted.

As regards the question of a settlement with the United States
of the pending question respecting the possession of the Island,
I am to state for His Grace's information that the manner of
dealing with this question involves much difficulty, as he will
see by the perusal of the Memoranda of which I enclose copies.

Sir Frederick Bruce will however be instructed again to
bring before the American Goverment the proposal of January 25 1861,
if he sees no objection to doing so at the present time, and Her
Majesty's Government will be able from his report to judge what
course should be taken, supposing the American Government are still
unwilling to agree to arbitration on the basis stated in that proposal.