Thomas v. United States

Hatfield, Judge,

delivered the opinion of the court:

This is an appeal from a judgment of the United States Customs Court.

Merchandise, consisting of lcnit .wool wearing apparel, not scalloped, was assessed for duty by the collector at the port of New York as “knit lace wearing apparel” at 90 per centum ad valorem under paragraph 1430 of the Tariff Act of 1922, the pertinent part of which reads as follows:

Par. 1430. Laces, lace window curtains, burnt-out laces and embroideries capable of conversion into burnt-out laces, nets and nettings, embroidered or otherwise, veils, veilings, fiouncings, alLovers, neck rufflings, fiutings, quillings, ruchings, tuckings, insertings, galloons, edgings, trimmings, fringes, gimps, *278ornaments; braids, loom woven and ornamented in the process of weaving, or made by hand, or on any braid machine, knitting machine, or lace machine;, and all fabrics and articles composed in any part, however small, of any of the foregoing fabrics or articles; all the foregoing, finished or unfinished (except materials and articles provided for in paragraphs 920, 1006, 1404, 1406, and 1424 of this Act), by whatever name known, and to whatever use applied, and whether or not named, described, or provided for elsewhere in this Act, when composed' wholly or in chief value of yarns, threads, filaments, tinsel wire, lame, bullions, metal threads, beads, bugles, spangles, or products of cellulose provided for in paragraph 1213 of this Act, 90 per centum ad valorem; * * *.

The importer protested, claiming that the merchandise was not. dutiable as assessed by the collector, but that it was properly dutiable,, alternatively, under various paragraphs of that act.

However, there was no claim in the protest that the merchandise was properly dutiable as knit wbol wearing apparel under paragraph 1114 of that act, the pertinent part of which reads as follows:

Pab. 1114. * * *
Outerwear and other articles, knit or crocheted, finished or unfinished, wholly or in chief value of wool, and not specially provided for, * * * valued at more than $2 per pound; 45 cents per pound and 50 per centum ad valorem.

In view of the fact that the paragraphs claimed in the protest are not relied upon by appellants, -we deem it unnecessary to quote them here.

In his answer to the protest, dated May 29, 1929, the appraiser reported as follows:

The merchandise marked “A” consists of knit wool wearing apparel, not scalloped, returned as knit lace wearing apparel at 90 per centum, paragraph 1430, act of 1922. Merchandise of this character in T. D. 43013 was held to be not lace articles or articles made from lace. Following the principle laid down in the above decision, merchandise of this character would now be returned as knit wool wearing apparel valued at more than $2 per pound at 45 cents per pound and 50 per centum ad valorem under paragraph 1114 of the same act, as now reported on the invoice.
Note T. D. 43152. (Italics ours.)

The collector’s letter, dated June 13, 1929, transmitting the papers to the United States Customs Court, was, according to the record, received by the clerk of that court June 15, 1929.

On July 24, 1930, counsel for the parties signed the following stipulation:

It is hereby stipulated and agreed by and between the Assistant Attorney General and the attorneys for the plaintiff:
That the appraiser’s report and collector’s letter may be incorporated herein and that the items marked “A” are the same type and character as those decided' in T. D. 43013.
That the record in T. D. 43013 may be incorporated and the case submitted.

The stipulation, according to the record, was not received by the ■clerk of the United States Customs Court until September 5, 1930.

*279Thereafter, on October 20, 1930, the court below, in an opinion by Tilson, Judge, rendered its decision in the case, holding that the merchandise was not dutiable as assessed by the collector, but that it was properly dutiable at 45 cents per pound and 50 per centum ad valorem under paragraph 1114, supra. In concluding'its decision, the court said:

* * * However, as plaintiffs failed to make any claim under paragraph 1114 of the Tariff Act of 1922, the protest-is overruled, without affirming the action of the collector as to the items of merchandise marked “A.” Let judgment be entered accordingly.

On the same date, October 20, 1930, judgment was entered in accordance with the court’s decision. Thereafter, on October 22, 1930, counsel for appellants filed a motion petitioning the court to set aside its decision and the submission of the cause, and requesting that the case be placed upon the “calendar.” The motion reads as follows:

Upon the annexed affidavit and the facts set forth therein, the attorneys for the plaintiffs herein move that the submission and decision in the above-entitled case be set aside and the case placed upon the calendar.

