C. J. Tower & Sons v. United States

Garrett, Chief Judge,

delivered the opinion of the court:

This is an appeal from the judgment of the United States Customs Court, Second Division, entered pursuant to its decision (C. D. 1595, 32 Cust. Ct. 138) overruling a protest on behalf of the importer against the collector’s classification and duty assessment of elevator sill plates (frequently referred to throughout the record as “feralum sill plates”) under paragraph 397 of the Tariff Act of 1930, as modified by the General Agreement on Tariffs and Trade, T. D. 51802, 82 Treas. Dec. 305. Duty was assessed at the rate of 22K per centum ad valorem.

■ Appellant claimed the sill plates to be properly classifiable and dutiable at 10 per centum ad valorem under paragraph 312 of the 1930 tariff act, as modified by the same General Agreement on Tariffs and Trade.

The pertinent portions of the involved paragraphs of the Tariff Act of 1930, as modified, read as follows:

Par. 397. Articles or wares not specially provided for, whether partly or wholly manufactured:
Hi * H* * H^ H* Hs
Composed wholly or in chief value of iron, steel, lead, copper, brass, nickel, pewter, zinc, aluminum, or other metal (not including platinum, gold, or silver), but not plated with platinum, gold, or silver, or colored with gold lacquer:
<•* Hi * Hi * *
Other (except slide fasteners and parts thereof)_22)4% ad val.
Par. 312. Beams, girders, joists, angles,' channels, ' cartruck channels, tees, columns and posts, or parts or sections of columns and posts, and deck and bulb beams, together with all other structural shapes of iron or steel: •
Hi Hi Hi H« Hi Hi Hi
Machined, drilled, punched, assembled, fitted, fabricated for use, or otherwise advanced beyond hammering, rolling, or casting_10% ad val.

At the trial before the Customs Court the importer introduced the oral testimony of three witnesses and caused several illustrative exhibits — a photograph and drawings depicting different features of the sill plates and different stages of their installation — to be placed in evidence. It may be said at this time that each of the three witnesses was either an official or employee, of the Otis Elevator Company, the actual importer here involved; that each of them had been associated with the company for many years, and that each of them apparently was practically an expert in the elevator art, including both the manufacture and installation of elevators.

One of the witnesses (Percy Foster) was connected with the Otis Elevator Company, Ltd., which is located at Hamilton, Ontario, *163Canada. That company manufactured the sills here involved 1 and exported them ready for use to the Otis Elevator Company of Harrison, New Jersey, in response to an order received from the latter company. He had been with the company thirty years and, at the time of testifying was “Works manager in charge of works accounting and foundry costs.” He, obviously, was thoroughly familiar with the manufacture of articles of the kind here involved. He was not cross-examined by counsel for the Government. His testimony was, in part, as follows:

Q. Will you tell the court, please, how such articles are produced? A. On feralun sills we receive an order from the Harrison Works, U. S. A., together with a drawing. A pattern is made from this drawing, sent into our foundry.
Q. By “pattern” do you mean a mold? A. A wood pattern, from which a casting is made, a sill plate casting. This casting goes to our foundry and is foundry finished, then sent into the machine shop for final processing, machining, which would be in the nature of planing, drilling, and finally painted and then shipped:
Q. What is the material which is used, you say? A. Iron.
Q. And is the feralun a trade name? A. Feralun is the addition of the abrasive in the easting process.
Q. And what is the purpose of that? A. Non-slip, a non-slipping process.
Q. Would you state again just what was done after the casting is completed? A. After the casting is completed it is what we term dry-finished, that is the gates and risers are ground off. And this is then sent into our machine shop. It is planed for grooves and a number of holes are drilled according to the drawing. And then it is sent to the paint shop, painted ready for shipment.
Q. You say that these are iron castings? A. They are iron castings, yes.
Q. And is that the process which was used in producing the sill plates in the case at bar? A. Yes.

Another of the witnesses (Philip Karmel) located with the Otis Elevator Company in New York (whose business is the manufacture and installation of elevators) had been connected with the company since 1929. He stated that his position with the company was that of “the supervising mechanical engineer in the executive offices rh charge of the design of doors, door equipment, door operators, and door interlocks” for elevators and that since 1929 his work had “largely been in connection with doors, door devices, door operators and electrical interlocks for doors.” He gave the following description of a sill plate such as that here involved:

* * * A sill plate is a part of a hoistway door assembly used at the entrance-way to an elevator at each landing. It’s a cast iron plate properly designed with grooves to guide the sliding hoistway doors, the bottom of the sliding hoistway doors. And it’s fastened to the building structural steel and supports the struts and the buck and the header, the door hangers and the doors, which go to make up this assembly.

