HQ 0221682 - Application for Further Review of Protest No. 1303-85- 000244; 19 U.S.C. 1520(c)(1) and 1514 - United States International Trade Commision Rulings

United States International Trade Commision Rulings And Harmonized Tariff Schedule

faqs.org Rulings By Number Rulings By Category Tariff Numbers

faqs.org > Rulings and Tariffs Home > Rulings By Number > 1991 HQ Rulings > HQ 0111398 - HQ 0222425 > HQ 0221682

HQ 221682

December 17, 1990

LIQ-9-01-CO:R:C:E 221682 PH

CATEGORY: LIQUIDATION

District Director of Customs
U. S. Customs Service
40 South Gay Street
Baltimore, Maryland 21202

RE: Application for Further Review of Protest No. 1303-85- 000244; 19 U.S.C. 1520(c)(1) and 1514

Dear Sir:

The above-referenced protest was forwarded to this office for further review. We have considered the points raised by your office and the protestant. Our decision follows.

FACTS:

This protest concerns six entries of back-to-back subway car seats for incorporation into subway cars in the Washington, D.C., subway system. The entries were dated October 18 and 28, 1983, and January 23, February 9, March 5, and April 6, 1984. The merchandise was entered as free, under the Generalized System of Preferences (GSP). The Form A accompanying the entries listed as 35.5 percent the proportion of the merchandise as originating in Brazil. All of the entries were liquidated as dutiable, all except the October 28, 1983, on June 22, 1984, and the October 28, 1983, entry on June 29, 1984. Approximately 20 other entries of this merchandise were liquidated as dutiable at about the same time. These other entries were protested within 90 days after liquidation under 19 U.S.C. 1514 and the protests were granted.

On November 5, 1984, the broker for the protestant requested that the six entries under consideration be reliquidated under 19 U.S.C. 1520(c)(1). The basis for this request was that the Form A's submitted with the entries were claimed to have shown an incorrect Brazilian-origin percentage. In a February 25, 1985, letter, the attorney of the protestant followed up the November 5, 1984, letter. In this February letter it was stated that the protestant had, in response to a Request for Information (Form 28) concerning certain price and freight cost information relating to other entries of the same seats, responded with a pro forma ex-factory price list which did not include the value of United States origin polyvinyl chloride (PVC) and neoprene as Brazilian for purposes of calculating GSP percentages. On October 6, 1983, the attorney of the protestant had written to Customs in further regard to the Form 28, "noting that the Brazilian exporter had mistakenly excluded the value of the [PVC] and neoprene as Brazilian, and claiming that status for them."

The February 25, 1985, letter is summarized (by the writer) as contending that whether or not the failure of the importer to include on the Form A as Brazilian the value of the PVC and neoprene was a mistake of law, there did occur: (1) a clerical mistake of failure to change from 35.5 to 100 percent the amount of Brazilian value of the back-to-back seats; and (2) a factual mistake of Customs disregarding the representation by the importer's counsel that the value of the PVC and neoprene were claimed as Brazilian.

By letter of April 12, 1985, to the broker for the protestant, Customs confirmed that the November 5, 1984, request for reliquidation under 19 U.S.C. 1520(c)(1) had been denied. Customs stated in this letter that the attorney of the protestant had been notified of the denial on or about March 5, 1985. Customs stated in this letter that the reason for the denial of the request for reliquidation was that "... the reason for the incorrect percentage [shown on the Form A's] was a misinterpretation of the law."

On May 5, 1985, the broker of the importer protested the denial of its petition for reliquidation under 19 U.S.C. 1520(c)(1) of the entries under consideration. The basis for this protest is stated to be "[t]he original Form A documents were prepared improperly as a result of clerical error." Copies of the above-described documents were enclosed with the protest. Further review of the protest was approved on August 19, 1985.

ISSUE:

Is the failure in this case to include as Brazilian the value of certain merchandise used in the construction of back-to- back subway car seats in the entry documents for the subway car seats a clerical error, mistake of fact, or other inadvertence qualifying for relief under 19 U.S.C. 1520(c)(1)?

