On September 8, I took Lieutenant Packard, Sergeant Carroll, and the 4 privates so furnished by Admiral Dahlgren to Port Royal Ferry and Delivered them to Captain A. L. Campbell, Third South Carolina Cavalry, who represented General Jones on the occasion.

The matter of exchange in this department is now closed, with the exception of Rev. Mr. Whitney, One hundred and fourth Ohio Volunteers, and Lieutenant J. D. Higgins, One hundred and twenty-third Ohio Volunteers, of whose cases I have already made a full explanation. If I have in this last matter of exchanging Lieutenant Packard, &c., violated your orders or those of the department, it has been done unintentionally. Whatever of blame there is herein is mine, and should in no respect affect yourself. I could neither break my word as given on August 16, nor permit Lieutenant Lay, Mr. Parkman, and Sergeant Burkhardt to return to their bondage after they had been brought down by Major Lay on the assurance that they should be exchanged if your investigation of Lieutenant Packard's case proved the major's statement as to their capture correct.

Major Lay, at the close of our interview on September 3, instant, stated that the Confederate authorities were still ready to exchange, rank for rank and man for man, all the prisoners whom they held in General Jones' department.

I have the honor to be, very respectfully, your obedient servant,

STEWARD L. WOODFORD,

Lieutenant Colonel 127th New York Vols., Agent for Exchange.

HEADQUARTERS DEPARTMENT OF THE SOUTH,
Hilton Head, S. C., September 11, 1864.

Rear-Admiral J. A. DAHLGREN,

Commanding S. Atlantic Blockading Squadron, Port Royal, S. C.:

ADMIRAL: In my letter of the 2nd instant, in answer to your favor of the 1st instant, concerning the batteries on Morris island firing into the flag-of-truce boat sent to communicate with the navy, I informed you that I had referred your letter to Brigadier-General Saxton, commanding Northern District, for investigation and a report. I have just received the report, and find that the officer in command of the battery was acting under orders which I gave some time since to the officers commanding the different districts of the department, viz, to allow no communication with the enemy at any other point than Port Royal Ferry. I informed Major-General Jones of this order, and there has been no attempt on his part to communicate with the army forces at other points.

It seems from Captain Green's report that the enemy's flag-of-truce boat came from an unusual place, which undoubtedly caused the officers of the batteries to be suspicious of it, as they did not know that it was the intention of the senior naval officer to communicate by flag of truce. I would respectfully suggest that in future, when you desire to send a flag-of-truce boat to the enemy at such points as are covered by our batteries, that you will notify the commanding officer of the district of your intention in time for him to give the necessary orders.

I have the honor to be, very respectfully, your obedient servant,

J. G. FOSTER,

Major-General, Commanding.