Strohmeyer & Arpe Co. v. United States

DISSENTING OPINION

Oliver, Presiding Judge:

I am constrained to dissent from the decision of my associates herein. I concur insofar as the decision holds that the product before the court is a wax and not a manufacture of wax and that the collector erred in assessing duty on it as such. I am of opinion, however, that this merchandise is properly entitled to entry free of duty as claimed by plaintiff herein.

*258The master rule of construction in customs litigation has ever been to interpret the intent of Congress (United States v. Clay Adams Co., 20 C. C. P. A. 285/288, T. D. 46078). As far back as the Tariff Act of 1883, Congress had placed vegetable and mineral wax on the free list. Paragraph 592 of the Tariff Act of 1883 provided for “Vegetable and mineral wax.” Thereafter and until the Tariff Act of 1922 “Wax, vegetable or mineral” had been specifically provided for in each succeeding tariff act until 1922. In the Tariff Act of 1922 the wax provision in the free list (paragraph 1693) was broadened by adding the provision for animal wax. The language in- the Tariff Act of 1922 has been reenacted as paragraph 1796 of the Tariff Act. of 1930, as “Wax: Animal, vegetable, or mineral.” It thus appears that the Congress has for many years and through many successive tariff acts made clear its intent to admit into this country free of duty, waxes;whether they be of animal, vegetable, or mineral origin. The only issue presented by the case at bar is whether that clearly evidenced intent of Congress is to apply if two of these duty-free waxes are mixed together before importation.

This precise issue was before our court in the case of Morningstar v. United States (T. D. 28220, G. A. 6609), and the decision therein is relied upon by the plaintiff to support its protest herein. In that case the imported article was a mixture of paraffin and carnauba wax as in the case at bar. In the Morningstar case, supra, the Board of General Appraisers sustained plaintiff’s claim to free entry (T. D. 28220). This decision was appealed to the United States Circuit Court for the Southern District of New York, which court affirmed the decision of the Board (T. D. 29121). The court there, speaking of the imported material which was a combination of carnauba wax and paraffin, said:

* * *. Of course hr the form in which we find them they are not the natural waxes, but nothing new has been introduced. Paragraph 695 does not restrict the' “wax, vegetable or mineral,” to a natural wax. It would be unjust to place this merchandise, which is inferior to pure carnauba wax, in a provision which calls for 20 per cent duty, when nothing has been done to the original free article except to treat it with another free article, and when it is clear that by such treatment no essential nonwax ingredient has been added to the merchandise. On the whole case the decision of the Board is sustained. [Italics mine.]

This decision of the circuit court was subsequently appealed to the circuit court of appeals whose decision affirming the lower court is, reported in 168 Fed. Rep. 541. The court (per Curiam) said (p. 542):

The importation is known as “carnauba wax substitute”; carnauba wax being a' vegetable wax. The government’s chemist admits that, although the so-calledf mineral waxes are not regarded as waxes in the chemical sense, paraffin belongs to that group. Evidently Congress used the words “mineral Wax” in their popular sense; otherwise, they would cover nothing. The article in 'question is compounded of carnauba wax and paraffin, and when completed is t'o all appear* *259anee a waxy substance, used for the same purpose as are other waxes, and containing no animal wax. We concur with the board and the Circuit Court.
The decision is affirmed.

In my opinion this decision is directly controlling in the instant case. In both cases the waxes were on the free list, were mixed with each other, and no other materials were added. In fact, in the Morningstar case, supra, the resulting merchandise had even been given a new name “carnauba wax substitute.”

There have been numerous decisions in our court holding that the dutiable status of articles of merchandise has frequently been changed by mixing or blending them into a new product, but they do not control in the case at bar.

In L. S. Tainter v. United States, 50 Treas. Dec. 331, T. D. 41814, a mineral wax to which stearic acid had been added was held to be dutiable as a nonenumerated manufactured article because it had been processed from its original condition and was therefore no longer a wax. In the case at bar the merchandise as imported was a wax.

In the Nonnabo Chemical Co. case (T. D. 37285, G. A. 8082), this court held a mixture of nitric and sulphuric acids, both of which were on the free list, to be properly dutiable under the tariff provision for “ * * * all chemical and medicinal compounds, preparations, mixtures, and salts, and combinations thereof not specially provided for.” The court there had before it two competing provisions. In the case at bar we are confronted with no such choice. We have no provision in the Tariff Act of 1930 for “compounds, preparations, or mixtures of waxes and combinations thereof.”

In United States v. General Dyestuff Corp., 29 C. C. P. A. 53, C. A. D. 170, the merchandise invoiced as “ig-wax (Mineral Wax)” was montan wax which had been obtained from lignite or brown coal, bleached with chromic acid, and then reduced with iron powder and hydrogenated with a nickel catalyst, resulting in a hydrocarbon held to be a nonenumerated manufactured article. The resulting product was not, as in the case at bar, a simple mixture of two duty-free waxes.

In Conron & Co. v. United States, 8 Treas. Dec. 385 (T. D. 25646, G. A. 5805), the imported merchandise was a combination of sesame and peanut oils, either of which would be free of duty if imported separately. The combination was held dutiable as a combination of expressed oils which were specifically provided for in paragraph 3 of the Tariff Act of 1897, the act there under consideration. To the same effect and subject to the same decision was the combination of peanut oil and cottonseed and other oils in Young & Kimball v. United States, 8 Treas. Dec. 641, Abstract 3787.

