FLORIDA BONDS-(Holford.)

Mr. HORNBY, British Commissioner:

THIS claim of the executors of the late Mr. Holford, a subject of Her Britannic Majesty, and formerly resident in London, upon the Government of The United States, in respect of certain bonds issued to him by the Republic of Texas prior to its annexation, arises under the following circumstances.

In the year 1838 the Republic of Texas, which had only recently separated itself from Mexico, was still engaged in carrying on the war with that country. The independence of Texas had not at that time being acknowledged by any Government but that of The United States. The resources of the young Republic were slight, and the result of the war was doubtful. In this state of things it became of the utmost importance to the Texan Government to obtain funds. to establish an efficient naval force, to prevent its ports from being blockaded and to operate upon the enemy's coast. Two Commissioners, Mr. Samuel M. Williams, and Mr. A. T. Burnley, were therefore sent to New York in October, 1838, with authority to negotiate a loan for the Republic of Texas.

These gentlemen, it appears, found considerable difficulty in executing their mission, until General Hamilton, of South Carolina, who had taken a very active part in the war, introduced them to the late Mr. Holford, who, at the request of the Commissioners and General Hamilton, agreed to advance a sum of money for the purchase of a steam-vessel then lying in the port of Philadelphia, called the "Charleston," to have her brought round to New York, to be there altered,

and armed as a vessel of war, and furnished with necessary stores, and then to send her at his own risk to Galveston, to be offered to the Texan Government.

The terms upon which Mr. Holford consented to render this important service to the Republic were embodied in the following agreement :-

Articles of Agreement* entered into in the City and State of New York this 24th day of October, 1838, between General James Hamilton, of South Carolina, as the authorized agent of James Holford, of London, of the first part, and A. T. Burnley and Samuel M. Williams, as Commissioners authorized by the Republic of Texas, to negotiate a loan of money for the said Republic, under the provisions of an Act passed by the Congress of Texas, the 16th May, 1838, of the second part, witnesseth,

That the said party, of the first part, binds and obliges himself to purchase the steamer "Charleston," now lying at Philadelphia (in the name of the said Hamilton), provided the said boat can be purchased for a sum not to exceed thirty thousand dollars.

The party of the first part further binds himself to have the said boat repaired, fitted out, provisioned, &c., under the management and direction of Samuel M. Williams, naval agent, of Texas, and to deliver her with all convenient dispatch at Galveston, in Texas; the whole expense of which, including all charges and expenses up to the time of her delivery at Galveston, not to exceed seventy thousand dollars. And when delivered in Texas, the said boat, her provisions, munitions, &c., to be offered to the Government of Texas for their bond for double the amount of the cost of the boat and expenses incurred up to the time of her delivery at Galveston, payable in five years from date, at the Bank of The United States, in Philadelphia, or in London, at such agency as Texas may engage in that city. The said bond to bear an interest of ten per cent, payable semi-annually. But inasmuch as the Commissioners, to negotiate a loan * Agreement, 24th October, 1838.

of money have no authority to contract for the purchase of a steam-boat, although they believe the Government of Texas would be much pleased to purchase the steam-boat "Charleston," when fitted out as contemplated on the terms herein mentioned, and will do all they can to induce the Government to make the said purchase; yet as the Government will not be bound to do so, and may not do so, therefore if they do not, as a compensation for the risk which the party of the first part is compelled to run of having the said boat, her provisions, munitions, &c., left on his hands, when he does not desire to hold such property, the parties of the second part bind themselves, as they have authority to do, to issue two bonds of the Republic of Texas, to James Hamilton, or order, payble in five years from date in the Bank of The United States in Philadelphia, bearing an interest of ten per cent payable semi-annually, the two together to be for a sum double the amount of the cost and expenses of said boat when delivered at Galveston; which bonds shall be forthwith executed in blank, and deposited with N. Biddle, Esq., President of The United States' Bank, at Philadelphia, who shall be directed and requested to fill up the date and amount as he may hereafter be directed by the joint written request of William Brancker, of New York, and either of the aforesaid Commissioners, after they shall have ascertained the cost and expenses of the boat up to the time of her delivery at Galveston, and that the Government declines to take the said boat; which said bonds, when so filled up, Mr. Biddle shall be directed to deliver to General James Hamilton or his order (at any time before the 1st day of March next), whenever he shall deposit in the Bank of The United States at Philadelphia to the credit of the Government of Texas, half the amount of the face of the said two bonds.

