I rcd. from Mr. Graham during your trip to Loudon the inclosed letter from Mr. Bagot.1 The subject of it is delicate. The first remark is that it belongs to Congress, not to the Ex. unless provided for by conventional arrangement explanatory or supplemental. The 2d. remark is that it has the aspect of equity, and may have been countenanced by the conversations of our Minister at London. 3d. But in order to judge fairly of its merits, it is necessary to ascertain the real motives of the B. Govt. for a measure which was certainly not Obligatory, and which took effect before it could be presumed that it would be reciprocal, & which could scarcely contemplate the unusual expedient of refunding now called for. It is probable, and I have some recollection that Mr. Adam’s letters show, that it was pressed on the B. Govt. by interested individuals; but would these individuals have been wronged by a refusal, and were they not net gainers pro tanto2 beyond any fair expectations? Were they again American Shippers, or British shippers in Amn. vessels? As far as the latter was the case, the reciprocity claimed, would consist in a remission in favor of B. subjects on one, and a refunding in favor of B. subjects, on the other. It is at least probable that part of the shipments from the U.S. in Amn. vessels to G.B. were B property; and that none of the shipments in B. Vessels from G.B. to the U.S. were Amn. property. This probability arises from the circumstances of the period. Another view of the subject may deserve attention. If the number of ships in question was nearly equal on each side, the duties to be refunded wd. greatly exceed the duties remitted; the cargoes in the former case being more valuable, tho’ the rate of duties in the latter may have been higher.

On the whole it will be best to give Mr. B. assurances of the conciliatory & liberal disposition which we really feel; But that enquiry must be made into the real merits of the case, and that whatever may be the result of them, no time will be lost, as nothing cd. be done by the Ex: previous to the meeting of the Legislature. How wd. it do, to let the claim if doubtful be combined with ours on the subject of the negroes carried away, either in negociation, or in a reference to Arbitrators? Cordial regards