He further testified:

* * * [T]he sill is used to support the door frame to guide the doors and it’s very carefully set in relation to the elevator guide rails for alignment with the elevator because the door frame and the sill support door closers or operating *164devices or power operators' and interlocks * * * are frequently operated from apparatus or devices carried by the elevator car. So that in order to assure alignment between the sill and the door frame and these devices the sill and door frame are set in proper relation to the guide rails.
Q. And what function is performed by the grooves in the sill plate? A. Well, the hoistway doors are sliding doors, moving horizontally, and they are equipped with small guide blocks which project down below the bottom of the door into the groove in this sill píate so that the groove guides the bottom edge of the door.

The third and last of the three witnesses (Carroll H. Fleming) called on behalf of the importer was graduated from the United States Naval Academy in 1919. He there made a study of engineering. He stated his practical experience as follows:

* * * When I graduated from the Navy I went into the active Navy on board ship. Left the Navy in ’25 for employment with the Otis Elevator Company; Was granted a leave of absence in ’42 to rejoin the Navy and was demobilized in ’46, after which I came back to the Otis Elevator Company.

This witness, like the witness Karmel, was also questioned by counsel for the importer and cross-questioned by counsel for the Government with reference to the weight carried by or resting upon the sills. This we discuss hereinafter.

At this juncture, we take occasion to state that both Karmel and Fleming were permitted to express their opinion, during the taking of their testimony, as to how the involved merchandise should have been classified. While the admission of such testimony is not improper, the courts are not in any respect bound by it and, so far as this particular case is concerned, it might as well have been omitted.

The testimony describing the merchandise, however, is deemed to be important.

No evidence of any kind was introduced on behalf of the Government. So, there was no effort to contradict that introduced on behalf of the importer and Government counsel rely solely upon the presumption of correctness which, by law, attaches to the collector’s classification upon the basis of which the duty rate was determined. If the classification was correct, the duty rate was correct.

The two paragraphs here involved are paragraphs in Schedule III — Metals and Manufactures — -of the Tariff Act of 1930. In that schedule, the paragraphs relating to metals appear and these are numbered 301 to 398, inclusive. Paragraph 397 constitutes the “basket clause” of the schedule. Insofar as here pertinent, it has been quoted, as modified by the Trade Agreements Act, supra. It will be noted that it includes provision for “articles or wares, not specially provided jor, if composed wholly or in chief value of iron, * * *.” [Italics ours.]

Paragraph 312 specially provides for a number of articles including structural shapes of iron.

*165We think it obvious that if the merchandise involved be found to be a structural shape of iron, it does not fall within the so-called “basket clause.”

As we understand the decision of the trial court, it held, in effect, that it had not been proven by the importer that the involved sill plates were structural shapes within the meaning of paragraph 312, supra, and for that reason held it classifiable under the phraseology of paragraph 397. Specifically, the court held:

Upon a careful review of the record and the various authorities cited by the parties, we find and hold that the sill plates in controversy are not structural shapes within the contemplation of paragraph 312, supra, as claimed by plaintiff, and since our attention has not been directed to any more specific provision, we hold that they were properly' classified by the collector of customs as articles or wares, not specially provided for, whether partly or wholly manufactured, wholly or in chief value of steel, and dutiable accordingly. The protest is therefore, overruled.

It is obvious, from reading its decision, that the trial court felt that to a great extent, certain of the prior decisions of this and other courts were controlling.

The determination of what is meant by the expression “structural shape” has been the subject of litigation over a long period of time and under different tariff acts. Cases involving it are cited in the decision of the trial court as follows:

