LIQ-9-01-CO:R:C:E 225163 PH

Regional Commissioner of Customs
(C/O Protest and Control Section)
6 World Trade Center, Room 762
New York, New York 10048-0945

RE: Protest No. 1001-93-107081; Clerical Error, Mistake of Fact, or other Inadvertence; Antidumping Duties; Reimbursement Certification; 19 U.S.C. 1520(c)(1) Dear Sir:

The above-referenced protest was forwarded to this office for further review. In its memorandum in support of the protest, the protestant requested a meeting. An opportunity for such a meeting was given to the representative of the protest who chose to submit a supplemental letter addressing issues which this office had raised in lieu of such a meeting. A copy of the protestant's April 29, 1994, letter is enclosed for your records.

We have considered the points raised by your office and the protestant. Our decision follows.

FACTS:

According to the file, on May 7, May 9, and June 5, 1987, the importer entered certain merchandise (certain enamel cookware) from Taiwan. The protestant acted as surety for the entries.

The merchandise under consideration was the subject of an antidumping investigation (case A-583-508) (Federal Register of December 31, 1985 (50 FR 53353)). In a notice of preliminary determination (Federal Register of May 20, 1986 (51 FR 18472)), Customs was directed to suspend liquidation of all entries of such merchandise that are entered, or withdrawn from warehouse, for consumption, on or after the date of publication and to require a cash deposit or the posting of a bond equal to the estimated weighted-average amount provided in the notice. A final determination was published in the Federal Register on October 10, 1986 (51 FR 36425), pursuant to which Customs was directed to continue to suspend liquidation of entries of the merchandise and to continue to require a cash deposit based on the estimated weighted-average amount provided in the notice. On December 2, 1986, in an Antidumping Duty Order, the International Trade Administration (ITA) published a determination in the Federal Register (51 FR 43416) that importations of the merchandise materially injure a United States industry (on the basis of findings of the International Trade Commission (ITC)) and Customs was directed to require a cash deposit based on the estimated weighted-average antidumping duty margins provided in the notice.

Pursuant to the above determinations, the importer deposited antidumping duties for the entries protested in the total amount of $4,426.25.

On February 8, 1988, Customs issued a telegram (No. 001557, Subject: Antidumping Duties (88-16)) advising that the Depart- ment of Commerce had not received a request for an administrative review of the antidumping duty finding/order for certain periods on merchandise listed in the telegram. Therefore, Customs officers were directed to assess antidumping duties on the subject merchandise entered, or withdrawn from warehouse, for consumption during the periods listed in the telegram at the cash deposit or bonding rate required at the time of entry. The instructions for the merchandise under consideration were to "liquidate all entries for all firms except: [not applicable in this case] [for the] period [of] 05/20/86 - 11/30/87".

On April 22, 1992, Customs sent a Customs Form 29, Notice of Action, to the importer in regard to the protested entries, along with certain other entries. Customs stated in the notice that the "entries [were] to be liquidated at [antidumping] duty rates as entered. Please complete attached reimbursement statement and return it to this office." The "reimbursement statement" form listed each of the protested entries, along with the other entries. The form cited 19 CFR 353.26, and stated that failure to return the document within 20 days could result in "up to double the amount of final antidumping duty determination rates." The certification on the form concerned whether the importer had entered into any agreement or understanding for the payment or refunding to the importer by the manufacturer, producer, seller or exporter of all or any part of the antidumping duties upon the listed entries. According to the box checked on the Customs Form 29, if the importer disagreed with the proposed action, the importer was requested to furnish its reasons in writing to Customs within 20 days from the date of the notice; after 20 days the entries were to be liquidated as proposed.

The entries were liquidated on July 24, 1992, with an increase in the antidumping duties in the total amount of $4,426.25 (representing the additional assessment equal to the total dumping duties deposited, on the basis that the reimbursement notice was not returned to Customs, as provided for in the above- referenced Customs Form 29) for the protested entries. According to the protestant, on February 19, 1993, Customs issued a demand for payment of the increased antidumping duties on the protestant-surety, "given that the importer was no longer in business."

On July 23, 1993, the protestant filed a request to reliquidate the entries under consideration on the basis that the liquidation of the entries with additional antidumping duties was the result of a clerical error, mistake of fact, or other inadvertence adverse to the claimant. By letter of September 1, 1993, Customs responded to the protestant's July 23, 1993, request for relief under 19 U.S.C. 1520(c)(1). In its letter, Customs stated (by checking the appropriate box on the form letter) that:

We have determined that there is no clerical error, mistake of fact, or other inadvertence correctable under section 520(c)(1). Consequently, the subject of your claim falls within the scope of Section 514. However, since your letter was not presented within the time limit prescribed by section 514, we cannot afford you review under that section of law.