LAW AND ANALYSIS:

Under section 520(c)(1), Tariff Act of 1930, as amended (19 U.S.C. 1520(c)(1):

Notwithstanding a valid protest was not filed, [Customs] may, in accordance with regulations prescribed by the Secretary, 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, or other customs transaction, when the error, mistake, or inadvertence is brought to the attention to [Customs] within one year after the date of liquidation or exaction ....

The alleged clerical error, mistake of fact, or other inadvertence was timely brought to the attention of Customs in this case. Customs denial of the request to reliquidate the entries was timely protested under section 514, Tariff Act of 1930, as amended (19 US.C. 1514).

The relief provided for in 19 U.S.C. 1520(c)(1) is not an alternative to the relief provided for in the form of protests under 19 U.S.C. 1514; section 1520(c)(1) only offers "limited relief in the situations defined therein" (Phillips Petroleum Company v. United States, 54 CCPA 7, 1, C.A.D. 893 (1966), quoted in Godchaux-Henderson Sugar Co., Inc., v. United States, 85 Cust. Ct. 68, 69, C.D. 4874 (1980); see also, Computime, Inc. v. United States, 9 CIT 553, 555, 622 F. Supp. 1083 (1985), and Concentric Pumps, Ltd. v. United States, 10 CIT 505, 508, 643 F. Supp. 623

The three situations giving rise to relief under 19 U.S.C. 1520(c)(1), assuming that the other requirements therein are met, are (1) a clerical error, (2) a mistake of fact, and (3) an "other inadvertence", none of which may amount to an error in the construction of a law and each of which must be adverse to the importer and manifest from the record or established by documentary evidence. These terms, as used in 19 U.S.C. 1520(c)(1), have frequently been interpreted by the Courts.

It has been stated that "[a] clerical error is a mistake made by a clerk or other subordinate, upon whom devolves no duty to exercise judgement, in writing or copying the figures or in exercising his intention" (see PPG Industries, Inc., v. United States, 7 CIT 118, 124 (1984), and cases cited therein). It has been held that a "mistake of fact exists where a person under- stands the facts to be other than they are, whereas a mistake of law exists where a person knows the facts as they really are but has a mistaken belief as to the legal consequences of those facts" (Hambro Automotive Corporation v. United States, 66 CCPA 113, 118, C.A.D. 1231, 603 F. 2d 850 (1979), quoted in Concen- tric Pumps, Ltd., v. United States, supra at 508; see also, C.J. Tower & Sons of Buffalo, Inc. v. United States, 68 Cust. Ct. 17, 22, C.D. 4327, 336 F. Supp 1395 (1972), aff'd, 61 CCPA 90, C.A.D. 1129, 499 F. 2d 1277 (1974), and Universal Cooperatives, Inc. v. United States, Vol. 23 Cust. Bull. & Dec., No. 29, July 19, 1989, page 38, 40, CIT Slip Op. 89-89). Inadvertence has been defined as "an oversight or involuntary accident, or the result of inattention or carelessness, and even as a type of mistake" (Occidental Oil & Gas Co. v. United States, Vol. 23 Cust. Bull. & Dec. No. 17, April 20, 1989, page 40, 42, CIT Slip Op. 89-40, quoting C.J. Tower & Sons of Buffalo, Inc. v. United States, supra at 22). The Courts have held that errors in the classification or valuation of merchandise are not clerical errors, mistakes of fact, or other inadvertences but mistakes as to the applicable law (see Mattel, Inc. v. United States, 72 Cust. Ct. 257, 262-263, C.D. 4547 (1974), and cases cited therein; see also, Cavazos v. United States, 9 CIT 628 (1985), and Occidental Oil & Gas Co. v. United States, supra).

Under the above-described interpretations, the failure by the protestant to include the value of the PVC and neoprene as Brazilian in this case was clearly not a mistake of fact or other inadvertence, but a mistake of law (i.e., the protestant knew the facts but not the legal consequences of those facts).

