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The Papers of Charles Hamlin (mss24661)
356 08 001-

Hamlin, Charles S., Miscellany, Printed Matter,"Report of the Fairchild
Commission on Hat Material Refunds, Jan., 1894

CHARLES HAMLIN
PAPERS
Folder q)
Bo x

MiscellanY

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tY) prrs_i__ A-L

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co 14
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0

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FAIRCHILD COMMISSION

kf7

"'
44"*
)

79-

24,4-eveA41.4. ./4;#44.6:1:adi;

1444
4-47"...vvt,e44,

dt4P-, ti,-1

T N D E.X.

tvca.

Procedure prior to Act of June 10, 1890.

1-5.

Records of refunds imperfect.

Present procedure. (Act of June 10,1890)

5-7.

Statement of reunds paid on G. A. Decisions.

Statement of refunds paid on certified statements,
January to November,1893.

Hat trimmings cases.

10.

Claims and estimated refund on hat trimmings.

10.

'Schedules to show analysis H.T.suits.
Mr. Hanlon's schedules of Four Fleitman suits.

17
21 and 70.

Use of schedules and extent to which they should be prepared. 23.
Undecided appeals to Department under tariff of 1883.

25.

Refunds on H.T. between 1888 and 1890.

27.

Synopsis 9915, March 1890.

28.

Method of reclassification by local appraiser in 1890.

31.

The"Philadelphiaucase and synoisis 11,798 of September
22, 1891.

35.

"Committeenof three General Appraisers.

37.

Its inception.

39.

Correspondence in respect to its functions.

40.

Letter of Attorney General, December 9, 1891, to Secretary
on setting aside of verdict in Philadelphia case.

44.

Procedure of Committee of General Appraisers.XX

46,59 and 85.

Four Fleitman cases.

47.

Offer of Compromise.

46.

Letter from

49.

r. Spaulding to Committee.

Correspondence in respect to cases.

49.

Local Appraiser's report.

53.

Methods of G.A. in examining these cases.

59 and 85.

Circular to importers.

85.

Decision of Committee.

63.

Action of Department-Letters to Collector and to John
Proctor Clark.

64.

Schedules of these four cases.

70.

Results of analysis.

71.

Unusual procedure in these cases.

78.

Letters of Att(,rney General, December 29, 1892,
declining to advise'Secety. 80.
Findings of O.A. advisory only.

81.

Criticisms on investigation of these cases by G.A.

85.

Claim of importers that there was a compromise. Final
action of Department in returning certified statements
to collector.

89.

As to recommendations.

91.

Rule in Schlesinger case.

92.

As applied to H.T.suits.

93.

As applied to tobacco refunds.

96.

Other subjects of refunds.

98.

Necessity of some method of classification and review
that will put an end to refunds.

100.

Nr.

ROOM OF THE SPECIAL COMMISSION APPOINTED TO INVESTIGATE THE ADMINISTRATION OF THE CUSTOMS LAWS IN THE
PORT AND DISTRICT OF NEW YORK.
BARGE OFFICE, New York, December 9, 1893.
Hon. John G. Carlisle,
Secretary of the Treasury.
Sir:REFUNDS.
By Department letter 3104-E, dated July 3, 1893, we were instructed to investigate and report as to the methods governing refunds at the New York Custom House of duties paid in excess, and ospecially to include in such examination and report all cases settled
or pending which bel.)ng to the class of refunds referred to in
Department's letter of the 14th of January, 1893, addressed to the
Collector of Customs at New York.
The object of these instructions was, chiefly, to direct an
inquiry into those claims for refunds known generally as "the hat
trimming cases".

Before stating the results of our investigation

of these cases, a general statement in respect to the procedure in
claims for

refunds is advisable.

Under the procedure prevailing before the Administrative Act
of June 10, 1890, the importer filed his protest against the Collector's classification after entry and as long before liquidation
as he pleased, but not later than ten days after the final liquidation, and within thirty days after the ascertainment and liquidation
of the duties he appealed to the Secretary of the Treasury.

