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Major Hudson, of Pendleton county, Kentucky, in his deposition, fully corroborates the statements in the petition as far as the impressment of a vessel and the service to which she was put, as well as the circumstances attending her destruction, but does not recollect the name of the vessel, her owner, or commander.

In addition to this positive evidence of the impressment and subsequent loss of the vessel, there is corroborative traditional evidence, which, though wanting the force of such testimony as that of Butler, Rice, Young, and Hudson, yet, in proving a transaction which occurred as early as the one now under consideration, is entitled, in the estimation of the committee, to some weight. In view, then, of all the testimony before them, direct and traditionary, your committee have no hesitancy in saying that they are satisfied that the said Philip R. Rice, his vessel and crew, were impressed into the service, and they continued in the service for the term of from two to three months, and that said vessel was lost by the act of the enemy.

The delay in making this application to Congress for relief seems to the committee to be well accounted for by the removal of the petitioner to Kentucky shortly after the close of the war; his poverty, change of habits, the death of many who had knowledge of the transactions, and the difficulty of obtaining the testimony of others, &c.

Your committee, therefore, report a bill for the relief of the heirs of the said Philip K. Rice, and recommend its passage,

2d Session, S

.

| No. 43.

ISAAC S. SMITH.

January 30, 1855.-Laid upon the table, and ordered be printed.

Mr. T. WENTWORTH, from the Committee on Commerce, made the fol

lowing

REPORT.

The Committee on Commerce, to whom was referred the petition of Isaac So

Smith, praying for remuneration for loss sustained by him in consequence of the annulment of his contract for the constructiin of a light-house on Horseshoe Reef, in Niagara river, respectfully report :

In the investigation of this case, it appears that, in 1851, Congress had appropriated $45,000 for the erection of a light-house on Horseshoe Reef, in Niagara river. In the same year, the petitioner presented to the Treasury Department a communication, accompanied by a plan for a light-house upon the above-named site, which was on the 15th day of August, 1851, referred to the then temporary Lighthouse Board for their consideration and report upon the subject. On the 21st of the same month, the board made an adverse report to the plan and proposition of the petitioner. (See Senate Doc. No. 28, 32d Cong., pp. 367–’9.) Notwithstanding this report, the collector of customs at Buffalo was authorized by the Treasury Department to enter into a contract with Mr. Smith for the erection of a structure upon his plan, which contract was made and executed on the 18th of November, 1851—the work to be executed to the satisfaction of the department by the 1st day of November, 1852; a copy of which is annexed to this report. The work was commenced in April, 1852, but, owing to bad weather and other adverse circumstances, but little was done on the 23d of August, 1852, when Mr. Smith applied to the Fifth Auditor for an extension of time,"say to the 1st day of July or August next”-and proposing a change in the plan involving an additional cost of about $3,000, the allowance of which he proposed to leave discretionary with the government. On the 27th of August, 1852, the Fifth Auditor, in communicating Mr. Smith's application to the Secretary, says: “ It was believed by Mr. Smith when the contract was formed, and he led me to believe, that the reef was conposed of solid rock, into which his shaft was to be sunk twelve feet. * * * * As the disappointment of not finding rock will occasion, as Mr. Smith alleges, additional expense, he submits a claim to an allowance of $3,000 on that account. To this allowance I am op

posed. * * * * Mr. Smith, in consequence of an unforeseen delay in the work, asks for an extension of the time within which to finish the work, until the 1st of August next. This, with your concurrence, I am willing to grant him."

Upon this communication, the acting Secretary replied that “the department was governed entirely by the representations of Mr. Smith that [the reef] was a solid rock ; and it was only on that plan it would have ever consented to make the contract for a work of that kind, which otherwise, in the opinion of the department, (and which is confirmed by that of Captain Benham,) could not with certainty be securely erected on the plan submitted by Mr. Smith.” In yielding to the change proposed by Mr. Smith, the acting Secretary says, “ but it must be with the distinct and express understanding that the change in the plan must be at the exclusive risk and expense of the contractor, and that in no event is any claim to exist against the department, except on the satisfactory completion of the work for the amount stipulated in the contract. * * * * If Mr. Smith concludes to progress with the work agreeably to the above, the additional time will be granted.”