Simon, Buhler & Baumann (Inc.) v. United States, 8 Ct. Cust. Appls. 273, T.D. 37537;
Myers & Co. v. United States, 12 Ct. Cust. Appls. 350, T. D. 40490;
United States v. Frank, 15 Ct. Cust. Appls. 97, T. D. 42184;
United States v. Henry L. Exstein Co., Inc., 16 Ct. Cust. Appls. 328, T. D. 43079;
E. L. Soule & Co. v. United States, 16 Ct. Cust. Appls. 524, T. D. 43240;
Amerlux Steel Corp. v. United States, 18 C. C. P. A. (Customs) 449, T. D. 44700;
European Trading Co. v. United States, 19 C. C. P. A. (Customs) 82, T. D. 45225;
Judson Freight Forwarding Co. v. United States, 20 C. C. P. A. (Customs) 229, T. D. 46038;
Otis McAllister & Co. v. United States, 27 C. C. P. A. (Customs) 4, C. A. D. 52;
The Frost Railway Supply Co. v. United States, 39 C. C. P. A. (Customs). 90, C. A. D. 469;
United States v. Winkler-Koch Engineering Co., 41 C. C. P. A. (Customs) 121, C. A. D. 540.

If we correctly understand the decision of the trial court, it seems to have been influenced largely by the decision in the Simon, Buhler & Baumann case, supra, respecting the matter of sustaining heavy weights or to resist great tension, or both.

Apparently, it did not take into consideration the decision of this court in the Judson Freight Forwarding case, supra, wherein we said that weight is a relative term, meaning, of course, that the weight *166of tbe structural article must be considered in tbe light of tbe purpose for which it is used.

That case arose under tbe 1922 tariff act and involved tbe classification of certain steel angles which bad been held by tbe Customs Court (seemingly largely upon tbe authority of this court’s decision in tbe Simon, Buhler cfc Baumann case, supra,) not to be structural shapes within tbe meaning of paragraph 312 of the 1922 act, which is practically a prototype of paragraph 312 of the 1930 Act, here involved.

In the course of the majority opinion in that case it was said (see 20 Ct. Cust. Appis. at page 234):

The language, “the capacity to sustain heavy weights or to resist great tension or both,” used by the court in that decision, is open to widely divergent interpretations. However, if it is read in connection with other language in the decision and the issues there involved, it is obvious that the court did not intend to define, except for the purposes of that case, the statutory term “structural shapes.” It was there pointed out that structural shapes were used not only in buildings and ships but, also, in mahy other structures, “anything,” as the court said, “composed of parts capable of resisting heavy weights or strains and artificially joined together for some special use.” We might add that in that ease the court was not aided by a summary of tariff information such as is before the court in the case at bar.

The Exstein case, supra, wherein certain steel bars were held by this court to be classifiable under paragraph 312 of the 1922 act was then discussed, and also the proper weight to be given to the Summary or Tariff Information. The majority decision then continued (see 20 Ct. Cust. Appis. at page 236):

* * * Accordingly, we are of opinion that the Congress did not intend to limit the term “structural shapes” to such shapes of iron and steel as were used only in large structures, but that it intended to include therein all structural shapes of iron or steel having the “capacity to sustain [relatively] heavy weights or to resist great tension or both,” and designed for the utilization of such capacity, to be used as such shapes, and suitable for such use in buildings, bridges, ships, cars, etc., requiring either heavy or light sections, or both, and also in certain “other articles requiring light sections” only. [Italics quoted.]

In the brief for the Government before us, it is said, after mentioning some of the cited cases: “Bearing in mind that no precise definition can be laid down for the involved terms an analysis of the cases on the subject is necessary.”, and proceeded to make such analysis.

We have examined the analysis with care. It really amounts to little, if anything, more than a recital of articles which have been held to be structural shapes and other articles which have been held not to be structural shapes.

There is no article in either class which is similar, either in its characteristics or its use, to the elevator sills here involved. So we derive little aid — practically none — from making comparisons of articles.

*167The evidence in the instant case, we think, established beyond possibility of doubt that the involved elevator sills were manufactured to serve a particular and indispensable function in the operation of elevators. For example, one indispensable structural feature of the sill is the groove through which the hoistway door is held in close line in opening and closipg the hoistway doors.

We are unable to conceive of any other art or industry in which the sills, in their imported condition, would be of the slightest use.

They have the particular shape which their particular function requires. Surely, when the common meaning of “structural shapes” is considered, the merchandise meets every possible definition of the phrase, and this court held, in the Judson Freight Forwarding Company case, supra, that the phrase should be applied on the basis of its common meaning.

For reasons indicated, we feel constrained to disagree with the decision of the trial court.

Therefore, the judgment appealed from is reversed and the case is ordered remanded for further proceedings not inconsistent with this decision.

The nominal appellant here (O. J. Tower & Sons) is a brokerage concern.