increase of business in 1923 over 1922; and the reports are that the business is continuing to increase practically the same as it did in 1923. We have charts which we will introduce in these hearings which will show the increase. Mr. TINKHAM. With this great increase in business in your department, the expenses under practically all your items must expand somewhat in proportion to that increase? Mr. HARRIS. That is it. The expense as a general rule we can not control, because of this automatic expansion. WEDNESDAY, MARCH 12, 1924. CONDUCT OF CUSTOMS CASES. STATEMENT OF MR. WILLIAM W. HOPPIN, ASSISTANT ATTORNEY GENERAL, CUSTOMS DIVISION. Mr. SHREVE. The next item is on page 99, under the head of "Miscellaneous objects, Department of Justice," under which comes the item for the conduct of customs cases. I notice there is a slight increase in this item, the appropriation for the current fiscal year being $83,100, while the estimate for 1925 is $89,470. If you desire to make a general statement regarding this appropriation, Mr. Hoppin, we will be glad to hear you. Mr. HOPPIN. I have a brief, Mr. Chairman. Mr. SHREVE. We will be pleased to have you read it to us. Mr. HOPPIN. The brief is quite lengthy, but I have a shorter statement here which I might read. I should like to have the full brief appear in the record. The full brief is dated January 18, 1924, and is not quite up to date. The other statement is dated February 21. I will submit the full brief for the record and will read the other. GENERAL STATEMENT. The office of the Assistant Attorney General in Charge of Customs Matters has charge of the preparation for trial and trial of customs cases before the court of first instance, the Board of United States General Appraisers, of appeals therefrom to the Court of Customs Appeals, and, in certain instances provided for by the Judicial Code, of appeals to the Supreme Court of the United States. The legal work performed by this office can be conveniently divided into three distinct divisions: 1. Suits involving the classification and the rate and amount of duty to be assessed upon imported merchandise under the tariff act of 1913 and the emergency act of May 27, 1921, the tariff act of 1922, and the rate of duty to be paid thereon; 2. Suits involving the value of imported merchandise; 3. Suits involving claims for the remission, abatement, or refund of duty paid either as drawback, additional duty, or because of damage to the merchandise, and all other decisions of the collector of customs of whatever character with which the importer is dissatisfied. Under the first subdivision above mentioned, the Board of United States General Appraisers is divided by statute into three subsidiary boards as outlined, each of which has concurrent jurisdiction over the cases in the three classifications above. In regard to the first class the cases allotted to each board is determined by the character of the merchandise imported. Trials of such cases are had before these boards at calendar calls in various ports throughout the United States. The seat of the Board of General Appraisers is in the city of New York. Their classification calendars are called monthly, and at the present time these three boards are handling approximately 5,000 cases a month. The Board of United States General Appraisers when hearing cases involving the value of merchandise sit individually as a trial court in the first instance. Upon the record there made an application for review may be made to a board consisting of three United States General Appraisers. A further appeal is allowed where questions of law are involved to the United States Court of Customs Appeals. This is an important branch of the work of customs litigation, a single case involving, at times, hundreds of thousands of dollars in duty, and often tying up the importation of similar merchandise during the pendency of the litigation. To this branch of the work falls to a large degree the practical enforcement of the antidumping provisions of the tariff law as to which there is now pending before this board a case which will involve, it is estimated, upward of $1,000,000. Wheat-flour cases involved upward of a million dollars. The third class above referred to involve new rights given importers for the first time under the tariff act of 1922, whereby they are relieved from the payment of duties under various circumstances; cases claiming a remission of additional duties where it is shown the importer did not intend upon entry to defraud the Government, misrepresent the facts to the appraiser, or to deceive the appraiser; the return of duties tentatively paid or erroneously exacted, for example, duties paid upon merchandise damaged or destroyed by fire or water after importation and while in the custody of the Government; and all decisions of the collector with regard to imported merchandise claimed by the importer to be erroneous or illegal. The above subdivision covers many activities of customs authorities which have heretofore never been the subject of judicial review by the customs tribunals. Under this classification come all disputes over the collector's decision; as to the exclusion of merchandise, either because of an infringement of a patent right or trade-mark, or because it is not legally marked with the