HQ 0111041 - Vessel Repair; casualty; ship rails; travel; cleaning Vessel: AMERICAN FALCON V-66 - United States International Trade Commision Rulings

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HQ 111041

December 17, 1991

VES-13-18-CO:R:P:C 111041 KVS

CATEGORY: CARRIER

Chief
Residual Liquidation and Protest Branch
6 World Trade Center
New York, NY 10048-0954

RE: Vessel Repair; casualty; ship rails; travel; cleaning Vessel: AMERICAN FALCON V-66
Vessel Repair Entry No. C13-0013883-6
Port of Arrival: Baltimore, Maryland
Date of Arrival: January 12, 1990

Dear Sir:

This is in response to your memorandum of May 9, 1990, which forwards for our consideration an application for relief filed in connection with the AMERICAN FALCON, vessel repair entry no. C13- 0013883-6. Our findings are set forth below.

FACTS:

The AMERICAN FALCON, while sailing in close proximity to the Azores, encountered heavy weather on December 24, 1989. Three containers were lost overboard and damage was sustained to the vessel structure. Four days later, the vessel put into port at the Netherlands and underwent foreign shipyard operations to the starboard ship railings in Rotterdam between December 28, 1989, and January 2, 1990.

Shortly thereafter, the vessel arrived in the United States at Baltimore, Maryland, on January 12, 1990. Formal entry was made in an untimely manner on January 29, 1990. An application for relief was timely filed on March 13, 1990. At the request of the Vessel Repair Liquidation Unit in New York, additional documents were submitted on March 29, 1990, and April 3, 1990. ISSUE:

Whether the foreign shipyard work performed on the subject vessel is not subject to duty pursuant to 19 U.S.C. 1466.

LAW AND ANALYSIS:

Title 19, United States Code, section 1466(a) provides, in pertinent part, for payment of duty in the amount of 50 percent ad valorem on the cost of foreign repairs to vessels engaged, intended to engage, or documented under the laws of the United States to engage in the foreign or coastwise trade.

Paragraph (1), subsection (d) of section 1466 provides that duty may be remitted if good and sufficient evidence is furnished establishing that the vessel was compelled by stress of weather or other casualty to put into a foreign port to make repairs to secure the safety and seaworthiness of the vessel to enable her to reach her port of destination. Thus, it is necessary that in order to qualify for duty remission, the party seeking relief must show both the occurrence of a casualty and the minimum repairs necessary for safety and seaworthiness.

The term "casualty" as it is used in the statute, has been interpreted as something which, like stress of weather, comes with unexpected force or violence, such as fire, explosion or collision (Dollar Steamship Lines, Inc. v. United States, 5 Cust. Ct. 28-29, C.D. 362 (1940)). In this sense, a "casualty" arises from an identifiable event of some sort. In the absence of evidence of such casualty, we must consider a repair to have been necessitated by normal wear and tear (Custom letter ruling 105159 (dated September 8, 1983)).

In the case under consideration, we find evidence of casualty. Among the timely-filed documents submitted, is included a survey of the damage which references heavy weather and indicates that only minimal repairs will be made. The accompanying shipyard invoice details the minimal repairs made. Furthermore, the applicant has included a copy of a Coast Guard Marine Accident Report and a full page detailed affadavit by the master of the vessel which was filed in connection with the incident.

After careful review of the supporting documentation, we find sufficient evidence indicating both the occurrence of a casualty and the completion of only the minimal necessary repairs. Therefore, we find the cost of labor for the repair of the ships railing listed on the Aber Marine Services invoice in the amount of $196.00 to be remissible. Similarly, the related cost of materials listed on D. van de Wetering B.V. invoice no. S- 1949/7042 in the amount of 5,840.00 Dutch florins (at the rate of .518135 dollars per florin, the converted cost is $3,026.00) is also remissible pursuant to 19 U.S.C. 1466(d)(1).

Additionally, we find the charges for transportation listed on the Aber Marine Services invoice in the amount of $380.00 and

D.H.S. Services in the amount of $100.00 to be non-dutiable in accordance with our holdings in C.I.E. 204/60 and C.I.E. 695/62. The D.H.S. Services invoice also lists a charge for the cleaning of cargo debris, mud and waste from the cargo decks. Because the cleaning was unaccompanied by repairs, we find the cost to be non-dutiable as per our holding in C.I.E. 51/61.

Accordingly, the application for relief is granted in full.

HOLDING:

Where the occurrence of a casualty is proven, the cost of the minimal repairs necessary will be remissible pursuant to 19 U.S.C. 1466(d)(1).

Sincerely,

B. James Fritz

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