On the 29o. of August, I had the honor to receive your respectable letter of the 15o. of May, and on the 14o. of October, that of the 7o. of June, with its enclosures; and on my Arrival at this place, Dr. Triplett put into my hands your several letters of the 9o. 11 & 19o. of July, and one from Mr. Wagner of the 6o. of August, with the several enclosures and papers mentioned therein. At the same time I received one from James Leander Cathcart Esqr. dated at Boston 12o. of September 1806, enclosing the Invoice and Bills of Lading for the articles sent to my charge, in the Ship Two Brothers.

From the time of my receiving your letter of the 15o. of May, till the arrival of the U. States Frigate Constitution, in the Bay of Algiers on the 30o. of December, not a single opportunity ocurred for me to repair to Gibraltar, and wait there the arrival of the Tunisian Ambassador, agreeably to your Instructions. The U. S. Schooner Enterprize, which brought this letter from Gibraltar, had no communication; and departed the moment my letters were sent on shore. Indeed, if an occasion should have offered for me to proceed After the month of September, it would have been impossible to have availed myself of it, as I was confined with a Violent and dangerous fever, for nearly two months, which rendered me totally unable to leave my room, and for a great part of the time my bed.

On the arrival of the Constitution I embarked on board her, and reached this place on the 12o: of the present month. For some months previous to my leaving Algiers, a difference had taken place between that Regency and that of Tunis, which cut off all intercourse between the two places, and I only heared of the death of Dr. Dodge (which happened on the 22d. of October) the day before I left Algiers.

I found here the Ship Two Brothers, which had brought the Ambassador from the United States. She had arrived about 20 days before. On the 13o. I landed, and on the 15o. had an Interview with the Dey; when I communicated to him the sentiments contained in your letter to me of the 7 of June, and referred to the letter which his Ambassador had delivered to him from the President of the U. States, as evidences of the good disposition of our Government towards him, and the desire we had to be at peace with him, upon terms which might be reciprocally beneficial. I also expressed the satisfaction which his Ambassdor had given, by his conduct, during his residence in the United States. He made a few observations; but as he was in the Public Hall of Audience he did not seem disposed to enter into a discussion or explanation of any points of business; and after the usual Compliments I left him, intending to visit him the day after to morrow, and have a private Audience.

On the 17o: I went to Bardo, by appointment, and found the Bey in his Private Appartment; who observed, after we had taken Coffee, that he believed it was the Custom of all Courts to let the business, which was ultimately to be laid before the Prince, be first communicated to the Prime Minister; as a Prince might commit himself by deciding before "he should have had time to reflect; I told him I beleived such was the Custom, and that I had no objection to that mode of negociating on any points we might have to discuss; but, as His Excellency, had, when I was here before, been pleased to converse with me on the subjects then brought forward, I presumed he wished to pursue the same mode at this time. Well well, says the Bey, I will now attend myself, for a Short time, to the subject, and would wish to know what Communications you have to make. T. L. "Your Excellency is well informed of the general wishes and expectations of my Government, by the letter which has been written to Y. E. by the President of the U. States; and by the correspondence which took place between your Ambassador and my Government, which I presume Y. E. has seen. To these I have nothing to add, but a confirmation of the same, and assurances of the earnest wish and desire of my Government to remain in freindship and harmony with you, according to the tenor of our Treaty.’

"As an evidence of the freindship & liberality of my Government, I am ordered to present to Y. E. and your Prime Minister, certain Articles sent for that purpose, and which I hope will prove acceptable."

Bey. "For my Cruizer and her two Prizes, which were taken by your Squadron, I have yet received no return. You offered a Brig, which was inadmissable. You gave a Frigate, a Brig, and two Schooners to Algiers, and you have given nothing to me."

T. L. "With respect to the Cruizer and her two Prizes, my Government is willing to shew their liberality, and disposition to promote harmony with Y. E. by making a reasonable compensation for the same (as the Vessels cannot now be Specifically restored) the circumstances which caused their Capture being now done away by our Peace with Tripoli; and on this point I will confer with your Ministers."

"When we concluded a Peace with Algiers, there was a Stipulation to pay a Certain sum of Money at that time; but between the conclusion of the Treaty, and the payment, Hassan Bassa, then Dey of Algiers, died, and was succeeded by Mustapha Bassa, who, taking advantage of that circumstance, made further demands. In order to arrange the Business, these Vessels were given as a part payment for peace & ransom of our Citizens, then in Captivity, since which we have never given a Vessel to that Regency: Our Treaty with Algiers Stipulates an Annual payment from us to that Regency, which we make in conformity thereto; but our Treaty with Y. E. makes no provision of that kind. My Government however, are not forgetful of their freinds, as Y. E. well knows, and they will no doubt, give evidence, from time to time, of the sense which they entertain of Y. Es freindship, and the harmony which may subsist between us. They will not, however, make any stipulations for presents, or payments, in regard to time quantity or quality. These, if made at all, will depend upon the good understanding which may exist between our Nations."

