A-86422, JUNE 4, 1937, 16 COMP. GEN. 1051

A-86422: Jun 4, 1937

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PENALTIES AND FORFEITURES INCURRED UNDER THE NAVIGATION LAWS WHERE THE DECREE OF FORFEITURE FOR VIOLATION OF SAID LAWS WAS ENTERED PRIOR TO THE DATE OF PASSAGE OF THE ANTI-SMUGGLING ACT. NOTWITHSTANDING SATISFACTION OF THE DECREE WAS NOT EFFECTED UNTIL AFTER THE DATE OF THE ACT. 1937: THERE WAS RECEIVED FROM THE COMMISSIONER OF CUSTOMS A LETTER OF MARCH 1. WILSON IN THE SUM OF $200.00 PRESENTS THE QUESTION AS TO WHETHER AN AWARD MAY BE MADE WHERE THE DECREE OF FORFEITURE FOR VIOLATING THE NAVIGATION LAWS WAS HANDED DOWN PRIOR TO THE DATE OF PASSAGE OF THE ANTI-SMUGGLING ACT. SATISFACTION OF THE DECREE WAS NOT EFFECTED UNTIL AFTER THAT DATE. THEREFOR IS TRANSMITTED TO YOUR OFFICE FOR DIRECT SETTLEMENT UNDER THE PROVISIONS OF SECTION 236 OF THE REVISED STATUTES.

A-86422, JUNE 4, 1937, 16 COMP. GEN. 1051

CUSTOMS SERVICE - VIOLATION OF NAVIGATION LAWS - INFORMERS' AWARDS WHERE DECREE OF FORFEITURE PRIOR TO AWARDING - GRANTING LEGISLATION AN AWARD OF COMPENSATION MAY NOT BE MADE FOR INFORMATION LEADING TO THE RECOVERY OF FINES, PENALTIES AND FORFEITURES INCURRED UNDER THE NAVIGATION LAWS WHERE THE DECREE OF FORFEITURE FOR VIOLATION OF SAID LAWS WAS ENTERED PRIOR TO THE DATE OF PASSAGE OF THE ANTI-SMUGGLING ACT, 49 STAT. 527, NOTWITHSTANDING SATISFACTION OF THE DECREE WAS NOT EFFECTED UNTIL AFTER THE DATE OF THE ACT.

ACTING COMPTROLLER GENERAL ELLIOTT TO THE SECRETARY OF THE TREASURY, JUNE 4, 1937:

THERE WAS RECEIVED FROM THE COMMISSIONER OF CUSTOMS A LETTER OF MARCH 1, 1937, WITH INCLOSURES, AS FOLLOWS:

SECTION 619 OF THE TARIFF ACT OF 1930, AS AMENDED BY SECTION 305 OF THE ANTI-SMUGGLING ACT (U.S.C., 1934 ED., SUP. II, TITLE 19, SEC. 1619) AUTHORIZES PAYMENT OF AWARD OF COMPENSATION FOR INFORMATION LEADING TO THE RECOVERY OF FINES, PENALTIES, AND FORFEITURES INCURRED UNDER THE CUSTOMS AND NAVIGATION LAWS.

THE ACCOMPANYING VOUCHER IN FAVOR OF WALTER HALDEMAN AND MILTON J. WILSON IN THE SUM OF $200.00 PRESENTS THE QUESTION AS TO WHETHER AN AWARD MAY BE MADE WHERE THE DECREE OF FORFEITURE FOR VIOLATING THE NAVIGATION LAWS WAS HANDED DOWN PRIOR TO THE DATE OF PASSAGE OF THE ANTI-SMUGGLING ACT, AUGUST 5, 1935, BUT SATISFACTION OF THE DECREE WAS NOT EFFECTED UNTIL AFTER THAT DATE. THE ACCOUNT, THEREFOR IS TRANSMITTED TO YOUR OFFICE FOR DIRECT SETTLEMENT UNDER THE PROVISIONS OF SECTION 236 OF THE REVISED STATUTES, AS AMENDED BY THE BUDGET AND ACCOUNTING ACT OF JUNE 10, 1921, (U.S.C., TITLE 31, SEC. 70).

THERE ARE INCLOSED, FOR YOUR CONSIDERATION IN CONNECTION WITH THE CLAIM, A COPY OF A LETTER DATED DECEMBER 1, 1936, ADDRESSED TO THE COLLECTOR OF CUSTOMS, PHILADELPHIA, PA., BY CUSTOMS AGENT ROBERT W. STANLEY, SETTING FORTH THE CIRCUMSTANCES UNDER WHICH THE INFORMATION WHICH LED TO THE RECOVERY WAS GIVEN, AND A COPY OF THE DECREE OF FORFEITURE HANDED DOWN BY THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF NEW JERSEY. THERE IS ALSO INCLOSED A COPY OF AN INFORMAL MEMORANDUM PREPARED IN THE BUREAU IN WHICH THE LEGAL PHASE OF THE CASE IS DISCUSSED.