In support of the motion, and annexed thereto, appears the affidavit of Mary Rehan, which, due to its importance, we quote:

Mary Rehan, being duly sworn, deposes and says: That protest 357839-G/12363, covering an entry by Thomas & Pierson for the account of Elizabeth Arden, arrived at the United States Customs Court.
That in enumerating the claims in the protest against the assessment of duty at 90 per centum ad valorem, the principal claim that the merchandise was properly dutiable at the rate of 45 cents per pound and 50 per centum ad valorem under paragraph 1114 of the Tariff Act of 1922 was omitted through error. That the appraiser in his report to the collector described the merchandise as knit wool wearing apparel and stated that the items marked “A” were properly dutiable under paragraph 1114.
That just before going on her vacation and upon the arrival of this case at the court, the deponent drew a stipulation which was rechecked by the appraiser, who passed the merchandise as being true in fact, and that the items marked “A” were the same type and character as those in T. D. 43013.’
That while on her vacation and following instructions from'deponent, Mr. King, of her office, presented the stipulation to Mr. Peter A. Abeles, of the Assistant Attorney General’s office. Said stipulation was signed and returned, with other papers for action, on deponent’s desk at the court.
The deponent, according to her best memory and belief, returned from her vacation a day or so after the signing of this stipulation. That the case has never appeared upon the docket and the deponent believed that it had been put back in the files so as to be properly placed upon the docket so that a motion to amend under section 514 might be filed.
That through error, the protest was submitted, with other protests upon which the deponent had been working and the deponent had no knowledge that this case had been tubmitted, but was under the impression that it had been returned to the files to be properly docketed. That the decision in this case was the first notice to the deponent that the case had been submitted.
*280Wherefore, because of this mistake on the part of the deponent, she now moves the court to set aside the submission which was made through error and to set aside the decision which is the result of this submission. (Italics ours.)
Maky Rbhan.

Thereafter, on November 14, 1930, the court below denied the motion of appellants in the following language:

The motion for rehearing in this case is hereby denied. Judgment will be entered accordingly.

The judgment was duly entered, and appellants appealed to this court.

It is contended by counsel for appellants that the stipulation submitting the cause to the court below, and upon which the case was decided, was inadvertently filed with the papers in the case; that counsel had no intention of submitting the cause until the same had been placed on the trial calendar and an opportunity afforded appellants to file a motion for leave to amend the protest, claiming the merchandise to be dutiable, as stated by the appraiser in his report, at 45 cents per pound and 50 per centum ad valorem under paragraph 1114, supra; that counsel had no idea that the stipulation had been filed and the cause submitted until they were notified of the court’s decision; that, as the case had never appeared on the calendar, and, as there had never been any “docket call thereof,” appellants had a right, under the provisions of section 514 of the Tariff Act of 1922, to amend the protest, subject, of course, to the legal discretion of the court below; that, it having been made to appear to the court that the cause was submitted inadvertently and unintentionally, the denial of appellants’ motion to set aside the judgment and the submission of the cause was an abuse of discretion; and that, therefore, the judgment should be reversed.

It is contended by counsel for the Government that the filing of the stipulation, submitting the case to the court, constituted—

(1) Either a first docket call; or
(2) That there was a waiver of the right to amend the protest in the case; and
(3) That the importers were willing to have all the formalities put aside, that is, of placing the case on the calendar of the court, and of having the case called for trial, in the hope of bringing the issues in the ease before the court for a decision to avoid the necessity of trial.

Counsel for the Government further contends that the provisions of section 514 of the Tariff Act of 1922, granting importers the right to amend a protest, in the discretion of the court, “at any time prior to the first docket call thereof,” were intended to require importers to define the issues in the case prior to the trial thereof in order to enable the Government to properly prepare and present its case to the court; that the court below was without power to set aside its *281decision and the submission of the cause and place the case on the calendar for the purpose of permitting an amendment to the protest; and that, therefore, the judgment below should be affirmed.

It appears from the record that the case never appeared on the court’s trial- calendar or docket, .and that there-had never been a calendar or docket call thereof.

