Puget Sound Freight Lines v. United States

• Decision Date: 01 February 1949
• Docket Number: Customs Appeal No. 4587.
• Citation: 173 F.2d 578,36 CCPA 70
• Parties: PUGET SOUND FREIGHT LINES et al. v. UNITED STATES.
• Court: U.S. Court of Customs and Patent Appeals (CCPA)

36 CCPA 70, 173 F.2d 578 (1949)

PUGET SOUND FREIGHT LINES et al. v. UNITED STATES.

Customs Appeal No. 4587.

United States Court of Customs and Patent Appeals.

February 1, 1949.

Lawrence, Tuttle & Harper, of San Francisco, Cal. (Frank L. Lawrence and George R. Tuttle, both of San Francisco, Cal., of counsel), for appellants.

David N. Edelstein, Asst. Atty. Gen. (Sybil Phillips, Sp. Atty., of New York City, of counsel), for United States.

Before GARRETT, Chief Judge, and HATFIELD, JACKSON, O'CONNELL, and JOHNSON, Judges.

JACKSON, Judge.

Appellant has appealed from a judgment of the United States Customs Court, Third Division, pursuant to its decision, C.D.1070, dismissing forty-two protests.

Certain of appellants' ships or vessels were assessed by the collectors at various ports in the State of Washington with fees relating to entry, clearance, and post entries. The assessments were levied pursuant to Sec. 2654 of the Revised Statutes, 19 U.S.C. § 58, 19 U.S.C.A. § 58. Appellants alleged in their protests that such assessments were illegally exacted because the Act of March 3, 1897, § 9, 29 Stat. 689, 46 U.S.C.A. § 330, abolished such fees where vessels operate in the waters of the Northern, Northeastern, and Northwestern frontiers of the United States, other than by sea.

When the cases were called for trial, counsel for appellee moved to dismiss the protests on the ground that the court was without jurisdiction to try the issues on their merits. The exact question raised was whether or not the assessment and collection of the involved fees are within the jurisdiction of the trial court under Sec. 514 of the Tariff Act of 1930, 19 U.S.C.A. § 1514, reading as follows:

"Sec. 514. Protest against collector's decisions

"Except as provided in subdivision (b) of section 516 of this Act (relating to protests by American manufacturers, producers, and wholesalers), all decisions of the collector, including the legality of all orders and findings entering into the same, as to the rate and amount of duties chargeable, and as to all exactions of whatever character (within the jurisdiction of the Secretary of the Treasury), and his decisions excluding any merchandise from entry or delivery, under any provision of the customs laws, and his liquidation or reliquidation of any entry, or refusal to pay any claim for drawback, or his refusal to reliquidate any entry for a clerical error discovered within one year after the date of entry, or within sixty days after liquidation or reliquidation when such liquidation or reliquidation is made more than ten months after the date of entry, shall, upon the expiration of sixty days after the date of such liquidation, reliquidation, decision, or refusal, be final and conclusive upon all persons (including the United States and any officer thereof), unless the importer, consignee, or agent of the person paying such charge or exaction, or filing such claim for drawback, or seeking such entry or delivery, shall within sixty days after, but not before such liquidation, reliquidation, decision, or refusal, as the case may be, as well in cases of merchandise entered in bond as for consumption, file a protest in writing with the collector setting forth distinctly and specifically, and in respect to each entry, payment, claim, decision, or refusal, the reasons for the objection thereto. The reliquidation of an entry shall not open such entry so that a protest may be filed against the decision of the collector upon any question not involved in such reliquidation."

Section 515 of the act, 19 U.S.C.A. § 1515,¹ which must be read in connection with Sec. 514 reads in part as follows:

"If the collector shall, upon such review, affirm his original decision, or if a protest shall be filed against his modification of any decision, and, in the case of merchandise entered for consumption, if all duties and charges shall be paid, then the collector shall forthwith transmit the entry and the accompanying papers, and all the exhibits connected therewith, to the United States Customs Court for due assignment and determination, as provided by law. Such determination shall be final and conclusive upon all persons, and the papers transmitted shall be returned, with the decision and judgment order thereon, to the collector, who shall take action accordingly, except in cases in which an appeal shall be filed in the United States Court of Customs and Patent Appeals within the time and in the manner provided by law."

It is not necessary to set out the Act of March 3, 1897, as the only issue before us is the jurisdiction of the United States Customs Court to entertain the protests on their merits.

