[499] [500] REECE M. OBERTEUFFER ET AL., Piffs. | ing," being a total of 250 marks, less 3 per cent in Err., 0. discount for cash, or 7 marks, 50 pfennigs, leaving 242 marks, 50 pfennigs, which added make 2585 marks, 05 pfennigs. In the entry, WILLIAM H. ROBERTSON, Collector of the value was stated at 2342 marks, 55 pfen the PORT OF NEW YORK. (See S. C. Reporter's ed. 499–517.) Import duties whether boxes, cartons and packing are to be included in valuation. 1. Under the Act of 1883, repealing former provisions, boxes or coverings of any kind, not of a material or form designed to evade duties thereon but designed to be used in the bona fide transportation of the goods to the United States, are not subject to duty. of 1883. 2. The exaction of duty on packing, whether packing the goods in cartons, or cartons in outer cases, or lining outer cases, is not warranted by law. such charges having been abolished by the Act 3. The addition to the valuation of imported goods, of items for boxes and cartons and for packing, is no part of the appraisal; and the remedy of the importer is not to apply for a new appraisement, but to protest and appeal. 4. The protest in the present case held sufficient to raise the points relied upon by the plaintiffs in error. [No. 1192.] Argued Jan. 6, 7, 1886. Decided Jan. 25, 1886. IN ERROR to the Circuit Court of the United States for the Southern District of New York. The case is stated by the court. Messrs. Edwin B. Smith, Stephen G. Clarke, William Stanley and Charles Curie, for plaintiffs in error. Mr. John Goode, Solicitor-Gen., for defendant in error. Mr. Justice Blatchford delivered the opinion of the court: This is an action brought in a state court in New York, by Reece M. Oberteuffer, Henry Abegg and Henry H. Daeniker, composing the mercantile firm of Oberteuffer, Abegg & Daeniker, against William H. Robertson, Collector of the Port of New York, to recover $140.80 as an excess of duties, paid on coverings and putting-up charges on hosiery and gloves, upon which ad valorem duties were imposed by law. It was removed into the Circuit Court of the United States by the defendant. At the trial the jury rendered a verdict for the defendant, by direction of the court, and there was a judgment for him for costs, to review which the plaintiffs have brought a writ of error. In July, 1883, the plaintiffs imported from Bremen two cases of wool gloves, Nos. 4836, 4837; twenty-one cases of cotton hosiery, Nos. 4852 to 4872; and one other case of cotton hosiery, No. 168. There were three invoices covered by one entry. The invoice of the two cases of gloves was dated at Leipzig and Chemnitz, in Saxony, June 29, 1883, and was of goods purchased by the plaintiffs. It covered 500 dozen of gloves, in five items, the prices of which per dozen were given and amounted to 2415 marks. There was a deduction of 3 per cent discount for cash, or 72 marks, 45 pfennigs, leaving 2342 marks, 55 pfennigs. There was then added, under the item of "packing charges," 25 marks "for cases," 220 marks "boxes," and 5 marks "pack-1 nigs. The invoice of the 21 cases of hosiery was dated at Leipzig and Chemnitz, in Saxony, July 5, 1883, and was of goods purchased by the plaintiffs. It covered 2949 dozen of hose, in twenty-one items, the prices of which per dozen were given, and amounted to 13,530 marks, 70 pfennigs. There was a deduction of 8 per cent discount for cash, or 405 marks, 95 pfennigs, leaving 13,124 marks, 75 pfennigs. There was then added, under the item of "packing charges," 420 marks "for cases," 1204 marks, 50 pfennigs "boxes," and 42 marks packing," being a total of 1666 marks, 50 pfennigs, less 3 per cent discount for cash, or 50 marks, leaving 1616 marks, 50 pfennigs, which added made 14,741 marks, 25 pfennigs. In the entry the value was stated at 18,124 marks, 75 pfennigs The invoice of the one case of hosiery was dated at Hohenstein, Ernsthal, in Saxony, July 4, 1883, and was of goods consigned to the plaintiffs for sale. It covered 178 dozen of hose, in six items, the prices of which per dozen were given, and amounted to 1629 marks, 20 pfennigs. There was a deduction of 4 per cent discount for cash, or 65 marks, 20 pfennigs; leaving 1564 marks. There was then deducted, for "case" 10 marks; "freight from Hohenstein to Bremen," 15 marks; "and to New York," 29 marks; "consul fees," 10 marks, 75 pfennigs; and "insurance," 10 marks, 25 pfennigs; being a total of 75 marks, less 4 per cent discount for cash, or 3 marks; leaving 72 marks, which deducted left 1492 marks; which was the value stated in the entry. On the invoice of the two cases of gloves the report of the appraiser was that 225 marks (be ing the 220 marks for "boxes" and the 5 marks for "packing"), less importer's discount, should be added to make market value in marketable condition.' This was done, and