On the other hand, in Pure Milk Association et al. v. United States, 72 Treas. Dec. 360, T. D. 49179, the imported merchandise was paraffin wax to which a small amount of coloring matter had been *260added giving it the desired color (red) for the specific use of coating cheese. The court held that this process and the addition of the coloring matter did not change the dutiable status of the paraffin and overruled the decision of the collector that it was a manufacture in chief value of wax, holding it free of duty under paragraph 1796 of the Tariff Act of 1930.

In Adolphe Hurst & Co., Inc. v. United States, 6 Cust. Ct. 364, C. D. 497, itíbe merchandise was an article composed of paraffin with a percentage of lime content in the form of calcium soap. The issue was between the provisions of paragraph 1536 of the Tariff Act of 1930 for:

* * * manufactures of * * * wax, or of which these substances or any of them is the component material of chief value * * *.

and paragraph 1796 for:

Wax: Animal, vegetable, or mineral * * *.

The court found the imported material, despite the calcium soap present, to be a wax. In considering whether the lime present was an impurity or was added, the court said (page 368):

* * * both the opposing chemists agree that however the lime content came into the original wax it remained a wax. Therefore the presence of the lime content could not have constituted a process of manufacture that converted the wax into something else, namely, a manufacture of wax, as classified by the collector.

The court further said (page 368):

* * * it seems perfectly clear that when the Congress phrased the language of the paragraph as it did:
Wax: Animal, vegetable, or mineral, not specially provided for.
"the Congress used a common form of expression denoting the division of all mundane physical matter, and in so using that common form of expression the Congress used it as commonly understood, to bo all-inclusive. The language which the Congress employed has exactly the same meaning as though the wording had been
WAX: Not specially provided for, or
ALL WAX; Not specially provided for, or
ALL WAX; From whatever source derived, not specially provided for.
It seems clear, therefore, that the estimated 10 per centum of calcium soap, the result of the lime content which .is admittedly derived from limestone clearly brings it within the intent of Congress to include it in the mineral division, one of the divisions into which all physical matter is commonly divided.

The doctrine of legislative sanction of judicial interpretation is applicable here. The Congress is presumed to have been aware of the decision of the circuit court of appeals in the Morningstar case (1909), and by reenacting the free-wax provision without change in language in subsequent tariff acts (except to add animal wax in paragraph 1693 of the Tariff Act of 1922), is presumed to have ratified and approved the construction of the courts in the Morningstar case, *261supra, lidding that a mixture of two duty-free waxes does not alter their free status.

Paragraph 1796 of the Tariff Act of 1930 reads: “Wax: Animal, vegetable, or mineral, not specially provided for.” It is true that, the use of the word “or” under strict grammatical rules indicates a disjunctive intent. In view, however, of the legislative approval of the judicial'interpretation given this same disjunctive construction in paragraph 696 of the Tariff Act of 1897 “Wax, vegetable or mineral” in the decision in the Morningstar case, supra, I feel that this is a case where some ambiguity exists and makes applicable the rule that courts may ignore the technical grammatical meaning and ascertain the real intent of the legislature. (Doughton Seed Co. et al. v. United States, 24 C. C. P. A. 258, T. D. 48686.) Such “strict-grammatical sense may be modified, extended, or abridged as is found necessary to accomplish the clearly ascertainable legislative purpose.” Bayersdorfer v. United States (7 Ct. Cust. Appls. 66, 68, T. D. 36390).

In paragraph 592 of the Tariff Act of 1883 the conjunctive “and” was used. Beginning with paragraph 751 of the Tariff Act of 1890 the disjunctivé “or” was substituted. The reason, if any, for this change in grammatical construction is not apparent and the legislative record of that period does not explain this action. It will be noted, however, that the word “of” has appeared in all tariff acts since the act of 1890, including paragraph 695 of the act of 1897 which was before the court in the Morningstar case, supra. Congress made no change but continued the same wording in the tariff acts enacted subsequent to the decision in that case.

In United States v. Stone & Downer Co. et al., 274 U. S. 225, at page 244, the court said:

* * * *. "With the intent of the Act clearly in mind, however, we must see whether it is true that the language used can only bear the construction insisted upon by the importers and upheld by the Court of Customs Appeals, or whether there is a broader and more reasonable construction that can be fairly placed upon the statute which will serve the plain Congressional purpose.

The merchandise as imported is not a pure animal, vegetable, or mineral wax, but is a combination of two of these duty-free waxes. I am of opinion that the imported wax comes squarely within the ruling in the Morningstar case, supra, where, as in the case at bar, the merchandise was a mixture of carnauba wax and paraffin. I believe the decision in the Morningstar case, supra, correctly interprets the intent of Congress and under the doctrine of legislative sanction of judicial interpretation controls the issue herein presented.

It having been clearly established that the importation is a wax, it is difficult to conclude that Congress intended to impose a duty on a combination of two waxes when the individual waxes were free of duty and there was no specific provision in the act for a mixture of these *262duty-free waxes. The protest should be sustained and the merchandise admitted free of duty under paragraph 1796 of the Tariff Act of 1930.