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HQ 113807

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October 13, 1998

VES-13-18-RR:IT:EC 113807 LLB

CATEGORY: CARRIER

Chief, Liquidation Section
U. S. Customs Service
P. O. Box 2450
San Francisco, California 94126

RE: Vessel Repair; Application for relief; M/V COURIER, Voyage 234; Entry No.
C32-0010837-2; Casualty; Engine room fire; 19 U.S.C. 1466(d)

Dear Sir:

This letter is in response to your memorandum dated December 6, 1996, which forwarded for our review an application for relief from duties relating to the above-referenced vessel repair entry. Our ruling follows.

FACTS:

The vessel COURIER had been continuously employed outside of the United States in operations on behalf of the Military Sealift Command between the time it departed the Port of Houston, Texas, on April 25, 1995, until its arrival in the Port of Honolulu, Hawaii, on July 23, 1996. The record reflects that on December 19, 1995, the vessel experienced a disabling fire in its engine room. The damage was extensive and the ship was adrift and without motive power for a period of some twenty hours following the incident. The vessel was thereafter able to enter the Port of Singapore where it was placed in a shipyard for a period of thirty three days while undergoing repairs to the engine room area.

The record provides copies of the relevant portion of the vessel deck log, repair invoices, telegraphic messages, and a Coast Guard Report of Marine Accident, Injury or Death (CG Form 2692). While other work unrelated to the fire incident was accomplished while the vessel was in the shipyard, those operations are segregated on a separate invoice.

This office is requested to review, and readily finds copies of, two fire damage repair invoices (designated as 96/A/Z/027A, and 96/A/Z/027B); an invoice from International Paint (No. 40028); and two invoices from W.H. Brennan (Nos. 960100291 and 960100292). We are also requested to examine American Bureau of Shipping survey report information on the fire damage.

LAW AND ANALYSIS:

Section 466, Tariff Act of 1930, as amended (19 U.S.C. 1466) provides, in pertinent part, for payment of duty in the amount of 50 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 engage in such trade.

Paragraph (1), subsection (d) of ?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 that repair was 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 a casualty, we must consider the repair to have been necessitated by normal wear and tear (ruling letter 105159, September 8, 1983).

In the present matter we find ample evidence to support the claim of casualty and relief from the assessment of vessel repair duties. This finding pertains to all of the casualty-related invoices and survey data forwarded for our review.

HOLDING:

The evidence considered substantiates the occurrence of a bona fide casualty and the application is granted as specified in the Law and Analysis portion of this ruling letter.

Sincerely,

Jerry Laderberg

Chief


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