The protestant contends that, regardless of whether its failure to include the value of the PVC and neoprene as Brazilian was a mistake of law, the failure to change from 35.5 to 100 percent the amount of Brazilian value of the back-to-back seats was a clerical error. However, there is no evidence in the file establishing, or even attempting to establish, that this "failure" was a "mistake made by a clerk or other subordinate, upon whom devolves no duty to exercise judgement, in writing or copying the figures or in exercising his intention" (see quotation from PPG Industries, Inc., v. United States, supra, defining clerical error). To result in reliquidation under 19 U.S.C. 1520(c)(1), a clerical error, mistake of fact, or other inadvertence must be "manifest from the record or established by documentary evidence." The protestant has not satisfied this requirement with regard to this claim of clerical error.

The protestant also contends that Customs erred in disregarding the representation by the protestant's counsel that the value of the PVC and neoprene were claimed as Brazilian. The basis for this claim is the October 6, 1983, letter from the attorney of the protestant to Customs. This letter explicitly relates to 3 specifically listed entries, not including any of the entries under consideration. In the letter it is stated that "[the substantially transformed imported materials (the PVC and neoprene)] should have been included in the entries in question." (Emphasis added.) There is no evidence in the file of any attempted correction of the entries for which reliquidation is sought until the initial request for reliquidation on November 5, 1984. We note that the Court of International Trade has stated that "... it is incumbent on the plaintiff to show by sufficient evidence the nature of the mistake of fact" (PPG Industries, Inc., v. United States, 4 CIT 143, 147-148 (1982), quoting in part from the lower court in Hambro, supra, (Hambro Automotive Corp. v. United States, 81 Cust. Ct. 29, 31, 458 F. Supp. 1220, C.D. 4761 (1978))). We do not believe that the protestant has even shown error, factual or otherwise, by Customs in this regard. Certainly, the protestant has not shown by sufficient evidence the nature of a clerical error, mistake of fact, or other inadvertence in this regard.

We believe that the Court of International Trade case of Universal Cooperatives, Inc. v. United States, Vol. 23 Cust. Bull. & Dec., No. 29, July 19, 1989, page 38, CIT Slip Op. 89-89, may be helpful in the analysis of this case. In that case the Court distinguishes between decisional mistakes, "in which a party may make the wrong choice between two known alternative set[s] of facts ... [which] must be challenged under [19 U.S.C. 1514]" and ignorant mistakes, "in which a party is unaware of the existence of the correct alternative set of facts ... [which] must be remedied under [19 U.S.C. 1520]" (Universal Cooperatives, Inc., supra, at page 40). In holding that the plaintiff protestant was not entitled to relief under 19 U.S.C. 1520, the Court stated:

Here ... all relevant positions as to the facts were known prior to the original liquidation and it would have been no hardship, and certainly no impossibility, for plaintiff to have made a timely protest against that liquidation. If the government was mistaken as to the facts as a result of having chosen incorrectly from a number of known alternatives, then the condition precedent for contesting that decision in court was the making of a timely protest under [19 U.S.C. 1514], thus allowing the question to be considered administratively in the most orderly and efficient way; protest made after liquidation. [Universal Cooperatives, Inc., supra, at page 41.]

As was true in the above-quoted case, in this case, according to the protestant's own submissions, all relevant positions as to the facts were known prior to the original liquidation. It would have been no hardship for the protestant to have timely filed protests against the liquidation, as was successfully done with regard to other entries of the same merchandise. This case is not one of those qualifying for the "limited relief" granted by 19 U.S.C. 1520(c)(1).

HOLDING:

The failure in this case to include as Brazilian the value of certain merchandise used in the construction of back-to-back subway car seats in the entry documents for the subway car seats is not a clerical error, mistake of fact, or other inadvertence qualifying for relief under 19 U.S.C. 1520(c)(1).

The protest is DENIED.

Sincerely,

John Durant, Director

Previous Ruling Next Ruling