A-26185, AUGUST 26, 1929, 9 COMP. GEN. 91

A-26185: Aug 26, 1929

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SUCH APPROPRIATION MAY NOT BE CONSIDERED AVAILABLE FOR SUCH EXCESS EXPENSES EXCEPT UPON A CLEAR SHOWING THAT THEY WERE NECESSITATED BY THE INTERESTS OF THE GOVERNMENT AND WERE NOT OCCASIONED MERELY BY NEGLECT ON THE PART OF THE ENFORCEMENT OFFICERS TO SECURE THE EXPEDITIOUS DISPOSITION OF THE PROPERTY CONTEMPLATED BY THE STATUTE. THERE HAS ARISEN THE QUESTION OF THE AVAILABILITY OF APPROPRIATIONS TO PAY STORAGE CHARGES ON CUSTOMS SEIZURES WHERE THE PROCEEDS FROM THE SALE OF THE PROPERTY SEIZED ARE INSUFFICIENT TO PAY SUCH CHARGES. SHALL BE PLACED AND REMAIN IN THE CUSTODY OF THE COLLECTOR FOR THE DISTRICT IN WHICH THE SEIZURE WAS MADE. 000 AND NO CLAIM AND BOND IS FILED FOR A JUDICIAL CONDEMNATION.

A-26185, AUGUST 26, 1929, 9 COMP. GEN. 91

STORAGE - PRIVATE PROPERTY SEIZED UNDER CUSTOMS LAWS IN VIEW OF THE PROVISIONS OF SECTIONS 604 ET SEQ. OF THE TARIFF ACT OF 1922, 42 STAT. 984, DIRECTING THE SPEEDY DISPOSITION OF PROPERTY SEIZED FOR VIOLATION OF THE CUSTOMS LAWS AND PAYMENT OF EXPENSES CONNECTED WITH THE SEIZURE, CUSTODY, AND DISPOSITION OF SUCH PROPERTY FROM THE PROCEEDS OF THE SALE, AND IN THE ABSENCE OF ANY EXPRESS PROVISION OF LAW AUTHORIZING THE PAYMENT OF SUCH EXPENSES IN EXCESS OF THE PROCEEDS OF THE SALE FROM THE APPROPRIATION FOR COLLECTING THE REVENUE FROM CUSTOMS, SUCH APPROPRIATION MAY NOT BE CONSIDERED AVAILABLE FOR SUCH EXCESS EXPENSES EXCEPT UPON A CLEAR SHOWING THAT THEY WERE NECESSITATED BY THE INTERESTS OF THE GOVERNMENT AND WERE NOT OCCASIONED MERELY BY NEGLECT ON THE PART OF THE ENFORCEMENT OFFICERS TO SECURE THE EXPEDITIOUS DISPOSITION OF THE PROPERTY CONTEMPLATED BY THE STATUTE.

COMPTROLLER GENERAL MCCARL TO THE SECRETARY OF THE TREASURY, AUGUST 26, 1929:

IN CONNECTION WITH THE SETTLEMENT OF THE CLAIM OF LUCY R. SEWARD, FOR STORAGE CHARGES ON AN AUTOMOBILE SEIZED BY CUSTOMS OFFICERS AND STORED WITH HER PENDING FINAL DISPOSITION, THERE HAS ARISEN THE QUESTION OF THE AVAILABILITY OF APPROPRIATIONS TO PAY STORAGE CHARGES ON CUSTOMS SEIZURES WHERE THE PROCEEDS FROM THE SALE OF THE PROPERTY SEIZED ARE INSUFFICIENT TO PAY SUCH CHARGES.