the duty paid on the added amount was $20.80. On the invoice of the 21 cases of hosiery the report of the appraiser was that 1246 marks, 50 pfennigs (being the 1204 marks, 50 pfennigs, for "boxes," and the 42 marks for "packing"), less importer's discount, should be added "to make market value in marketable condition." This was done, and the duty paid on the added amount was $114.80. On the invoice of the one case of hosiery, the report of the appraiser was that 30 pfennigs per dozen should be added "to make market value in marketable condition." This was done, and the duty paid on the added amount was $5.20. The importers filed a protest with the Collector in due time, and duly appealed to the Secretary of the Treasury, and brought suit in due time. The protest covered the entry in this case and was as follows: "We protest against the liquidation, as made by you, of our entries of merchandise, below referred to, and against the payment of the duties exacted thereon, and exacted on the charges of whatever nature thereon, on the following grounds, and upon each and every one of them. First. That, under the Act of March 3, 1883, the cost or market value of said merchandise is an appeal to him from your decision, and to Second. That, under the Act of March 3, 1963, only the value of said cotton hose or other merchandise is dutiable; whereas, the value of the usual and necessary sacks, crates, boxes and other coverings have been estimated as part of the value of said goods, in determining the amount of duties for which they should be liabe, contrary to the provisions of section 7, Act, March 3, 1883. Third By the Act of March 3, 1888, all duties beretofore exacted upon charges incurred ta the importation of merchandise are repealed, but there have been included, in estimating the dutiable value of said goods, actual, usual and necessary charges for putting up, preparing, and packing said merchandise; and we hereby parately and distinctly protest against all Cuties assessed by reason of such additions to the actual cost or market value of the actual merchandise imported. Fourth. That under the Act of March 8, 1983, said cotton hose or other merchandise are ely datiable at their first cost or net market valse in principal markets of countries whence exported; whereas, the appraiser, in fixing the Atable value of said merchandise, has illegally esamated and included as a part of such value the charges for finishing and putting up said merchandise, or one or more of said charges. Fifth. That the dutiable value of said mertadise is its cost or true market value at the se of its exportation, in the principal markets of the country whence it was exported, free of eberzes; but you have assessed a duty thereon pon a valuation in excess of such net cost or Srth. We further protest against the duty sed hereon, claiming that, for reasons eretofore set forth, the net invoice or entered Tue is the true legal value upon which the izes should have been assessed, and that the actions made to such value are made contrary to the Statutes of the United States, in that zedutiable charges have been reckoned as a ars of the dutiable value of said goods. and we give notice that we pay all higher és or rates than is claimed above as the legal day, under compulsion, and to obtain and keep 74st possession of our goods; and we also give The main question involved in the case is as to whether it was lawful to impose duties on the items for boxes and packing in the invoices of the two cases and the twenty-one cases, and on the item added to the invoice of the one case, which item was one for like boxes and packing. There was no duty charged on the outside packing case. The boxes in question were paper boxes or cartons which contained the goods, and were themselves packed in the outside case; and the item for packing was for packing the goods in the cartons and lining the outside case and packing the cartons in it. The cartons contained some of them a dozen and some a half dozen pairs of the articles. The outside case had a lining of heavy paper or oilcloth, to protect the goods from sea water. Some of the cartons had a partition running [504] through the middle, with half a dozen pairs of the articles on each side of the partition; some had a dozen pairs in each carton; and some had half a dozen pairs in each carton. The prices affixed to the gloves and hosiery bought, in the invoices of them, represent the prices of the goods, without case or cartons or packing. The plaintiffs paid, not only for the goods but for the cases, the cartons and the packing, paying a price per dozen of the goods, which covered the cases, the cartons and the packing, which price was 50 pfennig higher per dozen of the goods than if there had been no cartons. In the invoice of the one case, the prices affixed are the