The Confederate steamer Alabama has just captured an American barque off Green Point, or about four miles from the nearest land (Robben Island). I witnessed the capture with my own eyes, as did hundreds of others at the same time. This occurrence at the entrance of Table Bay, and clearly in British waters, is an insult to England and a grievous injury to a friendly Power, the United States.

Towards the Government of my country and her domestic enemies the Government of England assumes a position of neutrality; and if the neutrality can be infringed with impunity, in this bold and daring manner, the Government of the United States will no doubt consider the matter as one requiring immediate explanation.

Believing that the occurrence was without your knowledge or expectation, and hoping you will take such steps to redress the outrage as the exigency requires, I am, &c.

Mr. Rawson to Mr. Graham. August 6, 1863.

I am directed by the Governor to acknowledge the receipt of your letter of yesterday's date respecting the capture of the Sea Bride by the Alabama, and to acquaint you that he will lose no time in obtaining accurate information as to the circumstances of the capture. I have, &c.,

(Signed) RAWSON W. RAWSON,

Colonial Secretary.

Mr. Graham to Sir P. Wodehouse. August 6, 1863.

I have the honour to acknowledge the receipt of your despatch of this date.

I beg now to enclose for your Excellency's perusal, the affidavit of Captain Charles F. White, of the Sea Bride, protesting against the capture of the said barque in British waters. The bearings taken by him at the time of capture conclusively show that she was in neutral waters, being about two and a half miles from Robben Island. This statement is doubtless more satisfactory than the testimony of persons who measured the distance by the eye.