The trial court noted that there is a distinction between "rate and amount of duties chargeable" and "exactions" as provided for in Sec. 514, citing the cases of United States v. American Express Company, C.C.S.D.N.Y. 1907, 154 F. 996, T.D. 28285, which had to do with fees on packed packages; Dunbar Molasses Co. et al. v. United States, 58 Treas.Dec. 634, T.D. 44389, relating to inspection charges; and Adele Forwarding Co. v. United States, 62 Treas.Dec. 923, Abs. 21680, which involved cartage charges. The court observed that all of those fees or charges in the above cited cases were made in connection with imported merchandise. The court was of opinion that the cases cited in appellants' brief to sustain their contention that the involved fees fall within the meaning of the term protestable "exactions" — Vandergrift v. United States, T.D. 16581, G.A. 3277, which involved a fee for clearance of a foreign vessel to a foreign port; Hatch v. United States, T.D. 18230, G.A. 3940, which had to do with the entry fee of an American vessel which had touched at a Canadian port; and Sobrinos de Ezquiaga v. United States, 3 Tres.Dec. 807, T.D. 22507, G.A. 4773, involving "light-dues" on foreign vessels — were not controlling in view of the decision of this court in the case of Atlantic Transportation Co. v. United States, 5 Ct.Cust.App. 373, T.D. 34872.

The trial court was of opinion that the United States district courts have been vested with jurisdiction to hear and determine the issue herein under 28 U.S.C. § 41, subd. 5 now 28 U.S.C.A. § 1340, reading as follows:

"(5) Cases under internal revenue, customs, and tonnage laws.

"Fifth. Of all cases arising under any law providing for internal revenue, or from revenue from imports or tonnage, except those cases arising under any law providing revenue from imports, jurisdiction of which has been conferred upon the Court of Customs and Patent Appeals." (Italics ours.)

The court observed that both the district court and the court of appeals, Ninth Circuit, assumed jurisdiction in the case of Border Line Transportation Co. v. Haas, Collector of Customs, 9 Cir., 1942, 128 F.2d 192, certiorari denied, 318 U.S. 763, 63 S.Ct. 662, 87 L.Ed. 1134, prosecuted by the counsel for appellants herein. The issues in that case were identical with the facts here. It is true that the question of jurisdiction was not raised, but the court held on the merits that the vessels were not exempt from the payment of fees, as contended for by appellant.

The question of jurisdiction was squarely raised in the case of Union Oil Co. of California v. Bryan, D.C.S.D.Cal.1943, 52 F. Supp. 256, 261, wherein it was pointed out that the question of jurisdiction had not been raised in the Border Line Transportation case, supra. In the Union Oil case the court stated as follows:

"The Circuit Court for this District has several times stated that it is the duty of the court to first determine the question of jurisdiction in each case and if the same is lacking, to dismiss the action. `It is the duty of a federal court to determine a question of its jurisdiction sua sponte, though not raised by either party.' 20 Fed. Dig., Courts, and cases cited."

The court there held that it had jurisdiction and the issue not only involved the jurisdiction of the court, but also the issue as to whether or not taxes levied on the tonnage of a vessel which had sailed from Talara, Peru, to Vancouver, B.C., where its entire cargo was discharged, and was then sailed in ballast to the port of San Luis, California, was to be held as entering the United States from Vancouver rather than Talara, and whether or not the Collector of Customs could be sued to recover a tonnage tax if it were found to be illegally collected. The court held that it had jurisdiction to hear and determine the questions. Trial was had on the merits and judgment rendered as prayed for in the complaint. In assuming jurisdiction, the court quoted Title 28, Sec. 41 of the U.S.C. now 28 U.S. C.A. § 1340, hereinbefore set out. We are of opinion that the reasoning of the court was proper.

The trial court herein held that since district courts have refused to entertain jurisdiction in cases wherein jurisdiction is vested in the Customs Court, Riccomini v. United States, 9 Cir., 1934, 69 F.2d 480; Patchogue-Plymouth Mills Corporation v. Durning, 2 Cir., 1939, 101 F.2d 41, and since the district court and court of appeals in the Border Line case, supra, assumed jurisdiction, it follows that the United States Customs Court is without jurisdiction to try the instant issue on its merits.

In support of its reasons for dismissing the protests herein, the trial court also cited the case of Carriso, Inc. v. United States, 9 Cir., 1939, 106 F.2d 707, 709. That was an action against the United States under § 24 (20) of the Judicial Code, 28 U.S.C. § 41(20) now 28 U.S.C.A. § 1346, under the provisions of which district courts concurrently with the Court of Claims have original jurisdiction. It was alleged in the complaint that appellant was the owner of vessels which were entered and cleared at the port of San Francisco-Oakland, between February 11, 1932, and August 13, 1937, upon which the Collector of Customs exacted entrance and clearance fees and fees for surveyors'...