FEBJmAL· REPORTER, YOlo
48.
treasury regulations. for the transportation of merchandise in bond from one collection district in the United States to' anotber; and stated upon its face fuat the merchandise was "laden on board Cromwell's line for transportation and exportation to New Orleans in the state of Louisiana by waYo.f ., , , to be d,elivered to the collector or other proper officers .of the ,customson arrival at the port ofdestination;" and giving the consigneesaa "A.M, & Co,." It was further·proved that manifest o(the steam-ship contained no special reference to the merchandise in defendants offered testimony, which was received, under<i>bjectionsby the United States attorney, that it was their intention direct from the port 9f,New York to the ultimate into ship thEl tended,:destination thereof in Mexico, but that they found upon inquiry that there was no bonded carrier between the port of New York and Mexico. They therefore proceeded to withdraw thfl goods fr,om wareentries p.bove referEed to, and,.to ship the house unqer.the wllich. were bondeci cap-iers, to New mtendlOg th,e goods at that, port, and then to withd#r. for transpo'rt to :¥exico. They therefo,re delivered the recei)?tor bill' Of lading received froll:l:the Cromwell line ()f steamers the city of to the Agent of the Mexican. Central Railway COJllp/iny" from t.he Gentral a provldlOg that saId merbIll of ladIngfor the merc4andlse 10 chandise' sA-Guld, be transport,ed from 'sllid initial line and connections, (viz., theCtom'wellline ofsteamers,)and deHvered to the Mexican Cento, be transported over tral Railvvl:!'y Company at .lDIPaso,· RailWjay COIupany to Aguas Calientes, the fine' of said Mexican and <;leliV6,1't\d to consignees, etc. I It was. shown by testimony taken in New Orleans in behalf of the defeadants that the United States district inspector at New Orleans wasnotiiied by the delivery clerk for the Crom;' well line that certain bonded freight was on board the steamer New Orleans, and that such United States· district inspector came to the ship, and a manifest of the bonded goods was delivered to him, and that the States,inspector i,n90rsed the same, and certified to the transferor the merchandise to the cars of the Texas Pacific Railroad Company; ,that the merchandise was transferred and forwarded to Mexico by the Texas Pacific Railroad Company. It a]so appeared fuatA. M. & Co., the consignees of the goods at New Orleans, were the agents of the Cromwell line at that port. , The defendants further iI:ltroduced testimony, likewise against the objection Of the United States attorney,showingthatthe merchandise in question,arrived at Ciudad Juarez, in Mexico, about June Hi, 1889, and that the,tls:ua1 "landing certificate" in respect to such goods was 'duly executed, which certificate was certified by the United Staw9consul. IIi behalf Of the' government (plaintiff) testimony waS introduced showing tbiltthe merchandise in question had never been tathe collector of the port of or to his chief deputy collector,and that there were no records at the New Orleans custom-house showing the delivery of the same; that it was the duty ofithe bondedcofumon'carriet:to report the arrival of bonded met-
U.NlTED STATES 11. COPPELL.
369
ohandise.which was not done in this case; and also that the two transportation entries, together with certified extracts of the invoices for the goods, were received at the office of the collector in New Orleans on May 27, 1889, having been forwarded to said coilectorby the collector of the port,of New York in accordance with customs regulations, and had re'mained uncalled for since that date. It was also' proved by the testimonyof the United States district inspector of customs at New Orleans, above referred to, that he did not receive any verbal or written authority -in regard to the case in question specially; that, if the manifest required thattne bonded goods should be warehO\lSedat New Orleans, then it was ,an ov:ersight on his part not to require this to be done; and that hy reason ofs.lloh,o,versight the merchandise was allowed by him to be transferred :to the port of ultimate destination without rewarehousing at New Odeans.::", At the conclusion of the testimony counsel for the plaintiff moved the :coutt to direct a verdict for the government on the bonds. Edward Mitchell, U. S. Atty., and JamesT. Van .Rensselaer,A.sst.U. S. Atty. ' Olin, Rives Montgomery, for defendants. ".'
"
,
On the first question I think it my duty to rule for the ,as regards. that the of tlia from bemg carned out and the speclfied m the, Jrqm being fulfilled. AlI,such contingencies as interfere with ,theperfQrmance of thestipulatiot1S of a bond like this are at the risk of the bondsmen and owners of the goods who undertake to transfer them from one'warehtlJuse to another. So far as the United States are concel'ned,this bond did ,I1ot'contemplate I(ny transportation of the goods 'to Mexic6. No doubt that was the ultimate intent,ion of the owners; but, finding that they could 110t make any arrangement to send the goods directly to Mexico, because the carriers had not given the bonds required by law to enable them to take goods there, a different proposition had to be made to the government, which was simply that the goods' be transported from the warehouse' in 'New York to the warehouse in New Orleans. This,bond, construed with the statutes and regulations, imports virtually a contract between the parties and the government to do that thing, and nothing more. The government had possession of the goods, holding them for duties. It was the right of the importers under the laws to ship them directly and continuously to Mexico, provided they could find carriers who complied with the necessary cOJ;lditions. Not being able to do so, they had to avail themselYes. therefore,of another provision of the law, which allowed a removal of the goods f],'om the warehouse in New York to the warehouse in New Orleans. That they arranged to do by giving the bond upon which this suit ie brought. The government officers having the goods in their possessioij for the payment of duties, could not release them or deliver possession of .them to anyone, except under the provisions of law by which the duties are either. to be paid or secured. The law provides for. the United States to another port in v.48F.no.5-24
BROWN. J.