On October 13, 1993, the protestant filed the protest under consideration, protesting the denial of the July 23, 1993, request for relief under 19 U.S.C. 1520(c)(1). Further review of the protest was requested and granted.

ISSUE:

May the protest in this case be granted?

LAW AND ANALYSIS:

Initially, we note that the protest was timely filed (i.e., within 90 days after the denial of the request for relief under 19 U.S.C. 1520(c)(1)) and that the request for relief under section 1520(c)(1) was timely filed (within 1 year after the date of liquidation). The matter protested is protestable (see 19 U.S.C. 1514(a)(7)).

No certification that the protest is not being filed collusively to extend another authorized person's time to protest, as required for a protest by a surety (see 19 U.S.C. 1514(c)(2)), was provided. Because the protest must be denied on other grounds (see below), we are not addressing the issue of whether such a certification is required in a protest such as this, protesting the denial of a request by a surety for relief under 19 U.S.C. 1520(c)(1). Nor are we addressing the issue of whether the filing of a certification after the time for protest has expired, as the protestant purported to do in its April 29, 1994, letter, satisfies the requirement for such a certification. We note, however, that the leading Court case interpreting this requirement, Washington International Insurance Co. v. United States, 13 CIT 112, 707 F. Supp. 561 (1989), found the requirement for this certification to be an absolute, jurisdictional requirement, noting that "[it (i.e., the Court) was] hard-pressed to conceive of what such a reason [i.e., for not complying with the certification requirement] might be." (13 CIT at 115; see also Note 8, id, "This court finds no per se rule allowing omission of certification in such circumstances [i.e., when the importer was not locatable].")

We also are not addressing the issue of standing (because, in any event, the protest must be denied on other grounds, as explained below). However, we note that standing is a basic threshold jurisdictional requirement (see, e.g., Tisza v. Communications Workers of America, 953 F. 2d 298 (7th Cir. 1992), Shearson Lehman Hutton, Inc., v. Wagoner, 944 F. 2d 114 (2nd Cir. 1991); see also, West's Federal Practice Digest, 4th, Vol. 41, Federal Civil Procedure,  103.1, and cases discussed therein). Standing could be a bar to relief in this case because, in filing the request for relief under section 1520(c)(1), the surety sought to benefit from the provision as the agent of the importer. Therefore, the surety "merely step[s] into the shoes of [the importer] and only acquire[s] whatever rights to the refund of duties [the importer] had." (See, e.g., St. Paul Fire and Marine Insurance Co. v. United States, 2 CIT 104, 106, 525 F. Supp. 880 (1981).)

If bankruptcy of the importer occurred before the filing of the request for relief under 19 U.S.C. 1520(c)(1) in this case, as in the St. Paul Fire and Marine Insurance Co., case, supra, "the initial obligation for payment of the duties [would be] 'rooted in the prebankruptcy past'", so that "... any claim for refund of those duties vested in the trustees in bankruptcy ... [and] only they [i.e., the trustees in bankruptcy], and not the bankrupts, could properly pursue the claims by filing the protests." Since the bankrupt (i.e., the principal) could not properly pursue relief, neither could the surety, standing in the shoes of the principal, pursue such relief. However, because the factual evidence available does not conclusively establish the importer's bankruptcy (the protestant was given an opportunity to provide evidence on this issue and did not do so) and because the protest may be decided on other grounds, we are not denying the protest on the basis of standing.

In this case, the surety has sought relief under 19 U.S.C. 1520(c)(1). Under this provision, Customs may reliquidate an entry to correct a clerical error, mistake of fact, or other inadvertence, not amounting to an error in the construction of a law, when certain conditions are met. Section 1520(c)(1) has 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 understands 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 Concentric Pumps, Ltd., v. United States, 10 CIT 505, 508, 643 F. Supp. 623 (1986); 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, 13 CIT 516, 518, 715 F. Supp. 1113 (1989)). 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, 13 CIT 244, 246 (1989), quoting C.J. Tower & Sons of Buffalo, Inc. v. United States, supra, 68 Cust. Ct. at 22).

The conditions required to be met under 19 U.S.C. 1520(c)(1) are that the clerical error, mistake of fact, or other inadvertence must be adverse to the importer, manifest from the record or established by documentary evidence, and brought to the attention of Customs within one year after the date of liquidation of the entry. 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 affords "limited relief in the situations defined therein" (Phillips Petroleum Company v. United States, 54 CCPA 7, 11, C.A.D. 893 (1966), quoted in Godchaux-Henderson Sugar Co., Inc., v. United States, 85 Cust. Ct. 68, 69, C.D. 4874, 496 F. Supp. 1326 (1980); see also, Computime, Inc. v. United States, 9 CIT 553, 555, 622 F. Supp. 1083 (1985), and Concentric Pumps, Ltd. v. United States, supra).

