LIQ-9-01-RR:IT:EC 226391 IOR
Port Director
U.S. Customs Service
526 Water St.
Port Huron, Michigan 48060
RE: Application for further review of Protest No. 3802-94-100115; 19 U.S.C. 1520(c)(1); mistake of fact;
classification of sodium aluminosilicate; C.J. Tower & Sons
of Buffalo, Inc. v. United States; Bar Bea Truck Leasing
Co., Inc. V. United States; Fabrene, Inc., v. United States;
ORR Ruling 75-0026, dated January 24, 1975
Dear Sir:
The above-referenced protest was forwarded to this office
for further review. We have considered the facts and issues
raised, and our decision follows. It is our understanding that
the above-referenced protest is a lead protest, and that
additional entries are the subject of Protest No. 3802-94-100138.
Counsel for the protestant met with representatives of this
office on October 18, 1995 to discuss this case. An additional
submission dated December 4, 1995, commemorating the points
discussed at the meeting, was made on behalf of the protestant.
A copy of that submission is enclosed for your records.
FACTS:
This protest has been filed against your denial of a request
for reliquidation of the subject entries, pursuant to 19 U.S.C.
1520(c)(1).
This protest concerns 14 entries filed by the protestant
from May 6, 1993 through May 26, 1993, in Port Huron, Michigan,
covering sodium aluminosilicate. The proforma invoice
accompanying the sample entry no. 331-7xxx529-9, describes the
imported merchandise as sodium alumino silicate. The
accompanying invoice indicates a Canada HS subheading of
3823.90.40.00, and the Entry Summary has the subheading
6815.99.4000, and a stamp indicating that the merchandise was
liquidated as entered. By letter dated May 7, 1993, the
protestant submitted a ruling request regarding the tariff
classification of sodium aluminosilicate to Customs Area Director
in New York. The ruling request referred to the product as Z-14,
which is the protestant's product designation for sodium
aluminosilicate, identified the product as a synthetic zeolite,
and included a copy of the protestant's Material Safety Data
Sheet. Port Huron issued a Customs Form ("CF 28"), Request for
Information, to the protestant on May 13, 1993, regarding an
entry dated April 27, 1993, under an entry number which is not a
subject of this protest. In addition to appraisement information
and descriptive information requested, the CF 28 asked in item 14
"what exactly is this merchandise and how is it used." The
invoice description stated in the CF-28 was "Z-14 Additive/
Sodium Silico Aluminate." By letter dated June 29, 1993, the
protestant responded to the CF 28, including item 14, attached a
copy of the May 7, 1993 ruling request and the Material Safety
Data Sheet. A ruling was issued on July 1, 1993 by Customs which
stated that the applicable subheading for the product described
in the ruling request will be 3823.90.3900 of the Harmonized
Tariff Schedule of the United States (HTSUS), which provides for:
Prepared binders for foundry molds or cores; chemical
products and preparations of the chemical or allied
industries (including those consisting of mixtures of
natural products), not elsewhere specified or included;
residual products of the chemical or allied industries,
not elsewhere specified or included: other:... other:
mixtures of two or more inorganic compounds:... other.
Entries made under subheading 3823.90.3900 are duty-free.
The subject entries were liquidated on August 13, 1993 and
August 27, 1993 under subheading 6815.99.4000 of the HTSUS, which
provides for "articles of stone or of other mineral substances
(including articles of peat), not elsewhere specified or
included: other" dutiable at a rate of 2.2%. On September 2,
1993 the protestant's broker filed Protest No. 3802-93-100410
against the liquidation of the merchandise under subheading
6815.99.4000 of the HTSUS as opposed to subheading 3823.90.3900
of the HTSUS. The protest covered the subject entries as well as
additional entries. In support of the protest, the protestant
included a copy of the July 1, 1993 Ruling Letter. By letter
dated October 7, 1993 to the protestant's broker, the port
requested information regarding the imported merchandise from the
protestant, including the exact end use of the product. The
October 7, 1993 letter stated that thirty days would be allowed
for a response. The protestant's broker did not forward the
request for information to the protestant until November 3, 1993.
The protestant responded to the request for information by a
letter dated November 15, 1993 to its broker, however, the broker
apparently failed to forward the response to Customs. The
protest was denied on December 17, 1993 on the grounds that
information necessary to properly determine the classification of
the merchandise had not been submitted, and noted the October 7,
1993 notice.
