Section 7 of the Act of March 3, 1883, 22 Stat. 433, c. 121,
repealing Rev.Stat. §§ 2901, 2908, took effect immediately upon the
passage of the act.
Contemporaneous construction by the Treasury Department of a
repealing clause in the customs laws is entitled to weight in favor
of importers.
Prior to March 7, 1333, a collector of customs in the United
States was required by law, under penalty for nonperformance, to
ascertain the dutiable value of imported goods by adding to their
cost at the place of production the cost of transporting them to
the place of shipment to the United States and of the box or case
in which they were enclosed. This aggregate was called their price
or value "free on board," which, in the absence of fraud, was taken
to be their dutiable value. The Act of March 3, 1883, 22 Stat. 488,
c. 121, § 7, repealed this provision of law. Shortly after this
section took effect, and in ignorance of its passage, a shipment of
goods produced in Switzerland was made at Antwerp, the consular
invoice of which contained in detail the original cost of the goods
in Switzerland, the cost of transportation separately stated, and
the aggregate "free on board at Antwerp." On their arrival at the
port of New York, the consignee cabled for a new invoice to conform
to the changed
law. One was sent, but without a consular certificate. The
consignee presented both invoices at the custom house and asked to
use the second as explanatory of the first, and to enter the goods
at their net value, charges off. The weigher's return at the custom
house showed a less quantity of goods than that stated in the
invoice. The custom house officers required the importer to enter
the goods at their dutiable value according to the first invoice
and gave him to understand that that was all he could do. The
collector decided and the Secretary of the Treasury affirmed the
decision on appeal, that the cost of transportation, etc., was not
to be deducted from the dutiable value of the goods, and that the
duties were to be collected on the quantity as shown by the
invoice.
Held:
(1) That the levy of duties after March 3, 1883, on a valuation
including the charges of transportation from the place of
production to the place of shipment was contrary to law.
(2) That under the circumstances, the importer was not bound to
ask for an appraisement under Rev.Stat. § 2926.
(3) That the collector was not entitled to exact a duty upon a
deficiency in weight arising from loss of goods and not from
shrinkage.
(4) That the payment of the duties under these circumstances was
not voluntary.
Page 132 U. S. 492
This was an action against a collector of customs to recover
duties alleged to have been illegally exacted. Verdict for the
plaintiff and judgment on the verdict. The defendant sued out this
writ of error. The case is stated in the opinion.
MR. JUSTICE BRADLEY delivered the opinion of the Court.
This is a suit to recover alleged excess of duties exacted on
certain cargoes of asphaltum in cakes, imported by Bradbury, the
plaintiff below, from Antwerp, in May, 1883. Two questions are
presented in the case for our determination: first, whether the
seventh section of the Act of March 3, 1883, entitled "An act to
reduce internal revenue taxation, and for other purposes," went
into effect at the time of the passage of the act, or not until the
4th of July following; secondly, if it did go into effect at the
time of the passage of the act, whether, under the circumstances of
this case, the plaintiff below was entitled to the benefit of that
section. Prior to the passage of the act referred and the
department holds that it takes sections of the Revised Statutes
(which were taken from the ninth section of the Act of July 28,
1866, 14 Stat. 330) the collector, in determining the "dutiable
value" of merchandise, was required to add to the cost, or actual
wholesale price or general market value at the time of exportation,
in the principal markets of the country whence the goods were
imported, the cost of transportation, shipment, and transshipment,
with all the expenses included, from the place of growth,
production, or manufacture, to the vessel in which shipment was
made to the United States; also the value of the
Page 132 U. S. 493
sack, box, or covering, and commissions and brokerage; which
additions were to be regarded as part of the actual value, and a
penalty was imposed for not including them. These sections were
repealed by the seventh section of the Act of March 3, 1883. They
are repealed by words in the present tense, thus:
"That sections 2907 and 2908 . . . be, and the same are hereby,
repealed, and hereafter none of the charges imposed by said
sections or any other provisions of existing law shall be estimated
in ascertaining the value of goods to be imported."
We do not see how there can be any doubt that this repealing
section went into immediate effect. The law itself went into
immediate effect although, it is true, various provisions of it,
contained in other sections, were postponed to take effect some on
the 1st of July and some on the 1st of May. But where such
postponement was intended it was expressed, and only referred to
the parts that were so postponed. It did not affect the section in
question, and such was the understanding of the Treasury Department
itself at the time. In a Treasury circular of March 12, 1883,
addressed to the collectors of customs, the Secretary, referring to
the act in question, then just passed, said:
"Various sections recite the date when each shall go into
effect, and so far as concerns these sections, those dates control.
Section 7, however, names specifically no date when it is to go
into operation, and the Department holds that it takes effect from
and after the date of the passage of the act."