The protestant's June 23, 1993, request for relief under section 1520(c)(1) claimed that the liquidation of the entries with additional antidumping duties was the result of a clerical error, mistake of fact, or other inadvertence adverse to the claimant. Specifically, the protestant argued that although Customs instructions (i.e., the February 8, 1988, telegram referred to above) "clearly dictated that the entries should be liquidated on February 8, 1988, either through mistake or inadvertence these entries were not liquidated until July 24, 1992." The protestant contended that Customs committed two mistakes of fact or inadvertences in this case. The first was that Customs acted as if the suspension of liquidation had not been lifted in February of 1988. In this regard, the protestant argued that if Customs had not delayed the liquidation of the entries, the reimbursement statement would have been requested while the importer was still in business. The second mistake of fact or inadvertence by Customs, according to the protestant, was in acting as though the entries were unliquidated when, in fact, they were deemed liquidated on the four-year anniversary of the dates of entry (under 19 U.S.C. 1504(d)). Since the entries should have been deemed liquidated on the four-year anniversary, "it was a mistake to assess double antidumping duties when the entries had already been deemed liquidated with the amount of antidumping duties deposited at the time of entry." Finally, the protestant argued that Customs was mistaken to presume that the importer was subject to reimbursement of antidumping duties, on the basis of the failure of the importer to return the completed reimbursement statement sent to it with the Customs Form 29 (described above).

The evidence submitted with the request for relief consisted of copies of the February 8, 1988, liquidation instructions, the April 22, 1992, Request for Information, and the Customs Forms 7501 for the entries under consideration, with notations recognizing the liquidation instructions (i.e., "ADA As per HQ Telex 001557, dated 2/8/88 liquidate entry Dumping duty rate doubled".

The first mistake alleged by the protestant is that Customs acted as if the suspension of liquidation had not been lifted in February, resulting in the reimbursement statement being sent to the protestant after it was out of business. In other words, the inadvertence or mistake of fact alleged is Customs failure to liquidate the entry pursuant to the February 8, 1988, instructions.

As the protestant argues in this regard, we have ruled that relief may be granted under section 1520(c)(1) when an entry is prematurely liquidated with countervailing duties, contrary to instructions to suspend liquidation because of the pendency of the countervailing duty case (see, e.g., HQ ruling 223160, September 13, 1991). However, in that case it was established that the Customs officer who liquidated the merchandise was not aware that there was an outstanding countervailing duty case and that liquidation had been suspended. Thus, this position is consistent with Universal Cooperatives, Inc., v. United States, 13 CIT 516, 518, 715 F. Supp. 1113 (1989), which distinguished between "decisional mistakes" in which a party may make the wrong choice between two known alternative sets of facts and which "must be challenged under Section 514" and "ignorant mistakes" which are remediable under section 1520(c)(1) (see also, in this regard, Legal Determination 75-0026).

In this case, there is no evidence as to whether the Customs official who liquidated the protested entries was ignorant of the removal of the suspension of liquidation or whether that official was aware of the removal of suspension and determined that it was inapplicable to the entries under consideration. As explicitly stated in section 1520(c)(1), in order to qualify for relief under that provision, the clerical error, mistake of fact, or other inadvertence must be manifest from the record or established by documentary evidence (see, in this regard, PPG Industries, Inc. v. United States, 4 CIT 143, 147-148 (1982), and United States v. Lineiro, 37 CCPA 5, 10, C.A.D. 410 (1949), "[d]etermination of issues in customs litigation may not be based on supposition"). Since section 1520(c)(1) only affords "limited relief in the situations defined therein" (see Court cases above in regard to this proposition) and since the prerequisites for such relief have not been met in regard to this allegation, the protest is DENIED in this regard.

The second mistake alleged by the protestant is that of acting as though the entries were unliquidated (even though the entries were actually deemed to have been liquidated at the 4-year anniversary of the dates of entry) when the purported liquidation, with an increase in antidumping duties, was effected. In other words, the protestant alleges that it was an inadvertence or mistake of fact by Customs to liquidate the entries after they should have been deemed liquidated as entered on the 4-year anniversary of the entries.

In regard to this issue, the dates of the entries under consideration were May 7 and 9, and June 5, 1987. The date of the liquidation instructions was February 8, 1988. The date of liquidation was July 24, 1992, more than four years after the dates of entry and more than four years after the date of the liquidation instructions.