SECTION 605 OF THE TARIFF ACT OF 1922, 42 STAT. 985, PROVIDES THAT ALL VESSELS, VEHICLES, MERCHANDISE, AND BAGGAGE SEIZED UNDER THE PROVISIONS OF THE CUSTOMS LAWS, UNLESS OTHERWISE PROVIDED BY LAW, SHALL BE PLACED AND REMAIN IN THE CUSTODY OF THE COLLECTOR FOR THE DISTRICT IN WHICH THE SEIZURE WAS MADE, TO AWAIT DISPOSITION ACCORDING TO LAW. SECTIONS 606 TO 612 OF THE ACT PROVIDE FOR APPRAISAL OF THE SEIZURE; SALE AFTER THREE WEEKS' ADVERTISING IF THE APPRAISED VALUE DOES NOT EXCEED $1,000 AND NO CLAIM AND BOND IS FILED FOR A JUDICIAL CONDEMNATION; REPORT OF THE CASE TO THE UNITED STATES DISTRICT ATTORNEY FOR THE INSTITUTION OF CONDEMNATION PROCEEDINGS IF THE APPRAISED VALUE IS GREATER THAN $1,000,OR IF A BOND IS FILED WHERE THE APPRAISAL IS LESS THAN $1,000, SUMMARY SALE AT AUCTION WITHIN 24 HOURS AFTER THE APPRAISER'S RETURN, IF NOT IN EXCESS OF $1,000, WHENEVER IT APPEARS THAT THE SEIZED PROPERTY IS LIABLE TO PERISH OR TO WASTE OR TO BE GREATLY REDUCED IN VALUE BY KEEPING, OR THAT THE EXPENSE OF KEEPING THE PROPERTY IS DISPROPORTIONATE TO ITS VALUE; AND IN SUCH CASES WHERE THE VALUE EXCEEDS $1,000, REPORT TO THE UNITED STATES DISTRICT ATTORNEY TO PETITION THE COURT TO ORDER AN IMMEDIATE SALE, THE PROCEEDS IN SUCH CASES TO BE HELD SUBJECT TO CLAIMS OF PARTIES IN INTEREST TO THE SAME EXTENT AS THE GOODS, ETC., WOULD HAVE BEEN SO SUBJECT. SECTION 604 OF THE ACT MAKES IT THE DUTY OF EVERY UNITED STATES DISTRICT ATTORNEY "IMMEDIATELY" TO INQUIRE INTO THE FACTS OF CASES REPORTED TO HIM BY COLLECTORS AND, IF IT APPEARS PROBABLE THAT ANY FINE, PENALTY, OR FORFEITURE HAS BEEN CURRED,"FORTHWITH TO CAUSE THE PROPER PROCEEDINGS TO BE COMMENCED AND PROSECUTED, WITHOUT DELAY, FOR THE RECOVERY OF SUCH FINE, PENALTY, OR FORFEITURE.' SECTION 613 OF THE ACT PROVIDES FOR FINAL DISPOSITION OF THE PROCEEDS OF SALES OF SEIZED PROPERTY, WHETHER PURSUANT TO A DECREE BY THE COURT OR BY THE COLLECTOR WITHOUT COURT ACTION. AFTER PAYMENT OF VARIOUS CHARGES FROM THE PROCEEDS, INCLUDING EXPENSES OF MAINTAINING THE CUSTODY OF THE PROPERTY, AND IF NO REMISSION OF THE FORFEITURE IS GRANTED BY THE SECRETARY OF THE TREASURY, THE RESIDUE IS DIRECTED BY THE STATUTE TO BE DEPOSITED WITH THE TREASURER OF THE UNITED STATES AS A CUSTOMS FINE.

THE PROVISIONS OF THE CITED SECTIONS OF THE TARIFF ACT, WHILE AUTHORIZING THE PAYMENT OF EXPENSES OF MAINTAINING CUSTODY OF SEIZED PROPERTY FROM THE PROCEEDS OF THE SALE THEREOF, DO NOT EXPRESSLY PROVIDE FOR PAYMENT OF SUCH EXPENSES IN EXCESS OF AVAILABLE PROCEEDS, AND EVIDENTLY CONTEMPLATE A SPEEDY DISPOSITION OF SUCH PROPERTY WITHOUT INCURRENCE OF COSTS TO BE BORNE BY THE UNITED STATES IN EXCESS OF THE SALE VALUE OF THE PROPERTY. THIS IS SHOWN PARTICULARLY BY THE PROVISION FOR A SUMMARY SALE WITHIN 24 HOURS AFTER APPRAISEMENT IF IT APPEARS THAT THE PROPERTY WILL BE GREATLY REDUCED IN VALUE BY KEEPING OR THAT THE EXPENSE OF KEEPING THE PROPERTY IS DISPROPORTIONATE TO ITS VALUE, AND BY THE TERMS "IMMEDIATELY," "FORTHWITH," AND "WITHOUT DELAY" IN SECTION 604 DIRECTING THE ACTION OF THE DISTRICT ATTORNEY WHERE COURT ACTION IS NECESSARY BEFORE THE SALE.