This letter of the acting Secretary was communicated to Mr. Smith by William Ketcham, collector of customs at Buffalo. On the 13th, Mr. Smith replied to the collector, acknowledging the receipt of the acting Secretary's letter, and adds: “I have no doubt of my ability to construct the work permanently. I accept the proposition contained in Mr. Hodge's letter, (the acting Secretary,) and shall proceed with it as early as practicable in the spring. Unforeseen delays may arise which will render it impossible, with the utmost diligence, to complete it in less than one year from the time limited in the contract-say the 1st day of November, 1853.” On the 20th of September, 1852, the acting Secretary granted the extension to Mr. Smith as asked for—to wit, to November 1, 1853.

On the same day, the Fifth Auditor advised the collector of this decision of the acting Secretary. On the 22d of September, 1852, the collector wrote the Fifth Auditor that he should delay notifying Mr. Smith of the acting Secretary's decision granting the extension desired by Mr. Smith, to give time to the department to reconsider its decision, as it might be inclined to upon the receipt of a report made by Captain Benham, the engineer in charge of the work, recommending its abandonment. There is no evidence before the committee that Mr. Smith had notice of this decision. He denies the receipt of a copy of the Auditor's letter; and on the 14th of October the letter was recalled.

Mr. Smith's proposal for a modification of his plan was submitted by the department to the Light-house Board; and it was then decided that, “in the existing state of the case, it would not be expedient to authorize any modifications of the engagements or agreements heretofore entered into by the government respecting that work." This decision was communicated to Mr. Smith. On the 8th of May, 1854, the acting Secretary of the Treasury decided that the contract with Mr. Smith was no longer binding upon the government; and on the 11th of the same month Mr. Smith was notified of the decision,

Mr. Smith applied immediately to the department for a reversal of this decision, and denied the right of the government to annul the contract; and he now presents a claim for $26,061 09, which may be generally stated thus: Materials and expenses, with yearly interest charged, as specified in the account......

$12,317 01 Unsettled accounts...........

1,516 28 Profits on $13,833 29, say 33 per cent...

4,611 09 Petitioner's time, 4 years...

8,000 00

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And he bases his claim upon the ground that he, having asked for an extension of time within which to complete his contract, in writing, terminating November 1, 1852—“say till the 1st day of July or August next,” 1853—and the Secretary having answered, among other things, that “if Mr. Smith concludes to progress with the work agreeably to the above, the additional time he may require will be granted,” this correspondence operates as a waiver of time by the government, and gives him any time he may require in which to construct the light-house; that his subsequent letter of September 13, 1852, asking another limitation—to wit, the 1st of November, 1853– and the Secretary's agreement thereto, September 20, 1852, (not communicated to Mr. Smith,) has no effect upon the question, and consequently the annulment of the contract on the 8th of May, 1854, was illegal, and inflicted a wrong upon him, which government is bound to redress.

Your committee do not take the same view of the question, but are of opinion that the government, upon being applied to for an extension, having stated to Mr. Smith if he proceeded at his own risk he should have the time he might require; and thereupon he having named November 1, 1853, as the time when the work should be completed—there being no mistake or misapprehension on either sidethe question must be considered as definitely settled. This opinion is supported by the declaration of Mr. Smith himself, who, on the 29th of April, 1853–seven months after the correspondence with the Secretary upon this subject of extension-in a letter to the Lighthouse Board proposing additions to his plan, says, "all the parts of the contract, with the exception of the changes herein described, to be completed, according to its terms, by the 1st day of November next,” (1853) It is clear from this letter that the petitioner considered himself bound to complete his contract on the 1st of November, 1853; and if so, the committee cannot doubt the right of the government to declare, in May, 1854, that it would be no longer held upon the contract; and they ask to be discharged from any further consideration of the subject.

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