1. For background to this letter, see William Ellery to H, September 4, October 9, 1792; Olney to H, September 8, 13, October 4, 25, November 7, 28, December 10, 13, 27, 1792, March 14, 1793; H to Olney, September 19, 24, October 12, November 27, 1792.

2. In a decision on the case of Olney v Arnold handed down by the Supreme Court in 1796 the facts of the case were given as follows: “Olney, the Plaintiff in error, was the collector of imposts for Rhode Island; [Welcome] Arnold, the Defendant in error, was owner of the ship Neptune; and a citizen of the name of [Edward] Dexter, as the declaration alledged, was owner of the cargo of the ship; which arrived from Surinam, at Providence, about 4 o’clock P.M. on the 6th of November, 1792. On that day, the parties applied for a permit to land the cargo, and offered bonds to pay the duties; but the collector refused, or neglected, to accept the bonds and grant the permit. On the 7th of November, a second application was made for a permit, and bonds, actually executed, were tendered for the payment of the duties; but the collector again peremptorily refused to accept the bonds, or to grant the permit; in consequence of which the vessel, with the cargo on board, remained at a heavy expense from the 6th to the 13th of November; and Arnold laid his damages at £200” (3 Dallas, U.S. Reports description begins A. J. Dallas, Reports of Cases Ruled and Adjudged in the Several Courts of the United States, and of Pennsylvania, Held at the Seat of the Federal Government (Philadelphia, 1793–1801). description ends , 308).

Under the terms of Section 41 of “An Act to provide more effectually for the collection of the duties imposed by law on goods, wares and merchandise imported into the United States, and on the tonnage of ships or vessels,” duties on merchandise imported into the United States “shall be paid or secured to be paid, before a permit shall be granted for landing the same.” In cases where the amount exceeded fifty dollars the duties could be secured by a bond given by the owner to the collector but no further credits could be given for duties until the bond was discharged (1 Stat. description begins The Public Statutes at Large of the United States of America (Boston, 1845). description ends 168 [August 4, 1790]). In the case concerning the Neptune Olney maintained that “on the 17th of January, 1792, Arnold being indebted for duties, gave a bond for the amount, payable on the 17th of May, ensuing; that on the 5th of November 1792, the term for payment of the bond was elapsed, but the same remained unpaid and undischarged; that Arnold was the real owner of the cargo, but had fraudulently transferred it to Dexter, in order to obtain a credit at the Custom-house; that, though Dexter had tendered a bond on the 7th of November, it was rejected … and that a permit had been refused until the duties of the cargo were paid, or Arnold’s old bond was discharged” (3 Dallas, U.S. Reports description begins A. J. Dallas, Reports of Cases Ruled and Adjudged in the Several Courts of the United States, and of Pennsylvania, Held at the Seat of the Federal Government (Philadelphia, 1793–1801). description ends , 309).

In December, 1792, the case was heard before the Court of Common Pleas for Providence County and a decision was given in favor of Olney. Arnold then appealed to the Superior Court.