PRO-2-01/DRA-4-CO:R:C:E 224846 JRS
Ms. Sue A. Linnemann
Assistant District Director, Commercial Operations
U.S. Customs Service
P.O. Box 619050
Dallas/Ft. Worth, Texas 75261
RE: Application for Further Review Protest No. 5501-93-100085;timeliness of protests; 19 U.S.C. 1514; Goldhofer Fahrzeugwerk
GmbH & Co. v. United States; Sea-Land Service, Inc. v. United
States; legal notice of liquidation; 19 CFR 159.9; 19 CFR
This is in response to your request for further review of
the above-referenced protest. Our decision follows.
On February 8, 1993, District Director of Customs,
Dallas/Fort Worth, sent a letter to the importer's broker
informing him that his client's same condition drawback claim was
disallowed because the notice of exportation was not received by
Customs within the 3-year period from the date of exportation
(191.141(3)(c)). On February 25, 1993, a broker, on behalf of
its client, Westinghouse Electric Corporation, filed this protest
challenging the disallowance of its drawback entry dated April
26, 1989. Subsequently, on February 26, 1993, the drawback entry
was liquidated with a denial of drawback. This liquidation date
appears both on the drawback entry itself as well as on the ACS
entry Archive File.
Your office recommends denial, not on the fact that proof of
exportation was not timely filed (which is the reason listed on
the February 8, 1993 letter), but rather on the basis that the
merchandise descriptions on the air cargo manifest provided as
proof of exportation do not match descriptions on import invoices
and that you cannot be certain that the same merchandise which
was imported was in fact exported. We note, however, that a
Customs inspector in San Antonio examined the merchandise and
found it to be the same merchandise in the same condition as that
which was imported. See box 50 on CF 7539 dated April 26, 1989.
Is a protest filed by a broker on behalf of the importer
before the liquidation of a drawback entry timely?
LAW AND ANALYSIS:
Initially, we note that the refusal to pay a claim for
drawback is a protestable issue. See 19 U.S.C. 1514(a)(6).
However, a protest must be timely filed in order to give the
Customs Service jurisdiction to consider the protest's merits.
The statute, 19 U.S.C. 1514, fixes a definite time within
which a protest may be filed. 19 U.S.C. 1514(c)(2) requires that
a protest be filed with Customs within 90 days after, but not
before, notice of liquidation or reliquidation. This requirement
is strictly construed. Atari Caribe v. United States, 16 CIT ,
, 799 F. Supp. 99, 102 (1992); see also Peg Bandage, Inc. v.
United States, 17 CIT , Slip Op. 93-236 (December 15, 1993), as
printed in Vol. 28 Cust. B. & Dec., No. 1, January 5, 1994, pages
268-269. Untimely filed protests are invalid. United States v.
Wyman, 156 F. Supp. 97, 84 C.C.A. 123 (Mo. 1907); see also
Gallagher & Ascher v. United States, 21 CCPA 313 (1933); Spiegel
Bros. v. United States, 21 CCPA 310 (1933). The procedural issue
turns on what is the legal notice of liquidation, and once that
is determined, whether the protestant's broker filed its protest
within 90 days after, but not before, that notice to give the
Customs Service jurisdiction over the protest.
The only notice of liquidation that is statutorily mandated
is bulletin notice. See Goldhofer Fahrzeugwerk GmbH & Co. v.
United States, 13 CIT 54, 706 F. Supp. 892, 895 (1989), aff'd,
885 F.2d 858 (Fed. Cir. 1989); Tropicana Products, Inc. v. United
States, 713 F. Supp. 415, 419 (1989). This form and manner for
giving notice of liquidation of formal entries is set forth in
sections 159.9(b) and (c) of the Customs Regulations (19 CFR
159.9). Courtesy notice is not indispensable to liquidation, nor
is it recognized as legal proof of liquidation. 19 CFR 159.9(c).
Usually, courtesy notice is merely intended to inform the
importer or broker that liquidation is imminent.
In this case, the bulletin notice of liquidation that was
posted at the customhouse on February 26, 1993, was the only
legal notice of liquidation. The earlier informal "form" letter
dated February 8, 1993, informing the protestant's broker that
the claim was disallowed did not amount to legal notice of
liquidation. See 19 CFR 191.141(g)(3); 19 CFR 159.9(d). The
broker must wait until the claim is actually liquidated to file
the protest. As stressed in Goldhofer, supra, 13 CIT at 58, it
is the plain duty of a prudent importer to monitor the
customhouse bulletin in order to determine whether or not
liquidation has been made. On February 25, 1993, liquidation of
the drawback entry had not yet been effectuated, despite the
misleading language in the February 8th letter that the claim had
already been disallowed. The broker filed the protest on
February 25, 1993, one day prior to the posting of the bulletin
notice. The protest is, therefore, premature under 19 U.S.C.
1514 because it was filed before the liquidation of the drawback
entry. Consequently, the protest at issue is invalid.
We note, however, that the court may, in rare instances,
exercise its equitable powers and toll the statutory time
limitation when a party has been induced by his adversary into
allowing a filing deadline to pass. See Sea-Land Service, Inc.
United States, 17 CIT , Slip Op. 93-13, 812 F. Supp. 222
(1993). In Sea-Land Service, the importer received a letter from
Customs on May 30, 1990, stating that the entry in question will
be liquidated, when in fact it had been liquidated 5 days earlier
on May 25, 1990. The court found that Customs' erroneous letter
induced Sea-Land to allow the filing deadline to pass and that
Sea-Land acted reasonably in relying on Customs letter of May 30,
1990, and in assuming that the 90 days to protest would at least
not commence to run until May 30, 1990. Id. at 224. The court
noted that the importer had not checked the bulletin notice of
liquidation, as he is required to do. Based on equitable
principles, however, the court held that Sea-Land's protest was
timely filed as of August 28, 1990, by extending the statutory
ninety-day filing period from May 25 until May 30.
This case is distinguishable from the facts in Sea-Land
Service, supra. In this case, unlike Sea-Land, Customs made no
specific mention regarding the time of liquidation of the
drawback entry although, arguably, liquidation was implied.
Since the entry was not liquidated at the time the February 8th
letter regarding the claim's disallowance was issued, Customs did
not overtly mislead or interfere with the statutory time
limitation of 19 U.S.C. 1514, as the court had found that the
Customs Service had done in Sea-Land. Moreover, an argument can
be posited that the February 8th letter, unlike the notice in
Sea-Land, may not even be construed as a courtesy notice of
liquidation since it did not specifically reference the time or
fact of the drawback entry's liquidation.
Since this protest must be denied on procedural grounds, we
are statutorily foreclosed from considering the merits of the
denial of the same condition drawback claim.
A protest is considered untimely filed under 19 U.S.C.
1514(c)(2) when it filed anytime before the posting of the
bulletin notice of liquidation or reliquidation at the
customhouse, which is the only legal notice of liquidation.
You are directed to DENY the protest. In accordance with
Section 3A(11)(b) of Customs Directive 099 3550-065, dated August
4, 1993, Subject: Revised Protest Directive, this decision should
be mailed by your office to the protestant no later than 60 days
from the date of this letter. Any reliquidation of the entry in
accordance with the decision must be accomplished prior to
mailing of the decision. Sixty days from the date of the
decision the Office of Regulations and Rulings will take steps to
make the decision available to customs personnel via the Customs
Rulings Module in ACS and the public via the Diskette
Subscription Service, Lexis, Freedom of Information Act and other
public access channels.
John Durant, Director