ON the 13th July, 1861, Congress passed 'An act further to provide for the collection of duties on imports, and for other purposes.' The late rebellion was in its rise at this time, but the act did not refer to it, nor was its operation declared, in any part of it, to be temporary. By the 5th section it was enacted that 'whenever' the militia called forth by the President had failed to disperse insurgents in any State against the national authority, it should be lawful for the President, by proclamation, to declare that the inhabitants of such State, or part of a State, were in 'a state of insurrection against the United States;' and thereupon the statute proceeded, 'All commercial intercourse by and between the same and the citizens thereof, and the citizens of the rest of the United States, shall cease and be unlawful so long as such condition of hostility shall continue; and all goods and chattels, wares and merchandise, coming from said State or section into the other parts of the United States, and all proceeding to such State or section by land or water, shall, together with the vessel or vehicle conveying the same, or conveying persons to or from such State or section, be forfeited to the United States.'*fn1 1. The act of July 13, 1861, 'to provide for the collection of duties on imports, and for other purposes,' and which by one section, on a proclamation by the President, makes intercourse between citizens of those parts of the United States in insurrection against its government, with citizens of the rest of the United States unlawful, 'so long as such condition of hostilities should continue,' was not a temporary act, though passed during the late rebellion; nor on the cessation of hostilities did forfeitures, which had been incurred, after proclamation, under that section, cease to be capable of enforcement. 2. The act of 13th February, 1862, by which a sum of money was appropriated 'for the purchase of cotton-seed, under the superintendence of the Secretary of the Interior, for general distribution, provided that the said cotton shall be purchased from places where cotton is grown as far north as practicable,' did not give power to the Secretary of the Interior to authorize an agent to transport merchandise to any district where the seed was to be got; such district having been then declared by proclamation, authorized by Congress, to be in a state of insurrection against the authority of the United States, and all intercourse with it prohibited, except where the President in his discretion might allow it in pursuance of rules prescribed by the Secretary of the Treasury. 3. Nor was a letter from the Secretary of the Interior to a person, which by its terms did no more than authorize and appoint him to 'procure' a cargo of such seed 'in' a prohibited or partially prohibited district (Virginia), and to 'bring it to' a place not prohibited (Baltimore), even in its terms, such a license. The act contained, however, this proviso: 'That the President may in his discretion license and permit commercial intercourse with any such part of said State or section, the inhabitants of which are so declared in a state of insurrection, in such articles, and for such a time, and by such persons as he, in his discretion, may think most conducive to the public interest; and such intercourse, so far as by him licensed, shall be conducted and carried on only in pursuance of rules and regulations prescribed by the Secretary of the Treasury.' Soon after the passage of this act, to wit, on the 16th of August, 1861, President Lincoln made such proclamation as the act itself authorized;*fn2 declaring that the inhabitants of several States, which he named, including Virginia–'except the inhabitants of that part of it lying west of the Alleghany Mountains, and of such other parts of that State, and the other States hereinbefore named, as may maintain a lawful adhesion to the Union and the Constitution; or may be from time to time occupied and controlled by forces of the United States engaged in the dispersion of such insurgents,' 'Are in a state of insurrection against the United States, and that all commercial intercourse between the same and the inhabitants thereof, with the exceptions aforesaid, and the citizens of other States and other parts of the United States, is unlawful, and will remain unlawful until such insurrection shall cease or has been suppressed; that all goods and chattels, wares and merchandise, coming from any of said States, with the exceptions aforesaid, into other parts of the United States, without the special license and permission of the President, through the Secretary of the Treasury, or proceeding to any of said States, with the exceptions aforesaid, by land or water, together with the vessel or vehicle conveying the same, or conveying persons to or from said States, with said exceptions, will be forfeited to the United States.' From an early date of the insurrection certain persons in the loyal States were desirous, it seemed, to get cottonseed from the South. And some of the executive departments–to which these persons addressed themselves–with a view of seeing how far northward this national staple could be profitably cultivated, had listened, it appeared, on particular occasions, with favor to the idea. The Treasury was apparently deterred, however, from giving much co-operation to any project of the sort, from its unwillingness to grant either passes or requests for passes, the effect of which might be to violate the blockade by which the government was then vigorously affecting the rebellious ports; and in January, 1862, an authority, not long previously granted by the then Secretary of the Treasury, upon the recommendation of high military persons, to one Smith, was on this account by him revoked. Congress, however, a short time afterwards, to wit, on the 13th of February, 1862, passed–– 'An act making an appropriation for the purchase of cotton-seed for general distribution. 