1. Ports in the Canal Zone are to be regarded as foreign ports
within the meaning of Rev.Stats. § 4009, U.S.Code, Title 39, § 654,
dealing with the compensation allowable for transportation of mail,
by United States ships, between the United States and "any foreign
port." P.
280 U. S.
177.
So
held because of a long continued legislative and
administrative construction of the section in its application to
the Canal Zone, and without regard to whether, under the treaty of
cession, titular sovereignty over the Zone remains in the Republic
of Panama.
2. In case of ambiguity, a construction of a statute by the
department charged with its execution should be favored by the
courts, and, where such construction has been acted on for a number
of years, they will look with disfavor upon any sudden change
whereby parties who have contracted with the government on the
faith of it may be prejudiced. P.
280 U. S.
182.
66 Ct.Cls. 679 reversed.
Certiorari, 279 U.S. 831, to review a judgment dismissing a
claim for a balance due the steamship company for transporting
mails.
Page 280 U. S. 176
MR. CHIEF JUSTICE TAFT delivered the opinion of the Court.
This was a suit in the Court of Claims by the Luckenbach
Steamship Company, petitioner, against the United States, to
recover $30,370.94, claimed by the petitioner as a balance due for
transporting mails of the United States, in steamships of United
States registry, between ports of the United States and ports in
the Canal Zone from December 1, 1925, to June 30, 1926. Judgment
went against the petitioner, 66 Ct.Cls. 679, and a petition to this
Court for a review on certiorari was granted.
That the petitioner rendered the service stated and did so at
the request of the Postmaster General is not questioned. The only
matter in dispute is the true measure of compensation. The
Postmaster General allowed the sum of $82,851.62 and transmitted
approved vouchers therefor to the General Accounting Office for
direct settlement, but that office reduced the allowance to
$52,480.68, and caused this reduced sum to be paid to the
petitioner. Thereupon suit was brought for the balance.
The Postmaster General, in making his allowance, proceeded on
the theory that the compensation was to be determined according to
§ 4009 of the Revised Statutes, but the General Accounting Office
regarded that section as inapplicable. If the section was
applicable, the Postmaster
Page 280 U. S. 177
General's allowance was right, and should have been given effect
by the Court of Claims.
Section 4009, which originally was part of the Act of June 8,
1872, c. 335, § 269, 17 Stat. 316, consolidating and amending the
statutes relating to the Post Office Department, reads as
follows:
"Sec. 4009. For transporting the mail between the United States
and any foreign port, or between ports of the United States
touching at a foreign port, the Postmaster General may allow as
compensation, if by a United States steamship, any sum not
exceeding the sea and United States inland postage, and if by a
foreign steamship or by a sailing vessel, any sum not exceeding the
sea postage, on the mail so transported."
The specific point of difference between the Postmaster General
and the General Accounting Office was that the former treated the
ports in the Canal Zone as foreign ports within the meaning of that
section, while the latter regarded them as domestic ports.
The rights possessed by the United States within the Canal Zone
were acquired from the Republic of Panama under the Treaty of
November 18, 1903, 33 Stat. 2234. The Zone has a width of 10 miles
and extends across the Isthmus of Panama and into the sea at either
end for a distance of 3 marine miles from mean low water mark; but
the Cities of Panama and Colon and the harbors adjacent to them,
although within the outer boundaries of the Zone, are expressly
excepted thereunder by the second article of the treaty.
Whether the grant in the treaty amounts to a complete cession of
territory and dominion to the United States, or is so limited that
it leaves at least titular sovereignty in the Republic of Panama,
is a question which has been the subject of diverging opinions
* and is much
discussed in the
Page 280 U. S. 178
briefs. But, for the purposes of this case, the construction of
the treaty in that regard need not be examined as an original
question, and this because a long continued course of legislative
and administrative action has operated to require that the ports in
the Canal Zone be regarded as foreign ports within the meaning of §
4009.