IN A LETTER DATED FEBRUARY 8, 1929, RELATIVE TO THE MATTER, THE FORMER COMMISSIONER OF CUSTOMS STATED:

UPON REFERENCE TO SECTION 605, SUPRA, IT WILL BE NOTED THAT ALL VESSELS, VEHICLES, ETC., SEIZED FOR VIOLATION OF THE CUSTOMS LAWS, ARE PLACED IN THE CUSTODY OF THE COLLECTOR OF CUSTOMS FOR THE DISTRICT IN WHICH SEIZURE WAS MADE TO AWAIT DISPOSITION. SINCE IN MANY INSTANCES FORFEITURE PROCEEDINGS ARE NECESSARILY DELAYED THROUGH LIBEL PROCEEDINGS AND IN NO INSTANCE CAN FORFEITURE BE ACCOMPLISHED WITHIN A PERIOD LESS THAN THREE WEEKS (SECTIONS 607 AND 610 T.A. 1922), PROCEEDS DERIVED FROM THE SALE OF SEIZED MERCHANDISE WILL OBVIOUSLY, IN A NUMBER OF INSTANCES, BE LESS THAN THE AGGREGATE EXPENSES CHARGEABLE TO SUCH SEIZURES. ALSO, IN MANY INSTANCES, SEIZURES ARE MADE OF PROHIBITED ARTICLES AND GOODS OF NO COMMERCIAL VALUE WHICH MAY NOT BE SOLD.

SINCE THE LAW SPECIFICALLY IMPOSES UPON COLLECTORS OF CUSTOMS THE DUTY OF RETAINING CUSTODY OF ALL GOODS, VESSELS, ETC., SEIZED FOR VIOLATION OF THE CUSTOMS LAWS, TO AWAIT DISPOSITION, IT IS REQUESTED THAT YOU ADVISE THE BUREAU OF THE PROVISIONS OF LAW WHICH LIMIT THE PAYMENT OF EXPENSES INCURRED IN CONNECTION WITH SUCH SEIZURES TO AMOUNTS AVAILABLE FROM PROCEEDS OF SALE ONLY.

IN VIEW OF THE PROVISIONS OF SECTION 612 OF THE ACT AUTHORIZING A SUMMARY SALE WITHIN 24 HOURS (OR REQUIRING AN IMMEDIATE PETITION TO THE COURT FOR AN ORDER TO SELL, IF APPRAISAL IS OVER $1,000) WHENEVER IT APPEARS TO THE COLLECTOR THAT THE PROPERTY IS LIABLE TO PERISH OR WASTE OR TO BE GREATLY REDUCED IN VALUE BY KEEPING, OR THAT THE EXPENSE OF KEEPING IS DISPROPORTIONATE TO THE VALUE, THE BASIS FOR STATEMENT THAT "IN NO INSTANCE CAN FORFEITURE (SALE) BE ACCOMPLISHED WITHIN A PERIOD LESS THAN THREE WEEKS" IS NOT APPARENT. CERTAINLY, IF THE CONDITION OF THE PROPERTY IS SUCH THAT IT WILL NOT SELL FOR ENOUGH TO PAY STORAGE CHARGES FOR THREE WEEKS, A SUMMARY SALE PURSUANT TO SECTION 612 WOULD APPEAR TO BE REQUIRED. THE REQUEST FOR ADVICE AS TO THE PROVISIONS OF LAW WHICH "LIMIT" THE PAYMENT OF STORAGE CHARGES INDICATES A MISCONCEPTION OF THE FUNDAMENTAL PRINCIPLES CONTROLLING GOVERNMENTAL EXPENDITURES. THE REAL QUESTION IS WHAT PROVISIONS OF LAW AUTHORIZE PAYMENT AND NOT WHAT PROVISIONS LIMIT PAYMENT, FOR IT IS ELEMENTAL THAT ALL PAYMENTS FROM PUBLIC FUNDS ARE PROHIBITED UNLESS AUTHORIZED BY STATUTE, EITHER EXPRESSLY OR BY NECESSARY IMPLICATION. IN THIS CONNECTION IT IS NOTEWORTHY THAT THE CURRENT APPROPRIATION FOR COLLECTING THE REVENUE FROM CUSTOMS, ACT OF DECEMBER 20, 1928, 45 STAT. 1032, MAKES NO EXPRESS PROVISION FOR PAYING STORAGE CHARGES, WHEREAS THE APPROPRIATION FOR ENFORCING THE NATIONAL PROHIBITION AND NARCOTIC ACTS, SAME ACT, 45 STAT. 1035, UNDER MORE OR LESS ANALOGOUS CIRCUMSTANCES, EXPRESSLY PROVIDES FOR---

