Azurin v. Von Raab, 86-2154

• Decision Date: 29 October 1986
• Docket Number: No. 86-2154,86-2154
• Citation: 803 F.2d 993
• Parties: Ramon AZURIN; Gregorio Araneta, Plaintiffs-Appellees, v. William VON RAAB, in his capacity as Commissioner of Customs of the United States Customs Service, Defendant-Appellant.
• Court: U.S. Court of Appeals — Ninth Circuit

Page 993

803 F.2d 993

Ramon AZURIN; Gregorio Araneta, Plaintiffs-Appellees, v. William VON RAAB, in his capacity as Commissioner of Customs of the United States Customs Service, Defendant-Appellant.

No. 86-2154.

United States Court of Appeals Ninth Circuit.

Argued and Submitted Sept. 8, 1986.

Decided Oct. 29, 1986.

Anderson, Hibey, Nauheim & Blair, Richard A. Hibey, Timothy M. Broas, Gordon A. Coffee, Washington, D.C., for plaintiffs-appellees.

Richard K. Willard, Asst. Atty. Gen., Daniel A. Bent, U.S. Atty., John F. Cordes, Nicholas S. Zeppos, Gregory S. U.S. Dept. of Justice, Walden, Washington, D.C., for defendant-appellant.

Republic of the Philippines, Presidential Commission on Good Government, Republic of the Philippines Severina B. Rivera, Mark D. Bernstein, Honolulu, Hawaii, for amicus curiae.

Appeal from the United States District Court for the District of Hawaii.

Before WALLACE, ALARCON, and BEEZER, Circuit Judges.

WALLACE, Circuit Judge:

The United States Customs Service (Customs) appeals from an order of the district court issuing a writ of mandamus requiring it to release from custody certain property imported into the country. The district court had jurisdiction pursuant to 28 U.S.C. Sec. 1361. We have jurisdiction under 28 U.S.C. Sec. 1291. We conclude that the writ of mandamus was improperly issued.

I

This dispute arises out of the highly publicized departure of former President Ferdinand Marcos from the Republic of the Philippines. On February 26, 1986, Ramon Azurin and Gregorio Araneta (Azurin) arrived by military transport in Hawaii as part of a group of 90 individuals traveling with Marcos. Accompanying Marcos and his entourage was a second plane loaded with currency, jewelry, and other valuables. Customs took immediate possession of this property and commenced formal entry processing. Soon after the arrival of Marcos, a dispute arose over ownership of the merchandise. On March 1, the President of the Republic of the Philippines, Corazon Aquino, sent a letter to the United States Ambassador to the Philippines, Stephen Bosworth, requesting that the United States not release the imported property until its legal ownership could be established. This request was apparently conveyed to Customs. Marcos, acting through Azurin, filled out all the requisite Customs declarations, agreed to pay all applicable tariffs, and requested that Customs release the property. Faced with the conflicting claims of ownership, Customs refused to do so.

On March 13, 1986, Azurin filed an action in the United States District Court for the District of Hawaii, seeking a writ of mandamus compelling Customs to release the property. Around the same time, the Republic of the Philippines sent a second letter to Ambassador Bosworth, formally claiming ownership of the disputed property. The Central Bank of the Republic of the Philippines subsequently filed two suits in the District of Hawaii seeking return of all currency and gold imported by Marcos and his party. On June 16, 1986, the Republic of the Philippines filed another action in the Central District of California seeking, among other things, return of all property brought in or allegedly owned by Marcos. In one of the actions in the District of Hawaii, Customs sought leave to file a counterclaim and cross-claim which would implead the detained property. On June 6, 1986, the district court held a hearing in the instant case and issued the writ of mandamus, ruling that "Customs has no statutory duty or right to detain goods until such time as an importer proves legal ownership of the goods." Following the issuance of an emergency stay, Customs filed a timely appeal.

II

Mandamus relief is available to compel an official of the United States to perform a duty owed to an individual only if (1) the individual's claim is clear and certain; (2) the official's duty is "ministerial and so plainly prescribed as to be free from doubt"; and (3) no other adequate remedy is available. Fallini v. Hodel, 783 F.2d 1343, 1345 (9th Cir.1986) (Fallini ). Whether each element of the mandamus test is satisfied is a question of law reviewable de novo. Id.

