B-150854, APR. 11, 1963

B-150854, APR. 11, 1963

TO LAWRENCE AND TUTTLE:

YOUR LETTER OF JANUARY 31, 1963, REQUESTS RECONSIDERATION OF OUR CLAIMS DIVISION SETTLEMENT OF NOVEMBER 19, 1962, WHICH DISALLOWED YOUR CLIENT'S (VAN WATERS AND ROGERS, INCORPORATED) CLAIM FOR $9,666.35 REPRESENTING EXCESS CUSTOMS DUTIES PAID BY CUSTOMHOUSE BROKER ANTHONY B. BOWERS TO THE BUREAU OF CUSTOMS, NEW ORLEANS, LOUISIANA, ON ENTRIES FILED BY HIM.

THE RECORD SHOWS THAT ENTRY NOS. 2872, 3607, 4287, 4460, 4594, 5688, 288 AND 2489, DATED DECEMBER 22, 1950, FEBRUARY 7, 1951, MARCH 16, 1951, MARCH 27, 1951, APRIL 2, 1951, JUNE 1, 1951, JULY 16, 1951, AND DECEMBER 12, 1951, IN THE AMOUNTS OF $64.36, $37.51, $25.65, $1,780.95, $592.05, $2,804.04, $4,337.40 AND $24.39, RESPECTIVELY, WERE FILED BY ANTHONY B. BOWERS AS IMPORTER OF RECORD FOR THE ACCOUNT OF VAN WATERS AND ROGERS, INC., 4000 FIRST AVENUE SOUTH, SEATTLE, WASHINGTON. NO OWNER'S DECLARATIONS WERE FILED IN CONNECTION WITH THE ENTRIES. THE RECORD FURTHER SHOWS THAT MR. BOWERS IS NOW DECEASED AND LETTERS OF ADMINISTRATION OF HIS ESTATE HAVE NOT BEEN ISSUED.

PAYMENT OF THE CLAIM WAS DISALLOWED BY OUR CLAIMS DIVISION FOR THE REASON THAT NO OWNER'S DECLARATION HAD BEEN FILED IN CONNECTION WITH SUCH ENTRIES AND, HENCE, UNDER APPLICABLE CUSTOMS LAWS AND REGULATIONS YOUR CLIENT WAS NOT ENTITLED TO THE REFUND. IT ALSO WAS STATED THAT THE FACT THAT AN ADMINISTRATOR OF MR. BOWERS' ESTATE HAD NOT BEEN APPOINTED MAY NOT SERVE AS A BASIS FOR PAYMENT OF THE CLAIM TO OTHER THAN THE IMPORTER OF RECORD AND REFERRED TO 19 U.S.C. 1485 (F) WHICH READS, IN PART, AS FOLLOWS:

"WHENEVER SUCH MERCHANDISE IS CONSIGNED TO A DECEASED PERSON, OR TO AN INSOLVENT PERSON WHO HAS ASSIGNED THE SAME FOR THE BENEFIT OF HIS CREDITORS, THE EXECUTOR OR ADMINISTRATOR, OR THE ASSIGNEE OF SUCH PERSON OR RECEIVER OR TRUSTEE IN BANKRUPTCY, SHALL BE CONSIDERED AS THE CONSIGNEE

YOU STATE THAT THERE ARE THREE REASONS WHY 19 U.S.C. 1485 (F) DOES NOT APPLY, NAMELY:

"A) CONSIGNMENT WAS NOT TO A "DECEASED PERSON, , BUT TO PRESENT CLAIMANT.

"B) EVEN IF CONSIGNMENT HAD BEEN TO BOWERS, HE WAS NOT AT TIME OF ENTRY A "DECEASED PERSON," BUT A LIVING ONE WHO WAS ABLE TO COMPLY WITH ALL THE REQUIREMENTS FOR CUSTOMS ENTRY IN HIS OWN NAME AS NOMINAL CONSIGNEE.

"C) EVEN IF CONSIGNMENT HAD BEEN TO HIM RATHER THAN VAN WATERS AND ROGERS, THERE HAS BEEN SINCE HIS DEATH NO LEGAL REPRESENTATIVE, AND NONE IS LIKELY AFTER THE LONG PERIOD HERE INVOLVED.'