* * * COST OF SEIZURE, STORAGE, AND DISPOSITION OF ANY VEHICLE AND TEAM OR AUTOMOBILE, BOAT, AIR OR WATER CRAFT, OR ANY OTHER CONVEYANCE, SEIZED PURSUANT TO SECTION 26, TITLE II, OF THE NATIONAL PROHIBITION ACT, WHEN THE PROCEEDS OF SALE ARE INSUFFICIENT THEREFOR OR WHERE THERE IS NO SALE; COST INCURRED BY OFFICERS AND EMPLOYEES OF THE BUREAU OF PROHIBITION IN THE SEIZURE, STORAGE, AND DISPOSITION OF PROPERTY UNDER THE INTERNAL REVENUE LAWS, WHEN THE SAME IS DISPOSED OF UNDER SECTION 3460, REVISED STATUTES. * * *

WHILE THIS CIRCUMSTANCE IS NOT CONCLUSIVE THAT THE CUSTOMS APPROPRIATION IS NOT AVAILABLE IN ANY EVENT FOR PAYMENT OF STORAGE CHARGES ON CUSTOMS SEIZURES WHERE THE PROCEEDS OF SALE ARE INSUFFICIENT, THE OMISSION OF ANY EXPRESS PROVISION FOR SUCH PURPOSE IN THE APPROPRIATION, CONSIDERED IN CONNECTION WITH THE PROVISIONS OF THE ACT OF MARCH 3, 1925, 43 STAT. 1116, EXPRESSLY MAKING THE CUSTOMS APPROPRIATIONS AVAILABLE FOR THE PAYMENT OF THE COSTS INCIDENT TO THE SEIZURE AND FORFEITURE OF VEHICLES, DELIVERED TO THE TREASURY DEPARTMENT IN LIEU OF SALE, AND THE PROVISIONS OF THE TARIFF ACT DIRECTING THE SPEEDY DISPOSITION OF SEIZED PROPERTY AND PAYMENT OF EXPENSES CONNECTED WITH THE SEIZURE, CUSTODY, AND DISPOSITION FROM THE PROCEEDS OF THE SALE, IS AT LEAST PERSUASIVE THAT IT WAS NOT THE INTENTION OF THE CONGRESS THAT THE PROCEEDS OF SALE AVAILABLE FOR SUCH EXPENSES SHOULD BE SUPPLEMENTED BY USE OF THE APPROPRIATION, IN THE ABSENCE OF A CLEAR SHOWING THAT THE INCURRENCE OF SUCH ADDITIONAL EXPENSES WAS NECESSARY IN THE GOVERNMENT'S INTEREST IN THE FURTHERANCE OF THE PURPOSE OF THE APPROPRIATION; THAT IS, COLLECTING THE REVENUE FROM CUSTOMS AND THE DETECTION AND PREVENTION OF FRAUDS UPON THE CUSTOMS REVENUE.

