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HQ 227495




May 30, 1997

LIQ-9-01-RR:IT:EC 227495 PH

CATEGORY: LIQUIDATION

Port Director of Customs
Chief, Residual Liquidation and Protest Branch 6 World Trade Center, Room 761
New York, New York 10048-0945

RE: Protest No. 1001-96-105846; Protest No. 1001-96-200143; Clerical Error, Mistake of Fact, or other Inadvertence; Samples; 9811.00.60, HTSUS; 19 U.S.C. 1514; 19 U.S.C.

Dear Sir or Madam:

The above-referenced protest was forwarded to this office for further review. We have considered the evidence provided and the arguments made by the protestant, as well as Customs records relating to this matter. Our decision follows.

The samples enclosed with the protest are returned as you requested.

FACTS:

According to the file and Customs records, on May 30, 1995, the protestant entered the merchandise under consideration. According to the entry summary for the merchandise, the merchandise consisted of women's footwear, with a total entered value of $7,000 and a total entered duty of $756.13. The invoices for the merchandise bear the notation:

HTSUS 9811.00.60. Footwear is marked samples not for resale' on sole on insole of shoe. Samples of no commercial value. Value for Customs purposes only.

Five sample shoes are provided. In the case of four of the samples, the marking "SAMPLES NOT FOR RESALE" is on the outside of the sole of the shoe in letters more than 1/8 inch high, located at the widest point of the soles (approximately below where the ball of the foot would be). In the case of two of these shoes, the marking is partially defaced (i.e., the words "not for" are scratched over, leaving the words "samples" and "resale" unscratched. In the case of two of these shoes, the marking is a gold color against an off-white, or cream, sole. In the case of the other two of these shoes, the marking is off-white against a dark brown sole. In the case of the fifth sample, the marking is on the inside of the shoe (or sock lining), in the front half of the shoe with the marking being in a gold color against an off-white, or cream, color.

The entry was liquidated as entered on September 15, 1995. By letter of January 17, 1996 (received by Customs January 24, 1996), a Customs broker, stating it represented the protestant, "protest[ed] the liquidation of the [entry under consideration] as a clerical error under sec[.] 520.c.1 as our entry clerk clearly made a mistake of fact". The broker went on to state:

This shipment was processed as a duty paid entry when in fact all the merchandise was clearly marked "Samples not for resale" as is indicated on all the invoice[s] in the entry package.

By letter of July 1, 1996, Customs denied the request in the January 17, 1996, letter on the following basis:

Please be advised, both the samples and U.S. Customs original decision were reviewed [and] determined that Customs original decision was found to be correct.

On January 31, 1996, the protestant filed the protest under consideration. The stated basis for the protest was:

The [a]bove decision [July 1, 1996, letter from Customs denying the request for reliquidation under 19 U.S.C. 1520(c)(1)] is inconsistent with Ruling No. 556529, which allowed the marking of "Sample not for Resale" on the shoe."

Further review was requested, citing ruling 556529, and granted.

ISSUE:

May relief be granted under 19 U.S.C. 1520(c)(1) in this protest?

LAW AND ANALYSIS:

Initially, we note that both the request for reliquidation under 19 U.S.C. 1520(c)(1) and the protest of the denial of that request, under 19 U.S.C. 1514(a), were timely filed, and that the denial of a request for reliquidation under section 1520(c)(1) is a protestable decision under section 1514 (19 U.S.C. 1514(a)(7)).