ALSO, YOU MAKE REFERENCE TO 19 U.S.C. 1520 TOGETHER WITH CERTAIN REGULATIONS WHICH YOU STATE ARE APPLICABLE AND, IN EFFECT, PERMIT REFUND TO YOUR CLIENT. YOU INDICATE THAT THE LEGISLATIVE PURPOSE OF 19 U.S.C. 1485 AND 19 U.S.C. 1520 WAS TO SIMPLIFY AND FACILITATE CUSTOMS OPERATIONS INCLUDING REFUNDS.

FINALLY YOU REQUEST, IN EFFECT, THAT IF REFUND CANNOT BE MADE OTHERWISE WE REFER THE MATTER TO CONGRESS AS A MERITORIOUS CLAIM PURSUANT TO 31 U.S.C. 236.

SECTION 1483, TITLE 19, U.S.C. PROVIDES, IN PART, AS FOLLOWS:

"FOR THE PURPOSES OF THIS SUBTITLE---

"/1) ALL MERCHANDISE IMPORTED INTO THE UNITED STATES SHALL BE HELD TO BE THE PROPERTY OF THE PERSON TO WHOM THE SAME IS CONSIGNED; AND THE HOLDER OF A BILL OF LADING DULY INDORSED BY THE CONSIGNEE THEREIN NAMED, OR, IF CONSIGNED TO ORDER, BY THE CONSIGNOR, SHALL BE DEEMED THE CONSIGNEE THEREOF. * * *"

SECTION 1485 (D) OF THE SAME TITLE PROVIDES:

"A CONSIGNEE SHALL NOT BE LIABLE FOR ANY ADDITIONAL OR INCREASED DUTIES IF (1) HE DECLARES AT THE TIME OF ENTRY THAT HE IS NOT THE ACTUAL OWNER OF THE MERCHANDISE, (2) HE FURNISHES THE NAME AND ADDRESS OF SUCH OWNER, AND (3) WITHIN NINETY DAYS FROM THE DATE OF ENTRY HE PRODUCES A DECLARATION OF SUCH OWNER CONDITIONED THAT HE WILL PAY ALL ADDITIONAL AND INCREASED DUTIES, UNDER SUCH REGULATIONS AS THE SECRETARY OF THE TREASURY MAY PRESCRIBE. SUCH OWNER SHALL POSSESS ALL THE RIGHTS OF A CONSIGNEE.'

UNDER THE ABOVE-QUOTED PROVISIONS OF LAW IT HAS BEEN HELD THAT WHERE MERCHANDISE IS IMPORTED IN THE NAME OF A NOMINAL CONSIGNEE AND NO OWNER'S DECLARATION IS FILED THE NOMINAL CONSIGNEE IS TO BE REGARDED AS THE OWNER BOTH FOR THE PURPOSE OF ADDITIONAL ASSESSMENTS AND FOR REFUND OF EXCESSIVE DUTIES PAID, EVEN THOUGH THE NOMINAL CONSIGNEE DECLARES IN THE ENTRY THAT ANOTHER IS THE ULTIMATE CONSIGNEE AND ACTUAL OWNER. SEE MAGINNIS ET AL. EXRS. V. UNITED STATES, 74 CT.CL. 668; AMERICAN SHIPPING CO. V. UNITED STATES, 10 CUST.CT.REPTS. 300 (C.D. 771); 19 COMP. GEN. 309; AND B- 139564, AUGUST 11, 1959, AS TO REFUNDS; AND BALDWIN ET AL. V. UNITED STATES, 113 F. 217; UNITED STATES V. BISHOP, 125 F. 181; AND UNITED STATES V. VANDIVER, 133 F. 252, AS TO PAYMENT OF DUTIES.

