Origet v. Hedden/Opinion of the Court

The following are sections of the Revised Statutes particularly referred to:

'Sec. 2901. The collector shall designate on the invoice at least one package of every invoice, and one package at least of every ten packages of merchandise, and a greater number should he or either of the appraisers deem it necessary, imported into such port, to be opened, examined, and appraised, and shall order the package so designated to the public stores for examination; and if any package be found by the appraisers to contain any article not specified in the invoice, and they or a majority of them shall be of opinion that such article was omitted in the invoice with fraudulent intent on the part of the shipper, owner, or agent, the contents of the entire package in which the article may be, shall be liable to seizure and forfeiture on conviction thereof before any court of competent jurisdiction; but if the appraisers shall be of opinion that no such fraudulent intent existed, then the value of such article shall be added to the entry, and the duties thereon paid accordingly, and the same shall be delivered to the importer, agent, or consignee. Such forfeiture may, however, be remitted by the secretary of the treasury on the production of evidence satisfactory to him that no fraud was intended.'

'Sec. 2939. The collector of the port of New York shall not, under any circumstances, direct to be sent for examination and appraisement less than one package of every invoice, and one package at least out of every ten packages of merchandise, and a greater number should he, or the appraiser, or any assistant appraiser, deem it necessary. When the secretary of the treasury, however, from the character and description of the merchandise, may be of the opinion that the examination of a less proportion of packages will amply protect the revenue, he may, by special regulation, direct a less number of packages to be examined.'

Edwin B. Smith, for plaintiff in error.

Asst. Atty. Gen. Whitney, for defendant in error.

Mr. Chief Justice FULLER, after stating the facts in the foregoing language, delivered the opinion of the court.

1. Certain rulings of the court in respect of the exclusion of evidence are complained of, but we fail to discover any error therein.

In reference to the first two importations, plaintiff's manager was asked what he said to the assistant appraiser as to the production of evidence of the value of the goods, and what the conversation was which he had with the collector about a reappraisal, or a call for a reappraisal. The objections of the district attorney were that the importer's remedy for any defect or informality was to call for a reappraisement, and that the protest was insufficient. Undoubtedly, the remedy of the importer on the question of valuation simply is to call for a reappraisement, though, if his contention is that a jurisdictional defect exists, he can make his protest, pointing out the defect, and stand upon it as a ground of refusal to pay the increased duty. It was not claimed in the protest that any reappraisal was called for and refused. It does not seem to us that what plaintiff's agent said to an assistant appraiser, or conversations had subsequently to the appraisement could be competent, and, even if this might be so, there is no explanation in the record as to what evidence plaintiff sought to elicit. No offer of proof was made, nor did the questions clearly admit of an answer favorable to plaintiff on a matter manifestly relevant to the issue. Buckstaff v. Russell, 151 U.S. 626, 636, 14 Sup. Ct. 448. No reason was given for the exclusion of the questions, and, as it does not appear that plaintiff was deprived of any right by that exclusion, we cannot hold that error was committed.

The court excluded a question propounded to the merchant appraiser as to whether or not he and the general appraiser did not agree to apply the valuation of one case in each invoice to the entire importation of which it was a part. This was correct. If it were obligatory to open and examine and the cases, the evidence was immaterial, for it was conceded that all were not opened and examined. If the examination of one case in each invoice was sufficient, then the application of the valuation of that case to the entire importation of which it formed a part was proper.

The question 'whether or not those goods in the several cases were all of the same character as to value' was also excluded As the question covered both the importations, and the appraisers examined one case of each, it was immaterial. If there was a difference between the goods in the different cases of either importation, it is singular that the invoices are not set forth in the record. The inference is a reasonable one that they showed the goods in each importation to be of the same character and value, so that the examination of one case would be sufficient for all. There is nothing to indicate the contrary.

Some objection is made because the reappraisers availed themselves of clerical assistance to average the appraisements given by the different expert witnesses who appeared before them, but the merchant appraiser testified: 'It was for guidance simply. The report of the appraiser, signed by the witness, was based upon that computation and the witnesses' reports.' No exception seems to have been taken in reference to this matter, probably for want of legal basis.

2. Plaintiff made the point, in the argument upon defendant's motion to have a verdict directed in his favor, that section 2900 of the Revised Statutes 'was unconstitutional in its provisions for fixing or authorizing a twenty per cent. additional duty.' The court expressed the opinion that this point was not open under plaintiff's protest, and this would seem to be so, but the question has been disposed of on its merits in Passavant v. U.S., 148 U.S. 214, 13 Sup. Ct. 572.

3. The contention that the importer has the right to be present throughout the proceedings on the reappraisement, hear or examine all the testimony, and cross-examine the witnesses, which was passed on in Auffmordt v. Hedden, 137 U.S. 310, 11 Sup. Ct. 103, is renewed in this case.

The importer appeared at the opening of the reappraisal, and made application that he or his associate or his counsel might examine the various affidavits made by experts, importers, merchants, and others, be present at the taking of any testimony, and cross-examine all witnesses produced, or suggest questions to the general appraiser. The appraisers ruled that they could not accede to this request, but expressed their desire to hear the importers in regard to their reappraisements, and their assurance of appreciation of any suggestions the importers might make as to asking questions of the witnesses. The presumption in favor of official action sustains this ruling as being in accordance with the rules and regulations established by the secretary of the treasury, under section 2949 of the Revised Statutes, to secure a just, faithful, and impartial appraisal of all merchandise imported into the United States, and just and proper entries of the actual market value or wholesale price thereof; and this was indeed the fact, as appears by reference to the general regulations of 1884, and instructions of June 9, 1885, given at length in Auffmordt v. Hedden.

