The Lace House v. United States

141 F. 869, 73 C.C.A. 103, 1905 U.S. App. LEXIS 4054

• Court: Court of Appeals for the Fifth Circuit
• Decided: December 12, 1905
• Docket: No. 1,454
• Status: Published

Opinion

SHELBY, Circuit Judge,

áfter making the foregoing statement of the case, delivered the opinion of the court. .

The merchandise condemned by the judgment of the Circuit Court was shipped from London, England, to New York, the port of arrival, and was forwarded to Atlanta, Ga., the port of entry. The invoice described the case of goods as consisting of lace and embroidery, and stated their value in English money. The claimant, by its president, paid the duty on the goods according to the invoice. There were in the case three lace dresses—in a separate package—on which the duty was not paid; the government’s officer declining to receive the same, because the dresses were not listed in the invoice. The surveyor at the port of Atlanta had no knowledge of the value of laces. He wrote and sent samples of the lace to an appraiser in and for the port of New York for expert advice on the subject, and received a reply inclosing a list and description of the laces by pattern numbers, and a statement of their value per metre, auné, and dozen, in the currency of Switzerland and Saxony, the countries where the laces and embroideries were made. The Atlanta surveyor’s clerk, Smith Easley, made a calculation of the value of the goods as shown in the invoice, and as shown in the statement sent the surveyor from New. York, and found that, among the many packages contained in the case, there were three “that amounted to 66 per cent, by the appraised value more than the invoice price.” By the appraised value the witness meant the value as'stated on the list sent the surveyor from New York in answer to his inquiry. “Each of these separate items,” said the witness, “exceeded 50 per cent, by appraised value over the value given in the invoice.” The surveyor, Markham, testified that on the receipt of the list with the valuation of the laces, sent in answer to his letter, he adopted the same as his appraisement. No written appraisement was made by the surveyor in any manner. No notice of any kind was given to the claimant, the consignee, or to any one, that any change had been made of the valuations stated in the invoice. The court received the evidence offered, and held that it proved a valid appraisement of the goods, and directed the jury to return a verdict for the government and against the claimant. The correctness of these rulings presents the questions to be decided. The court directed the verdict for the government because the appraised value of the merchandise exceeded the value declared in the entry by more than 50 per centum. The part of the statute directly in point (Tariff Act July 24, 1897, c. 11, § 32, 30 Stat. 211 [U. S. Comp. St. 1901, p. 1924]) was quoted by the court in its instruction to the jury, and is copied in the foregoing statement of the case. The entry is presumptively fraudulent when the “appraised value of the merchandise exceeds,” etc. To make the statute applicable there must be a legal appraisement. The correctness of the court’s rulings, therefore, depends on the legality of the appraisement in question.

It should be noted 'in the beginning that the act of February, 1881, made Atlanta, Ga., a port of delivery and provided for the appointment of only “a surveyor of customs.” Act Feb. 28, 1881, c. 92, 21 Stat. 373 [U. S. Comp. St. 1901, p. 1753]. There is no collector at the port of Atlanta, and no appraiser. At a port of delivery where there is no collector the surveyor may be invested with such of the powers and duties of collectors as are appropriate to such ports. Rev. St. U. S. §§ 2628, 2629 [U. S. Comp. St. 1901, pp. 1811, 1812]; Customs Regulations (1899) art. 1612. And where there are no appraisers, appraisement may be made by the collector or other proper officer. Customs Regulations (1899) arts. 1241, 1603. It is true, therefore, as contended by the United States Attorney, that Markham, as surveyor of customs of the port in which the merchandise had been entered, had the authority “to cause the actual market value or wholesale price at the period of exportation, in the principal markets of the country from which the same has been imported, to be appraised, and such appraised value shall be considered the value upon which duty shall be assessed” (Rev. St. U. S. § 2906 [U. S. Comp. St. 1901, p. 1923]), and that he was authorized to ascertain this value by “the use of all reasonable ways and means in his power.” Act June 10, 1890, c. 407, §10, 26 Stat. 136 [U. S. Comp. St. 1901, p. 1922]. There being no collector and no appraiser at the port, Markham, the surveyor, was charged with the duty of appraisement. He had no knowledge of the value of the goods. Therefore, by sending samples, he sought information on the subejct. His right to use Whitehead’s letter and the statement it contained, or any other available means is unquestioned. The statute clearly confers such right on him. He testified: “I made the statement attached to that letter my appraisement of the goods.” It may be conceded that the letter and statement contained sufficient information from which the surveyor could have made an appraisement of the goods. That is immaterial. The controlling question is, did he make a valid appraisement as required by law ? Is it not required by law that the appraisement should be shown by some writing, memorandum, or certificate, signed by the officer making it? These questions are answered, we think, by the statutes:

“Where merchandise shall be entered at ports where there are no appraisers, the certificate of the revenue officer to whom is committed the estimating and collection of duties of the dutiable value of any merchandise required to be appraised, shall be deemed and taken to be the appraisement of such merchandise required by law to be made by such officer.” Rev. St. § 2950 [U. S. Comp. St. 1901, p. 1940].