This contemporaneous construction is entitled to some weight in
favor of importers.
United States v. Johnston,
124 U. S. 236,
124 U. S. 253.
At all events, it was undoubtedly the correct construction.
The question then arises whether the plaintiff below, by
anything that took place in the entry of the goods at the custom
house or by any omission to do what the law required, precluded
himself from being entitled to the benefit of this statute.
Under the old law, the cost or value of the goods at the place
of production was often merged for convenience with the costs of
transportation to the place of shipment and the other charges, and
the aggregate was called the price or value "
free
Page 132 U. S. 494
on board" of the vessel in which the goods were shipped
to the United States. This price or value, "
free on
board," or "
f.o.b.," in the absence of fraud,
represented the "dutiable value," subject, of course, to correction
by appraisement. When the vessel arrived and the consignee
presented the entry at the custom house, it was accompanied with
the invoice, showing this price or value. In the present case,
although the goods were shipped in April, the consignors in Europe,
not being aware of the passage of the Act of March 3, 1883,
repealing sections 2907 and 2908, made out the invoices in the
usual way, stating the price of the goods as free on board at
Antwerp, including therein the original cost of the goods at the
mines, near Neufchatel, Switzerland, their cost of transportation
from Neufchatel to Antwerp, and the other charges required by the
repealed sections. This invoice was duly certified by the consul at
Manheim, Germany. Before the entry of the goods, a corrected
supplementary invoice had arrived in answer to a telegram, and was
presented at the time of the entry, but it had no consular
certificate, that being supplied afterwards. On the trial of the
cause, the plaintiff introduced evidence tending to show these
facts. He produced the entry, which described the importation as
"12,000 cakes, 300,000 kilometers, asphaltum, marks 15,750,
$3,749," with the usual consignee's oath that the invoice and bill
of lading produced with the entry were the true and only ones
received, and that the invoice exhibited the actual cost or fair
market value at Neufchatel of the goods, and all charges thereon.
The invoice, certified by the consul, on which the entry was based,
was also produced in evidence, representing the goods as "a
quantity of asphaltum, 300,000 kilograms at 52.50 marks per 1,000
kilograms, 15,750 marks, free on board, Antwerp." There was
attached to this invoice, on making the entry, and when produced in
evidence, the uncertified, supplementary invoice before referred
to, which represented the goods as
"a quantity of asphaltum, 300,000 kilograms; value at the mines,
34.50 marks per 1,000 kilos., M 10,350. Freight and charge from the
mines to Antwerp, free on board at 18 marks per 1,000 kilos.,
5,400. Free on board Antwerp, marks 15,750. "
Page 132 U. S. 495
Attached to the consular invoice was the oath of the owner of
the goods, which stated, among other things, that said invoice
contained the actual cost and quantity thereof, and of all charges
thereon. The certificate of the consul, attached to said invoice,
was dated 20th of April, 1883, and certified, among other things,
that the invoice,
"in which are mentioned and described certain asphaltum,
amounting, with the charges thereon, to the gross sum of marks
15,750, was produced to him by the owner,"
and that the actual market value of the goods, except as
corrected by him, was correct and true. The plaintiff further
offered evidence to show that, being charged with duties on the
entire amount of 15,750 marks, he protested against the assessment
on the ground that the defendant
"assessed duty upon the cost of transportation, shipment, and
transshipment, with all expenses included, from the place of
production and the entire amount of 15,750 marks, he protested
shipment was made to the United States, contrary to section 7 of
the Act of March 3, 1883,"
claiming "that said charges were not subject of appraisement or
duty," and, on a second ground, that the weigher's return showed a
less quantity than that on which duty was charged, and that he paid
the excess of duties exacted under compulsion solely for the
purpose of obtaining the goods.
An appeal was taken to the Secretary of the Treasury, who
affirmed the decision of the collector on the ground that the
deduction for charges had not been made in the entry, and the
action was brought within proper time thereafter. A. W. Patterson,
the plaintiff's custom house broker, testified that he presented
the two invoices above named at the custom house on the entry of
the goods; that he made the entry for the plaintiff; that he asked
to make the entry on both the consular and supplemental invoices,
the latter as explanatory of the former; that the custom house
officers refused to allow this to be done; that he asked permission
to use the supplemental invoice in connection with the other
invoice, as explanatory, and enter in the net value, charges off,
which was refused; that he then entered the goods according to the
consular invoice; that the supplemental invoice had come in
Page 132 U. S. 496
answer to a telegram to the Neufchatel Asphaltum Company, to
furnish a corrected invoice, showing what the charges were; that
subsequently to the entry of the goods, a copy of the supplemental
invoice was received, properly certified by the consul. This copy
was admitted in evidence. The weigher's certificate was also
produced, showing a deficiency of 2,740 pounds of asphaltum in the
cargo of the Marshall, and over 9,000 pounds in that of the Edith,
for which no refund of duty had been made. The witness Patterson
further testified as to the meaning of the expression "free on
board," as before stated.