By the Act of March 2, 1905, c. 1311, 33 Stat. 843, which came
within less than two years after the treaty, Congress declared that
the laws regulating the importation of merchandise and the entry of
persons into the United States from foreign countries should apply
to and control the importation of merchandise and the entry of
persons from the Canal Zone into any state or territory of the
United States or the District of Columbia, and on September 8,
1909, 27 Op. Attys.Gen. 594, the Attorney General, in an opinion
given to the Secretary of War, held that the Canal Zone was not a
possession of the United States within the meaning of the Tariff
Act of August 5, 1909, c. 6, 36 Stat. 11, imposing specified rates
of duty upon various articles when imported from a foreign country
into the United States or "into any of its possessions."
In 1911 the Postmaster General, being authorized by an Act of
March 3, 1891, c. 519, 26 Stat. 830, to arrange for the
transportation of mails in American steamships between ports in the
United States and foreign ports, submitted to the Attorney General
the question whether, as respects mails largely intended for the
cities of Colon and Panama, it would be within the letter and
spirit of that act to arrange for the carrying of such mails from
the ports of New York and San Francisco to the government docks at
Cristobal and Balboa in the Canal Zone. The Attorney General
responded in the affirmative, saying, 29 Op. Attys.Gen.194,
196:
"It appears from the papers transmitted by you that it will be
more convenient for the vessels contracting for
Page 280 U. S. 179
this mail service to use principally the government docks, which
are being constructed at Cristobal on the Atlantic side and Balboa
on the Pacific side, and the question arises whether, by using
these docks, which are in close proximity to, but outside the
limits of, the Cities of Colon and Panama and within the Canal
Zone, and vessels would be carrying mails to foreign ports. It is
stated in this connection that docking the large vessels at the
Cities of Colon and Panama would result in serious loss of time,
and that the actual call at these places could be obviated by the
use of a tender to meet the vessels upon entering the 'harbor
adjacent to these ports' to receive and deliver the mail in Colon
and Panama, the vessels then proceeding to the government docks at
Cristobal and Balboa."
"It has been held that the purpose of the Act of March 3, 1891,
is 'to promote the carriage of the ocean mails in ships of American
register, and thereby to promote ocean commerce in American
bottoms,' and that this statute, 'designed to promote foreign
commerce, is entitled to a liberal construction, with a view to
carrying out the purpose of its enactment.' 20 Op. 98, 101."
"In my opinion, the service proposed is in substantial
compliance with the letter and spirit of the statute, as being
between 'ports of the United States' and 'ports of foreign
countries.' The word 'port' is not limited in its application to
the city which bears the same name, but has been defined as
including the entire harbor, within its inclosures and projections
of land, where ships take refuge and seek shelter [citing
authorities]. Construing the word 'port' as synonymous with
'harbor,' the vessels unquestionably would be carrying the mails to
a foreign port if they entered the harbor, since the treaty
reserves to Panama not only the cities of Panama and Colon, but
also 'the harbors adjacent to said cities.' In any event, I think
that carrying the mails upon such vessels within
Page 280 U. S. 180
such close proximity to said cities that they might safely be
landed in a small boat would be a substantial compliance with the
terms of the act."
By § 12 of an Act of August 24, 1912, c. 390, 37 Stat. 569,
Congress, while extending to the Canal Zone the laws of the United
States relating to extradition and the rendition of fugitives from
justice, declared that, for such purposes, "and such purposes
only," the Zone should be treated as an organized Territory of the
United States, and, by § 9 of an Act of August 21, 1916, c. 371, 39
Stat. 529, Congress provided that the laws of the United States
relating to seamen of vessels of the United States when "on foreign
voyages" should apply to the seamen of all vessels of the United
States when in the Canal Zone.
In 1925, the Department of Labor, construing a provision in the
Immigration Act of February 5, 1917, c. 29, 39 Stat. 874, relating
to seamen on board vessels arriving in the United States from "any
foreign port or place," ruled that the ports in the Canal Zone
should be deemed foreign ports in the sense of that act, Par. 4,
Rule 6, Immigration Laws and Rules of 1925, and in 1926 the
Comptroller General held that, as ports in the Canal Zone are
considered foreign ports in the absence of special provision to the
contrary, an alien seaman shipping on an American vessel from a
port in the Canal Zone is limited in the matter of relief to such
as may be extended to an alien seaman shipping on an American
vessel from a foreign port. 5 Dec.Comp.Gen. 647.
