Section IV, paragraph J, subsection 7, of the Tariff Act of
October 3, 1913, c. 16, 38 Stat. 114, 196, after declaring that a
discount of five percentum on all duties imposed by the act hall be
allowed on such goods as shall be imported in vessels admitted to
registration under
Page 243 U. S. 98
the law of the United States, adds, by way of proviso,
"that nothing in this subsection shall be so construed as to
abrogate or in any manner impair or affect the provisions of any
treaty concluded between the United States and any foreign
nation."
Held,that the grant of the discount is confined to
goods in American bottoms, and the effect of the proviso is to
respect the treaty privileges with which such a grant would be in
conflict not by extending the grant to goods borne in foreign
vessels, but by suspending the grant entirely while such privileges
exist.
6 Cust.App. 291 reversed.
The case is stated in the opinion.
Page 243 U. S. 105
MR. JUSTICE HOLMES delivered the opinion of the Court.
In these cases, the Court of Customs Appeals has held that, by §
IV, paragraph J, subsection 7, of the Act of October 3, 1913, c.
16, 38 Stat. 114, 196, merchandise imported in the registered
vessels of the United States, or in the registered vessels of other
nations entitled by treaty to pay no higher duties than those
levied upon vessels of the United States, is granted a discount of
5 percent upon the duties imposed by the act. Following an
enactment that, except as otherwise specially provided in the
statute, duties should be levied upon all articles imported from
any foreign country at the rates prescribed in the schedules, the
above-mentioned subsec. 7 is as follows:
"That a discount of five percentum on all duties imposed by this
Act shall be allowed on such goods, wares, and merchandise as shall
be imported in vessels admitted to registration under the laws of
the United States:
Provided, That nothing in this
subsection shall be so construed as to abrogate or in any manner
impair or affect the provisions of any treaty concluded between the
United States and any foreign nation."
More or less complete reciprocity is established by treaty with
nearly all the commercial countries of the world, and the discount
of 5 percentum was extended by the Court of Customs Appeals to
goods imported in vessels of Belgium, the
Page 243 U. S. 106
Netherlands, Great Britain, Austria-Hungary, Germany, Italy,
Spain, and Japan.
The government contends that, while the subsection may indicate
a reversal of the policy of reciprocity that has prevailed more or
less for the better part of a century, Rev.Stats. § 4228, it relies
upon future negotiations to make the change effective, and suspends
action while the present treaties remain in force, since it could
not give the discount to merchandise in American bottoms alone
without breaking the numerous treaties to which we have referred.
The argument on the other side is that the words of the subsection
are satisfied by extending the discount to goods from all the
treaty countries, whereas, by the construction contended for by the
government, they are emptied of meaning, or at least of present
effect. We are of opinion that the government is right, and, as the
meaning of the words seems to us to be intelligible upon a simple
reading, and to be fortified by the facts preceding their adoption,
we shall spend no time upon generalities concerning the principles
of interpretation.
We have a clear opinion as to what the subsection means if the
words are taken in their natural, straightforward, and literal
sense. It grants a discount only to goods imported in vessels
registered under the laws of the United States, and conditions even
that grant upon its not affecting treaties. There is a strong
presumption that the literal meaning is the true one, especially as
against a construction that is not interpretation, but perversion;
that takes from the proviso its ostensible purpose to impose a
condition precedent, in order to universalize a grant that purports
to be made to a single class, and to do so notwithstanding the
express requirement of the statute that specified rates should be
paid. Nobody would express such an intent in such words unless in a
contest of opposing interests, where the two sides both hoped to
profit by an ambiguous phrase. But the section is
Page 243 U. S. 107
not ambiguous on its face, and there is no sufficient ground for
creating an ambiguity from without when it is considered that the
purpose to favor American shipping was the manifest inducement for
putting the subsection in.
The tariff bill as it first passed the House granted an
exemption in favor of American shipping without the proviso. The
clause was struck out by the Senate, and after it had been pointed
out that such an enactment would violate many treaties, there was a
conference which led to the passage of the subsection in its
present form. It seems to us obviously more reasonable to suppose
that Congress was content to indicate a policy to be pursued when
possible than that, by circuitous and inapt language, it enacted
that there should be a general discount from the rates specifically
directed to be charged. That the subsection means what it says and
no more seems to us still plainer when it is considered that,
without going into nice calculation, the benefit to American
shipping of such a general discount would be at least
problematical, and certainly would be relatively small. A grant in
present terms, subject to a condition precedent, is familiar to the
law, and is not unknown in grants of the present kind.
Dunlap
v. United States, 173 U. S. 65.
There was some discussion at the bar and in the court below upon
the question whether the treaties operated as laws or were simply
executory contracts, but it seems to us superfluous. If the statute
bore the meaning attributed to it below, it granted the discount to
the nations having treaties of reciprocity, even if those treaties
were only contracts. As, in our opinion, the subsection means what
it says, it grants the discount to none.
Judgments allowing the discount of five percentum
reversed.
MR. JUSTICE DAY is of opinion that the statute was interpreted
correctly by the Court of Customs Appeals, and therefore
dissents.
* The docket title of these case are: No. 149,
United States
v. M. H. Pulaski Co., et al.; No. 150,
United States v. R.
B. Henry Co., et al.; No. 151,
United States v. James
Elliott Co., et al.; No. 152,
United States v. J. Wile
Sons & Co.; No. 153,
United States v. Robert Muller
& Co.; No. 154,
United States v. Wood & Selick, et
al.; No. 155,
United States v. E. La Montane's Sons;
No. 156,
United States v. Albert Lorsch & Co., et al.;
No. 157,
United States v. Cullman Brothers, et al.; No.
158,
United States v. G. W. Faber, Inc.; No. 159,
United States v. Louis Meyers & Son; No. 160,
United States v. William Openheim & Sons, et al.; No.
161,
United States v. Park & Tilford; No. 162,
United States v. Selgas & Co.