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manner in which they carried out his orders. Respectfully, Theodorus Bailey, Acting Rear-Admiral Commanding E. G. B. Squadron. U. S. Flag-ship San Jancinto, Key West, Dec. 28, 1863. Hon. Gideon Welles, Secretary of the Navy: sir: It gives me great pleasure to call the attention of the department to a very important service performed by the schooner Fox, a tender of the San Jacinto, under the command of Acting Master George Ashbury. The circumstances are as follows: On the twentieth of December, a steamer was discovered in the mouth of the Suwanee River, apparently at anchor or aground. The Fox immediately beat up toward her until, when within about three quarters of a mile of the steamer, she grounded in eight and a half feet of water, and opened upon her with the howitzer, at the same time sending an armed boat in to capture the steamer. An attempt was made to intimidate our people by mounting a piece of stove-pipe on a chair, to represent a forecastle gun, and a log of