Wrote Seward a letter on the subject of captured mails, growing out of the prize Peterhoff. On the 18th of August last I prepared a set of instructions embracing the mails, on which Seward had unwittingly got committed. The President requested that this should be done in conformity with certain arrangements which Seward had made with the foreign ministers. I objected that the instructions which Mr. Seward had prepared in consultation with the foreigners were unjust to ourselves and contrary to usage and to law, but to get clear of the difficulty they were so far modified as to not directly violate the statutes, though there remained something invidious towards naval officers which I did not like. The budget of concessions was, indeed, wholly against ourselves, and the covenants were made without any accurate knowledge on the part of the Secretary of State when they were given of what he was yielding. But the whole, in the shape in which the instructions were finally put, passed off very well. Ultimately, however, the circular containing among other matters these instructions by some instrumentality got into the papers, and the concessions were, even after they were cut down, so great that the Englishmen complimented the Secretary of State for his liberal views. The incense was so pleasant that Mr. Seward on the 30th of October wrote me a supercilious letter stating it was expedient our naval officers should forward the mails captured on blockade-runners, etc., to their destination as speedily as possible, without their being searched or opened. The tone and manner of the letter were supercilious and offensive, the concession disreputable and unwarrantable, the surrender of our indisputable rights disgraceful, and the whole thing unstatesmanlike and illegal, unjust to the Navy and the country, and discourteous to the Secretary of the Navy and the President, who had not been consulted. I said to Mr. Seward at the time, last November, that the circular of the 18th of August had gone far enough, and was yielding more than was authorized, except by legislation or treaty. He said his object was to keep the peace, to soothe and calm the English and French for a few weeks.
Lord Lyons now writes very adroitly that the seizure of the Peterhoff mails was in violation of the order of our Government as “communicated to the Secretary of the Navy on the 31st of October.” He makes no claim for surrender by right, or usage, or the law of nations, but it was by the order of our Government to the Secretary of the Navy. No such order was ever given by the Government. None could be given but by law of Congress. The Secretary of the Navy does not receive orders from the Secretary of State, and though I doubt not Mr. Seward in an excitable and inflated moment promised and penned his absurd note, which he called an order when conversing with them, — gave it to them as such, — yet I never deemed it of sufficient consequence to even answer or notice further than in a conversation to tell him it was illegal.
SOURCE: Gideon Welles, Diary of Gideon Welles, Secretary of the Navy Under Lincoln and Johnson, Vol. 1: 1861 – March 30, 1864, p. 269-70