Potter, an examiner in the appraisers' department, testified
that he passed the entry in question, and endorsed it "Correct,"
which merely meant that the entry was sufficient to cover the
market value of the goods. He further testified that he found from
memory, and by comparison with other goods in the same markets,
that the market value of these goods was 34 marks, 50 pfennigs, or
35 marks at the mines at the place of production. Being asked if he
had passed, as a rule, invoices of asphaltum from Manheim, Germany,
for a considerable period before and after that time at the same
rate of 34.50, he said that would be impossible to say without the
papers, but he presumed that that was about the market value. On
cross-examination, he stated that he had no recollection as to what
he found the market value of this importation to be, independent of
what was written upon the entry and invoice. To the question "Have
you any recollection at all of what you did in fact find the market
value in the principal foreign ports to be?," his answer was,
"Yes, I have that recollection, because it is so stated on the
invoice [supplemental] that 34 marks, 50 pfennigs, per thousand
kilograms was about the usual price, and it seems to have been
stated there on the invoice."
To the further question
"Then, as I understand, the effect of your testimony is that,
from looking at the supplemental invoice, you form the impression
that the value at that time at the mines was 34 marks and 50
pfennigs per thousand kilograms?"
his answer was, "Yes, sir." Esterbrook, chief liquidating clerk
of the custom house, testified
Page 132 U. S. 497
that, according to the course of business in the custom house
under the law, the entered value is the value declared upon the
entry under oath, and that the practice is that the collector shall
not levy duty on less than the entered value, though the amount in
the invoice is less. Another clerk testified to the same
effect.
Thereupon, the evidence being closed, the counsel for the
government moved that the jury be directed to find for the
defendant upon the following grounds: 1. that the evidence does not
show the duty exacted on any amount in excess of the invoice value;
2. nor in excess of the entered value; 3. nor does it make out a
case of recovery for the plaintiff. The court having denied this
motion, the counsel then made a request to charge fourteen separate
propositions, the substance of which was that under section 2900 of
the Revised Statutes, which declares that "the duty shall not,
however, be assessed upon an amount less than the invoice or
entered value," the collector was bound to assess the duty on the
amount stated in the entry and in the invoice certified by the
consul, and could not take notice of the uncertified invoice, and
that if the plaintiff desired to have the invoice corrected, his
remedy was to demand an appraisement under section 2926 of the
Revised Statutes, which provides that merchandise of which
incomplete entry has been made, or an entry without specification
of particulars, either for want of the original invoice or for any
other cause, or which has received damage during the voyage, shall
be conveyed to a warehouse, and there remain until the particulars,
cost, or value, as the case may require, shall have been
ascertained, either by the exhibition of the original invoice or by
appraisement at the option of the owner, importer, or consignee,
and until the duties shall have been paid or secured to be
paid.
The court declined to adopt the propositions of the counsel, but
charged the jury that, as the invoice certified by the consul
purported to show the value of the goods "free on board at
Antwerp," if the jury were satisfied by the evidence that this
meant that the value so expressed included charges, the charges of
transportation and placing on board ship -- charges from
Page 132 U. S. 498
the markets of the country to the ship -- then it was not an
invoice of the "dutiable value," but was an incomplete invoice;
that if this was its character, the importer or consignee had a
right to claim that it was incomplete, and to ask that the goods be
appraised, or that he might amend his invoice. The charge then
proceeded as follows:
"You have heard Mr. Patterson testify as to what occurred when
he presented this invoice to the entry clerk. . . . Now if he was
given to understand when he presented that invoice there, and
stated that he wanted to get the charges out in some way, and
presented this additional paper -- you heard his testimony about
what he did -- if he was given to understand that he must enter
those goods at the value expressed -- that is, the value, including
the charges, the value expressed in the invoices -- and in no other
way, and that they could not get along in any other way than that,
then he was not bound to ask for an appraisement. If they gave him
to understand that that was the only thing he could do -- if they
met him right there, when he wanted to put in this additional
invoice, and said 'the only thing you can do is to enter these
goods at this value,' and the importer was compelled to do it in
order to proceed at all, and he yielded to that -- then he was not
bound to say anything about an appraisement. But if they did not do
that -- if they merely refused that, and gave him a chance to ask
for an appraisal if he wanted to, and he did not ask for it, he
mistook his remedy, and the plaintiff cannot recover, and it was
his fault that he did not enter them right. But if they cut him
right off on that subject, and said he must enter at this larger
value, then it was their fault, and the plaintiff can recover if
duties on charges were collected."