Section 514 of the Tariff Act of 1922 provides, among other things, that “under such rules as the Board of General Appraisers may prescribe and in its discretion, a protest may be amended at any time prior to the first docket call thereoj.” (Italics ours.)

Rule 5 of the rules of the United States Customs Court, adopted December 22, 1930, provides that the clerk of that court—

* * * shall designate a clerk, to be known as the calendar clerk, whose duty it shall be to prepare for the several divisions, with the approval of the judges thereof, trial calendars of cases that are-properly cognizable before them, placing on the calendar, in the order of their filing, s,uch cases as may be disposed of conveniently.

Rule 14 of that court provides, in part, as follows:

In all cases on the New York calendars the parties plaintiff, or their attorney of record, and all other persons who may be entitled thereto, shall be given ten days’ notice by mail of the day and hour set for the call of the calendar.

Section 518 of the Tariff Act of 1922, so far as the same.is pertinent to the issues here, provides:

* * * The board of three general appraisers deciding a case or a general appraiser deciding an appeal for a reappraisement may, upon the motion of either party made within thirty days next after such decision, grant a rehearing or retrial of said case when, in the opinion of said board or said general appraiser the ends of justice so require.

It must have been obvious to the court below, at the time its original decision was rendered, either that the case had been inadvertently submitted, or that counsel representing the importers were acting without regard to their obligations as members of the bar of that court. It plainly appeared at that time, as stated by the court in its decision, that the proper, paragraph of the tariff act had not been claimed in the protest, and, as this fact appeared from the report of the appraiser, made a part of the record by stipulation, it was evident that counsel for importers were fully aware of it. Accordingly, the court could not have been taken by surprise when the motion to set aside its judgment and the submission of the cause, supported by an affidavit showing that the cause had been inadvertently and unintentionally submitted, was filed by counsel for appellants. Nevertheless, being fully advised in the premises, the court denied the motion.

It is unthinkable that the court could have doubted the truth of the allegations contained in the affidavit. The allegations were not only *282consistent with all the facts and circumstances of record, and were not denied by the Government, but they were made by a member of the bar of that court. It plainly appeared from the affidavit, at the time the motion was overruled, that the cause had never been submitted with the intelligent consent of counsel for appellants. The court must have been of opinion that, under the circumstances, it was without power to permit an amendment to the protest; otherwise, the motion would undoubtedly have been granted.

There was no express waiver of the right to amend the protest and, as the cause was submitted unintentionally' and inadvertently by counsel for appellants, there was nothing upon which a waiver by implication could be founded. At the time of the oral arguments in this court, counsel for the Government stated that the facts as stipulated by the parties warranted the concession that the merchandise was erroneously assessed by the collector and that it was properly dutiable under paragraph 1114,- supra, as held by the court below. Substantially the same concession is made in the Government’s brief. This being so, the Government was not misled to its prejudice or otherwise, and the doctrine of waiver by estoppel is not involved. See 40 Cyc. 254 et seg.

Accordingly, as there was no waiver of the right to amend the protest and, as there had never been any docket call thereof, the court had the power to set aside its decision and the submission of the cause, and place the case on the calendar so that the protest could be amended. Having the power to act, the court’s failure to do so can not be defended by invoicing the legal proposition that the motion was addressed to its discretion. The motion was addressed to the legal, not to the arbitrary or capricious, discretion of the court. In view of the uncontradicted facts of record, we think it was the positive duty of the court under the law, in order to prevent a miscarriage of justice, to have sustained the motion. Draeger Shipping Co. v. United States, 13 Ct. Cust. Appls. 419, T. D. 41341. See also Monroe-Goldkamp Co. v. United States, 13 Ct. Cust. Appls. 545, T. D. 41429; Bache & Co. v. United States, 6 Ct. Cust. Appls. 507, T. D. 36128.

The facts and the law involved in the case at bar were conceded by all concerned. Were this not so, a different situation would, of course, be presented.

The primary duty of the courts of the United States is to do justice under the law. A failure in this regard, the opportunity being afforded, can never be defended, and any attempt to do so must of necessity be based on a denial of the existence of those fundamental principles of justice upon which courts are founded.

The judgment is reversed and the cause remanded for proceedings consistent with the views herein expressed.