By letter dated August 11, 1994, on behalf of the
protestant, counsel for the protestant requested that the subject
fourteen entries be reliquidated under 19 U.S.C. 1520(c). The
notice has a handwritten note indicating receipt by Customs on
August 12, 1994, although the filing date in ACS is August 26,
1994. We are treating the request for reliquidation as having
been filed on August 12, 1994. According to a telephone
conversation between a member of my staff and the concerned
import specialist in your office, your office concurs with this
treatment. The request for reliquidation states the following:
Due to a mistake of fact or other inadvertence, the
Detroit District failed to apply the July 1, 1993
decision to the attached list of 14 entries of sodium
aluminosilicate which were unliquidated as of that
date. As of that date, [the protestant's] imports of
Z-14 were required to be liquidated under Subheading
3823.90.3900 in accordance with the binding ruling.
Apparently, however, the binding Customs ruling either
was not known to, or was overlooked by, the appropriate
Customs officials with respect to these 14 entries.
These entries were erroneously or mistakenly liquidated
under HTS Subheading 6815.99.4000, the provision for
"other articles of stone or of other mineral
substances.
The protestant states in the request for reliquidation that the
liquidation of the 14 entries under subheading 6815.99.4000 HTSUS
after July 1, 1993 "constitutes a mistake a [sic] fact or other
inadvertence not amounting to an error in the construction of a
law'." The protestant states that the liquidations were
"necessarily the result of a mistake of fact" and that Customs
mistook the identity of the imported product, or overlooked the
existence of the binding ruling. The request for reliquidation
was denied on August 29, 1994, stating that it was "not subject
to Section 520 action."
The protestant filed the subject protest on October 14, 1994
against the refusal to reliquidate the 14 entries of sodium
aluminosilicate under 19 U.S.C. 1520(c)(1). As background, the
protestant states that the merchandise is synthetically produced,
and is not made from stone or other mineral substances. In the
protest, as in its request for reliquidation, the protestant
states that "due to a mistake of fact or other inadvertence" the
Detroit District failed to apply the July 1, 1993 decision to the
subject entries. The protestant states that "apparently...the
binding Customs ruling either was not known to, or was overlooked
by, the appropriate Customs officials with respect to these 14
entries," and that the entries were erroneously liquidated under
subheading 6815.99.4000 HTSUS. In support of its position that
no mistake of law occurred, the protestant states that because of
the July 1, 1993 ruling, the classification of the merchandise is
"clear and undisputed," Customs liquidations were "necessarily"
the result of a mistake of fact. The protestant asserts:
It appears that despite [the protestant's] submission
of information to the District in June 1993 (two months
before these entries liquidated) identifying the
product, and despite the invoice description of the
product as sodium aluminosilicate (the same description
that appears in Customs binding ruling), Customs
mistook the identity of the imported product, or
overlooked the existence of the binding ruling.
In the December 4, 1995 submission, the protestant states
that there is no dispute regarding the proper tariff
classification of sodium aluminosilicate imported by the
protestant, and that the classification of the merchandise under
subheading 6815.99.4000 HTSUS was due to a mistake of fact by the
port as to the nature of the imported merchandise. In support of
its position that a mistake of fact correctable under 19 U.S.C.
1520(c)(1) occurred, the protestant cites Marubeni America Corp.
v. United States, 35 F.3d 530 (Fed. Cir. 1994); Nestle
Refrigerated Food Co. v. United States, No. 94-118, slip op. (Ct.
Int'l Trade July 20, 1994), Vol. 28, No. 32 Customs Bull & Dec.
(Aug. 10, 1994) 25; HQ 225399 dated November 8, 1994; C.J. Tower
& Sons of Buffalo, Inc. v. United States, 68 Cust. Ct. 17, C.D.
4327, 336 F. Supp. 1395 (1972), aff'd, 61 CCPA 90, C.A.D. 1129,
499 F.2d 1277 (1974); ITT Corporation v. United States, 812 F.
Supp. 213 (Ct. Int'l Trade 1993) revs'd on other grounds 24 F.3d
1384 (Fed. Cir. 1994).
The file contains a copy of the July 1, 1993 ruling letter,
with handwritten comments and a handwritten note made by the
liquidating import specialist referencing an August 24, 1993
telephone conversation with a National Import Specialist.
ISSUE:
Whether relief may be granted under 19 U.S.C. 1520(c)(1) to
correct an alleged mistake of fact in the classification of
merchandise?
LAW AND ANALYSIS:
Initially we note that this protest was timely filed
pursuant to 19 U.S.C. 1514(c)(2)(B). The date of decision
protested was August 29, 1994, and the protest was filed on
October 14, 1994. In addition, the refusal to reliquidate an
entry under section 1520(c)(1) is a protestable matter pursuant
to 19 U.S.C. 1514(a)(7).