The court further charged that if the examiner who appraised the
goods appraised their value in the principal markets of the country
whence they came, in the shape they were -- that is, in cakes -- at
34 marks, 50 pfennigs, that was their dutiable value, and the
collector exacted a duty in excess for charges, whether he called
them charges or not, and the plaintiff should recover what he paid
for this duty on charges, because the law of 1883 took out charges
as a part of the dutiable value; but
Page 132 U. S. 499
that if this was not the value that the appraiser took when he
says he did appraise the goods, and the jury cannot tell what it
was, then they cannot tell what duty was paid on charges, and the
plaintiff has not made out his case.
As to the deficiency in weight, the counsel or the government
contended, and asked the court to charge, that the plaintiff was
not entitled to recover anything in respect to the difference
between the weights stated in the invoices and entries and the
weights stated in the official weigher's returns. The court
declined so to charge, and instructed the jury that if the
deficiency arose from the loss of goods on the passage, a
proportionate reduction should be made; but not if it arose from
mere shrinkage, and if all the goods that were sent arrived.
The counsel for the government excepted to each part of the
charge as given, and to each refusal to charge as requested.
We do not think that the court below committed any error in its
instructions or in its refusals.
First. In regard to the construction and effect of the consular
invoice which expressed the value of the goods "free on board," it
was perfectly proper and right to instruct the jury that if they
were satisfied from the evidence that this form of valuation was
understood to include charges of transportation from the place of
production to the place of shipment, and other charges of shipment
and transshipment, then the levy of duties on such valuation, since
the passage of the act of 1883, was contrary to law, and that the
plaintiff could recover back the duties levied on the amount of
such charges, provided he took the proper course to avail himself
of the error. This is so evident that it needs no discussion to
make it plainer.
Secondly. As to the course which the plaintiff did pursue, we
see no error in the position taken by the court that although the
statute prescribed a particular method to be followed, under
section 2926 of the Revised Statutes, in case of an incomplete
entry of goods or an entry without the specification of particulars
-- namely, to convey the goods to a warehouse, there to remain
until the particulars, cost, or value should be ascertained either
by the exhibition of the original
Page 132 U. S. 500
invoice or by appraisement -- yet if, when the importer or
consignee pointed out the imperfection and desired to correct it,
or have it corrected he was met by a declaration of the officers
that he must enter the goods at the value expressed in the invoice
and in no other way, and was given to understand that that was the
only thing he could do, and he was compelled to do that in order to
proceed at all, then he was not bound to ask for an appraisement
under the statute. The case was prejudged against him. The theory
of the custom house officers evidently was that the valuation of
the goods in the entry and invoice was binding on the importer
although in that valuation he had inadvertently included charges
for transportation and other charges exempted from duty by the act
of 1883, and that it was his own fault for having so included such
charges, and that he was estopped from disputing the valuation thus
made and sworn to, even though qualified by the words "free on
board," which could have no effect to alter the valuation. It is
not stated in these words, but that was the tendency of the
evidence, and we think that the jury were properly instructed on
the subject.
Thirdly. As to the deficiency in the weight of the goods, as the
value was measured by the weight, both in the invoice and by the
appraiser, namely so much per 1,000 kilograms, we think the court
was right in telling the jury that any deficiency arising from loss
of goods, and not from mere shrinkage, was a proper subject of
recovery. If goods are damaged or affected intrinsically, that is a
matter for examination and appraisement under section 2927, Revised
Statutes, but if any portion of them has never come to hand, but
has been actually lost, the case would seem to come within the
spirit of section 2921, which says that
"If, on the opening of any package, a deficiency of any article
shall be found on examination by the appraisers, the same shall be
certified to the collector on the invoice, and an allowance for the
same be made in estimating the duties."
The appraisers' certificate in the present case related merely
to
pro rata value, and not to quantity -- that was
ascertained and certified by the weigher. If only half of the cargo
was found on board the ship, it could hardly be contended that the
importer would be bound by his entry and invoice to pay duty on the
entire cargo shipped at Antwerp.
As to the point that the payment of the duties was voluntary on
the part of the plaintiff, it is obvious to remark that the case,
as already considered, involved this very question. The verdict of
the jury in favor of the plaintiff, under the instructions given,
was virtually a finding of the fact that the plaintiff was
compelled to pay the illegal duties in order to get possession of
his goods. The counsel for the government says that he ought to
have asked for a reappraisal. The question whether he was bound to
take that course or not was involved in the inquiry submitted to
the jury under the second head of instructions.
We see no error in the record, and the judgment is
Affirmed.