'370
FEDERAL REPORTER"
\'01.48.
·the:United States uponeonditions·somewhnt diffarent·fromthose; forre'mb"id eto,it foreign country; and, llIS these owners could not' remoVe the . goods'directly to· Mexicoithey arranged to remove' them' to New Orleans. ".chat· w&laJI that the United States assented to although I have nddoubt that:itwasmerelythe first step,sa:faJ as the shippers in the intended transportation to Mexico. In order to remove' the goods to the New Orleans warl:!housethe defendants gave this bond, !which provides expressly that! the,Y shall deliver tbegoods to the ('A)lleetorithere, enter t'htlm suitably for warehousing, and then produce here:a certificatethatthe goodshuvebeen warehoused there. The last twoprGVill'ions are mel'ely designed to secure 'the first,. namely, the prop:ell'de1ivery to: theedllector there. The p"opertlelivery for warehousing;Must bema:de;bymeans ()fan entry for warehousing. The defendalits!agl.'eed to make'that entry; br ;else pay ,double the amount of duties,imposed them here. Such a that it is compe,tenHor.4be· secretary of. the treaeuryto require under the act of congress. .'
Mr. Rives. We make no r.',f'rn-,::<":' ,'., , ,._ ,: ' .. .-:,1'\
honor.
BIi.?*N,}. 3900 , ,..... .' ... for may be. w1thd.rawn, under bond,Wlfli(lUt payment' 'of t'be dutieS, fl'o'jriabondedwatehonse in anycolleqtion d'istrlct:, and betratiilported toaborided warll''h0I1$e'in' any other coHeeltion district:an'd"l'eWareboused thereat;'and any 8ucbinerebandisemay:be 110 tranllported;.to Us destination, wboUY>bf land, or whQUy. by· water,or ,partially by.land,and partially,}>y ..ovElr IJ,\leh routes.M t>ftlw treasury and veyeq qver foreign; t!'lrritory. ,the shall 1;11 treaty ,sFipulations grant a ftee',tj'ght' of via'/ oYer ill1bh tei'ritory," ' ',J;, ,.. , : ' ,'. . , .,. .. " treasury the fQ'r.m ()f the ·bond to be ", .·· The given tranBportll-ti{)D of merchli,ndise from ..t one collec,tion disthe preceding sectrict toa port in, another Collection dIstrict, liS. tion, alBa the' l t.1ine fOr such delivery; and for a failure to transport and delivei' withilt the-time limited any Bucih 'bonded mel'clraridise'to the collector at ·the designated porta duty ,of double' ,the amount t1i whieb",aidmerchandiBe would be liable shall be wbiah ,shall by slIch hond." . Thltt is' a. statutory requirement; which the 'had no right to waive. He was requu-ed:to take a bond, inwhich,'amongotheJ:'things, ·it was conditioned that"if this delivery was :not 'ms.de lak reqUired;;doubIe ,duty should be .paid. .:Cpncede, then) all that hasb6en testified toin'.this The goods arrived at' New Orleansund er a special manifest, which on its face' showed what'ivas the (,)bligation ofthe partlies there, namely, to deliver them to theeol:leotor at Ne" Orleans fot'·,wa.rehousing. This -required' hot merely a.nominal and· formal delivery ,to soIhe representa·tiveof the ,collector, or the inere bringin.gof them into. the collection dis'trict, but i anaetual entry,and of them to ;the coHector for warehousing.· .· And, that there should be no doubt about that, 'the regn·lation ofthe':treasury department prescribesthat,specific duty ,and that ,J' . . ',' '. '
·
f
UNITED STATES V. COPPELL.