19 U.S.C. 1514 sets forth the proper procedure for an
importer to protest the classification and appraisal of
merchandise when it believes the Customs Service has
misinterpreted the applicable law. A protest must be filed
within ninety days after notice of liquidation or reliquidation.
Otherwise, the tariff treatment of merchandise is final and
conclusive. In this case, the protestant did file a timely
protest under 19 U.S.C. 1514, and the protest was denied, due to
the protestants failure to furnish the information requested by
Customs.
19 U.S.C. 1520(c)(1) is an exception to the finality of
1514. Under 1520(c)(1) 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. The
error must be adverse to the importer and manifest from the
record or established by documentary evidence and brought to the
attention of the Customs Service within one year after the date
of liquidation. 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, 10 CIT 505, 508, 643 F. Supp. 623 (1986)).
Essentially the protestant's claim is that the subject
merchandise was classified under the wrong HTSUS provision. The
mistakes alleged by the protestant are that the binding Customs
ruling either was not known to, or was overlooked by, the
appropriate Customs officials with respect to these 14 entries or
Customs mistook the identity of the imported product (i.e.was
unaware of the nature of the merchandise). The protestant has
failed to provide any evidence that the subject imported
merchandise was the same merchandise as that for which the July
1, 1993 ruling was issued. Therefore, the protestant has failed
to establish that any error has occurred, as is required under 19
U.S.C. 1520(c)(2).
However, assuming that a classification error was made, we
will address the alleged mistakes of fact. The courts have
consistently taken the position that an erroneous classification
of merchandise is not a clerical error, mistake of fact, or other
inadvertence within the meaning of 19 U.S.C. 1520(c)(1), but is
an error in the construction of a law. See, Mattel Inc. v.
United States, 377 F. Supp. 955, 72 Cust. Ct. 257, C.D. 4547
(1974); and C.J. Tower & Sons of Buffalo, Inc. v. United States,
336 F.Supp. 1395, 68 Cust. Ct. 17, C.D. 4327, aff'd. 499 F.2d
1277, 61 CCPA 90 (1972). Here, the only error set forth by the
protestant is one involving the classification of the imported
merchandise. Customs has found that an exception exists and
reliquidation is proper when a Customs officer is not aware of a
classification ruling. ORR Ruling 75-0026, dated January 24,
1975. That ruling also states, however, that if an import
specialist takes note of a Headquarters ruling, and decides it is
not applicable to the merchandise, that decision is an error in
the construction of the law, excluded from relief under 19 U.S.C.
1520(c)(1).
As stated above, a mistake of fact must be manifest from the
record or established by documentary evidence. The CIT has ruled
that mere assertions by a complainant without supporting evidence
will not be regarded as sufficient to overturn a Customs
official's decision. Bar Bea Truck Leasing Co., Inc. V. United
States, 5 CIT 124, 126 (1983). Further, upon an assertion that
merchandise has been wrongly classified due to a mistake of fact,
"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), citing Hambro
Automotive Corp. v. United States, 81Cust. Ct. 29, 31, 458 F.
Supp. 1220,1222(1978) aff'd 66 CCPA 113, C.A.D. 1231, 603 F.2d
850 (1979). The protestant has provided no documentary evidence
to show that the responsible import specialist was unaware of the
July 1, 1993 ruling letter. Moreover, the file indicates that
the import specialist had a copy of the ruling in the file,
considered its applicability and discussed it with an NIS before
liquidating the last eight of the subject entries. Therefore,
because the import specialist took note of a ruling, and decided
it was not applicable to the subject merchandise, the import
specialists decision, if in error, was an error in the
construction of the law, and excluded from relief under 19 U.S.C.
1520(c)(1).
In support of its position that the mistake as to the
identity of the merchandise is a remediable mistake of fact the
protestant cites Marubeni America Corp. v. United States, 35 F.3d
530 (Fed. Cir. 1994); and Nestle Refrigerated Food Co. v. United
States, No. 94-118, slip op. (Ct. Int'l Trade July 20, 1994),
Vol. 28, No. 32 Customs Bull & Dec. (Aug. 10, 1994) 25, which
state that while the meaning of a classification term is a
question of law, the issue of whether a particular product fits
within a defined tariff term is a question of fact. The cited
distinctions were made in the context of determining the court's
standard of review in resolving the issue of the proper
classification of imported merchandise. We do not find those
distinctions applicable in this case, which concerns whether the
protestant is entitled to relief under 19 U.S.C. 1520(c)(1).
