_14th March._--Before it is decided whether Ministers are to go out, or accommodate their present differences with the K., I shall try and collect as well as I can, all the important particulars which have led things to the present vexatious state. It was the intention of Ld. Grenville, not only to extend the provisions of the Irish Act of 1793 to the whole British Army, but also to open Staff appointments to the Catholics, but this dispatch to the King was expressed with some degree of ambiguity, so that it might be construed to mean that he intended only to extend the provisions of the Irish Act to this country. It was so understood by the King, Lds. Sidmouth, and Howick; and when transmitted to Ireland and read by Mr. Elliot to the Catholics, it appeared so ambiguous, that when they demanded an explanation of this point, Mr. E. wrote to Ld. Spencer for instructions how to answer them. This letter was sent to Lord Grenville, and answered by him without any consultation with his colleagues. In his answer he expressed surprise that Mr. Elliot should have had any difficulty upon the subject, and authorised him to inform the Catholics that it was the intention of Governt. to remove all disabilities whatever in the army attaching to members of their Church. When Ld. Sidmouth understood the misconception under which he had laboured with regard to the meaning of the proposed clause, he appeared to be extremely distressed, and expressed himself very doubtful whether he should not enter into an explanation with the King, in order to explain his own conduct in the whole affair. But at length he determined that, if no communication was made on the subject by the Cabinet, he should take no notice whatever of it; as it was uncertain in what light the dispatch might have been viewed by the King, and whether he had understood by it that the new clauses were to be exactly the same as those of the Irish Act in 1793, or to apply also to the Staff appointments. It was judged proper by the Cabinet to say nothing of this difficulty and contrariety of opinions to the King, but to send to him the proposed clauses, which it was found afterwards more convenient to be made into a separate Bill, and to leave him to object to them if they were different from what he was prepared for.