In which he "recognized" the civil authorities of Portsmouth so far as civil law "may be compatible with the enforcement of martial law. " As we are situated, the control of the whole subject is with the military authorities, who may proclaim martial law whenever they may so determine. I am most happy to add the there has been no difference or "conflict" with the civil authorities of the city and county of Norfolk, and that our relations, both official and social, have been of the most agreeable and satisfactory character.

Since my interview with Governor Peirpoint above referred to, I have reviewed the subject,and I have issued the following order:

SPECIAL ORDERS,
HDQRS. DEPT. OF VIRGINIA, SEVENTH ARMY CORPS, Numbers 24.
August 12, 1863.

* * * * * *

XI. The provost-marshal of the cities of Norfolk and Portsmouth will take possession of all houses owned by disloyal persons now within the rebel lines, and of all real property within said cities owned by disloyal persons who take and active part against the Government of the United States, or who whole the orders of this department; but no property shall be condemned until written evidence shall have been taken in the premises, and be approved by the general commanding.

X. The fund created by the rental of the above property shall be appropriated exclusively toward the relief of the destitute families of officers and soldiers in the rebel army.

By command of Brigadier-General Naglee:

GEORGE H. JOHNSTON,
Assistant Adjutant-General,

Which is now in force and which, in connection with special orders of August 1, herein inclosed will indicate my policy, and which is as far as I can conscientiously go in the premises.

I regret the course pursued by the mayor of the city of Portsmouth. He has succeeded in doing just what I endeavored to avoid.

The persons in destitute condition, referred to by the President, were ordered to be taken care of immediately upon my arrival in Norfolk, and that subject was never one of difference,and I believe, was never referred to by Mayor Collins at the only interview ever had between us.

Respectfully submitting the above report let me request that it may be laid before the President in explanation of the subject.

I am, generally, very respectfully, &c.,

HENRY M. NAGLEE,

Brigadier-General, Commanding.

[Sub-inclosure.]

SPECIAL ORDERS,
HDQRS. DEPT. VA., 7TH ARMY CORPS, Numbers -.
Norfolk, Va., August 1, 1863.

I. The following line is hereby established: Commencing at the mouth of the Western Branch of the Elizabeth River; thence, by the Western Branch,to the head of the same; thence, by Bower's Hill, to the head of Deep Creek; thence, through the Dismal Swamp, to Lake Drummond; thence to the head of the Western Branch of the Pasquotank River, and thence, by the latter and the Pasquotank River, to Albemarle Sound.

II. Any person attempting to pass the above line will be arrested and severely punished.

III. Any person attempting to pass letters, information, or merchandise across the above line, and all interested with them, will be imprisoned and severely punished; and the goods seized, as well as