AS INDICATED IN YOUR LETTER, 19 U.S.C. 1520 AUTHORIZES THE SECRETARY OF THE TREASURY TO REFUND DUTIES OR OTHER RECEIPTS AND AUTHORIZES THE APPROPRIATION OF FUNDS NECESSARY TO MAKE SUCH REFUNDS. HOWEVER, NEITHER THIS CODE PROVISION NOR THE CUSTOMS REGULATIONS (19 CFR 24.70 (A), 19 CFR 24.36 (C) (REFERRED TO IN YOUR LETTER AS 19 CFR 24.69 (C) ( AND 19 CFR 24.73) CITED IN YOUR LETTER AUTHORIZES REFUNDS TO BE MADE OTHER THAN IN CONFORMANCE WITH 19 U.S.C. 1483 AND 1485 (D), I.E., TO OTHER THAN THE NOMINAL CONSIGNEE WHEN NO OWNER'S DECLARATION HAS BEEN FILED, OR IN A CASE WHERE THE NOMINAL CONSIGNEE IS DECEASED, TO OTHER THAN THE ADMINISTRATOR OR EXECUTOR OF HIS ESTATE. FOR EXAMPLE, 19 CFR 24.70 (A) MAKES REFERENCE TO "CLAIMS FOR PAYMENTS DUE * * * OWNERS OF MERCHANDISE ON ACCOUNT OF REFUNDS OF EXCESSIVE DUTIES * * *.' AS INDICATED ABOVE, UNDER CUSTOMS LAWS AND REGULATIONS THE "OWNER" FOR CUSTOMS PURPOSES IS THE NOMINAL CONSIGNEE (CUSTOMS BROKER) UNLESS AN OWNER'S DECLARATION HAS BEEN FILED. SEE 19 CFR 24.36 (B). ALSO, UNDER 19 CFR 24.36 (C) PAYMENT IN CASE OF A BANKRUPT NOMINAL CONSIGNEE APPARENTLY COULD BE MADE ONLY TO HIS TRUSTEE IN BANKRUPTCY. AS TO 19 CFR 24.73 CONCERNING MISCELLANEOUS CLAIMS NOT "OTHERWISE PROVIDED FOR," THERE IS NOTHING THEREIN WHICH WOULD AUTHORIZE PAYMENT OF THE INSTANT CLAIM.

THEREFORE, AND SINCE THE RECORD DISCLOSES THAT NO OWNER'S DECLARATION WAS FILED IN CONNECTION WITH THE ENTRIES INVOLVED HERE UNDER APPLICABLE CUSTOMS LAWS AND REGULATIONS, MR. BOWERS AS THE NOMINAL CONSIGNEE, IS ENTITLED TO THE REFUND IN QUESTION. HENCE, SINCE THE RECORD DISCLOSES THAT MR. BOWERS IS DECEASED, THE ADMINISTRATOR OR EXECUTOR OF HIS ESTATE WOULD BE ENTITLED TO THE REFUND. THIS WOULD BE TRUE WHETHER OR NOT 19 U.S.C. 1485 (F) BE CONSIDERED APPLICABLE IN THE INSTANT CASE. ACCORDINGLY, UPON THE PRESENT RECORD NEITHER THE BUREAU OF CUSTOMS NOR THIS OFFICE MAY PAY THE CUSTOMS REFUND INVOLVED HERE TO YOUR CLIENT, BECAUSE UNDER APPLICABLE LAWS AND REGULATIONS IT IS NOT QUALIFIED TO GIVE A GOOD ACQUITTANCE TO THE UNITED STATES.

IF PURSUANT TO PERTINENT STATE LAW EITHER A PUBLIC ADMINISTRATOR OR YOUR CLIENT, AS A CREDITOR, OBTAINS LETTERS OF ADMINISTRATION IN CONNECTION WITH MR. BOWERS' ESTATE, THE COLLECTOR OF CUSTOMS FOR NEW ORLEANS WOULD, NO DOUBT, REFUND THE EXCESS CUSTOMS DUTIES UPON RECEIPT OF A CLAIM FROM THE PARTY OBTAINING SUCH LETTERS. HOWEVER, PAYMENT WOULD BE LIMITED TO $6,910.76, SINCE THE RECORD DISCLOSES THAT INCREASED DUTIES IN THE AMOUNT OF $2,755.59 DUE THE UNITED STATES FROM MR. BOWERS (IN CONNECTION WITH ENTRIES MADE BY MR. BOWERS FOR OTHER IMPORTERS) WERE SET OFF AGAINST THE REFUND DUE HIM UNDER ONE OF THE ENTRIES (ENTRY NO. 5688) INVOLVED IN THIS CASE BY THE COLLECTOR OF CUSTOMS, NEW ORLEANS. THIS ACTION REDUCED THE AMOUNT DUE MR. BOWERS' ESTATE IN CONNECTION WITH THE ENTRIES INVOLVED HERE FROM $9,666.35 TO $6,910.76.

