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HQ 223110

May 2, 1991

LIQ-9-01-CO:R:C:E 223110 DHS

CATEGORY: ENTRY LIQUIDATION

Assistant District Director,
Commercial Operations Division
Detroit, Michigan

RE: Application for Further Review of Protest No. 3801-1-100185, Dated January 18, 1991; 19 U.S.C. 1520(c)(1); mistake of fact

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:

According to the file, the District Director denied reliquidation under Section 520(c)(1) of the Tariff Act of 1930, as amended, 19 U.S.C. section 1520(c)(1)(1982) on the issue of classification of pneumatic tools.

The protestant avers that the tools were misclassified: however, this misclassification is correctable as a mistake of fact under section 1520(c)(1). It is the protestant's belief that since your office approved a protest to reclassify previous entries that were misclassified that they are entitled to have the misclassification of the present entries reclassified under section 1520(c). A copy of the previously approved protest was provided.

You contend that the error in the classification of the merchandise is an error in the construction of the law, and therefore, not correctable under section 1520(c)(1). It is your opinion that since the same merchandise was entered under the previously allowed protest that the importer had descriptive literature available to him at the time of determining the classification number. A mistake of fact, therefore, could not exist.

ISSUE:

Whether the tariff classification of imported merchandise may be corrected under section 1520(c)(1).

Whether an approved protest permitting reclassification of misclassified merchandise is binding on subsequent protests brought under section 1520(c).

LAW AND ANALYSIS:

Section 520(c)(1) of the Tariff Act of 1930, as amended (19 U.S.C. 1520(c)(1), provides that Customs may correct certain errors, if adverse to the importer, within one year of the date of liquidation. In pertinent part Section 1520(c)(1) provides:

(c) Notwithstanding a valid protest was not filed, the appropriate customs officer may, ... reliquidate an entry to correct--

(1) a clerical error, mistake of fact, or other inadvertence not amounting to an error in the construction of 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 of the appropriate customs officer within one year after the date of liquidation or exaction; ...

A petition under Section 1520(c)(1) was designed to provide for a limited remedial action on the part of the Customs official under the above circumstances; it is not an alternative to the normal liquidation-protest method of obtaining review.

A mistake of fact has been defined as "a mistake which takes place when some fact which indeed exists in unknown, or a fact which is thought to exist, in reality does not exist." C.J. Tower & Sons of Buffalo, Inc. v. United States, 68 Cust. Ct. 17, 22, C.D. 4327, 336 F. Supp. 1395, 1399 (1972), aff'd, 61 CCPA 90, C.A.D. 1129, 499 F.2d 1277 (1974). Mistakes of fact occur when a person believes the facts to be other than what they really are and takes action based on that erroneous belief. See, T.D. 54848 (1959).

A mistake of law, on the other hand, 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, 854 (1979)(citing 58 C.J.S. Mistake, section 832)

The court in Universal Cooperative, Inc. v. United States, 13 Ct. Int'l Trade ___, 23 Cust. B. & Dec., No. 29, pg 38 (June 27, 1989), made a distinction between the types of factual mistakes. "There is the decisional mistake in which a party may make the wrong choice between two known, alternative set of facts. There is also the ignorant mistake in which a party is unaware of the existence of the correct alternative set of facts. The decisional mistake must be challenged under Section 514 (19 U.S.C. 1514). The ignorant mistake must be remedied under Section 520 (19 U.S.C. 1520(c)(1))."

The case at hand is analogous to B.S. Livingston & Co., Inc. v. United States, Slip Op. 89-151, dated October 27, 1989. In that case, a representative of the importer had a description of the merchandise and improperly applied the tariff schedules. Customs accepted this classification at the time of liquidation. After the 90 day period to file a protest lapsed, the importer unsuccessfully requested reliquidation of the entry. This was followed by an unsuccessful protest to the denial based upon the conclusion by Customs and the court that no section 1520 error had occurred in liquidation. Since the importer had failed to file an appropriate protest under section 1514(a), contesting the customs classification, the importer could not seek relief under section 1520(c).

In reaching this decision, the court referred to the principle that a determination by the Customs Service of the particular provision or the item of the tariff schedules is a conclusion of law. Mattel, Inc. v. United States, 72 Cust. Ct. 257, 262, C.D. 4547, 377 F. Supp. 955, 960(1974). This was supported by the language in Occidental Oil & Gas Co. v. United States, 13 CIT ___, slip Op. 89-40 at 6 (citing Mattel Inc. v. United States), which stated that "an erroneous classification of imported merchandise is not remedial as a clerical error, mistake of fact or inadvertence under section 1520(c)(1)."

In this case, there is no evidence presented by the importer which would substantiate a claim for reliquidation under section 1520(c). Nothing in the facts suggests that the importer believed the facts to be other than what they really are. According to the listed merchandise on the previously approved protest, it appears that the importer knew the description of the entered merchandise. Based upon the above, reliquidation of the entry under section 1520 would not be applicable to the situation at hand. The protestant's remedy to correct the classification of the merchandise was to file a timely protest pursuant to 19 U.S.C. section 1514(a).

Finally, we address the contention presented by the protestant regarding the binding affect of an approved protest, which permitted the correction of a misclassification, on other misclassified entries.

It is a well established principle that every transaction stands independently, and absent an "established and uniform" practice the determination to liquidate one entry is not binding upon subsequent entries. This principle is supported by the court in Asiatic Petroleum Corporation v. United States, 64 Cust. Ct. 47, 51, C.D. 3958 (1970), rev'd on other grounds, 59 CCPA 20, C.A.D. 1029, 449 F.2d 1309 (1971), which concluded that res judicata was inapplicable unless an "established and uniform" practice was proved.

The approval of one protest permitting liquidation of specific merchandise is not proof of an "established and uniform" practice. The previously approved protest, therefore, would not have any binding affect on the approval of claims brought under section 1520(c).

HOLDING:

The subject protest should be DENIED in full.

A copy of this decision should be attached to the CF 19 Notice of Action to satisfy the notice requirement of section 174.30(a), Customs Regulations.

Sincerely,

John A. Durant, Director

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