THE BUREAU RECOMMENDS THAT THE INFORMERS' CLAIM BE ALLOWED IF LEGALLY POSSIBLE. IT WOULD BE APPRECIATED IF A COPY OF YOUR DECISION IS FURNISHED IN ORDER THAT THE BUREAU'S FILES ON THE CASE MAY BE COMPLETED.

THE FACTS APPEAR TO BE AS FOLLOWS: ON JUNE 5, 1933, WALTER HALDEMAN AND MILTON J. WILSON CALLED A CUSTOMS AGENT BY TELEPHONE AND REQUESTED HIM TO COME TO WILSON'S HOME, AS A GARVEY WOULD COME INTO THE MULLICA RIVER AND UNLOAD A QUANTITY OF LIQUORS AROUND SUNRISE THE NEXT DAY. AS A RESULT OF THIS INFORMATION, THE CUSTOMS AGENT, ACCOMPANIED BY HALDEMAN AND WILSON, CAPTURED THE GARVEY L-2859, KNOWN AS THE "IT," ON THE MORNING OF JUNE 6, 1933. THE LIQUOR WAS SUMMARILY FORFEITED AND SOLD DECEMBER 30, 1933, AND PAYMENT MADE TO THE INFORMERS AS PROVIDED BY SECTION 619 OF THE TARIFF ACT OF JUNE 17, 1930, 46 STAT. 758. THE VESSEL WAS RELEASED UNDER SECTION 938, REVISED STATUTES, UNDER $800 BOND, WAS LATER LIBELED UNDER THE NAVIGATION LAWS (SEC. 4377, REV.STAT.), AND ON APRIL 16, 1935, FINAL DECREE WAS ENTERED FOR $800 WITH INTEREST AND COSTS. ON OCTOBER 12, 1935, PAYMENT OF $800 WAS MADE IN SATISFACTION OF THE DECREE, AND ON SEPTEMBER 9, 1936, AN ORDER WAS FILED CANCELING STIPULATIONS FOR VALUE AND COSTS AND WAIVING COSTS.

SECTION 619 OF THE TARIFF ACT OF 1930 PROVIDED IN SUBSTANCE, INSOFAR AS HERE PERTINENT, THAT ANY PERSON NOT AN OFFICER OF THE UNITED STATES WHO FURNISHED A CUSTOMS OFFICER ORIGINAL INFORMATION CONCERNING ANY FRAUD UPON THE CUSTOMS REVENUE, OR A VIOLATION OF THE CUSTOMS LAW PERPETRATED OR CONTEMPLATED, WHICH LED TO THE RECOVERY OF ANY DUTIES WITHHELD, OR OF ANY FINE, PENALTY, OR FORFEITURE INCURRED, MIGHT BE AWARDED AND PAID BY THE SECRETARY OF THE TREASURY A COMPENSATION OF 25 PERCENT OF THE NET AMOUNT RECOVERED. THE ACT MADE NO REFERENCE TO OR PROVISION FOR COMPENSATION TO INFORMERS OF VIOLATIONS UNDER THE NAVIGATION LAWS. THE SECTION WAS AMENDED BY SECTION 305 OF THE ACT OF AUGUST 5, 1935, 49 STAT. 527, BY INSERTING AFTER THE WORDS "CUSTOMS LAWS" WHEREVER THEY APPEARED IN THE SECTION THE WORDS "OR THE NAVIGATION LAWS.'

THE CLAIM HERE PRESENTED REPRESENTS 25 PERCENT OF THE AMOUNT RECOVERED IN THE LIBEL PROCEEDINGS AND IS PREDICATED UPON THE THEORY THAT SINCE THE $800 THERETOFORE DECREED TO THE UNITED STATES WAS NOT ACTUALLY COLLECTED UNTIL AFTER THE ENACTMENT OF THE AMENDMENT, THE CLAIMANTS ARE ENTITLED TO A SHARE THEREIN.

IT IS TO BE NOTED THAT THE AMENDMENT WAS ENACTED AFTER THE ENTIRE TRANSACTION IN CONNECTION WITH THE SEIZURE AND SALE OF THE CONTRABAND LIQUORS UNDER THE CUSTOMS LAWS HAD BEEN COMPLETED AND THE INFORMERS HAD BEEN PAID THEIR REWARD, AND AFTER ALL OF THE PROCEEDINGS AGAINST THE VESSEL UNDER THE NAVIGATION LAWS HAD BEEN PROSECUTED TO A CONCLUSION, SAVE THE ACTUAL PAYMENT OF THE AMOUNT FIXED IN THE ACTION. ALL THE FACTS UPON WHICH THE CLAIM IS BASED HAD BECOME HISTORY BY THE TIME THE AMENDMENT WAS PASSED.

THE QUESTION PRESENTED IS WHETHER AN AWARD CAN BE MADE TO THE TWO INFORMERS WHERE DECREE OF FORFEITURE FOR VIOLATION OF THE NAVIGATION LAWS WAS ENTERED THEREON PRIOR TO THE DATE OF THE PASSAGE OF THE AMENDMENT OF AUGUST 5, 1935, BUT SATISFACTION OF THE DECREE WAS NOT EFFECTED UNTIL AFTER THAT DATE.