country of origin; claims for drawback which have been disallowed by the collector; claims for the remission of additional duties exacted by the collector under section 489, tariff act of 1922; claims for allowance for damage by fire, water, or other casualty; and, all other decisions of whatever character made by the collector of customs with which the importer is dissatisfied. All the litigation resulting from the above activities are under the direct charge of the Assistant Attorney General in charge of customs matters and from this appropriation must come the funds to defray the expenses of maintaining the office at New York, the salaries of attorneys, clerical force, and traveling expenses incident to the trial of customs cases throughout the whole of the United States. The result sought to be accomplished by the maintenance of this office is to protect the revenue of the United States arising from the tariff acts. All of the cases coming before the customs tribunals involve court trials in which the importers are represented by learned and astute counsel, most of whom have been schooled in the office of the Assistant Attorney General, but notwithstanding the high quality and long training of the opposition, the result of the work of the attorneys in this office is a great saving to the Government, in duties collected throughout the country upon imported merchandise. Since the passage of the tariff act of 1922 statistics show a larger amount of duty has been collected than at any like period in the history of customs tariffs. To some extent, at least, it has been possible by reason of these large receipts from customs duties to create a surplus in the Treasury of the United States and will probably render possible the reduction of taxes. The fact that there has been collected a large amount of money over this period of time is no warranty that it will be retained in the Treasury of the United States unless adequate provision is made for the prosecution of litigation. The statute under which authority is given for the appropriation for this office is subsection 30 of section 28 of the act of August 5, 1909. A statement of the amount of litigation in regard to a customs matter which is now pending is illuminative as to the work to be done. During the fiscal year ending June 30, 1923, the cases filed with the Board of General Appraisers attacking the classification of merchandise and decisions of the collector amounted to 26,303. During the months of July to December, inclusive, 1923 (included in the fiscal year ending June 30, 1924), the protests filed amounted to 20,778, or about 80 per cent advance. Cases involving the remission of additional duties there were filed in the fiscal year ended June 30, 1923, 901; from July 1, 1923, to December 31, 1923, 414 petitions. On claims for allowance for damage under section 563 there were filed 52 during the fiscal year ended June 30, 1923, and from July to December 31, 1923, 198 claims. The following list will show that since 1920 the cases involving the classification of merchandise received by the Board of United States General Appraisers have been increasing steadily: For the fiscal year ending June 30, 1920_ 2, 416 4,863 12, 336 26, 303 20, 778 In cases involving the value of imported merchandise the same percentage of difference appears. In the fiscal year ended June 30, 1923, there were 7,082 appeals taken. In the first six months of the fiscal year ending June 30, 1924 (July 1 to December 1, 1923), there have been filed 7,732 of such appeals, or more than the total number received in 1923. On appeals taken to the board of three general appraisers to review decisions of the single general appraisers in cases involving the value of merchandise during the year ending June 30, 1923, there were 1,191 filed and in the first six months, July to December, of the fiscal year ending June 30, 1924, there were 841 of such appeals filed. It is noteworthy that as to these latter appeals which involved arguments before the board and briefing by attorneys of this office, there were appeals filed as follows: showing a constant increase. In this connection, it must also be noted that during the calendar year starting January 1, 1924, the Board of General Appraisers has fixed documents at 41 different cities throughout the United States from Portland, Me., to Key West on the eastern coast and from Portland, Oreg., to San Diego on the western coast, including practically all the ports of entry of any importance on the northern coast and also the Gulf ports. Many of the larger cities have more than one docket a year, for instance, Philadelphia has four dockets, Chicago five dockets, San Francisco and Los Angeles three dockets, Boston four dockets, etc. These various dockets are slit up into trips on which the general appraiser starting from New York accompanied by a reporter makes a circuit of from two to six ports. An attorney from this office is sent to try the cases at each of these ports. The necessity of preparation for the trial of cases, the examination of witnesses, etc., requires the attorney to leave the home office in New York in most cases about one week in advance of the first hearing day at an out-of-town port. Annexed hereto is a copy of the projected dockets for the calendar year 1924. |