'Be it enacted, &c., That there be, and is hereby, appropriated, out of any money in the treasury not otherwise appropriated, the sum of $3000 for the purchase of cotton-seed, and $1000 for the purchase of tobacco-seed, under the superintendence of the Secretary of the Interior, for general distribution; provided that the said cotton-seed shall be purchased from places where cotton is grown as far north as practicable.' Among the persons who wished to enter into this business of getting cotton-seed was Mr. William L. Hodge, of Washington City. On the 7th of March, 1862–after the passage of the above-quoted act of Congress,–he obtained from the Secretary of the Treasury a license 'to employ a vessel to carry cotton-seed from any point on the waters of Virginia emptying into the Chesapeake Bay to the port of Baltimore; provided that he, the said William, shall first execute a bond, with one or more sureties, to be approved by the Solicitor of the Treasury, in the penal sum of $20,000 conditioned that the vessel so employed shall not transport to or from Baltimore or Virginia, any goods, wares, or merchandise, or supplies other than those actually required for the use of the crew thereof for one trip;' and with a further proviso, among some others, 'that one-half of the cotton-seed so obtained shall be furnished to the Secretary of the Interior at the cost thereof.' Of this license for some reason Mr. Hodge never availed himself. He gave no bond and the document remained a dead letter. He did, however, procure on the next day after the date of this license a letter, in these words, from the Secretary of the Interior: DEPARTMENT OF THE INTERIOR, March 8, 1862. SIR: Congress having authorized this department to procure*fn3 cotton-seed for planting in the loyal States, I hereby authorize and appoint you to procure a cargo of the same in Virginia, and bring it to Baltimore, &c. This letter will be your authority to procure said seed, and all parties in employ of the United States are respectfully requested to allow you to pass freely for said purpose. I am, &c., C. B. SMITH, Secretary. W. L. HODGE, Esq., Washington City, D. C. The Secretary of the Navy some time afterwards thus indorsed this letter: NAVY DEPARTMENT, April 25, 1862. Naval officers in command of ships of war will respect the inclosed, and will afford protection in waters under their control and jurisdiction inside the capes of Chesapeake Bay. G. WELLS. In possession of the letter of the Secretary of the Interior, thus indorsed, Mr. Hodge entered into a contract with one Penniman, who it seemed had been associated in the formet enterprise of Smith, to supply the Secretary with 'cotton-seed under the recent act of Congress.' In pursuance of this agreement Penniman loaded first a vessel called the Hunter, with which he went into prohibited districts, but brought back no cotton-seed, though he got some tobacco. He then loaded 'The Reform,' a schooner of fifty-seven tons, at Baltimore, with a cargo of a miscellaneous kind, well suited to a blockaded region,–several considerable items of which it was alleged were not on the manifest; though this document was sworn to as true. With this cargo the Reform cleared for Alexandria, a lawful port; and then set sail for Urbanna, in the eastern district of Virginia; a district then in insurrection against the United States, and so proclaimed by the President to be.*fn4 Before the vessel had got far she was seized by the revenue officers, brought back and libelled for forfeiture in the District Court for Maryland. The libel set forth the act of 1861, the President's proclamation under it, and that this vessel was in the act of going to a prohibited district. The answer which was put in by the claimant of the vessel, one Bailey, and by Penniman, owner of the cargo, admitted in the main these allegations; defending by matter in avoidance chiefly. It gave very interestingly a narrative of the project to get cotton-seed in the welfare of the country by different persons; of Smith and Penniman's failure; alleging various confidential interviews with officers of the government, military, naval, and civil; that secrecy was understood by all to be a matter indispensable to success; and also a diversion of public attention from what was really doing; and this–along with the fact that the respondents were informed at the Treasury when Smith's license was revoked, that it was revoked because too much publicity had been given to his intention, and for no other reason–was assigned as the cause for the clearance to one port while the real destination was to another; a matter which it was said the military commander of the region, General Dix, was perfectly apprised of, though of course others generally were not; that at the time of the passage of the act of 1862, no part whatever of the cotton-growing country was occupied by forces of the United States; that the act, by its express terms, contemplated a purchase from places as far north as the staple grew; and that the point to which the voyage was directed, Urbanna, did answer and was the only place that did satisfy the requisitions by the act prescribed. A cargo was taken aboard, it was said, because the only currency at this time common to the northern and southern portions of the United States was gold, and because–there having been a universal suspension of specie payments with an establishment of paper as a legal tender for almost everything–gold was an article of commerce as much as anything else, and specially dangerous from its now sudden mutations in market value to deal in at all; that it was necessary to take something which could be advantageously exchanged for cotton-seed; that the respondent, Penniman, selected such articles as he supposed would best effect the object of obtaining such seed. And the answer submitted that if the sending of such a mission into Virginia by the Secretary of the Interior under the authority of Congress was a lawful act, the enterprise had not become unlawful, and the goods intended to be used therein forfeited, because of a difference of opinion as to the details of the execution of such mission between the officers of the customs and the messenger of the government. The most that could be done was to reform such mission according to what might be determined to be its true object and scope, and not to impose a forfeiture for a mistake in construction of an act of Congress; especially in a matter where secrecy was of the essence and where the want of means to have full and clear understandings was so conspicuous. The District Court dismissed the libel; and its decree was confirmed on appeal to the Circuit Court. The case was now here for review on appeal by the United States. Between the time when the proceeding in the District Court was begun, and that when the case came here to be heard on appeal, the insurrection, in vigor when the libel was filed, had been in effect suppressed. The rebel armies had everywhere surrendered. The civil head of it was a prisoner of the United States, in one of its fortresses; and the whole insurrectionary combination was scattered and destroyed. Military forces were, however, still kept in parts of the rebellious region. The ancient order of things was not in all matters renewed. From the States lately in rebellion members were not yet received in Congress.