THE QUESTION MUST BE ANSWERED IN THE NEGATIVE.

THE VESSEL WAS GUILTY OF TWO SEPARATE AND DISTINCT OFFENSES AGAINST THE LAWS OF THE UNITED STATES, (1) A VIOLATION OF CUSTOMS LAWS AND (2) A VIOLATION OF THE NAVIGATION LAWS. THE ILLEGAL TRANSPORTATION OF CONTRABAND LIQUORS INTO THE UNITED STATES WAS A VIOLATION OF THE CUSTOMS LAWS. SECTION 619 AUTHORIZED AWARD OF COMPENSATION UPON THE RECOVERY OF ANY TAX, FINE, PENALTY, OR FORFEITURE INCURRED UNDER THE CUSTOMS LAWS. WHEN THE ILLICIT LIQUORS WERE CAPTURED AS A RESULT OF THE INFORMATION GIVEN BY THE CLAIMANTS, SUMMARILY FORFEITED AND SOLD UNDER THE CUSTOMS LAWS, AND THE INFORMERS PAID THEIR COMPENSATION, THE TRANSACTION PURSUANT THERETO WAS CLOSED. SO FAR AS ANY RIGHT TO FURTHER COMPENSATION WAS CONCERNED, THE PRESENT CLAIMANTS WERE COMPLETELY OUT OF THE PICTURE.

THE EMPLOYMENT OF THE VESSEL IN "ANY OTHER TRADE THAN THAT FOR WHICH SHE IS LICENSED" WAS IN CONTRAVENTION OF SECTION 4377, REVISED STATUTES, WAS A VIOLATION OF THE NAVIGATION LAWS, AND WAS A DISTINCT OFFENSE. IN THE LIBEL PROCEEDINGS UNDER THAT STATUTE THE CLAIMANTS HAD NO INTEREST AND NO CONCERN FOR THE REASON THAT THE LAW AS IT THEN EXISTED MADE NO PROVISION FOR COMPENSATION TO INFORMERS UNDER THE NAVIGATION LAWS. IT MAY BE OBSERVED THAT SECTION 4377, REVISED STATUTES, ALSO, WAS AMENDED BY THE ACT OF AUGUST 5, 1935, 49 STAT. 528, THE AMENDMENT NOT BEING NECESSARY FOR CONSIDERATION HERE.

THE AMENDMENT OF AUGUST 5, 1935, TO SECTION 619 DID NOT DIMINISH OR AMPLIFY THE RIGHTS OF THE CLAIMANTS AS THEY WERE PRIOR THERETO, NOR INVEST THEM WITH ANY RIGHTS TO COMPENSATION NOT THERETOFORE EXISTING. IT IS A FUNDAMENTAL CANON OF STATUTORY CONSTRUCTION THAT A STATUTE, OR AN AMENDMENT TO AN EXISTING STATUTE, WILL BE CONSTRUED PROSPECTIVELY, AND NOT RETROSPECTIVELY UNLESS REQUIRED IN EXPRESS TERMS OR BY NECESSARY IMPLICATION, AND THAT THE PARTS OF AN EXISTING STATUTE NOT ALTERED BY AN AMENDMENT ARE CONSIDERED AS HAVING BEEN THE LAW FROM THE TIME THEY WERE ENACTED. SEE UNITED STATES V. ST. LOUIS ETC. RAILWAY CO., 270 U.S. 1, IN WHICH THE COURT SAID: ,THAT A STATUTE SHALL NOT BE GIVEN RETROACTIVE EFFECT UNLESS SUCH CONSTRUCTION IS REQUIRED BY EXPLICIT LANGUAGE OR BY NECESSARY IMPLICATION IS A RULE OF GENERAL APPLICATION.' THAT STATEMENT WAS QUOTED IN THE CASE OF WARNER V. WALSH, 27 FED./2D) 952, IN WHICH THERE WAS FOR CONSIDERATION THE EFFECT OF AN AMENDMENT TO AN EXISTING REVENUE LAW. THE COURT THERE HELD THAT THE AMENDMENT WAS PROSPECTIVE ENTIRELY AND APPLIED "NOT ONLY TO SUITS BEGUN AFTER ITS PASSAGE BUT TO SUITS BEGUN AS A RESULT OF TRANSACTION WHICH AROSE AFTER ITS PASSAGE * * *.' THE AMENDMENT OF AUGUST 5, 1935, DOES NOT BY EXPRESS LANGUAGE, OR BY NECESSARY IMPLICATION, REQUIRE A RETROACTIVE EFFECT, AND THE RULE OF CONSTRUCTION STATED ABOVE IS CONCLUSIVE. PRIOR TO THE PASSAGE OF THE AMENDMENT, THE CLAIMANTS WERE NOT ENTITLED TO THE COMPENSATION HERE SOUGHT, AND THERE APPEARS NO ROOM FOR EVEN A SUPPOSITION THAT ITS PASSAGE INVESTED THEM WITH ANY RIGHT TO SUCH COMPENSATION.