New York 26 December 1815
Will you allow me to ask the favour of you to enquire into the proceedings at law against me and my Securities by the United States on account of some Bills of Exchange which I furnished the Treasury Department last year in connection with the Contract I made for the loan of five Millions of Dollars. After you become acquainted with the facts of the case I shall be particularly obliged if you will direct the suits to be settled on my paying so much money as you may be of the opinion is justly due from me on that account. The amount cannot, as I am informed, be ascertained by arbitration, without a special Act of Congress authorising a settlement in that way. And, to have it ascertained by a regular course of law, in the way it is now progressing, will cost me at least twenty five thousand Dollars (expences of suits). I am content that you should decide the amount. I know that you will do it on such principles as you may think legal, fair and liberal; and if you should think the opinions I have formed erroneous, it would lead me to suspect I had been too much under the influence of my own interest in forming them, and I should be content with your decision. If you are not willing to direct any particular settlement to be made, I beg leave to intreat you to direct the twenty nine suits which are now pending consolidated into one. So that a legal decision may be had, without putting me and my Securities to more trouble or expence than may be necessary to secure a proper decision of the points in dispute. This can be done in a variety of ways. That which suggests itself to me as the most advisable, is for Judgments to be entered up in all the cases, and for a Writ of Error to be filed in only one. The proceedings in the others after the Judgments are perfected to be suspended under an agreement that they shall all be settled on the principles which the high Court shall decide in the case carried up by Writ of Error. My first object in writing this letter is to produce an amicable settlement of the business, without further trouble delay or expence. If that cannot be effected, my next object is to obtain permission to have my case decided by the Supreme Court of the United States, without incurring such ruinous and unreasonable expences as I shall inevitably have to encounter, if you do not interpose your authority or advice; and thereby produce an immediate change in the proceedings which are now going on against me. By this mail I forward a letter to the Comptroller who I believe has the direction of all suits in the case of the United States, a Copy of which together with a statement of my transactions in the Loans of the United States you have herewith which I beg the favour of your perusing; they, united with your own knowledge of the various occurrences, will give you a full view of the subject. There is an impression on the public mind that I made most dreadful sacrifices to raise the money and that I was compelled to sell a large portion of my Stock before peace was concluded, and that which I held at such period was hypothecated to the Banks and monied men as security for the payment of money I had borrowed. Those Banks and men pressed me for immediate payment which compelled me to sell before any very considerable advance took place, and as our market would not bear to have so great a sum pressed on, I sent Stock to the amount of a half Million of dollars to London, for which I had to pass bills to raise money to release the Stock in America. Those Bills were sold at a very unfavourable Exchange, which afterwards improved so much that it made my speculation a very bad one, so much so, that I shall not make one Cent by the Stock sent to England, although I obtained it under my contract with Government at the low price of 80, and this was a considerable portion of that which I held when Peace took place and on which it was publicly said I had made so much money. That you may know the unfavourable price of our Stocks in England, I beg leave to inclose two letters from Messrs. Baring Brothers & Co. I am fully sensible that this has not any thing to do with the merits of my account with the Government, and I only state it to do away the opinion that I have made such a vast sum by my Contract. At the time it was made, it was understood between Mr. Campbell and myself that I was to pay $300.000 in England, and that Stock was to be sent there for sale to provide the funds. At that time I calculated he would send the Stock to the Bankers of the United States at London for sale on my account, and that I should have the profit or bear loss, as the case might be, estimating its cost at the contract price. This he did not absolutely promise, but left the subject open until the period should arrive for that part of the contract to be carried into effect. When that period did arrive, he deemed it inexpedient to arrange the business in that way, but offered to take my Bills with approved Indorsers for the amount and leave me to provide funds as I thought proper. Being in distress for the funds to compleat my payments, I acceded thereto, and as I had to furnish two indorsers on the Bills, and as none of my friends were willing to become answerable for me (involved as I was in the loans) to a large amount, I had to give a great number of bills, and have them indorsed by different people, thus dividing the responsibility among many of my friends; and separate suits have been brought against me, and against each Indorser on each Bill, in consequence of which there are now twenty nine suits pending to decide what a single suit is competent to do, and without the consent of the opposite party, they can only be carried up to the Supreme Court by a Writ of Error in each suit, which will cost nearly as much as the whole matter of real Controversy, which Mr Fisk the District Attorney informs me he cannot consent to without the directions of Government.
After Peace took place, American 6 percent Stock advanced in England to 95, from which it declined and went down to 80, as soon as it was known in that Country, that the interest on it was not paid in specie, nor an equivalent thereto, but in a depreciated paper, by which the foreign Proprietors lose 15, or 20 per cent in getting home their interest money, when if it was paid in Gold or Silver they would get it home to a profit, or at all events without loss. This operated dreadfully hard on me as I was compelled to sell under that State of things.
Before I close this letter, allow me to say that I never have ceased to exert myself to the utmost of my power to promote public good, and although I have considered myself hardly dealt by, and while harrassed & perplexed with numerous suits many of which appeared to me wholly unnecessary. I have devoted a large proportion of my time and funds to accommodate persons who had claims on Government, and who were in distress for the money due them, General Swift now at Washington, will bear testimony of the Services I have rendered, and Mr. Brent pay master of the Army of the United States will not only confirm his Statement, but inform of my liberal advances for the accommodation of his department when he could not get a dollar from any other Bank in this State. With the most sincere desire for your health & happiness, I beg leave to subscribe myself, Your assured friend
NB. The order which issued from the Treasury on the 30th. November to which I refer in my letter to the Comptroller, is copied in the Statement of my transactions in relation to the Loan, page 165.
DLC: Papers of James Madison.