reply to my dispatch, inclosing a copy of yours of the 19th instant with a copy of a dispatch of the Secretary of War to you of the 18th instant respecting trade at Norfolk, the Secretary of the Navy informs me that he is expecting a communication from the Treasury or War Department specifying details of a proposed arrangement for permits, and until it is received that he has no new instructions to give in regard to the blockade.

In reference to the detention of the William Penn the Navy Department, under date of the 29th instant, approves my course and instructs me as follows:

Until the blockade is raised or broken or publicly modified it must be enforced in good faith by the navy. Fort Monroe is not a port of entry, and clearances are not to be made from that point, which is, like Norfolk, subject to blockade. If the Secretary of War or Treasury have seized or obtained possession of staves or tobacco, or any other articles which belong to the Government, and either of them have authorized such articles to be exported, you will recognize their authority. But permits from any officer for general traffic or exports on private account are unknown to the Department intrusted with the blockade and cannot be recognized.

In reply to my communication of the 24th instant you suggest, in substance, that all the steamers in the employ of the army, as shown by the authentic list you have sent me, should pass the blockade without stopping even at the outer guard vessel; that Colonel Thomas, chief quartermaster here, will give certificates to each steamer, which she shall retain while so employed, and when she is discharged Colonel Thomas' certificate will be taken from the captain, and you will immediately notify me, that she may be erased from the list you have sent; and if any new steamer is chartered you will give me like immediate notice, that she may be added to the list; and that all steamers not on the official list will be directed to stop at the outer guard vessel and show their certificates.

I cheerfully accept this proposition, and shall submit our correspondence on the subject and my action in relation thereto for the consideration and decision of the Navy Department.

In respect to the Metamora I beg leave to say that as soon as you informed me she was in your personal service the gunboat on guard duty was promptly instructed on the subject. Had the gunboat on blockade, while ignorant of the fact that you were on board the Metamora, stopped her, I am sure you would, on reflection, not have felt offended, as military men do not take offense at the proper challenge of a sentinel. Yesterday I was not allowed to go on the ramparts of Fort Monroe, though I was in uniform and had made myself known, without a permit from one of your officers, and then I was, and very properly, I believe, challenged by a sentinel and stopped until I exhibited my pass. I saw in this only military propriety and felt no infraction of dignity was intended.

I have the honor to be, general, very respectfully, yours,

S. P. LEE,

Actg. Rear-Admiral, Commanding N. Atlantic Blockading Squadron.

HEADQUARTERS DISTRICT OF NORTH CAROLINA,
Raleigh, November 1, 1862.

Major General J. G. FOSTER, U. S. A.,

Commanding Department of North Carolina, New Berne, N. C.:

GENERAL: Your letters of the 24th and 28th ultimo are received. I "appreciate the many difficulties in the way of finding, identifying, and