And in Act June 10, 1890, c. 407, § 13, 26 Stat. 136 [U.' S. Comp. St. 1901, p. 1932], it is enacted that:

“At ports where there Is no appraiser, the certificate of the customs officer to whom is committed, the estimating and collection of duties, of the dutiable value of any merchandise required to be appraised, shall be deemed and taken to be the appraisement of such merchandise.”

By article 1246, Customs Regulations (1899), it is made the duty of the officer acting as appraiser “to appraise the actual market value,” etc. “These facts will be indorsed upon the invoice and signed by the appraiser * * and article 1266 requires that the advances on invoices shall be made, “by writing on the invoice opposite each item advanced the words, ‘Add to make market value,’ stating in numerals the amount necessary to make the price per unit.”

While these regulations are valuable as showing the practical construction placed by the Treasury Department on the customs laws, we understand, of course, that many of them are merely directory, and that an appraisement might be valid and yet not in strict conformity with every requirement of the rules prescribed. U. S. v. Loeb, 107 Red. 692, 46 C. C. A. 562. But looking to the statutes themselves we cannot avoid the conclusion that it was intended that the appraisement should be reduced to writing. Commenting on the regulations and statutes we have cited, the Treasury Department on May 26, 1904, in a formal letter of advice to collectors as to their duties when acting as appraisers, informed them that “the certificate of the collector is the legal evidence of appraisement.” And the Secretary added:

“And the certificates or the returns of values on invoices of goods, in order to be accepted as final, must be signed by you in your official capacity as appraiser, as required by law.” 7 Treasury Decisions, pp. 844, 845 (T. D. 25,321).

There are other statutory provisions that point to the same conclusion. If the importer of merchandise is dissatisfied with the appraisement, he may within two days give notice to the collector in writing and require a reappraisment (section 13, 26 Stat. 137 [U. S. Comp. St. 1901, p. 1932]), and on the reappraisement being made by the appraiser the consignee was entitled to an appeal to 'the board of three general appraisers. Customs Regulations (1899) art. 1274. Unless the appraisement is put in writing and signed, or in some way identified by the officer making it, and notice of it be given, it seems impossible to give effect in practice to the statutes intended to allow a review of the appraisement. This right of review is a valuable one, and a construction of the statutes that ignores it cannot be correct. The fact that the statute confers on the importer or consignee the right to require within two days after the appraisement a reappraisement indicates that it was the intention that the appraisement should be in writing, and that notice should be given to the owner or consignee. The Treasury Department evidently puts that construction on the statutes, because such notice is required to be given by its regulations. “The addition made by the appraiser having been thus noted on the invoice and certified by him [referring to procedure under article 1266], the invoice will be forwarded to the collector, who will at once give notice of the advance to the importer.” Customs Regulalions (1899) art. 1267. The notice required to be given by the Treasury Department states that the “merchandise has been appraised in accordance with law,” and states the amount which the appraisement exceeds the amount declared as the value on entry. And the notice •concludes:

“If you appeal from this appraisement, it will be necessary to do so within two official days after the day of this notice.”

When the goods are legally appraised, the fact that they are seized for undervaluation does not deprive the consignee or owner of the right of reappraisement. It is in just such cases that the right is most valuable. In the case of United States v. Nasser, heard before Judge Grosscup in 1894, the appraisement of the goods had been made in the usual manner, but the surveyor of customs denied the importer the right to appeal, because the goods were then under seizure for violation of the customs laws, and the court said “that as the defendant had been denied the full right of appeal the lawful appraisement •on which to base- the government’s claim is wanting. * * * ” Synopsis of Decisions, Treasury Dept. (1894) T. D. 14,778, p. 185. Where the appraisement is not made in writing, and no notice of it is given to the consignee, who is the claimant, the claimant being thereby deprived of the right to demand reappraisement, it seems to us that the intention of the statutes would be defeated should we hold that such appraisement was valid and a proper basis for the forfeiture •and condemnation of the goods. We are of opinion that the record •does not show such a compliance with the statutes and treasury regulations as to make the appraisement binding on, and conclusive against, ■the claimant, and that the evidence offered to show an appraisement ■should have been excluded on the claimant’s objections, and that there was error in directing a verdict for the government.

No questions are raised by the record making it necessary to comment on the fact that the case contained three lace dresses which were not listed on the invoice. Collectors and other officers of the customs liave directions from the Treasury Department as to the return to make on the invoice in such cases. It is sufficient to say now that the fact that the dresses were not on the invoice did not justify the instructions given the jury.

The judgment of the District Court is reversed, and the cause remanded, with instructions to grant a new trial.