Class 3. Suits involving claims for the remission of additiona duties, section 489 of Title IV of the tariff act of September 21, 19221 Class 4. Suits involving claims for abatement or allowance of duties for any entry, deterioration, or loss or damage sustained by any merchandise while remaining in a bonded warehouse, section 563, Title IV, tariff act of September 21, 1922.

SUITS INVOLVING CLASSIFICATION, RATE, AND DUTY ASSESSED UPON IMPORTED MERCHANDISE.

Suits under class 1, involving classifications, etc., are started by the filing of what is called a protest. That protest is filed and finally comes up for a hearing before the Board of United States. General Appraisers. My office has charge of the litigation before said board, or the litigation instituted by those proceedings that are started by a protest, which, in effect, is a protest against the decision of the Collector of Customs, involving the classification of merchandise. For instance, the Collector of Customs may say that the chief value in merchandise is silk, whereas the protest may set up that the chief value is cotton.

Mr. OLIVER. In performing that service, are you acting at the instance and request of the Treasury Department or in conformity with the rules and requirements of that department?

Mr. HOPPIN. Our client is the Treasury Department. The protest is provided for by those sections that I have just enumerated, and our office represents the Government in all litigation arising therefrom.

Mr. SHREVE. Are those cases brought before the Court of Customs Appeals?

Mr. HOPPIN. No, sir; they are brought before the Board of General Appraisers.

Mr. SHREVE. I mean when an appeal is taken from the Board of General Appraisers are the cases carried to the Court of Customs Appeals?

Mr. HOPPIN. To the Court of Customs Appeals, yes, sir.

Mr. SHREVE. In the first instance, it is tried before the Board of General Appraisers, or, rather, really in the first instance, it is tried. before a single appraiser, is it not?

Mr. HOPPIN. Appeals are tried before both a single appraiser and a board. We have two classes of work, one the out-of-town work, covering the entire country. We have some 44 out-of-town dockets covering all of the large cities and a good many of the smaller cities in the country. That work is done by a single general appraiser, who practically sits as a commissioner in protest work and as the trial judge in reappraisement work.

Mr. SHREVE. The record that is made in that case before the single appraiser becomes the record on which the case is tried in the higher court?

Mr. HOPPIN. Exactly, yes, sir.

I will finish the classification, of merchandise, if I may.

This classification No. 1 also covers the legality of all orders and findings entering into the same as to the rate and amount of duties chargeable, and as to all exactions of whatever character, within the jurisdiction of the Secretary of the Treasury, including,

t

also, his decisions excluding any merchandise from entry or delivery, under any provision of the customs revenue laws, or the collector's decision excluding any merchandise from entry under the provisions of the customs revenue laws; his liquidation of any entry; his refusal to pay any claim for drawback; his refusal to liquidate any entry for a clerical error discovered within one year after the date of entry, or within 60 days after liquidation when liquidation is made more than 10 months after the date of entry.

Under section 514 of the tariff act of 1922, provision is also made for the amendment of protests pursuant to rules of the Board of General Appraisers. This provision is taken advantage of freely, approximately 600 motions having been filed since the enactment of this provision.

By section 516 (b) of the tariff act of 1922, provision is made whereby an American manufacturer, producer, or wholesaler may file a protest against the decision of the collector as to the classification and rate of duty imposed upon imported merchandise.

By section 517 of the act of 1922, provision is made for the determination of frivolous protests (or appeals) by the Board of General Appraisers.

t A large part of this work is entirely new as to procedure and involves the added jurisdiction given to the Board of General Appraisers under the act of 1922. Formerly a great many of those matters which now come before the Board of General Appraisers were determined by the Secretary of the Treasury or, as a matter of practice, by the collector of customs. Now all of those cases come before the Board of General Appraisers for adjudication.

Mr. OLIVER. They have original jurisdiction of them?

Mr. HOPPIN. Yes, sir; and, in fact, they have exclusive jurisdiction. For instance, there are claims for allowance, where the goods are stored in warehouse and are stolen, or where the warehouse burns down.

Mr. OLIVER. Has that change of procedure operated to congest the dockets at all?

