HQ 227756 - Protest and Application for Further Review No. 2704-97-102936; Denial of drawback; mistake of fact, clerical error or inadvertence; 19 U.S.C. ?1520(c)(1) - United States International Trade Commision Rulings

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HQ 227756

February 2, 1998

LIQ-9-01/DRA-2-02 227756 CB

CATEGORY: LIQUIDATION DRAWBACK

Port Director
U.S. Customs Service
300 South Ferry Street
Terminal Island, CA 90731
Attn: Drawback Branch

RE: Protest and Application for Further Review No. 2704-97-102936; Denial of drawback; mistake of fact, clerical error or inadvertence; 19 U.S.C. ?1520(c)(1)

Dear Sir/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.

FACTS:

On March 10, 1995, protestant filed a drawback claim on behalf of its client requesting a refund of duty for 2,967.40 grams of imported gold jewelry subsequently exported. The claim was liquidated on February 28, 1997 without the benefit of drawback because the claimant failed to furnish proof of export.

On June 17, 1997, protestant filed a petition under 19 U.S.C. ?1520(c)(1) requesting reliquidation of the drawback claim. Protestant alleged that the airway bill and ADEPS coding sheet were actually mailed to Customs on March 31, 1995, in reply to a request from Customs dated March 20, 1995. As proof of mailing, protestant calls attention to a handwritten notation dated March 31, 1995, which states that "Copy of AWB, HAWB, worksheet mailed to DB office" and it is signed MDM. Attached to the ?1520 petition was the proof of export. It is our understanding that your office never received the documents which were purportedly mailed on March 31, 1995. The petition was denied on July 16, 1997, on the basis that there is no authority under 19 U.S.C. ?1520(c)(1) to pay a claim for drawback.

The subject protest was filed on September 15, 1997. Protestant asserts that the wording of 19 U.S.C. ?1520(c)(1), "in any entry, liquidation, or other customs transaction" means in any entry, any liquidation, or any other transaction. Thus, drawback claims fall within the purview of section 520(c)(1).

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, were timely filed. The refusal to reliquidate an entry under section 1520(c) 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, 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. 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. 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)).

Petitions under ?1520(c)(1) relating to the denial of a drawback claim would not necessarily generally meet the requirement that the clerical error, mistake of fact, or other inadvertence be "adverse to the importer." Under 19 CFR 191.73, it is the exporter that is deemed entitled to receive drawback, unless the manufacturer or producer reserves the right to claim drawback and provides evidence that such reservation was made with the knowledge and consent of the exporter. However, in many other instances, the drawback claimant would be the exporter only of the merchandise, or the manufacturer or producer. In those situations, the drawback claimant would not meet the requirements of ?1520(c)(1), because the denial of drawback would not be "adverse to the importer."

Assuming that a drawback claim can involve an error adverse to the importer, as required by the plain language of 19 U.S.C. made the alleged mistake of fact, clerical error, or other inadvertence. Also, protestant doest not specify where the error occurred or even if an error occurred. In a letter dated September 5, 1997, protestant simply states "[a]s all the documents requested by you were timely filed by us (see former request) we feel that the error was not ours and that this situation should definitely be covered by sect 520(c)(1)." (emphasis in original) Is protestant alleging that the alleged mistake of fact occurred if Customs personnel failed to match up the proof of export, supposedly mailed by protestant, to the subject drawback claim? If so, such mistake is not manifest from the record nor has it been established through documentary evidence by protestant. Protestant has not provided any evidence that the proof of export documentation was received by Customs. The Court of International Trade 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). Although the protestant has submitted the missing documents along with the petition, the protestant has failed to explain in any way why they were not received by Customs originally. There is no allegation that any documents, figures or facts were unknown, out of order or missing. Other than simply stating that someone made an error, protestant has not demonstrated how and who made the alleged mistake or clerical error. Nor, has protestant shown how non-receipt of mail qualifies as a mistake of fact, clerical error or other inadvertence.

It is clear that protestant's allegation of a mistake is actually a challenge to a legal conclusion of the Customs Service. Protestant is challenging Customs decision to liquidate without the benefit of drawback based on the non-receipt of the required proof of export.
As such, it must have been raised by a timely protest pursuant to 19 U.S.C. ?1514(a), as a mistake of law can only be corrected by filing a ?1514(a) protest within 90 days after liquidation. See e.g., Computime Inc. v. United States, supra, B.S. Livingston & Co., Inc. V. United States, supra.

HOLDING:

There is insufficient evidence to show that the denial of the petition under 19 U.S.C. ?1520(c)(1) was improper.

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 A. Durant
Director

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