Nozaki Bros. v. United States

Richabdson, Judge: These^four consolidated cases involving Japanese canned clams are before us a second time, having been restored to the calendar by the order of this court for the production of further evidence. See Nozaki Bros. Inc., and Frank P. Dow Co., Inc., et al. v. United States, 36 Cust. Ct. 398, Abstract 59833. The action arose as a result of the failure of the collector at the port of Los Angeles to use as a basis for the assessment of duties in liquidation, the dutiable value of the merchandise as found by this court in reappraisement proceedings. These values were incorporated in a decision and judgment, dated December 2, 1952, entitled Pacific Trading Co., Inc., et al. v. United States, 29 Cust. Ct. 501, Reap. Dec. 8179. At the original hearing of the cause, it was established that after the decision and judgment in the aforementioned reappraisement proceedings had been transmitted to the collector, a clerk in the customs service, whose duty it was to note the judgment of the court on the records of the collector, erroneously stamped the involved entries and the invoice summary sheets to indicate that the reappraisement appeals had been dismissed. We append hereto a photostatic copy of the judgment of the United States Customs Court involved herein. The collector later proceeded to liquidate the entries using as the dutiable value of the merchandise, the value as found by the appraiser. The liquidations took place between the dates of May 14 and July 15, 1953. The plaintiffs did not protest the liquidations within 60 days thereafter, but considered the erroneous action of the clerk in stamping the entries “dismissed” to be a clerical error, and requested correction thereof by way of reliquidation of the entries pursuant to 19 U. S. C. section 1520 (c) (1) (§ 520 (ci) (1) of the Tariff Act of 1930), as amended by the Customs Simplification Act of 1953. That section of the act — 247 — — 248 — authorizes the Secretary of the Treasury to refund duties or other receipts in certain specified cases and further provides in part that: (e) Notwithstanding a valid protest was not filed, the Secretary of the Treasury may authorize a collector to reliquidate an entry to correct— (1) a clerical error, mistake of fact, or other inadvertence not amounting to an error in the construction of a law, adverse to the importer and manifest from the record or established by documentary evidence, in any entry, liquidation, ap-praisement, or other customs transaction, when the error, mistake, or inadvertence is brought to the attention of the customs service within one year after the date of entry, appraisement, or transaction, or within sixty days after liquidation or exaction when the liquidation or exaction is made more than ten months after the date of the entry, appraisement, or transaction; On the second hearing, it was established by the testimony of the acting deputy collector of customs in charge of the liquidating division in the office of the collector of customs at Los Angeles that a request for reliquidation based on clerical error had been made by counsel for plaintiffs in a letter, dated October 16, 1953, which was received by the collector and forwarded to the Bureau of Customs on October 23, 1953. This request was denied on April 30, 1954. The instant protests were filed on June 28, 1954, within 60 days of this refusal. In the first hearing, the case was before the court on a motion of Government counsel to dismiss for untimeliness, but the court did not enter a judgment on the motion. The court felt itself called upon to determine whether the protests were timely under the provisions of section 520 of the Tariff Act of 1930, as amended. It stated, . . the action of the customs clerk may very well be considered a 'customs transaction,’ within the meaning of the statute. Therefore, if it was brought to the attention of the customs service within 1 year after such 'transaction/ the present protests are timely.” The court could not determine either from the official papers or the oral evidence whether the ''mistake of fact” in the action of the customs clerk (which the court found to be a customs transaction) had been brought to the attention of the customs service within 1 year after the transaction, and restored the case to the docket in order that this evidence might be supplied. The plaintiff in the first hearing and in its brief at the close of the second hearing continued to contend that the liquidations were void since the collector did not comply with the decision of the court in Pacific Trading Co., Inc., supra. Counsel for the Government at the original hearing and by incorporation of defendant’s first brief after the second hearing, moved to dismiss the protests as untimely because not filed within the 60-day period after the liquidations as prescribed in 19 U. S. G. section — 249 — 1514 (§ 514, Tariff Act of 1930). This section provides for protest within 60 days after (but not before) “liquidation, reliquidation, decision, or refusal” of all exactions of every character within the jurisdiction of the Secretary of the Treasury. The cases are before us on this motion to dismiss. The court, in its opinion rendered after the first hearing, discussed cases on the matter of timely protests against void reliquidations. It did not make a decision or enter a judgment on the issue involved here, which is the timeliness of a protest against a void liquidation involving the