True, there have been instances in which Congress specially
provided that, for particular purposes, the Canal Zone should be
treated as a territory or possession of the United States. This is
illustrated in the provision already cited relating to extradition
and the rendition of fugitives from justice, and in the acts
relating to the liability of carriers by railroad for injuries
suffered by their employees, Act April 22, 1908,
Page 280 U. S. 181
c. 149, 35 Stat. 65; to espionage, Act June 15, 1917, c. 30,
title 13, 40 Stat. 231, and to sabotage, Act April 20, 1918, c. 59,
40 Stat. 533. But the purposes for which these special provisions
were made were such that nothing was subtracted thereby from the
force of the provisions before mentioned, wherein, for purposes
connected with importation, immigration and ocean transportation
between the United States and the Canal Zone, Congress required
that ports in the latter be regarded as foreign ports.
For a period of years and continuously to December 1, 1925, the
Postmaster General tendered to the petitioner, and the latter
accepted for transportation in American steamships, and so
transported for the United States, large quantities of mail between
the United States and ports in the Canal Zone, and for this service
the petitioner was paid the compensation intended by § 4009 -- the
Postmaster General and the accounting officers treating the ports
in the Canal Zone as foreign ports in the sense of that
section.
The service just described was continued without break into and
through the period here in controversy -- December 1, 1925, to June
30, 1926 -- and the Postmaster General, still treating the Canal
Zone ports as foreign ports, allowed the same compensation as
before. For this period, and this alone, the accounting officers
declined to regard those ports as foreign ports. The service was
continued after the period in question, and, for this later
service, the Postmaster General and the accounting officers
concurred in allowing the compensation intended by § 4009, the
accounting officers resting their assent upon an Act of Congress of
July 3, 1926, c. 793, 44 Stat. Part 2, p. 900.
It thus appears, as was said by the Postmaster General in a
letter of July 23, 1926, to the petitioner, that the Post Office
Department, from the outset and continuously up to and through the
period in question, "considered
Page 280 U. S. 182
the service to the Canal Zone as being in the same category as
that to a foreign country," and approved compensation vouchers on
that basis.
This recitation of pertinent legislative and administrative
action demonstrates that this case is one in which we should apply
the rule announced in
United States v. Alabama Great Southern
R. Co., 142 U. S. 615,
142 U. S. 621,
where it was said:
"We think the contemporaneous construction thus given by the
executive department of the government, and continued for nine
years through six different administrations of that department -- a
construction which, though inconsistent with the literalism of the
act, certainly consorts with the equities of the case -- should be
considered as decisive in this suit. It is a settled doctrine of
this Court that, in case of ambiguity, the judicial department will
lean in favor of a construction given to a statute by the
department charged with the execution of such statute, and, if such
construction be acted upon for a number of years, will look with
disfavor upon any sudden change whereby parties who have contracted
with the government upon the faith of such construction may be
prejudiced."
Our conclusion also has obvious support in the Act of July 3,
1926,
supra, whereby § 4009 was reenacted in a form which
undoubtedly puts ports in the Canal Zone on the same plane as
foreign ports for the purposes of that section. The committee
reports relating to that enactment show that it was particularly
designed to meet and avoid the adverse ruling of the General
Accounting Office, and to continue the prior course of action
respecting the measure of compensation to be paid for carrying
mails between the United States and the Canal Zone; that it was
intended to recognize, as the prior practice did, that, for "all
practical purposes," such mails "are foreign mails;" and that the
purpose of the act was not to
Page 280 U. S. 183
alter the rates paid to American ships, "but to clarify the
law." House Report No. 1305, 69th Cong. 1st.Sess.; Senate Report
No. 1096, 69th Cong. 1st Sess.; House Report No. 1788, 70th Cong.
1st.Sess.; Annual Report Postmaster General, 1927, p. 46.
We hold, therefore, that, on the findings of the Court of Claims
set forth in the record, judgment should have been given the
petitioner for the balance of $30,370.94.
Judgment reversed.
* 20 Am.Journal International Law, pp. 120-122; Isthmian
Highway, Miller, p. 221;
Wilson v. Shaw, 204 U. S.
24,
204 U. S.
32-33.