Under 19 U.S.C. 1520(c)(1), Customs may reliquidate an entry to correct a clerical error, mistake of fact, or other inadvertence, not amounting to an error in the construction of a law and adverse to the importer, when certain conditions are met. Section 1520(c)(1) has frequently been interpreted by the Courts. It has been stated that "[a] clerical error is a mistake made by a clerk or other subordinate, upon whom devolves no duty to exercise judgement, in writing or copying the figures or in exercising his intention" (see PPG Industries, Inc., v. United States, 7 CIT 118, 124 (1984), and cases cited therein). It has been stated that: "[M]istakes of fact occur in instances where either (1) the facts exist, but are unknown, or (2) the facts do not exist as they are believed to [and] [m]istakes of law, on the other hand, occur where the facts are known, but their legal consequences are not known or are believed to be different than they really are" (Executone Information Systems v. United States, 96 F. 3d 1383, 1386 (Fed. Cir. 1996) (emphasis in original), citing Hambro Automotive Corporation v. United States, 66 CCPA 113, 118, C.A.D. 1231, 603 F. 2d 850 (1979); see also, Degussa Canada Ltd. v. United States, 87 F. 3d 1301 (Fed. Cir. 1996)). Inadvertence has been defined as "an oversight or involuntary accident, or the result of inattention or carelessness, and even as a type of mistake" (Aviall of Texas, Inc. v. United States, 70 F. 3d 1248, 1250 (Fed. Cir. 1995), citing Hambro, supra).

The conditions required to be met under 19 U.S.C. 1520(c)(1) are that the clerical error, mistake of fact, or other inadvertence must be adverse to the importer, manifest from the record or established by documentary evidence, and brought to the attention of Customs within one year after the date of liquidation of the entry. The relief provided for in 19 U.S.C. 1520(c)(1) is not an alternative to the relief provided for in the form of protests under 19 U.S.C. 1514; section 1520(c)(1) only affords "limited relief in the situations defined therein" (Phillips Petroleum Company v. United States, 54 CCPA 7, 11, C.A.D. 893 (1966), quoted in Godchaux-Henderson Sugar Co., Inc., v. United States, 85 Cust. Ct. 68, 69, C.D. 4874, 496 F. Supp. 1326 (1980); see also, Computime, Inc. v. United States, 9 CIT 553, 555, 622 F. Supp. 1083 (1985) (cited by the protestant, see above), and Concentric Pumps, Ltd. v. United States, 10 CIT 505, 508, 643 F. Supp. 623 (1986)).

Basically, the protestant in this case claims that the entries should have been reliquidated because the "entry clerk" of the broker of the protestant "clearly made a mistake of fact", in that "... all the merchandise was clearly marked Samples not for resale' as is indicated on all the invoice[s] in the entry package." No evidence of the alleged mistake of fact is provided.

It is fundamental that in order to qualify for relief under 19 U.S.C. 1520(c)(1), it must be established that there was an error or mistake (i.e., in this case, it must be established that the entry and liquidation were incorrect).

The ruling cited by the protestant (HQ 556529) holds that "[t]he marking of non-quota footwear imported for sample use by means of a label reading Sample Not For Resale' permanently attached to the sock lining in a readily visible place may qualify for free entry under subheading 9811.00.60, HTSUS [and] where the sock lining will not be visible, the stamping of the sample legend onto the outer sole with indelible ink would suffice to qualify the shoes for duty-free entry under this subheading, provided the ink cannot be removed without disfiguring the sole." In the LAW AND ANALYSIS of the ruling it is stated that "[t]his [i.e., the above-quoted holding] assumes that the ink cannot be removed without disfiguring the soles, and that the legend is stamped on the sole in close proximity to the heel so that the ink will not wear off." See also, rulings HQ 555552, HQ 557825, and HQ 560231. In ruling HQ 557825, we held:

The footwear imported for sample use which has the marking "Sample Not For Resale" embossed on the sole of the shoe in a readily visible place may qualify for free entry into the U.S. under subheading 9811.00.60, HTSUS, provided that the legend cannot be removed without disfiguring the soles of the shoe and the legend is stamped on the sole in close proximity to the heel so that the ink will not likely wear off.