IN YOUR LETTER OF JANUARY 16, 1962, ADDRESSED TO THE COMMISSIONER OF CUSTOMS, YOU INDICATE THAT THIS SETOFF ACTION MAY HAVE BEEN TAKEN ON THE ASSUMED AUTHORITY OF MAGINNIS ET AL., EXRS. V. UNITED STATES. HOWEVER, YOU STATE THAT THE COLLECTOR'S ACTIONS WERE PROTESTED "BECAUSE CONTRARY TO LAW AND PREJUDICIAL TO RIGHTS OF CLAIMANT.' YOU ALSO STATE THAT THE MAGINNIS CASE IS DISTINGUISHABLE FROM THE INSTANT CASE BECAUSE IN THAT CASE THE NOMINAL CONSIGNEE WAS ALIVE AND COULD BE DEALT WITH BOTH BY THE GOVERNMENT AND BY CLIENTS, WHILE IN THE INSTANT CASE THE NOMINAL CONSIGNEE IS DECEASED AND, SINCE NO LEGAL REPRESENTATIVE HAS BEEN APPOINTED, THERE IS NO ONE THE GOVERNMENT OR ANY OTHER PARTY CAN DEAL WITH.

WE CANNOT AGREE THAT THE MAGINNIS CASE IS DISTINGUISHABLE FROM THE INSTANT CASE. THE PRINCIPLES SET FORTH IN THE MAGINNIS CASE WOULD BE FOR APPLICATION WHETHER THE NOMINAL CONSIGNEE IS DEAD OR ALIVE. IF THE NOMINAL CONSIGNEE IS DECEASED THEN HIS ESTATE IS ENTITLED TO ANY MONEYS DUE HIM FROM THE UNITED STATES AND THE ESTATE IS LIABLE FOR ANY MONEYS DUE THE UNITED STATES FROM THE NOMINAL CONSIGNEE. IN OTHER WORDS, THE ESTATE, IN SUCH A CASE, WOULD BE BOTH THE DEBTOR AND CREDITOR OF THE UNITED STATES. THE COURTS HAVE LONG HELD THAT THE UNITED STATES HAS THE SAME RIGHT WHICH BELONGS TO EVERY CREDITOR TO APPLY THE UNAPPROPRIATED MONEYS OF HIS DEBTOR IN HIS HANDS, IN EXTINGUISHMENT OF THE DEBTS DUE HIM. SEE UNITED STATES V. LOUISIANA, 127 U.S. 182; UNITED STATES V. MUNSEY TRUST COMPANY, 332 U.S. 234; AND SEABOARD SURETY CO. V. UNITED STATES, 67 F.SUPP. 969. THUS ANY REFUND IN THE INSTANT CASE WOULD BE LIMITED TO $6,910.76.

CONCERNING SUBMISSION OF THE CLAIM TO THE CONGRESS PURSUANT TO THE ACT OF APRIL 10, 1928, CH. 334, 45 STAT. 413, 31 U.S.C. 236, WE ARE AUTHORIZED UNDER THIS ACT TO SUBMIT TO THE CONGRESS THOSE CLAIMS OR DEMANDS UPON OUR OFFICE THAT MAY NOT LAWFULLY BE ADJUSTED BY THE USE OF AN APPROPRIATION THERETOFORE MADE, WHICH CLAIMS OR DEMANDS WE DEEM CONTAIN SUCH ELEMENTS OF LEGAL LIABILITY OR EQUITY AS TO BE DESERVING OF THE CONSIDERATION OF THE CONGRESS. HOWEVER, IN VIEW OF THE PERTINENT STATUTORY PROVISIONS, APPLICABLE REGULATIONS AND THE ABOVE CITED COURT DECISIONS, CONCERNING ENTITLEMENT TO REFUND OF EXCESS CUSTOMS DUTIES, AND SINCE AN ADMINISTRATOR, IF APPOINTED, WOULD BE ENTITLED TO THE REFUND IN QUESTION, WE WOULD NOT CONSIDER REPORTING THE CLAIM TO THE CONGRESS UNDER THE 1928 ACT.