prices for the goods, including, in fact, the items deducted on the invoice, and also the charge for cartons, which charge was not deducted on the invoice, although there is nothing on the invoice to show that that charge was part of the price. The cartons are for the convenience of the trade, in transporting the goods and preserving them and handling them and counting them; and the cartons go with the goods in them, until they become empty through the sale of their contents in the United States, to consumers who buy at retail, for use. The cartons have labels on, showing the article and the style and the size and the quantity. Before examining the provisions of the Act The contention of the plaintiffs is that, by virtue of section 7 of the Act of March 3, 1883, 22 Stat. at L. 523, referred to in the protest, it was unlawful to exact duty on the value of the cartons and the packing; that, in respect to the invoice of the one case, the addition made was at we do not intend by this protest to for cartons already included in the entered valParish or waive any right we may have to ue; and that it was error to direct a verdict for and of the difference between the duty ex- the defendant. ared of us and any less duty which may hereer be adjudged the legal duty upon said of 1883, it will serve to make a determination is, intending this protest to be made against of their meaning more easy, if it is distinctly -duty charged upon said goods; seen what were the enactments in force on the ing that said duty is not the legal duty to subject at the time that Act was passed. aid goods are chargeable, holding you | By section 7 of the Act of March 3, 1865, 13 y exacted by you upon said goods above "That in all cases where there is or shall be Stat. at L. it duty, and protesting against all illegal imposed any ad valorem rate of duty on any of duty thereon; and hereby give goods, wares or merchandise imported into the that we intend this protest to apply to United States, and in all cases where the duty [505] are similar importations by us; and also imposed by law shall be regulated by or dithe duplicate protest herewith submitted rected to be estimated or based upon the value on by you to the Secretary of the of the square yard, or of any specified quantity ary, under the rules of your office, to be or parcel of such goods, wares or merchandise, [506] related to additions by the importer, on entry, and to the duty not being assessed on an amount less than the invoice or entered value, was reenacted as section 2900 of the Revised Statutes. So much of the same section as related to the rule for appraisement was re-enacted as section 2906, in these words: "When an ad valorem rate of duty is imposed on any imported merchandise, or when the duty imposed shall be regulated by or be directed to be estimated or based upon the value of the square yard, or of any specified quantity or parcel of such merchandise, the collector within whose district the same shall be imported or entered shall cause the actual market value or wholesale price thereof, at the period of the exportation to the United States, in the principal markets of the country from which the same has been imported, to be ap praised; and such appraised value shall be considered the value upon which duty shall be assessed." it shall be the duty of the collector within So much of section 7 of the Act of 1865 as according to the actual value so determined; Provided, That all additions made to the cntered value of merchandise for charges shall be regarded as part of the actual value of such merchandise, and if such addition shall exceed by 10 per centum the value so declared in the entry, in addition to the duties imposed by law, there shall be levied, collected, and paid a duty of 20 per centum on such value." These provisions of section 9 of the Act of 1866 were re-enacted as sections 2907 and 2908 of the Revised Statutes in these words: "Sec. 2907. In determining the dutiable value of merchandise, there shall be added to the cost or to the actual wholesale price or general market value, at the time of exportation in the principal markets of the country from whence the same has been imported into the United States, the cost of transportation, shipment and transhipment, with all the expenses included, from the place of growth, production or manufacture, whether by land or water, to the vessel in which shipment is made to the United States; the value of the sack, box or covering of any kind in which such merchandise is contained; commission at the usual rates, but in no case less than per centum; and brokerage, export duty, and other actual or usual charges for putting up, preparing and packing for transportation or shipment. All charges of a general character incurred in the purchase of a general invoice shall be distributed pro rata