failure of the collector to follow a valid decision or judgment of the United States Customs Court. Plaintiffs predicate their right to be relieved from the burden of the additional duties imposed as a consequence of the failure of the collector to give effect to the reappraisement judgment in liquidating the entries herein on two grounds. The contention is first made that since the entries were not liquidated in accordance with the mandate of the court as contained in the reappraisement decree, the liquidations are void ab initio. The second contention of plaintiffs is that all of the elements necessary to bring the case for the plaintiffs within the requirements of section 1520 (c) (1), supra, are present, and, therefore, the Secretary of the Treasury, or the official to whom the authority had been lawfully delegated, was required to authorize the collector to reliquidate in conformity with the mandate of the court on reappraisement; and that the denial of relief thereunder on the ground that a timely protest had not been filed under section 1514, supra, constituted error as a matter of law, since by the express terms of the statute, the Secretary may order reliquidation “notwithstanding a valid protest was not filed.” Counsel for the defendant argues that the right of the Secretary of the Treasury to make refunds under section 1520 (c) (1), supra, is discretionary; that his decisions thereunder are final and not subject to judicial review. This is a case of first impression in that it is the first instance in which the United States Customs Court unquestionably had jurisdiction of the subject matter pursuant to a timely appeal in a reappraisement matter and entered a valid judgment, which was not followed by the collector in liquidating the entries covered thereby. This court has been confronted with situations, however, in which the collector has failed to reliquidate entries in conformity with a valid judgment rendered in a protest proceeding. See Aris Gloves, Inc. v. United States, 20 Cust. Ct. 102, C. D. 1091; Herrmann v. United States, 6 Treas. Dec. 447, T. D. 24459. In the cited cases, the court held that the action of the collector in reliquidating the entries involved in a — 250 — manner that did not accord with the mandate of the court was null and void. The plaintiffs contend that the liquidations in the instant cases are void under the principle enunciated in the Aris and Herrmann cases, supra, since it is an admitted fact that the collector did not follow the judgment of the court in Pacific Trading Co., Inc., supra. We are in complete agreement with the contention of the plaintiffs that the liquidations herein are void. Under 19 U. S. C. section 1501 (§ 501 of the Tariff Act of 1930), the United States Customs Court is .given the power, upon timely appeal, to reappraise imported merchandise. 28 U. S. C. section 2636 (a) provides that, in the absence of timely application for review, the decision of a single judge in a reappraisement proceeding “shall be final and conclusive upon all parties.” No application for review was made and, therefore, the decision in the Pacific Trading Co., Inc., case, supra, became final and conclusive upon all parties. The collector, therefore, as the court said in the Aris Gloves case, supra, had to “find the basis for his action taken upon the rendition of judgment by this court within the four corners of the judgment,” citing 25 C. J. S. page 345, section 181 ; O’Connor-Harrison & Co. et al. v. United States, 15 Ct. Cust. Appls. 214, T. D. 42239; and United States v. Kurtz, Stuböeck & Co., 5 Ct. Cust. Appls. 144, T. D. 34192. The collector, when reliquidating pursuant to court order, functions in a ministerial or clerical capacity only; he makes no voluntary decision and must follow the judgment of the court to the letter. The decisions so holding are numerous. See Smith v. United States, 1 Ct. Cust. Appls. 489, T. D. 31527; United States v. Kurtz, Stuböeck & Co., supra; Roessler & Hasslacher Chemical Co. v. United States, 13 Ct. Cust. Appls. 451, T. D. 41347; United States v. Edward M. Poons Co. of Kobe, Inc., 18 C. C. P. A. (Customs) 283, T. D. 44451; Wm. Wetstein v. United States, 10 Treas. Dec. 531, T. D. 26848; Formica Insulation Co. v. United States, 60 Treas. Dec. 576, T. D. 45178; Bullocks, Inc. v. United States, 68 Treas. Dec. 99, T. D. 47809; Frank P. Dow Co., Inc. v. United States, 69 Treas. Dec. 336, T. D. 48163; Los Angeles Trading Co. v. United States, 1 Cust. Ct. 264, C. D. 62; Fulghum & Co. v. United States, 1 Cust. Ct. 284, C. D. 66; and Walser Mfg. Co. v. United States, 69 Treas. Dec. 1286, Abstract 34067. In the Poons case, supra, the appellate court said: When, therefore, the Customs Court, on January 29, 1929, adjudged the protest sustained as to the items which had been assessed under paragraph 1406 and ordered a reliquidation upon these, it was a judgment which bound the collector and all other parties to the controversy. Equally binding was that portion of the judgment which overruled the protestin’,aiq ¡other respects. Appellee, of course, might have then appealed, but it could nojlonger proceed by protesting the collector’s action, that action beingjadmittedlyjin strict conformity with the — 251 — judicial decree. The collector’s act thereunder was not one involving discretion on his part, either actual or by legal presumption, but was a merely clerical or ministerial act complying with a judicial mandate. The collector made no “decision”; the decision was made for him. It was not made by another administrative officer of the Government, as the Secretary of the Treasury, but by a court; it was not an administrative order, but a court decree. [Italics quoted.] In Frank P. Dow Co., Inc. v. United States, supra, the court commented as follows: ... we are of the opinion that the collector, being a purely ministerial officer and by statute charged with the administration of the law, is bound to follow the judgments of this court whether he may regard them as right or wrong. He could of course have had the matters in question in the present case called to the attention of this court through an application for rehearing seasonably filed, or, if he so elected, could have had a timely appeal filed from this court’s decision. He did neither. Rather, he chose arbitrarily to reliquidate the entry as he deemed proper and to ignore the judgment of this court. To hold such procedure legal would in effect be an attempt to vest in collectors appellate jurisdiction over the judgments of this court. The mere statement thereof manifests the utter absurdity of any such proposition. We wish to point out that the record contains evidence which indicates that the decree of the court was not intentionally ignored by the collector in this case, but that he liquidated on the basis of the original appraised values through inadvertence. Nevertheless, the collector was bound to conform to the reappraisement mandate and liquidate the entries on the basis of the dutiable values decreed therein. It is conceded by the defendant that this was not done. The judgment of this court, which the plaintiffs had the absolute right to expect the collector to observe, was completely disregarded. The action of the collector in liquidating the entries herein contrary to the reappraisement decision is as ineffective as is his action in reliquidating entries in a manner that does not conform to a judgment. When we say that the liquidations herein are void, we use the term in its literal and absolute sense, meaning that an act so characterized is an absolute nullity, wholly lacking in legal efficacy, unable in law to support the purpose intended, incapable of ratification, confirmation, or enforcement in any maimer or to any degree. See Black’s Law Dictionary, 4th edition, 1745; 92 C. J. S. 1024 and cases cited. The term “void” as we here apply it to these liquidations connotes an “utter negativeness which is the equivalent of nonexistence.” Void things are in legal effect no things. Frazier v. Jeakins, 68 P. 24, 28, 64 Kan. 615, 57 L. R. A. 575; People v. Shall, 9 Cow. (N. Y.) 778, 784; Lowery v. Garfield County, 208 P. 2d 478, 485, 122 Mont. 571. It seems to be the position of the counsel for the defendant that even if these liquidations are void, plaintiffs’ remedy would be by timely protest, and, in the absence of such protests, the liquidations became final and binding. — 252 — The fallaciousness of this argument is readily apparent. If these liquidations are void in the sense that a void act is no act, there have clearly been no liquidations against which protests could be filed. Under the express terms of section 1514, supra, protests may not be filed before liquidation. Therefore, the protests herein are premature. A somewhat analogous situation is to be found in the posting cases, wherein this court and the appellate court have repeatedly held that where the notice of liquidation was not given in the form and manner prescribed by the Secretary of the Treasury, the collector had not made a final legal liquidation against which protest could be filed and the statute of limitations did not begin to run. See United States v. Astra Bentwood Furniture Co., 28 C. C. P. A. (Customs) 205, C. A. D. 147; United States v. B. Holman, Inc., 29 C. C. P. A. (Customs) 3, C. A. D. 164; Standard Oil Co. of Louisiana v. United States, 33 C. C. P. A. (Customs) 152, C. A. D. 329. In these and other posting cases, the protests have been dismissed as premature, and the court has stated that it is the duty of the collector to liquidate the involved entries in the form and manner required by law. It would be anomalous to say that an act is void and of no effect because it does not conform to an order of an administrative officer and the time within which a statute of limitations is to run does not begin; and at the same time say that when a judicial officer issues an order and it is not followed, the statute, nevertheless, begins to run. Certainly, the valid order of a constitutional court should at least be accorded the same dignity as the order of an administrative agency. The cases cited by counsel for the defendant in support of its contention that the protests herein should be dismissed for untimeliness are distinguishable from the instant cases on the facts. In none of the cases cited by counsel for the defendant was there a failure on the part of the collector to follow a valid and binding mandate of the court in liquidating entries of merchandise. In view of our conclusion, it is unnecessary to pass upon other points raised by the plaintiffs. Since there have been no legal liquidations of the entries herein, the protests are untimely because prematurely filed, and must be dismissed. Under the circumstances, it is the duty of the collector to liquidate the entries on the basis of the dutiable values as found by this court in Pacific Trading Co., Inc., supra. Judgment will be rendered accordingly.