Mr. HOPPIN. Yes, sir. Of course, that involves an immense amount of litigation which we formerly did not have jurisdiction of at all. All of those claims and this added jurisdiction, which now comes to the Board of General Appraisers

Mr. OLIVER (interposing). Were not many of those cases heretofore adjusted by the action of the Treasury Department, from which no appeal was taken?

Mr. HOPPIN. Yes, sir; they were left to a large extent to the discretion of the Secretary of the Treasury, and they could not be reviewed by any court, being discretionary matters.

Mr. OLIVER. Have the decisions of this court, in the main, been along the lines that the Treasury Department formerly held and followed, or have the decisions in many cases been adverse to the discretionary decisions of the Treasury Department? I was interested to know whether in the cases that you have tried under this new procedure you have found the court largely following the decisions of the Treasury Department in cases where the same points were involved.

Mr. HOPPIN. That is a very hard question to answer, because a great many of those cases are unique. They are sui generis.

Mr. OLIVER. I can understand that, and my question did not apply to those cases.

Mr. HOPPIN. I should say, in general, yes. Of course, there are a number of matters which have been put into the act of 1922 which were not under the jurisdiction of the Secretary of the Treasury, such as the remission of additional duties, and manufacturers' protests, where the American manufacturer is given the same right to protest as the importer, and to have it tried out in the same way. There are other matters which are set forth here, but into which I will not go in detail, that have produced an immense amount of litigation.

As to the classification work, it is divided among three boards, each of which has merchandise of a certain character upon which it makes adjudications. This involves, therefore, really three separate courts in determining these classification questions.

In addition to that, of course, we have those out-of-town dockets which must be attended to by our attorneys, in which these classification questions are brought up, and where the single general appraiser sits as a commissioner in classification. He receives this testimony as a commissioner, and it is brought back and transcribed. Then this board of three considers the case on the testimony submitted in the out-of-town ports. The decisions of any of these boards may be appealed to the United States Court of Customs Appeals and, in certain instances, where a certificate of importance has been obtained from the Attorney General, they may be appealed to the United States Supreme Court.

REAPPRAISEMENT APPEALS (see p. 56).

Class 2 embraces all litigation arising under paragraph (m), section 3, of the tariff act of October 3, 1913, and section 501 of the tariff act of September 21, 1922, relating to the dutiable value of imported merchandise. This is initiated by what is called an appeal to reappraisement, which can be taken either by the importer or the collector of customs, and which brings in the question of the value found by the local appraiser, the local appraiser being the official who values the merchandise when it is first assessed for duty.

These reappraisement appeals come before a single general appraiser there being nine general appraisers, and each one of them sits as a separate trial judge in reappraisements. That makes nine separate courts on reappraisements, in addition to the three separate courts on classifications. If either party is dissatisfied with the decision of the single general appraiser sitting in reappraisements, there is an appeal to a board of three. That makes three additional courts in which we have to appear and represent the Government.

Under the act of 1922 an entirely new right is given to appeal from the decision of the Board sitting in reappraisements to the court of Customs Appeals. This, of course, will mean a great many more appeals to the Court of Customs Appeals.

Mr. SHREVE. As a matter of practice, what are the facts as to the increase of the business. Do you find that your business is actually largely increasing, or that there are a great many cases of that kind coming before you brought either by American manufacturers or importers?

Mr. HOPPIN. I have some figures on that. During the fiscal year 1922 12,336 protests were filed, while during the fiscal year 1923, 26,303 protests were filed, and during the first seven months of the fiscal year 1924, there were 25,590 protests filed.

Mr. SHREVE. How many of those were disposed of? If you have not the figures with you, you may insert them in the record.

Mr. HOPPIN. I have the figures here somewhere.

One difficulty, of course, with our practice is that what they call test cases will be taken up. The test case may be carried up to the Court of Customs Appeals, or, in some instances to the Supreme Court, and the protests will accumulate. They have the right to file them against each particular entry, and before that test case is decided, those protests will be piled up to the number of, perhaps, three or four thousand on the same class of merchandise.

Mr. SHREVE. Those protests will all be finally determined by the decision in one test case that has been filed?

