E.—No. 3 .

both sides, and amongst them the chief Kereti, whose loss seems to have dispirited the loyal natives, for they immediately commenced to retreat, slowly at first, but when after another volley or two their two other leaders, Hemi and Riwai, were killed,.they fairly broke and fled. Tho reserve, instead of coming to their support, also fled, most of them recrossing the river. The battle seemed at this moment completely lost, and probably would not have been retrieved had it not been for the chief Haimona Hiroti, who when he reached the end of the island shouted, "I will go no further," and immediately rallied some twenty men just in time to pour a deadly volley into the rebels, who were close, upon them. After this it seems to have been a hand to hand fight; but the rebels having lost several of their leaders, and Mete Kingi with the reserve having rejoined Haimona Hiroti, soon broke and fled, being hotly pursued till they reached the head of the Island, when all who survived (with the exception of a few who escaped in a canoe) took to the"river, and were most of them shot down. Matone, though he was badly wounded while swimming, succeeded in gaining the bank, but was almost immediately tomahawked by a native policeman, Te M'oro, who lost no time in swimming after him. It is scarcely possible to state what the rebel loss was, but forty dead bodies were found on the island, and several more were seen to sink while attempting to cross the river. Nearly all the survivors are known to be wounded. The friendly natives had twelve killed, and from twenty-five to thirty wounded. Several spears and other weapons of war were taken, and also Pehi's King flag, which was found in a large canoe ; and on searching Matene's whare, the conquerors obtained a prize of ninety sovereigns. It is only fair to add that amongst the friendly natives were some thirty or forty Kingites, who have most of them since renounced Kingism, and taken the oath of allegiance to tho Queen. The meeting last evening alluded to as taking place in the runanga house lasted several hours, but as the purport of the speeches was the same as at tlie great meeting held to-day at Eanana (Loudon), it is needless to report them. In the course of this morning (Friday, 20th), Hori Kingi and his party, whom we had left behind at Otumairo, arrived; and after a tangi and some speechifying, we proceeded to I .nana, where now nearly the whole of the loyal natives were assembled. At the meeting held in the latter part of the day nearly all the chiefs spoke, so that it is impossible to give more than one or two. Mete Kingi : " I was on my way to town to ask for instructions as to our course of proceeding for the future, to ask for assistance in the way of arms and ammunition, and to know what I am to do about the prisoners. Now you havo come, our way is clear ; it is a good thing you have done in coming here. You, the representative of the Governor. Our hearts are light through seeing you this day." Haiiiona : " We want guvs ; old-fashioned muskets with caps for the older men, double-barrelled guns and rifles for the younger men, with powder, lead, caps, and most of all we want soldiers tobe stationed at each pa, as they are on the Waikato. We also want big guns to protect our pas, and to be assisted in our commissariat, for most of these men have left homes and cultivations. We want military settlers, the same as they have on the Waikato. We are prepared to give them land if they protect us ; but above all things let us have roads made into this river to bring up supplies, and also that soldiers may be brought to our assistance." Hoani Wikemtt : " Let my road be made at once through the Kokoro to come out near Parikino, and let Pakeha and Maori work together at this road." « Hori Kingi and others chiefly referred to the prisoners, the purport of their speeches being—" We have fought for the Queen and for tlie protection of the Pakehas. "We have killed in the battle of Moutoa many of our nearest relations and friends. We have taken others of them prisoners. Have we not done enough for the Queen and our friends the Pakehas ? Must we surrender these prisoners to be sent to Auckland or "Wellington, and there put into gaol ? But if they must be surrendered, whatever you say shall be done. Cannot Te Raimona be given up to us ? lie is nearly related to every chief of this river—to all of us ; but if you decide that they must all be given into your hands, we will do so." In replying, I stated that I had come up on behalf of the Government and settlers to thank them for the stand they had made against Matene and his fanatics, for having displayed such bravery, and for having achieved such a signal victory; that I sympathised deeply with ail those who had lost their friends and relations in the fight; that I felt certain the Government would provide for the widows and orphans and also for the wounded ; that with respect to assistance, I had already supplied them with ammunition and as many guns as I could procure at Wanganui, that more should be sent from AVellington ; that I -would supply them with provisions from time to time as long as they were kept away from their homes and cultivations; that with regard to the prisoners, they were rebels taken fighting against the Queen, and were therefore Queen's prisoners ; that I was bound to insist upon their all being handed over to me; that the Governor alone had the power to pardon and liberate them. To all this they answered, " Good; it shall be as you say ;wc will go with you and take the prisoners." Saturday, 21st. —This morning I proposed that I should go and see Pehi, accompanied only by my interpreter, aud asked for a canoe. Hori Kingi at once got into a state of great excitement, and while addressing the natives said, "Is Petatone mad? is he come up here to bring confusion amongst us ?" When 1 asked for an explanation, he replied, "Am I not responsible for your life ? If you are killed and I kill Pehi, will that be sufficient utu for your death ? When I left Wanganui I promised that if you were killed I would be killed also. I allowed you to go from Otumairo to Koroniti without me the other evening, because you were only to pass friendly pas ; but beyond this you are not safe unless protected by a sufficient force. Hori Kingi must and will go wherever Petatone goes. Wait till Monday, and we will all accompany you to tho pa where Pehi at present is." There was no resisting such an appeal as this. In the afternoon, however, they sent me with a large force to Tawhitinui and Kauaeroa, two pas where there was a considerable number of wounded rebels, and where the majority of the prisoners were being kept under a sort of surveillance, for they could scarcely be said to be in custody. Dr. Fletcher having dressed their wounds, we returned to Eanana. Late at night all the principal chiefs came into my tent, and agai'< ""ked whether I could not let oft'the prisoners, especially To Raimona ; when I repeated that I had no po., li- to comply with their request, they went away, saying, " We will say no more about them, but will surrender all of them to you on Monday."

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