IN THE CLAIM OF LUCY R. SEWARD, TO WHICH REFERENCE HAS BEEN MADE, IT APPEARS THAT A PAIGE AUTOMOBILE WAS SEIZED AT SWANTON, VT., ON NOVEMBER 23, 1921, FOR VIOLATION OF THE CUSTOMS LAWS AND WAS STORED WITH THE CLAIMANT. THE VALUE OF THE CAR WAS APPRAISED AT $250. AFTER ADVERTISING, A CLAIM AND BOND WERE FILED AND THEREUPON THE CASE WAS TRANSMITTED TO THE UNITED STATES DISTRICT ATTORNEY AT BURLINGTON, VT., UNDER DATE OF DECEMBER 20, 1921. DESPITE THE FACT THAT THE ATTENTION OF THE UNITED STATES ATTORNEY WAS AGAIN CALLED TO THE MATTER BY THE COLLECTOR UNDER DATE OF SEPTEMBER 26, 1922, IT APPEARS THE LIBEL OF FORFEITURE WAS NOT FILED UNTIL FEBRUARY 6, 1925. ALTHOUGH A DECREE OF CONDEMNATION WAS FILED DECEMBER 21, 1925, THE CAR WAS NOT SOLD BY THE UNITED STATES MARSHAL UNTIL JULY 7, 1926, ALMOST FIVE YEARS AFTER THE SEIZURE. OVER $200 STORAGE CHARGES HAD BEEN INCURRED ON THE CAR. THE FORFEITED CAR AFTER ITS FIVE YEARS OF STORAGE WAS SOLD, AS DESCRIBED BY THE COLLECTOR,"FOR THE PRINCELY SUM OF $25.25," OF WHICH, AFTER PAYING THE COSTS OF ADVERTISING THE SEIZURE AND THE SALE, ONLY $9.25 WAS AVAILABLE TO PAY STORAGE CHARGES. WHILE THIS SEIZURE WAS MADE UNDER LAWS IN EFFECT PRIOR TO THE TARIFF ACT OF 1922, THE PRIOR PROVISIONS RELATING TO THE DISPOSITION, ETC., OF SEIZED PROPERTY WERE CLOSELY ANALOGOUS TO THOSE CONTAINED IN THE TARIFF ACT, AND IT IS MOST DIFFICULT TO IMAGINE ANY NECESSITY IN THE GOVERNMENT'S INTEREST WHICH REQUIRED THAT FINAL DISPOSITION OF THE PROPERTY BE DELAYED FIVE YEARS, OR UNTIL IT HAD BECOME PRACTICALLY WORTHLESS AND STORAGE CHARGES HAD ACCRUED IN AN AMOUNT ALMOST EQUAL TO ITS APPRAISED VALUE WHEN SEIZED.

IT IS REALIZED, OF COURSE, THAT WHERE THERE MUST BE A COURT DECREE OF CONDEMNATION BEFORE THE SALE, DELAY MAY ENSUE DUE TO THE CROWDED DOCKET OF THE COURT. IN SUCH CASES, AND ALSO WHERE THE DETERMINATION OF THE COURT IS ADVERSE TO THE UNITED STATES, OR FOR ANY OTHER REASON THE SEIZED PROPERTY MAY NOT BE SOLD, NECESSARY EXPENSES PROPERLY INCURRED BY THE COLLECTOR IN MAINTAINING THE CUSTODY PRIOR TO FINAL DISPOSITION WOULD APPEAR TO BE A PROPER CHARGE AGAINST THE CUSTOMS APPROPRIATION WHERE THE PROCEEDS OF SALE, IF ANY, ARE INSUFFICIENT. BUT YOU ARE ADVISED THAT IN THE ABSENCE OF EXPRESS AUTHORIZATION BY STATUTE, CREDIT FOR PAYMENTS IN OTHER CASES OF STORAGE CHARGES IN EXCESS OF AVAILABLE PROCEEDS OF SALES OF PROPERTY FORFEITED UNDER THE CUSTOMS LAWS, INCURRED AFTER THE EXPIRATION OF THE PRESENT FISCAL YEAR MAY NOT BE ALLOWED EXCEPT UPON A CLEAR SHOWING THAT SUCH EXCESS EXPENSES WERE NECESSITATED BY THE INTERESTS OF THE GOVERNMENT AND WERE NOT OCCASIONED MERELY BY NEGLECT OR PROCRASTINATION ON THE PART OF THE ENFORCEMENT OFFICERS. IN THIS CONNECTION IT MAY BE SUGGESTED THAT WHERE THERE APPEARS TO BE UNUSUAL DELAY AFTER A CASE HAS BEEN REPORTED TO A UNITED STATES DISTRICT ATTORNEY FOR INSTITUTION OF LIBEL PROCEEDINGS, THERE MIGHT BE FOR YOUR CONSIDERATION WHETHER THE MATTER SHOULD NOT BE REPORTED TO THE ATTORNEY GENERAL IN ORDER TO SECURE THE EXPEDITIOUS DISPOSITION OF THE PROPERTY CONTEMPLATED BY LAW.