Mr. HOPPIN. The protests will be; yes, sir. Of course, the test case must be very carefully tried and briefed all the way through.

Mr. SHREVE. Then, I presume you have another class of protests that are simply made for the purpose of getting them on record, in the hope that something may happen by which they may have a case.

Mr. HOPPIN. Yes, sir; there are protests filed in the hope that something may turn up, but, of course, we can not prevent that. This work has increased by leaps and bounds, involving as it does, the interpretation of an entirely new tariff act.

Mr. OLIVER. How many attorneys do you assign to that work? Mr. HOPPIN. There are 14 in the office, including myself.

APPRAISERS' COURTS.

Mr. SHREVE. You might state, if you will, just where the appraisers' courts are being held in the various cities of the United States.

Mr. HOPPIN. At the back of this brief I have a list of the out-oftown dockets, showing our schedule for last year.

Mr. SHREVE. You might just give us an idea of what territory they

cover.

Mr. HOPPIN. They cover practically every principal city in the United States, and we have anywhere from two to four attorneys constantly attending them.

CUSTOMS ATTORNEYS.

Mr. OLIVER. Out of what fund are those attorneys paid?

Mr. HOPPIN. They are all paid out of this appropriation, and our regular staff performs all of the legal work of the office.

Mr. SHREVE. I suppose it is very necessary to have these attorneys on the ground at the very beginning, because the evidence produced then is the evidence on which the case must be finally presented.

Mr. HOPPIN. Yes, sir. There may be a case tried out in Chicago or at San Francisco, and that may be the very case that is carried up to the Court of Customs Appeals upon which thousands of dollars of revenue may depend. We have some cases now, for instance, under the antidumping provision, affecting wheat flour, and if the Government should lose those cases the effect might be disastrous

upon the wheat-producing industry of the country. We have some cases involving machinery upon the outcome of which that particular industry is absolutely dependent.

Mr. ŎLIVER. Have you been able to get attorneys who are especially qualified for this class of work, or who really have had experience in matters of this kind?

Mr. HOPPIN. We have endeavored to retain the attorneys that we have had.

Mr. OLIVER. That is exactly why I was interested in asking that question as to whether or not they are experienced in this special line of work and are satisfactory, and whether such attorneys have been arbitrarily dismissed.

Mr. HOPPIN. That has been our difficulty, sir; to retain attorneys. This is the only workshop of its kind, and practically we have some 30 experienced customs attorneys or firms conducting litigation against our office.

Mr. HARRIS. I would like to state there, Mr. Chairman, that none of them have been dismissed. They go to firms where they can get better money.

Mr. OLIVER. I am glad of that.

Mr. HOPPIN. They were all offered inducements which the Government was unable to meet. They all resigned. I think four or five have resigned since I have been in office, all due to the fact that they were offered inducements which we were unable to compete with. And, of course, those men-this is not said in any spirit of criticismwe are forced to meet as attorneys for clients in litigation before the board. In fact, practically every member of the customs bar is a man who has been trained in the office of which I have charge. It is the only place in which an attorney can get experience in this particular branch of the work; and I think, with hardly an exception, the attorneys practicing actively before the board are men who have passed anywhere from two to three years in this office.

Mr. OLIVER. Of course the Government should not be put in the position of having students to look after its business and graduates from this school to look after the cases of parties who are against the Government. I think that would be most unfortunate. For that reason I had hoped we were adopting a policy that would insure these parties a continuance of employment at entirely satisfactory salaries.

Mr. HOPPIN. I would like to say in that connection, sir, that I have made every endeavor, with the appropriation which has been given to me, to grant some increase to these attorneys who have been in the customs service for a long term of years, so that we could retain their services, and the same with employees in the office; and while the increases have been extremely moderate, the only way in which I could have retained their services was to grant them these small increases; and I believe that as a result of that policy I have saved the Government an immense amount of money. Mr. SHREVE. You may proceed with your general summary.

REAPPRAISEMENT APPEALS.

(See p. 54.)

Mr. HOPPIN. The reappraisement feature of the work is of increasing importance, due to the increase in the number of appeals