The letter relates to Kelly's commission to paint a portrait for the Royal Academy of
the King in garter robes.
[Sydney] Lee (he thought it was) had told him that
Poynter had received £2,000 for his portrait of
King Edward VII, though the usual fee was £1,000. Kelly has two attempts at explaining himself: he understood that no fee could be expected until the RA was out of debt (except £100 for expenses?), but if the RA did get out of debt, he or his heirs ought to get the fee.
Kelly adds a postscript, in which he asks Lamb about a lost umbrella with his name engraved on the handle. He includes a sketch of the umbrella.