among all parts of sach invoice; and every part thereof charged with duties based on value shall be advanced according to its proportion, and all wines or other articles paying specific duties by grades shall be graded and pay duty according to the actual value so determined. Sec. 2908. All additions made to the entered value of merchandise for charges shall be regarded as part of the actual value of such merchandise, and if such addition shall exceed by 10 per centum the value declared in the entry, in addition to the duties imposed by law there shall be collected a duty of 20 per centum on such value." after entry, exceeded by 10 per cent the entered value of the goods, a duty of 20 per cent, in addition to the duties imposed by law, was required to be collected "on such value." This additional duty did not depend upon an intent to defraud, but was imposed for the mere omission of the charges from the entry. By section 14 of the Act of 1874, the omission to add the charges, without intent to defraud, was declared not to be a cause of forfeiture; but when they were omitted, it was made the duty of the public officers to add them for the purposes of duty, and to add the further sum of 100 per cent of the amount so added; such additions to be a part of the dutiable value. Then followed the seventh section of the Act of 1883, in these words: "That sections 2907 and 2908 of the Revised Statutes of the United States, and section 14 of the Act entitled 'An Act to Amend the Customs Revenue Laws, and to Repeal Moieties,' approved June 22, 1874, be Then followed section 14 of the Act of Jane and the same are hereby repealed; and hereafter 2, 1974, 18 Stat. at L., 188, which provided as none of the charges imposed by said sections, follows: "That wherever any statute requires or any other provisions of existing law, shall tit, to the cost or market value of any goods, be estimated in ascertaining the value of goods ares and merchandise imported into the to be imported; nor shall the value of the usual United States, there shall be added to the in- and necessary sacks, crates, boxes or covering ice thereof, or, upon the entry of such goods, of any kind be estimated as part of their value wares and merchandise, charges for inland in determining the amount of duties for which ransportation, commissions, port duties, ex- they are liable; Provided, That if any packages, Perses of shipping, export duties, cost of pack- sacks, crates, boxes or coverings of any kind, 4 boxes or other articles containing such shall be of any material or form designed to ds, wares and merchandise, or any other in- evade duties thereon, or designed for use otherdental expenses attending the packing, ship-wise than in the bona fide transportation of paz or exportation thereof from the country or goods to the United States, the same shall be pare where purchased or manufactured, the subject to a duty of 100 per centum ad valorem Orion, without intent thereby to defraud the upon the actual value of the same. revetne, to add and state the same on such incor entry shall not be a cause of a forfeitof such goods, wares and merchandise or of the value thereof; but in all cases where the e or any part thereof are omitted, it shall be the duty of the collector or appraiser to add the same, for the purposes of duty, to such ince or entry, either in items or in gross, at ath price or amount as he shall deem just and anable (which price or amount shall, in the sence of protest, be conclusive), and to impose and add thereto the further sum of 100 per tom of the price or amount so added; which on shall constitute a part of the dutiable Pale of such goods, wares and merchandise, all be collectibles to duties on imports.' as provided by law in reSection 26 of the e Act repealed all prior inconsistent provis By this section 7 of the Act of 1883, in the first place, sections 2907 and 2908 of the Revised Statutes, and section 14 of the Act of 1874, are repealed. This repeals the provision of section 2907, that, in determining the dutiable value of the merchandise, there shall be added to its appraised market value (to be ascertained under section 2906, which is left unrepealed), the expenses and charges mentioned in section 2907, among which are "the value of the sack, box or covering of any kind, in which such merchandise is contained," "and all other actual or usual charges for putting up, preparing and packing for transportation or shipment." It also repeals the provision of section 2908 for the additional duty of 20 per cent when the addition for the charges mentioned in section 2907 ex ceeds by ten per cent the entered value. It also ach were the enactments in force when the of 1874, for the addition of double the charges repeals the provisions of section 14 of the Act 4 of 1983 was passed. When the duty was