LIQ-1-09 RR:CR:DR 227484 CB
Port Director of Customs
U.S. Customs Service
Entry Branch
9777 Via de La Amistad
San Diego, CA 92173
ATTN: Carol J. McDaniel, Otay Mesa
RE: Protest and application for further review no. 2501-96100086; reliquidation to correct mistake of fact; 19 U.S.C.
1514; 19 U.S.C. 1520(c); burden of proof
Dear Sir/Madam:
This responds to the referenced protest. The protest record has
been reviewed and our decision follows.
FACTS:
The subject protest covers thirty entries which were liquidated
between January 27 and June 30, 1995. The subject golf club
heads were entered under subheading 9506.39.0060, Harmonized
Tariff Schedule of the United States (HTSUS), as golf club heads.
According to protestant, at the time of entry, the broker was
unaware that the values reflected on the invoices for the golf
club heads which were identified as damaged were incorrect.
Protestant asserts that this valuation was incorrect because it
was based on the material values and the labor costs for good
golf club heads. As it turned out, these damaged articles were
actually worthless except for their scrap value. As a result,
the invoiced and entered unit values were clearly excessive.
A 19 U.S.C. 1520(c)(1) petition was filed on December 27, 1995.
Protestant sought a refund of the excess duties and merchandise
processing fee assessed therein due to clerical error, mistakes
of fact or other inadvertence. The petition did not contain any
documentary evidence. Your denial of the request for
reliquidation is dated July 19, 1996. The subject protest was
filed on October 15, 1996.
This office afforded protestant an opportunity to make a written
submission to substantiate its claim. As a result of our
request, protestant submitted an affidavit from the Vice
President of Finance & Administration for Lynx Golf dated January
28, 1998. Lynx was neither the importer of record nor the broker
for the subject entries. According to the invoices, Lynx was the
consignee. The affidavit refers to an "Exhibit A", however,
there is no attachment to the affidavit. Nonetheless, the
affiant asserts that neither the importer nor the broker knew
that the golf club heads were useable only as scrap.
ISSUE:
Was Customs denial of the importer's request for reliquidation
under 19 U.S.C. 1520(c)(1) erroneous, such that this protest
under 19 U.S.C. 1514(a)(7) should be approved?
LAW AND ANALYSIS:
Initially, we note that the protest, with application for further
review, was timely filed under the statutory and regulatory
provisions for protests (see 19 U.S.C. 1514 and 19 CFR Part
174). We also note that refusal to reliquidate an entry under
section 1520(c) is a protestable decision under section 1514 (19
U.S.C. 1514(a)(7)).
Under the protest procedure of 19 U.S.C. 1514, errors in the
classification, valuation, etc. of merchandise can be corrected,
and reliquidation obtained with refund of overpaid duties, if the
error is bought to the attention of the appropriate Customs
officer within 90 days of the liquidation. Failure to file a
protest within the prescribed period renders the liquidation
final and binding on the importer and the government.
After the expiration of the 90-day period, an importer can obtain
a reliquidation of the entry, and a refund of overpaid duties, in
only limited circumstances. Under 19 U.S.C. 1520(c)(1), an
entry can be reliquidated 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 brought to the attention of the appropriate Customs officer
within one year from the date of liquidation. The error must be
manifest from the record or established by documentary evidence.
This means that the nature of the error must be observable upon
review of the record or upon submission of documentary evidence.
In either event, the burden is on the petitioner to establish the
nature of the error claimed and to demonstrate that it falls
within the ambit of the statute.
A mistake of fact must be manifest from the record or established
by documentary evidence. The Court of International Trade (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). In ITT
Corp. v. United States, 24 F.3d 1384, 1387 (Fed. Cir. 1994),
the court found that reliquidation under 19 U.S.C. 1520(c)
requires both notice and substantiation. Notice of a clerical
error, mistake of fact, or other inadvertence includes asserting
the existence of a clerical error, mistake of fact, or other
inadvertence "with sufficient particularity to allow remedial
action."
As stated in the FACTS section of this decision, protestant has
submitted an affidavit from an individual who is neither an
employee of the importer nor of the customs broker. Yet, the
affiant purports to attest as to the state of mind of those who
prepared the entry documentation. There is no evidence (i.e., by
the person making the allegedly erroneous valuation as to what he
or she believed the nature of the merchandise to be and the basis
for that belief) establishing that the alleged error was a
mistake of fact and not a mistake of law.
The protestant has failed to meet the substantiation requirements
for relief pursuant to 19 U.S.C. 1520(c)(1). The protest
consists of an assertion regarding the valuation of the damaged
golf heads and virtually no assertions (with supporting
documentation) about the broker's belief regarding the value of
the merchandise. Since we do not know who made the mistake, we
cannot determine whether it is a mistake made by one upon whom
devolves no duty to exercise judgment, nor do we have any
evidence that the lack of awareness of the incorrect valuation
resulted from a mistake or an exercise of judgment. Furthermore,
the invoices describe the merchandise as damaged golf club heads.
Thus, given the fact that the merchandise was properly described
in the invoices, it is not clear where the alleged mistake
occurred.
For examples of the evidence required in 19 U.S.C. 1520(c)(1)
requests, see HQ ruling 224118, July 26, 1993; note also the
description of the evidence required by the Court of
International Trade in ITT, supra, and note in particular, that
evidence to "[make] clear to Customs that a mistake of fact,
rather than one of law, actually occurred" is necessary. 812 F.
Supp. at 217. See also, Andy Mohan Inc. v. United States, 74
Cust. Ct. 105, C.D. 4593, 396 F. Supp. 1280 (1975), aff'd 63
CCPA 104, C.A.D. 1173, 537 F.2d 516 (1976); and Bar Bea Truck,
supra at 126, with regard to the sufficiency of evidence when
there is "no affidavit or other evidence in support of
[plaintiff's] counsel's bald assertion ...."
Finally, protestant seems to be attempting to avoid the time
limits of 19 U.S.C. 1514 on a case that involves the
construction of the valuation laws. Protestant alleges that the
merchandise consisted of worthless golf club heads which were
suitable only for scrapping. Thus, the merchandise was
improperly entered, appraised and liquidated. The importer bears
the burden of proof to show, by a preponderance of the evidence,
not only that the merchandise was damaged but the extent of the
damage as well. See W. Sheldon & Co. v. United States, 18
CCPA 177 (1930). Furthermore, the courts have stated that it is
up to the importer to overcome the presumption of correctness
attaching to Customs action in assessing the appropriate duty.
See generally, Wm. M. Jones & Co. v. United States, 38 CCPA 158
(1951). A review of the record shows that Customs examined the
entry documentation (this was not a by-pass entry) and,
therefore, there is a presumption of correctness attached to
Customs appraisement of the merchandise. In the instant case,
protestant has failed to overcome this burden. According to the
affiant, the heads were remelted and sold as scrap metal. The
scrap was sold for $0.22 per pound (approximately $0.11 per
head). However, there is no documentary evidence to substantiate
these assertions. In the absence of any evidence to support its
claim regarding the value of the merchandise, we must conclude
that the merchandise was properly entered, appraised and
liquidated.
HOLDING:
The subject protest should be DENIED. The mistake of fact
alleged in this case is not manifest from the record nor
established by documentary evidence, as required by 19 U.S.C.
1520(c)(1).
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 ACS and the public via the Diskette
Subscription Service, Freedom of Information Act, and other
public access channels.
Sincerely,
John Durant, Director
Commercial Rulings Division