The critical issue in this appeal pertains to the second prong of the mandamus test. In the case before us, this prong requires that Customs have a ministerial duty to release the goods so plainly prescribed as to be free from doubt. The starting point in determining the scope of Customs's duty lies in examining the language of the agency's enabling statutes. Board of Governors v. Dimension Financial Corp., --- U.S. ----, 106 S.Ct. 681, 686, 88 L.Ed.2d 691 (1986). "Absent a clearly expressed legislative intention to the contrary, that language must ordinarily be regarded as conclusive." Consumer Product Safety Commission v. GTE Sylvania, Inc., 447 U.S. 102, 108, 100 S.Ct. 2051, 2056, 64 L.Ed.2d 766 (1980). Customs's statutory authority to detain goods is set out in section 1490(a) of the Tariff Act of 1930 (the Act):

Whenever entry of any imported merchandise is not made within the time provided by law or the regulations prescribed by the Secretary of the Treasury, or whenever entry of such merchandise is incomplete because of failure to pay the estimated duties, or whenever, in the opinion of the appropriate customs officer, entry of such merchandise can not be made for want of proper documents or other cause, or whenever the appropriate customs officer believes that any merchandise is not correctly and legally invoiced, he shall take the merchandise into his custody ... to be held ... until entry is made or completed and the proper documents are produced, or a bond given for their production.

19 U.S.C. Sec. 1490(a) (emphasis added).

The parties' dispute centers on the phrase "or other cause." Customs argues that this phrase grants it broad discretion to detain goods for any number of reasons, including failure to prove ownership. Azurin argues that ownership is pertinent for purposes of entry only insofar as it is necessary for Customs to determine who is liable for duty. Since he has offered to pay all applicable duties, Azurin argues that ownership has been rendered irrelevant, and Customs therefore no longer has authority under section 1490 or any other statute to detain the disputed property.

Both sides concede that neither this statute, nor any other Customs statute or regulation, specifies an explicit duty to release goods under these circumstances. Because this is an action for mandamus, we need not determine the full scope of the authority of Customs to detain goods. Instead, the focus of our inquiry is limited to determining whether Customs has a clear ministerial duty to release the detained property despite the existence of conflicting claims of ownership.

The applicable statutes do not directly address this issue. However, some assistance in interpreting the statutory scheme is provided by the statute governing the "entry of merchandise," 19 U.S.C. Sec. 1484(a)(2)(C). That section requires all entry documentation to be filed by the "owner or purchaser" of the imported merchandise. When a consignee declares on entry that he is the owner, this same section provides that Customs "may, without liability, accept the declaration" of ownership. Customs argues that this language grants it broad discretion to inquire into ownership, and, if necessary, to detain property pursuant to section 1490 until ownership can be established. Azurin argues that section 1484(a)(2)(C) is merely a "hold harmless" provision that permits Customs to accept or reject a declaration of ownership without fear of liability so that it need not detain property until proof of ownership is produced. The applicable statutes and regulations do not define "owner or purchaser" for purposes of section 1484(a)(2)(c), nor do they explicitly state the reason for the section's "owner or purchaser" requirement.

The plain language of this section suggests that legal ownership may be relevant for purposes of entry. The statute requires entry documentation to be filed by the "owner or purchaser," not the "possessor" or "the individual willing to pay duties." Even more important, the statute does not create a clear ministerial duty to ignore legal ownership when determining whether to release goods.

Indeed, principles of administrative law implicated by the plain language of section 1484(a)(2)(C) suggest that Customs may well have to consider the issue of legal ownership before it can reject a declaration. Both sides concede that this section gives Customs the power to accept or reject a declaration of ownership made by a consignee. Customs, however, cannot act arbitrarily. It must have some justification for rejecting a declaration. Cf. Citizens to Preserve Overton Park, Inc. v. Volpe, 401 U.S. 402, 416, 91 S.Ct. 814, 823-24, 28 L.Ed.2d 136 (1971) (informal agency decisions must be based on consideration of relevant factors). The only possible justification for rejecting a declaration of ownership under this statute is that the Customs official has some reason to believe that the declarant does not have any right to possess the goods. Thus, in order to reject such a declaration, Customs necessarily has to consider "legal ownership." Interpreting the statute in a way that rendered legal ownership irrelevant would permit Customs to act arbitrarily.

Nor can we find a duty to ignore legal title in the agency regulations governing importation of property. Azurin relies on 19 C.F.R. Sec. 101.1(1) (1985), which defines "importer" as the individual "primarily liable for the payment of any duties on the merchandise," to support the assertion that ownership is relevant only insofar as it is necessary to determine who is liable for duty. Section 1484(a)(2)(C), however, requires that the "importer of record" for purposes of documentation be either the "owner or purchaser" or, "when appropriately designated by the owner, purchaser, or consignee," a licensed...