On the morning of the 7th instant, just at daybreak, the detachment under Captain Ludlow, which was encamped at Fox Creek, Douglas County, 7 miles southeast of Vera Cruz, was attacked by a body of riflemen concealed in the bush. Five of our men were wounded (one mortally) and several horses killed. The detachment formed under a continued fire, and made a charge upon the enemy, who eluded the cavalry by retreating through the wood trails. Captain Ludlow then fell back upon Hartville, where he was joined in the evening by the re-enforcements under Captain Heiden. This latter body I had dispatched on the 7th instant, having received information of the presence of a considerable body of marauders at Vera Cruz or its vicinity. The wounded were sent back from Hartville, and the next day occupied in scouting the country southward from Hartville.

On this day (the 8th) my men were joined by some Home Guard scouts, and about 18 of Bowen's cavalry, under Lieutenant Flint, from the post at Marshfield. During the day information was had of a body of men (supposed to be the same party which had attacked Captain Ludlow on Fox Creek) being at a place called Mountain Grove, 2 miles west of Montreal, on the borders of Texas and Wright Counties. Disposition was made to surround this place, and after a most fatiguing march over rough mountain roads, in the midst of a terrible storm, the settlement (lying on the summit of the hill) was reached about noon of the 9th. As the cavalry was surrounding the principal buildings a sharp fire was opened on it from a small blacksmith shop. The enemy broke for the bush and for a tavern building near by. All those who did not gain the tavern were killed by the cavalry, except one, who escaped on his horse. Fire was then opened on our men from the tavern, but it was speedily taken after a sharp fight. Notwithstanding the enemy were armed with rifles and protected by the buildings none of our men were killed and but a few trifling flesh wounds received Eleven of the marauders were killed; 6 wounded, 2 of these mortally; and the rest, 21 in number, taken prisoners.

Being satisfied that the band was thus thoroughly broken up the command returned to Lebanon, and the prisoners are now safely confined in the jail here. Previous to their return there had been sent in here at different times 19 other prisoners who had been taken during the week. Over 30 horses were captured and as many rifles and guns, which last were turned over to Union citizens, who are at once organizing a company to keep down any further attempt to make up their bands.

In the upper story of the tavern were found saddles and an overcoat lost in the attack at Fox Creek. On the person of one of the prisoners (J. C. Campbell, a justice of the peace in Wright County) was found a document of which the following is a copy:

[Special authority.]

HEADQUARTERS M. S. G., February 7, 1862.

Authority is hereby given to J. C. Campbell to organize all the men that he can recruit for that purpose into companies, to operate as a guerrilla force in the Sixth and Seventh Military Districts. He is instructed to disarm all Home Guards and other hostile organizations in those districts, and to place the arms thus taken in the hands of his own forces. He will at the same time embarrass the enemy as much as possible by cutting off their re-enforcements, scouting parties, and supplies. He is particularly instructed to prevent depredations upon private property, the unnecessary disturbance of any person whatever, either by the men under his own command or by others, and he will report his actions to this army.

by order of Major-General Price:

F. O. GRAY,
Acting by Special Authority.