Bey. "I repeat, that the Vessels given to Algiers was independt. of your peace payment; and all I ask is to be put upon the same footing as other nations stand with you, particularly Algiers, in respect to periodical payments. I am as great as Algiers, and expect to be treated in the same manner that you treat her; and if you will wait six you will see if I am not superior to Algiers, by the event of the war between us. You once offered me an Annuity of 12,000 Dollars, and presents equal to 6000 more, which I declined accepting at that time, and why should you refuse to give me something now. I do not wish to Stipulate for Military Stores, or Cash, or any particular Article; but I want something Stipulated. I have not received a present from you since your Peace and treaty with me; and such Articles as diamonds, Cloth &ca. which it is customary to give me personally, do not benefit the Regency, or my Officiers. I want something for them."

T. L. "I can again assure Y. E. that the Vessels given to Algiers were in part payment of the peace Stipulation, as can appear from our accounts with that Regency. As to the dispute between Y. E. and Algiers; or the issue thereof, it is not an Affair of ours’. We do not interfere in the concerns of other Nations. It is true that my Government did, through Mr. Cathcart, offer an Annuity to Y. E. which was declined, and we are not now obliged, or disposed to renew that offer; and I can only repeat, that my Government will not be backward to give proper evidence of their friendship, if peace & harmony exist between us; but we shall not make Stipulations to that effect. We have a Treaty with Morocco, and with Tripoli, as with Y. E. But we have not, and shall not pay them any thing like a tribute; and should we now agree to do so to Y. E. they might have just cause to expect the same from us."

The Bey then went, for a few minutes, into the next room, and on his return, said he was very much engaged, and could not, at present, attend any further to this business; And that on Monday Next the Sapatapa would converse with me on our affairs. I took my leave and returned to Tunis

On Monday the 19o. I went again to Bardo, and was conducted to the Room of the Sapatapa, where, after Compliments & Coffee, he began on the old Strain of a Stipulated Regalia from the U. S. I told him candidly and plainly, that his Master must not expect any thing of that kind. That we were willing to preserve the Treaty with this Regency, as it stood; but, as there was not in it any Stipulation for a payment from us, we should not have it introduced. That we had already given evidences of our friendship towards the Bey and his Nation; and if we continued in harmony and Amity with him, we might shew him occasionally such marks of friendship as we were willing to shew to our freinds.

He urged, very strongly, that it was verbally agreed, when the Treaty was made, that we should send a periodical Regalia. This had not been complied with, and of course, they should expect something on that account. That Mr. Cathcart had offered, on behalf of the Government, 12,000 dollars and 6000 dolls., as before stated, and that it was presumed that I had the power of granting the same.

I assured him again, that I was so far from being empowered to do anything of the kind, that I was expressly forbidden to accede to it. He saw I was fixed, and then observed, that he beleived my Government had chosen me on purpose to come here, and go to other places to Negociate, as they could never get any thing from me.

I replied, that I felt it my duty to be at once candid and explicit in all my negociations with him, and as he had no reason to think that I was personally opposed to his Master, or to his Government, he must beleive that when I refused, I did it on a principle of duty, and in Obedience to the Orders of my Government. He then requested I would state to my Government the manner in which this had been pressed. This I assured him I should do; but it would have no avail in altering their determination.

He then entered on the compensation for the Cruizer and her two Prizes. I told him my Government was willing to give a new proof of their generosity & friendship in this matter; for altho’ the Vessels were taken in a manner to make them good prizes to us, yet the object of our Blockade being accomplished, the Government would, from their liberality, make a just Compensation for them; and wished him to say what would be considered the value of them. He then went on to shew, that the expense had been great in equipping the Cruizer, dwelt on the value of the Prizes, and said much on the chance which the Cruizer would have had to make other Prizes, had she not been captured by us, &c.

I heared all he had to say on those points, and then told him I had seen the Cruizer and her two Prizes, in Malta, and that I would not have given one thousand dollars for the whole, but wished there could be some estimates made.

He observed that the Brig, which had been prepared to be sent out in lieu of these Vessels, had cost the U. States between 8 and 9000 dollars; but that that sum was not adequate to the Cruizer and her two Prizes. After some further observations on the subject, I told him I would at once offer eight thousand dollars, which must be considered as very liberal; and I hoped would close the business: He said this, he knew, was far below the expectation of his Master, and begged I would add something to save his face with the Bey.

Without hesitation, I told him I would add two thousand more; and from this Point he must never hope to move me.

He promised to report our conversation to the Bey, and if I would come to Bardo the day after tomorrow, I should know his determination on the several Points which we had discussed.

After closing our conversation on business, I assured the Sapatapa, in a Solemn manner, that it was my firm beleif that in less than ten years from this time, the friendship of the U. States would be worth a Kingdom to a Nation in Amity with them; and that their enmity might be the loss of a Kingdom to the Nation opposing them. And that I did not Speak this in a way of boasting or threatening, but upon a full conviction of its truth, from my Knowledge of the Country and the Circumstances attending it.

The Sapatapa replied, that he had no doubt of the fact, from all he had heared of us; but, says he, we talk of things of the present moment, and never look into futurity. After leaving the Sapatapa I paid my respects to the Bey, and returned to Tunis.