The parties of the second part further bind themselves, if applied to before the 1st of March next, to substitute in place of the two bonds mentioned above, two such sterling bonds with the necessary coupons as we may be authorized to issue, under the laws of Texas, and for similar amounts.

In testimony of all which the parties of the first and second parts have hereunto subscribed their names and affixed their seals at the date first above written.

(Signed) J. HAMILTON,

(L. S.)

Authorized Agent of James Holford.

A. T. BURNLEY (L. S.)

SAMUEL M. WILLIAMS (L. S.)

The stipulations of this Agreement were completely fulfilled by Mr. Holford. The "Charleston" was purchased, fully equipped, and sent to Galveston, to be accepted on the terms of the contract by the Texan Government, if it should think fit to do so.

As was anticipated by the Commissioners, the acquisition of the "Charleston" on these terms was deemed highly advantageous by the Texan Government. A receipt for the vessel and her appurtenances was given under date of the 23rd of March, 1839; and an Act of Congress was passed on 10th January, 1839, for the special purpose of confirming the contract which the Commissioners had entered into.

In recognition also of the value of Mr. Holford's assistance, it was further "Resolved by the Senate of the Republic of Texas in Congress assembled, that as a manifestation of the sense entertained by this body of the very liberal and friendly conduct of Mr. James Holford, of Great Britain, in the advance of funds for the purchase of the steamer 'Charleston,' that the thanks of Congress be, and are hereby, tendered to Mr. James Holford, and also that the Honourable Secretary of the Navy be requested, should Mr. Holford visit this country, to extend towards him on his arrival a cordial welcome to our shores."

Nothing then remained to be done but to ascertain the amount to which Mr. Holford was entitled under the contract; and accordingly two persons were appointed by the Texan Government to audit the accounts relating to the purchase of the "Charleston."

These persons, on the 24th June, 1839, reported that the total amount of the actual cost and expenses paid by Mr. Holford in respect of the "Charleston " 90,014 dols. 84 cents.

was

According to the terms of the agreement, therefore, coupled with the instructions of the 20th March, 1839, Mr. Holford became entitled to receive a bond from the Government of Texas for the sum of 180,028 dols., payable in five years, with ten per cent interest. The Government, however, did not strictly comply with the conditions of the contract as to the mode of payment, but gave Mr. Holford 226 bonds, each for 1007., equal to 22,6007.; and 31 bonds, each for 250l., equal to 7,550l.: all of them dated the 1st July, 1839.

These bonds were in the following form :

REPUBLIC OF TEXAS, NORTH AMERICA.

Ten per cent loan for five million of dollars, with an annual accumulating sinking fund of 300,000 dols.

The Republic of Texas hereby promises to pay to the bearer the sum of two hundred and fifty pounds sterling, bearing an interest of ten per cent per annum, payable semiannually, on the first days of January and July, at

, on the delivery of the proper dividend warrants in the margin hereof. The faith and revenues of the Republic are solemnly pledged for the payment of the interest and principal of this loan, according to the several Acts of the Congress of Texas, passed the 18th November, 1836, and the 15th May, 1838. And there is, moreover, specially pledged for the same purpose, by an Act of Congress passed 22nd January, 1839, the sum of three hundred thousand dollars, to be reserved annually out of the sales of the public lands as a permanent and accumulating sinking fund, until the whole loan has been paid off. And in case this bond has not been previously redeemed with the consent of the holder by the operation of the said sinking fund, the Republic of Texas undertakes and promises that it shall be finally paid,