If a protest under 19 U.S.C. 1514 had been timely filed by an authorized party, relief could have been granted, pursuant to 19 U.S.C. 1504(d), as interpreted before its amendment by section 641 of Public Law 103-182 (the North American Free Trade Agreement Implementation Act (107 Stat. 2057, 2204), enacted December 8, 1993), or as so amended. In regard to the interpretation of section 1504(d) before its 1993 amendment, see Nunn Bush Shoe Co. v. United States, 784 F. Supp. 892 (CIT 1992) (i.e., if the suspension of liquidation was removed before the end of the 4-year period after entry, liquidation was required before the four-year anniversary of the entries). Because no timely protest was filed under section 1514, relief may not be granted under that statute (see United States v. A. N. Deringer, Inc., 66 CCPA 50, 593 F. 2d 1015 (1979); Omni U.S.A., Inc. v. United States, 6 Fed. Cir. (T) 99, 840 F. 2d 912 (1988); and Philip Morris v. United States, 13 CIT 556, 716 F. Supp. 1479 (1989) (affirmed in part and reversed in part in an unpublished decision of the Court of Appeals for the Federal Circuit, 8 Fed. Cir. (T) 187, 907 Fed. 2d 158 (1990)), relating to the issue of "void" versus "voidable" liquidations).

Relief under section 1520(c)(1) is unavailable in this regard basically for the same reasons cited regarding the first mistake alleged by the protestant (i.e., lack of evidence establishing the alleged inadvertence or mistake of fact). That is, there is no evidence as to whether the Customs official who liquidated the protested entries did so as a result of inadvertence or mistake of fact not amounting to an error in the construction of law, or as a result of a mistake in the construction of law. See SCA International, Inc., v. United States, 14 CIT 59 (1960), for a case finding that section 1520(c)(1) is inapplicable without such evidence in the case of an improper liquidation. As the Court stated in that case, "[t]he essential question is -- did the improper liquidations occur as a result of a mistake in the construction of law or as a result of a mistake of fact" (14 CIT at 60). As noted above in regard to the first mistake alleged by the protestant, since section 1520(c)(1) only affords "limited relief in the situations defined therein" (see Court cases above in regard to this proposition) and since the prerequisites for such relief have not been met in regard to this allegation, the protest is DENIED in this regard.

The protestant also argues that Customs made a clerical error, mistake of fact, or other inadvertence in presuming that the importer was reimbursed for the antidumping duties, on the basis of the importer's failure to provide the reimbursement statement, is as follows. Our analysis of this argument follows.

The Department of Commerce has advised Customs regarding its interpretation of this issue (see June 5, 1991, letter from the Department of Commerce to Customs, copy enclosed). According to this letter, for entries during the time-period in which the protested entries were made, the Department of Commerce required the importer to file a reimbursement certificate with Customs within 30 days after the earlier of: (1) publication of the antidumping order or any administrative review thereof pursuant to 19 CFR 353.53, or, if appropriate, 19 CFR 353.49; or (2) importation of the merchandise in a district in which not previously imported (see also 19 CFR 353.55, between 1980 and 1989, now at 19 CFR 353.26). The letter also stated that, "[i]f the importer goes out of business before the deadline for filing the certificate has passed, Customs should not presume that reimbursement has occurred [and] if the importer goes out of business after the deadline for filing the certificate has passed, Customs should presume that reimbursement occurred." There is no requirement, in either the June 5, 1991, letter or in the applicable regulations (19 CFR 353.55 between 1980 and 1989 and 19 CFR 353.26 now) that Customs must give an importer notice to provide a reimbursement statement; the applicable regulations require the importer to file the statement with Customs.

In this case, Customs records indicate that the importer went out of business as of March 27, 1992, and the protestant does not disagree with those records. The date of the antidumping order in this case was December 17, 1986. According to the February 8, 1988, Customs telegram issuing liquidation instructions (see above), there was no request for administrative review of the antidumping order. There is no evidence presented as to the date of first importation in the district of importation of the protested entries. However, even if we assume that the earlier of the events 30 days after which the importer was required to file the reimbursement statement was the date of publication of the antidumping order, the evidence before us is clear that the importer went out of business after the deadline for filing the reimbursement certificate, in which case the Department of Commerce advised in its June 5, 1991, letter that Customs should presume that reimbursement occurred. The request for relief is DENIED in this regard (and we note that a protest, if one had been timely filed by an authorized party under 19 U.S.C. 1514 would also have been denied in this regard).

HOLDING:

The protest (i.e., as to the demand on the surety for payment of the increased antidumping duties) is DENIED.

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, with the Customs Form 19, 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 ECHOES and the public via the Diskette Subscription Service, Freedom of Information Act, and other public access channels.

Sincerely,

John Durant, Director
Commercial Rulings Division

Enclosures