In the case of the samples provided in this case, four of the five samples have the marking not in close proximity to the heel, but right below the ball of the foot where "... the ink will ... likely wear off" (quoted from above, with emphasis added), and in two of those samples, the defacement of the marking indicates how readily the marking may wear off. In the case of three of the samples, the color of the marking is not clearly contrasting (gold on off-white or cream) (note that ruling HQ 556529 refers to a marking in "indelible dark ink" and ruling HQ 557825 refers to "a visible legend ... in a contrasting color". In the case of the sample in which the marking is not on the sole but on the inside of the shoe (or sock lining), although the shoe is open on part of the sides, the marking is on the front part of the shoe, partially below the closed toe-portion and may not be "readily visible" (see ruling HQ 555552) or "conspicuous" (see ruling HQ 557825). We note, in this regard, that, for the reasons given above, the Customs field office advised that the protest should be denied on the merits (see ruling HQ 555552, which contains the proviso that the appropriate Customs officer "[must be] satisfied that such treatment [marking] renders the shoes unsuitable for use for any purpose other than soliciting orders for foreign merchandise").

Even if we were to assume that the entry and liquidation were incorrect in this case, the protestant must also establish that the alleged error was due to clerical error, mistake of fact, or other inadvertence, not amounting to an error in the construction of a law, adverse to the importer and manifest from the record or established by documentary evidence. In this case, the protestant claims that the alleged error was due to a mistake of fact, (i.e., "... where either (1) the facts exist, but are unknown, or (2) the facts do not exist as they are believed to ..." (Executone, supra); see also, ITT Corp. v. United States, 812 F. Supp. 213 (CIT 1993), reversed, 24 F. 3rd 1384 (Fed. Cir. 1994) ("... the document preparer simply understood the nature of the merchandise to be other than what it was [and] [t]hus, a mistake of fact occurred" (812 F. Supp. at 216); although the Court of Appeals reversed, it stated about the CIT finding of a mistake of fact: "[the finding] is amply supported by the record and not clearly erroneous" (24 F. 3d at 1388))).

Under 19 U.S.C. 1520(c)(1), the clerical error, mistake of fact, or other inadvertence not amounting to an error in the construction of a law must be "manifest from the record or established by documentary evidence." The alleged error in this case is not manifest from the record (see ITT, 24 F. 3d at 1387, "... manifest from the record [means] apparent to Customs from a facial examination of the entry and the entry papers alone, and thus requir[ing] no further substantiation"). In ITT, the Court stated that "[m]istakes of fact that are not manifest from [the] record ... must be established by documentary evidence" (id.).

In this case there is no such documentary evidence and there is no explanation (other than the statement that "our entry clerk clearly made a mistake of fact") as to how or why the alleged error occurred. However, there is documentary evidence that the importer and broker knew, or should have known the nature of the merchandise under consideration (i.e., each of the invoices for the merchandise includes a statement that the footwear consists of "samples of no commercial value" and is marked "Samples Not For Resale" and each invoice bears the classification notation "HTSUS 9811.00.60"). In such a case, the Court of International Trade has held that relief under 19 U.S.C. 1520(c)(1) is not available (see B.S. Livingston & Co. v. United States, 13 CIT 889 (1989)). In the Livingston case, the Court stated:

In this case, plaintiff has not claimed, and, indeed, cannot state that it was unaware or mistaken as to any facts pertaining to the merchandise [because the merchandise was correctly described in the invoice and the asserted classification was provided in the invoice]. Hence, in this action plaintiff can only state that it "carelessly placed the incorrect tariff classification on the entry documents.

...

Upon the record before the court, it is the determination of the court that plaintiff has not stated a claim upon which relief may be granted pursuant to section 1520(c)(1). [13 CIT at 894]

Further, if the protestant intended to allege that the allegedly incorrect entry and liquidation was due to a clerical error, we note that the Courts have held that the essence of clerical error is the intent of the person preparing the document in which the error was allegedly made and where there is no evidence from that person as to his or her intent, the evidence is insufficient to sustain a claim of clerical error (see, e.g., Pacific Trading Co. v. United States, 20 Cust. Ct. 170, C.D. 1103 (1948); Francisco Castelazo v. United States, 24 Cust. Ct. 294, C.D. 1250 (1950); see also PPG Industries, Inc. v. United States, 7 CIT 118

Accordingly, we have no choice but to DENY the protest under consideration.

HOLDING:

Relief may NOT be granted under 19 U.S.C. 1520(c)(1) for the reasons given in the LAW AND ANALYSIS portion of this ruling. The protest is DENIED.

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,

Director, International

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