The following quotation from the instructions of 1885 will suffice to explain the reasons for the rule: 'The law provides that the merchant appraiser shall be familiar with the character and value of the goods in question, and it is presumed that the general appraiser will have or will acquire such expert knowledge of the goods he is to appraise as to enable him to intelligently perform his official duty with a due regard for the rights of all parties and independently of the testimony of interested witnesses. The functions of the reappraising board are the same as those the original appraisers. They are themselves to appraise the goods, and not to depend for their information upon the appraisement of so-called experts in the line of goods in question. * *  * Appraisers are authorized to summon witnesses, but there is no authority for the public examination of such witnesses or their cross-examination by importers or counsel employed by such importers. The appraising officers are entitled to all information obtainable concerning the foreign market value of goods under consideration, but such information is not public property. It is due to merchants and others called to give such information that their statements shall be taken in the presence of official persons only. It must often occur that persons in possession of facts which would be of value to the appraisers in determining market values are deterred from appearing or testifying by the publicity given to reappraisement proceedings.'

As already stated, plaintiff in the case at bar was invited by the appraisers to present his views in regard to the reappraisement, and to suggest questions to be put to the witnesses. He did not avail himself of the opportunity, but insisted on the right to remain throughout the proceedings, to be informed as to all the evidence, and to cross-examine the witnesses as in open court. This, according to Auffmordt v. Hedden and Passavant v. U.S., could not be conceded. In those cases it was ruled that under the revenue system of the United States the question of the dutiable value of imported articles is not to be tried before the appraisers, as if it were an issue in a suit in a judicial proceeding; that such is not the intention of the statutes; that the practice has been to the contrary from the earliest history of the government; and that the provisions of the statute in this behalf are open to no constitutional objection.

As respects taxation and assessment for local improvements, such notice and hearing as are appropriate to the nature of the case, and afford the opportunity to assert objections to the methods pursued or to the amount charged, are deemed sufficient for the protection of the individual. Lent v. Tillson, 140 U.S. 316, 327, 11 Sup. Ct. 825.

Duties imposed under tariff laws are paid in order that goods may be brought into the country, and provisions in respect of their levy and collection are framed in view of the character of the transaction. The finality of the appraisal is a condition attending the importation prescribed by the government as essential to the operation of the system; and, if the importer is afforded such notice and hearing as enables him to give his views and make his contention in respect of the value of his goods, he cannot complain.

4. It is further claimed that the examination of the goods was not such as to qualify the merchant appraiser to act; that is, that he did not examine with sufficient care the cases of goods which he did examine. It is not denied that he was 'a discrete and experienced merchant,' but that he was 'familiar with the character and value of the goods in question,' as prescribed by section 2930, appears to be questioned on the ground of carelessness in investigation. His testimony in chief was not happily expressed, yet, on cross-examination, it clearly and distinctly appeared that he examined the goods in one case out of each importation sufficiently to satisfy him that they were the same order of goods that his firm imported. This established the familiarity required by the statute, and placed his qualifications as an expert beyond reasonable doubt. We agree with the circuit court that the verdict of a jury, controlled by the theory that such an expert was not qualified for appraising the goods, could not have been sustained.

5. The stress of the argument is laid, however, upon the proposition that all the seven packages were not examined. The argument is that the collector deemed it necessary, under section 2939, that all the cases should be examined, and therefore directed them all to be sent to the public store 'for examination and appraisement'; that it thus became the imperative duty of the appraisers to examine every one of the cases; and that as they examined but one out of each invoice, or only two out of the seven, there was a want of examination fatal to the appraisement. On behalf of the government, it is argued that sections 2901 and 2939 were intended for the benefit of the government, and not of the importer; but, although that was the primary intention, we are not inclined to deny that it might happen where the collector had given specific direction for the examination of more than one package out of ten, and the importer had relied on the direction, the omission to examine the number of packages directed might, under some circumstances, be availed of by him as constituting a want of the examination to which he was entitled. We can suppose a case in which the importer might truthfully contend that he did not request the more extensive examination because of the direction, and did not demand the full execution of the direction because of the rightful assumption on his part that it would be so executed, and his ignorance that it was not. The objection would be exceedingly technical where there was nothing to indicate that any injury could have ensued, as where there was no reasonable basis for the claim that one package differed in intrinsic value from another; but, giving it the full force insisted on, it is clear enough that a case in which it would be applicable could not arise unless it appeared that the collector had given such direction. And in that particular this record is deficient. What the record shows is that the seven cases 'were by the collector ordered to the public store, and that they were there at the time of the reappraisement'; but it does not affirmatively show that the collector deemed it necessary that all the cases should be examined, while, as a matter of convenience, by having all sent there (and there were but seven), the general appraiser and the merchant appraiser could open and examine each case if either of them deemed it necessary, or if the importer desired them to do so, or informed them that the packages differed in value. The collector could have directed all the cases to be opened and examined, or either of the appraisers could have done it; but it would be going an inadmissible length to hold that the mere fact that the cases were sent to the public store necessarily amounted to a specific direction by the collector that all should be examined, and, if all were not (although the appraisers did not deem it necessary, and no demand by the importer to have them all sent there for that purpose was shown), that jurisdiction failed, and the reappraisement was illegal. We are of opinion that the circuit court rightly directed a verdict for the defendant.

Judgment affirmed.