The protestant also cites to HQ 225399 dated November 8,
1994, in which we quoted Fabrene, Inc., v. United States, 17
C.I.T. 911 (1993), Vol 27, Customs Bulletin and Decisions, No.
36, p. 9, 11 (quoting from Boast, Inc., v. United States, 17
C.I.T. 114 (1993), Vol. 27, Customs Bulletin and Decisions, No.
9, p. 11, 14) which stated "[a] mistake sufficient to invoke the
relief provided by 1520(c)(1), is one which 'goes to the nature
of the merchandise and is the underlying cause for its incorrect
classification.'" As an example of this type of mistake, in HQ
225399 we stated that neither of the affiants claimed that they
believed the subject watches were wrist watches when they were
actually pocket watches. In HQ 225399 we also cited Universal
Cooperatives, Inc., v. United States, 13 CIT 516, 518, 715 F.
Supp. 1113 (1989) for the Court's distinction 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 19 U.S.C. 1520(c)(1). Believing an item to be one thing
when it is actually another is a correctable mistake. However,
not knowing what an item is, and not knowing whether to classify
it under one subheading as opposed to another, is a decisional
mistake and not correctable under 19 U.S.C. 1520(c)(1). The
fact that Customs asked questions about the composition of the
merchandise and its end use, supports the conclusion that Customs
did not know what the merchandise was, as opposed to believing it
to be one thing when it was actually another.
A mistake of fact was found in HQ 223524, dated February 13,
1992, where merchandise was classified as a wool fabric, when in
fact it was in chief value silk. A mistake of fact was found on
the basis of an invoice which identified the merchandise as
"Chief Value Wool." Customs found that the words "Chief Value
Wool" on the invoice reasonably caused the broker and Customs to
misunderstand the nature of the merchandise and reasonably and
directly led to the classification of the merchandise under the
wool provision. However, in the case of other silk merchandise
for which the invoices did not contain the words "Chief Value
Wool," Customs found that there was insufficient evidence to
demonstrate that it was a mistake of fact that caused the
misclassification rather than an error in law. Similarly, in
this case, the merchandise was identified as sodium
aluminosilicate on the invoice accompanying the entry, therefore
there is insufficient evidence to demonstrate that Customs
believed the merchandise to be something other than sodium
aluminosilicate. Based on the foregoing, we find that the
protestant has failed to set forth any correctable error, and no
error is manifest from the record. Any classification error was
an error in the construction of a law which could only be
remedied by the filing of a 19 U.S.C. 1514 protest within 90
days of liquidation. In this case such a protest was filed and
denied due to failure of the protestant to respond to Customs
inquiries.
In C.J. Tower & Sons of Buffalo, Inc. v. United States, 336
F.Supp. 1395, 68 Cust. Ct. 17, C.D. 4327, aff'd. 499 F.2d 1277,
61 CCPA 90 (1974), neither the District Director of Customs nor
the importer were aware of the nature of the imported
merchandise, which would have entitled it to duty free treatment,
until after the liquidation became final. The court held that
such a lack of knowledge did not amount to an error in the
construction of the law but came within the statutory language
"mistake of fact or other inadvertence." Degussa Canada Ltd. v.
United States, 889 F. Supp. 1543 (Ct. Int'l Trade 1995) citing
C.J. Tower & Sons, 68 Cust. Ct. at 22, 336 F.Supp. at 1399. We
find the Tower case inapplicable in this case, because there is
no evidence that the protestant was unaware of the nature of the
imported merchandise. In fact, the protestant protested the
liquidation of the imported merchandise in a timely manner,
indicating that the protestant was aware of the nature of the
imported merchandise. In ITT Corporation v. United States, 24
F.3d 1384 (Fed. Cir. 1994), cited by the Protestant, the CIT had
found a mistake of fact when the Plaintiff's agent had used
company documents applicable to different merchandise which was
to be sent to a different customer. See ITT Corporation v.
United States, 812 F.Supp. 213, 216 ( CIT 1993). We find ITT
Corporation does not apply to support the protestant's claim.
HOLDING:
The protestant has not established a mistake of fact in the
liquidation of the subject entries, and reliquidation of the
entries is not permissible pursuant to 19 U.S.C. 1520(c)(1).
Consistent with the decision set forth above, you are hereby
directed to deny the subject 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, Freedom of Information Act and other public
access channels.
Sincerely,
Director,
International Trade
Compliance Division
Enclosure