omitted, among which charges are specified adem, or based on the value of a given "cost of packages, boxes or other articles conor parcel of goods, there was, by sec-taining such goods, wares and merchandise, and ment here of the actual market value or packing, shipping or exportation thereof from 6 of the Revised Statutes, to be an ap- any other incidental expenses attending the Sale price of the goods, at the period of the country or place where purchased or manurtation, in the principal markets of the factured." ry from which they were imported; and | appraised value was to be the dutiable Revised Statutes, and in section 14 of the Act e of the goods, as merchandise, without ref- of 1874, being charges and being eliminated as by of the items required by section part of the dutiable value of the goods, and secto be added as charges to such actual mar- tion 2906 remaining for the appraisement of the tems so required to be added were charges charges so abolished, it would seem that the e or wholesale price of the goods. All goods per se, without the addition of any of the - 2908, if the items added for charges, plain. The items thus specified in section 2907 of the [510] [511] [512] But that section goes on to say: "And hereafter none of the charges imposed by said sections or any other provisions of existing law shall be estimated in ascertaining the value of goods to be imported." Nothing is imposed by section 2907 of the Revised Statutes but the addition to the appraised market value, provided for by section 2906, of the items specified in section 2907, all of which are thus declared by section 7 of the Act of 1883 to have been "charges." Those charges are no longer to be added or estimated, as before, in determining the dutiable value of the goods. So, the repealed section 14 of the Act of 1867 imposed nothing except in respect of the items it specified, which were items to be added to appraised market value and are, therefore, declared by section 7 of the Act of 1883 to have been "charges." same purpose. They were designed to be used in the bona fide transportation of the goods to the United States, not only because they were and had been a customary article in the trade for covering and transporting these goods, but because they were intended to accompany the goods and remain with them in the hands of the retail dealer until the goods should be sold to the consumer. The change made by section 8 of the Act of 1883 in the oaths required on entry is in consonance with the above interpretation of the effect of section 7. Section 8 amends section 2841 of the Revised Statutes, as to the forms of the three several oaths, in the following manner, the particular parts referred to of the old forms and the new ones being placed side by side, and the parts in each which differ from the other being in italic: Oath of consignee, importer or agent. Old oath. chased) or fair market value (if otherwise obtained), at the time or times and place or places, when or where procured (as the case may be), of the said goods, wares and all costs for finishing said merchandise, including goods, wares and merchandise to their present condition, and no other or different discount," etc. Oath of owner in cases where merchandise has been actually purchased. But that section goes on still further to say: The last clause of section 7 of the Act of 1883 adds force to the foregoing views. It is this: "Provided, That if any packages, sacks, crates, boxes or coverings of any kind, shall be of any material or form designed to evade duties thereon, or designed for use otherwise than in the bona fide transportation of goods to the United States, the same shall be subject to a duty of 100 per centum ad valorem upon the actual value of the same." This implies that if the boxes or Coverings of any kind are not of a material or form designed to evade duties thereon, and are designed to be used in the bona fide transportation of the goods to the United States, they are not subject to duty. If either of these things occurs they are subject to 100 per cent duty. There is not, in the present case, any suggestion that the cartons were of a form or material designed to evade duties thereon. They were of the usual kind known to the trade before the law was passed, as customarily used for the Old oath. "That the invoice which count of the actual cost Oath of manufacturer or owner in cases where merchandise has not been actually purchased. Old oath. "The invoice which I New oath. "The invoice which 1 now produce contains a just and faithful valua tion of the same, at their fair market value, at the time," etc. "That the said invoice contains also a just and faithful account of all the costs for finishing said goods, wares and merchandise to their present condition, and no other discount," etc. now produce contains a |