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HQ 113049

August 11, 1994

VES-13-18-CO:R:IT:C 113049 GOB

CATEGORY: CARRIER

Deputy Regional Director
Commercial Operations
Pacific Region
One World Trade Center
Long Beach, California 90831

RE: Vessel Repair Entry No. 603-1012987-3; 19 U.S.C. 1466; 19 U.S.C. 1466(d)(1); Casualty

Dear Sir:

This is in response to your memorandum dated March 18, 1994 which forwarded the application for relief submitted by American Seafoods Company ("applicant") with respect to the above- referenced entry.

FACTS:

The record reflects the following. The AMERICAN DYNASTY ("vessel") is a U.S.-flag vessel owned and operated by the applicant. It has registry and fisheries endorsements. Certain foreign shipyard work was performed on the vessel in the second half of 1993. The vessel arrived at the port of Seattle, Washington on December 23, 1993. A vessel repair entry was filed on December 30, 1993.

You ask for our determination with respect to the following items:

Item No. Vendor Description
1 4-4.03 Asmar (Talcahuano) Rudder
1 10-10.01 " " Recording thickness of hull indents
2 Asmar (Punta Arenas) Checking system
3 " " Rubber system
6 " " Sonar repairs
8 " " Sonar repairs
9 Det Norske Veritas Survey

In its application, the applicant states as follows:

The fishing vessel AMERICAN DYNASTY while operating in the South Pacific off the coast of Chile encountered extremely heavy weather which caused damage to the rudder and to the sonar of the vessel.

The damage was sufficient enough to cause the master of the vessel to divert the vessel to Punta Arenas, Chile to undergo emergency repairs. As noted in the copies of the vessel log attached and the statement of the master the vessel was considered to be in a dangerous situation and further operation would cause additional damage and possibly the loss of the rudder leaving the vessel to the perils of the sea.

The statement of the master dated March 1, 1994 reads as follows, in pertinent part:

1. Date and time of incident: June 24, 1993 @ 2010... ...
3. Size of seas: 10-15 Foot; Beaufort scale of 4 ...
5. What steps were taken after the incident and why? We felt a strong vibration coming from the stern, couple with steering difficulties. We...determined that the problem was indeed the rudder and in need of immediate inspection...
The actions were taken because they were absolutely necessary. As master of the vessel, I felt the crew would be in danger had we not gone to the Punta Arenas shipyard immediately.
...
8. Could we have proceeded to the U.S. for repairs from the area of the incident safely?
Absolutely not. I believe the most prudent decision was to proceed to Punta Arenas. After we discovered that the temporary repair to be ineffective it was necessary for us to use the Talcuano drydock to have the rudder put back in a safe operational condition.

Additional correspondence dated February 14, 1994 from the master states as follows:

Regarding: Rudder Failure on 6/24/93

At approximately 2000 on June 24th 1993 the AMERICAN DYNASTY experienced partial rudder failure due to external forces of nature...

Regarding: Shattering of Sonar Dome on 9/24/93

At approximately 2137 on September 24th 1993 the AMERICAN DYNASTY experienced the loss of the sonar dome. The bow
thruster room, which provides physical access to the sonar, was taking on water. It was necessary to use emergency water pumps to correct for flooding. The vessel was definitely in an emergency state.

The record includes certain sheets which appear to be parts of the vessel's log.

The sheet for June 24, 1993 states in pertinent part as follows:

2000 ... position: Lat: 53-47's, 74-19'w. All secure... 2010 Divert Vessel towards Punta Arenas due to rudder problems.

The sheet for September 24, 1993 states in pertinent part as follows:

2000 ...Rough weather out of NW, vessel rolling/pitching mod.-heavy fishing All secure
2137 Shattered the sonar dome. Bow thruster spare is taking on water. Steaming to Concepcion Channel to seek shelter...& access [sic] damage.

ISSUE:

Whether duty on certain items is subject to remission under 19 U.S.C. 1466(d)(1).

LAW AND ANALYSIS:

19 U.S.C. 1466 provides for the payment of duty at a rate of fifty percent ad valorem on the cost of foreign repairs to vessels documented under the laws of the United States to engage in foreign or coastwise trade, or vessels intended to be employed in such trade.

19 U.S.C. 1466(d)(1) provides in part that the Secretary of the Treasury is authorized to remit or refund such duties if the owner or master of the vessel furnishes good and sufficient evidence that the vessel was compelled by stress of weather or other casualty to put into a foreign port and make repairs to secure the safety and seaworthiness of the vessel to enable her to reach her port of destination. 19 CFR 4.14(c)(3)(i) provides that "port of destination" means such port in the United States and "...only the duty on the cost of the minimal repairs needed for the safety and seaworthiness of the vessel is subject to remission or refund."

19 U.S.C. 1466 and 19 CFR 4.14 essentially set forth a three- part test, each of the elements of which must be
established by good and sufficient evidence to qualify for remission:
1. a casualty occurrence;
2. an unsafe and unseaworthy condition;
3. the inability to reach the port of destination without foreign repairs.

We have stated as follows in numerous decisions:

The term "casualty", as it is used in the vessel repair statute (19 U.S.C. 1466) has been interpreted as something which, like stress of weather, comes with unexpected force or violence, such as fire, or spontaneous explosion of such dimensions as to be immediately obvious to ship's personnel, or collision (see Dollar Steamship Lines, Inc. v. United States, 5 Cust. Ct. 28-29, C.D. 362 (1940)). In the absence of such a casualty event, we must consider the repair to have been necessitated by normal wear and tear (ruling 106159, September 8, 1983).

In Dollar Steamship Lines, the court stated in pertinent part:

We are of the opinion that a casualty similar to "stress of weather" should be of necessity a happening that comes with the violence of the turbulent forces of nature.

Black's Law Dictionary (Fifth Edition, 1979) defines casualty as follows:

A serious or fatal accident. A person or thing injured, lost or destroyed. A disastrous occurrence due to sudden, unexpected or unusual cause. Accident; misfortune or mishap; that which comes by chance or without design. A loss from such an event or cause; as by fire, shipwreck, lightning, etc.

After a consideration of the record, we find that the applicant has not presented good and sufficient evidence that the vessel was compelled by stress of weather or other casualty to make the subject repairs in order to secure the safety and seaworthiness of the vessel to enable her to reach her port of destination. Stated more succinctly, the applicant has not established that casualties occurred. We use the plural of the word "casualty" because the record indicates that the crew of the vessel became aware of the problems with the rudder and the sonar dome at two different times which were three months apart. The record does not indicate how the damage which necessitated the repairs occurred. The record does not include adequate documentation upon which we can conclude that the repairs were necessitated by a casualty, as that term is described and defined above. The statements of the master and the excerpts
from the vessel's log are far from adequate to meet the good and sufficient evidence standard.

We note additionally that it is not clear from the record that items two and three of the three-part test stated above have been satisfied by good and sufficient evidence. In a case such as this, the record will frequently include a report of the U.S. Coast Guard, a classification society, or a surveyor, indicating that the vessel was in an unsafe and unseaworthy condition and that rerpairs were necessary before it could proceed.

HOLDING:

The applicant has not presented good and sufficient evidence that it is entitled to remission of duties pursuant to 19 U.S.C. 1466(d)(1). Accordingly, the application is denied.

Sincerely,

Arthur P. Schifflin
Chief

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