371
is 011e of the conditions of this bond. That was a suitable provision to secure the object of the statute. When the goods arrived at New Orleans it was no. doubt through the mistake or blunder of the inspector of cnstoms there that the proper disposition of the goods was not' made. They were not sent to the warehopse. No steps were taken to that end; but the inspector, having notified that there were goods in bond there on the vessel, looks at the paper,-this very manifest, which it is proved was put into his hands,-indorses it, makes some memorandum upon it, and then directs the goods to be loaded on the Texas Pacific cars for EI Paso. They were so shipped, and went on to Mexico. No doubt, if there had been any existing agreement by which the government had arranged for the transportation of these goods to Mexico, the inspector's act would have been a mere irregularity, from which it suffered no harm or loss. But it is impossible for the court to look beyond, thlil actual arrangement to which thegovemment was a partYi and, as 'I said in the beginning, the only arrangement to which the government was a party was a transfer of these goods from a New York bonded warehouse to a New Orleans bonded warehouse. That was interrupted, as may be assumed from the evidence in this case, by no fault whatever of the shippers; no more than if the ship had foundered, voyage, or the goods been burned at the wharf, or captured by ,pirates, or otherwise The intention of the shippers was defeatlild, indeed, by something over which they had no control; but nevertheless the thing that they had contracted for was not done. At whose· risk were these contingencies?, Upon a bond like this, they were, I think, at. the risk of the bondsmen. The government, havingpossession of \he for the purpose of collecting duties. in effect says to the owner: "You may ship the goods to New Orleans, if you choose; but you must put them in warehouse there, as security for the duties; and you must take all the risk of the passage, and of whatever may defeat the due entry of the goods for warehousing in New Orleans,"save perhaps the act of God and of public enemies. What the owners and these delendants agreed to do has not been done, and the government loses its duties. Is it any defense in a suit upon such a contract to say that the goods. failed to reach the warehouse through' no fault of the defendants? I think not. The inspector's negligence, if it was simple negligence, was not legally chargeable against the government as its own negligence. The inspector's fault was not the government's fault. The government did not assume these risks. On tbis ground I must direct a verdict for the government, there being no disputed question of fact. I hnve purposely received almost all the evidenceoffered, in order to show as fully as possible the facts as to these two points j; viz" whether the fallure,to warehouse in New Orleans 00currecJ. py apy fault on the part of the shippers; and, second, whether the qi:d' go into Mexico, where the owners intended them to go; that ti;I.tllegal question may be presented its simplest form, and any tlrroron if there easily reviewed and corrected. ,oJ} cppinb:lI aIll quite satisfied; 80 that, if the defendants' design
372
FEDERAL REPORTER,
vol. 48.
had been accomplished by the go\'ernment's assent, 'and in the wny provided by law, the government would not have lost anything. But I must hold the defeadants liable, for the reason that the govenlment never did assent, and was no party, to the defendants' ultimate design. The only arrangement the government made was that it would permit the removal of the goods from the New York bonded warehouse td the New Orleans bonded warehouse, leaving the parties, after the goods arrived there, to obtain by some new arrangement with the government the right to remove the goods to Mexico. Verdict directed for the plaintiff in double the atnount of the duties, with interest.
LoUISYILLE ,PUBLIC' WAREHOUSE Co. v. SURVEYORO]il PORTA-T LoUDVILLE.
(otrcuit Oourt, D. Kentucky; December 1, 1891.) "
CuSTOMS DUTIES-REIMPOJtTED WHISXy-WITlID,RAWAL FROM ,BOND.
The tari:tf, act of I, 1890, (26 U. S, St. 624.) iI)section 22, that on the reimportation of an article manufactured in the United 'states. and once exwithout payiqg an internal revenqe tax, it shall pay a duty equal to ternal revenue tax o,n such article. SectIon 50 d,eclares that all-;Y merchan,dIse posited'in bond 'before the date of the act may be withdra}'vp' for consumption on payment of ,the duties ,in force before the act, arid that, when:iluch duties are based u1>0n the weight of the goods, the weight shall be taken at thl'! time of the withdrawal.' -Hel.d,tbatwhile, under the internal revenue law$,' the pr'oof 'of llpirits is deterinill,ed by weight. yet the tax is always assessed upon' !thegaJlon, measureJIlent,whet'her the spirits are above or below prOOf. and hence whisky. when withdrawn from bond, must pay according to the numtier of galli:ms at the tbne of imp9rtation and not at the time of withdrawaL. . . ' : .
At Law. Appeal from a decisionofthe board ·of general 8opralsers. GeO'l'ge W. Jolly, U. S. Dist. Atty., for surveyor. WillBon&- Thurn, for Warehouse Company. BARR, J. .This is a proceeding filed by the Louisville Publie Warehouse (Jompany,asking for a review of'the decision of the board of general appraisers undel' the fifteenthsaction of an act of congress proved June 10, 1890:,(26 St. at Large, 138.) The Louisville Public Warehouse Company, nsthe importer and consignee of Mrtain' whiskies expor.ted from the United States, and afterwards, on" the<Yth day of January:,1890,:reimported into the United States,Mmplaius that said company was compelled to pay the -collector a tax of 7 gallons ot,whisky more than the lawautborize'd to'·be:collected. The warehouse· company imported and: entered into bond ;fbI' ing'five,burelsOf whisky on the 6th dayo! Ja:nual'yj 1890; and said company withdrew same on the.:,28th day· Of! Noveniber; 1890, and the ,difference in tbequantityof whisky entered into said:: ware. house in· January, 1890, and when withdrawn I 'O1l No:.vembel' 28,1890, was seven gallons,asascertainedrbyithe gauge at tM