[Indorsement.]

JANUARY 15, 1864.

Respectfully referred to Major General G. H. Thomas.

H. W. HALLECK,

General-in-Chief.

[Inclosure.]

BIRMINGHAM, ENGLAND,

December 29, 1863.

Major General H. W. HALLECK,

Commanding-in-Chief of the U. S. Army:

SIR: Learning by the last arrival from New York that Government have built a fort on the site of a blast-furnace belonging to me at Chattanooga, Tennessee, situated on the bluff at the river's bank in the town, I have taken the liberty to call your attention to a fact that is not generally known and which accidentally came to my knowledge. The site of the furnace or the fort is a bluff which rises about 80 to 100 feet perpendicularly from the river. In the face of this bluff, near high-water mark and accessible from the river, is a cavern, which I am told extends under the bluff and through the ridge for upward of 1 mile. This cavern has been the resort of fugitive slaves. It has occurred to me that as the army has been there but a short time the officers in command may not know of its existence. Judging from what I know of the position I have thought it might be a matter of some importance to you to be made aware of the fact. Whether it could be used as a mine to destroy the works over it your officers are better able to judge than I am, but as this bluff commands the ferry, the river for some distance, and the town of Chattanooga, and the East Tennessee and Georgia Railroad, and in view of the scarcity of water in the town, it may safely be called the key of the position. And as the position is ranked as a "decisive strategical point of the highest order" (perhaps equal to Ulm), I have taken the liberty to address you this letter.

Trusting that it may benefit our cause, I remain, yours, respectfully,

JAMES HENDERSON.

The opening is small and concealed by brush-wood.

J. H.

COLUMBIA, December 30, 1863.

General CROOK,

Pulaski:

Can I see you to-day at Lynnville. Have you or General Dodge any late intelligence from West Tennessee? Captured rebel dispatches indicate that Forrest intends crossing the Tennessee River somewhere between the mouth of Duck River and Fort Henry. I don't know how much importance to attach to them. Can you not get scouts over the river to report the movements of our own and rebel forces?

WM. SOOY SMITH,

Brigadier-General, Chief of Cavalry.