I sent the Articles to Bardo yesterday, which had been forwarded for the Bey and the Sapatapa. The Cloths for the Sapatapa were of a very indifferent quality, of Colours not suited to this Country; He asked, as a favor to have them changed, which I promised to do if he would send them to the Consular House, and others could be fou⟨n⟩d more suitable.

On the 21o: of January I went again to Bard⟨o⟩ to know the determination of the Bey on the poin⟨ts⟩ which I had discussed with the Sapatapa on the 19o. He the Sapatapa began with a long Speech on the injustice of Capturing the Cruizer &c. saying that Vessels of War were never prevented from entering blockaded Ports &c. and that the Mahometans were not bound by the law of Nations as understood among the Christians. I went over the same ground on this subject, which I had followed in my several interviews with the Bey in Augst 1805.

After a few more observations, he said this was talking to no purpose at present. The Vessels had been taken, and my Government had shewn a disposition to make compensation for them, but that H. E. did not consider the sum of $10,000 as adequate, that he wanted a Vessel which would shew to the world that we had done him justice for the injury which his flag had suffered, that the Vessel which had been tendered to Melimelli could not be received, for the reasons which he Melimelli, had given to my Government; but that H. E. expected to have the American Ship now in this Port, which had brought his Ambassador from the United States.

I told the Sapatapa I thought that this subject would have been closed, by the very liberal Compensation which had been mentioned in Our last interview. But if H. E. should prefer this Vessel to the money, I would endeavour to purchase her of the owner, who was here, and the Bey might have her as she now stood. He replied, very quickly, that his Master expected the Ship in addition to the 10,000 Dollars. I answered, as quickly, that such a measure was totally out of the question; and I would tell him candidly, that I had, to remove all difficulty, even agreed to give 2000 dollars more than the cost of the Brig intended for the Bey, which sum my Government might oblige me to pay personally; but that I never could, nor would consent to give the money and the Ship.

He then intimated, that if the money was received, it was expected that the sum should be increased. This, I assured him, would never be done. He held out his closed hand to me, and said, you are like this, you cannot be opened. I bowed assent. He said he would acquaint his Master with my determination And if I would wait a few minutes I should know his ultimate decision. He left me, for about half an hour, and then returned, saying that his Master would receive the money in preference to the Ship; and that now all matters were settled between us; and that the Citizens of the U. States might come here and trade upon the footing of the other Nations and feel as perfect a security as they could do in their own Country. He said the Bey was satisfied, and hoped he should always continue in harmony with the U. States.

He wished to know whom I intended to leave here in charge of our Affairs, and desired it might be a person who would attend to our own affairs only, and not enter into any intrigues with the Representatives of other Nations here, in matters which did not concern us, as he knew, from experience, that such a Character would be highly injurious to both Nations. I told him I should endeavour to find a Character of the description he wished, as my Government always had been, and always would be adverse to entering into any intrigues in affairs which did not Concern them. He hoped a Consul would soon be sent from the U. States, who would be a permanent resident among them here, as great inconveniences arose from the frequent changing our Chargé d’affairs. I assured him there was no doubt but the President would send a Consul here, as soon as he should know that a proper understanding had taken place with His Excellency, and that we were likely to remain in harmony and friendship.

After leaving the Sapatapa, I paid my respects to the Bey, in the Hall of Justice, and returned to Tunis.

Thus far Sir, I have given you a faithful detail of my Negociation here, which I am very happy to find has terminated so satisfactorily; for on my arrival, I had reason to expect much difficulty in arranging our affairs in the way we wished, as there was evidently a determination on the Part of the Bey to insist on terms to which we never could, nor ever would consent; but the decided ground which I took on that subject, convinced him that he could have nothing to expect from persisting in his demands; And the manner in which the negociation was carried on, also convinced him, that while we spurned the humiliation of a tribute, we were willing to be his friends upon the fair ground of reciprocity between Nations, and that our friendship was an object of too much consequence for him to give it up lightly.

In order to settle all accounts before I leave this Regency, I shall have occasion for about 20, or 25,000 dollars, to pay the 10,000. dollars before mentioned, The Freight and demurrage of the ship two Brothers which Amounts to 5755 dollars, some debts due from the Consulate here, and remit some money also to Tripoli to enable Dr. Ridgely to pay every thing which may be due then, previous to the arrival of Dr. Davis. To obtain this, I shall be obliged to draw upon Leghorn; and to cover my drafts there, I have this day drawn upon the Department of State, in favor of Messrs. Degen, Purviance &Co. Navy agents of the U. S. in Leghorn, for twenty five thousand Dollars, in five setts of Exchange of 5000 $ each, each sett in six bills, and each bill accompanied with a letter of advice.

I shall now close this letter to have it in readiness to forward, by the first opportunity which may offer of conveying it to any place from whence it may find a ready conveyance to the United States, and shall communicate in another letter whatever may take place previous to my leaving Tunis. With sentiments of the highest respect and most perfect attachment, I have the honor to be Sir, Your Most faithful & Obedt. Servt.