No. 20.
Mr. Clapp to Mr. Hunter.

No. 13.]

Sir: The statement which I made in my dispatch, No. 5, on information which I supposed to be entirely reliable, that Brazil has, in consideration of the cession of the territory north of the river Apa, released Paraguay from all financial claims on account of the late war, proves to be incorrect. On the contrary, she has secured in the recent treaty an acknowledgment of indemnity due for her expenses, which evidently amounts to a perpetual mortgage on the territory and independence of Paraguay.

I am, &c,

DEXTER E. CLAPP.