The

decision of the Secretary on such appeals was final and conclusive

dr••••••
-

unless suit was brought within ninety days after the decision of the
Secretary or within ninety days after the payment of duties paid
after the decision of the Secretary.

If the Secretary of the

Treasury delayed more than ninety days in making his decision on
such appeals, suit might then be brought before the decision was
made.

Until about 1887 the method of receiving and docketing pro-

tests in the Collector's office in this port was very loose.
fa-

tests were dropped in a box, a clerk gathered

isk,0,11Z9M firL7o

a &If
b1Eq

.1;:1;

Siub7lo

,1 1()Y w54

$14)481 L
1-:(31:11;7.xo

af &s'

them together, and

when he had leisure, wrote on them the date of filing.

6,31:fa:-Iv.11 0:r

this method was very inaccurate.

Pro-

Of course

For several years, however, the

r
protests have been carefully stamped with the date of receipt as
soon as filed, and

we have no reason to doubt that the records now

kept of protests are in satisfactory condition and that the correct
date of receipt is stamped upon every one.
These protests when received by the Collector were sent to the
local Appraiser for examination and report in respect to the description of the merchandise and the classification, and when returned to the Collector from the local appariser, were, if an appeal
had been taken, forwarded to the Department.

Sometimes the local

appraiser in returning these protests to the Collector, attached
samples of the goods, but this was the exception, not the rule.

such samples were received by the Collector from the Local Appraiser
they were sent to the Department with the protest and were not returned to the Collector, except where the sample was valuable and
had been obtained from the importer.

In such cases the sample was

returned to the Collector to be re-delivered to the owner. Within
ninety days after the appeal had been taken, if the Secretary had

:11.72u0

1r1 •
.pfyP

7E0

not decided ',he appeal, or within ninety days after his decision,
If he had, the importer brought an action, commonly called a common
law action, for damages against the Collector personally.

The

damages claimed were the amount of duties which it was alleged the
Collector had tAcen in excess of the lawful rate.

These actions,

termed in the statute "suits" were quite commonly brought in the
State courts and were always moved by the U. S. Attorney into the
Circuit Court of the United States for this District.
After the suit had been begun the Attorney filed a bill of
particulars in which he set out the various items required by statute, viz: a description of the goods, the place from which imported,
the name of the

vessel from which they were landed, the date of the

inveice, the date of the entry, the amount of duty illegally exactei
the date of the payment of duties, the date of the filing of the
protest, the date of appeal to the Secretary of the Treasury, and
the date of the Secretary's decision, ir any had been made.

has been always quite common in the complaints to demand damages in
a ficticious amount, but the bills of particulars were expected to
be a more accurate statement of the claim.
When one of these suits had been brought to trial and the
plaintiff had recovered a judgment, if the Department adopted the
decision as a rule for its action, instructions were sent to the
Collector and the cases in question were then taken up by a bureau
now in the Law Division, formerly in the Liquidating Division,
known as the Bureau of certified Statements. In this bureau the inwhich
voices and entries covered by the suitsAwere to be settled, were
gathered together, distributed by suit numbers and the invoices wer(

sent to the local appraisi:r to be reclassified by him in accordance
with the decision of the court.

On such reclassification this burea

bureau made up the certified statement which showed the amount to
be paid, both principal and interest.
The bureau of certified statements both in the Collector's
of-fice and in the Naval office, deal only with suits.

It has not

been the custom to pay on certified statements claims covered by
protests that have not been put in suit./ This latter class of
claims was, of course, large in most of the important classes of
refunds that have arisen from time to time.

When the Department

pted a decision of the court on a particular issue as a rule of
ad,
...

%a
,

AsU

V•

action, all those protests not yet in suit that were in the liquid-

J.0

ating division upon which the Department decided to pay refunds,

ter-

6e:
ei114•

t Efl

'lose edS OS

eds lo
n '10

ed:

d‘t t lef-.Joqa,
f,S?)

mineb Ialrfinoo

were considered in that division.

The practice was to send the

Invoices to the local Appraiser to be reclassified in accordance
with the rule adopted by the Department, and on such reclassification these invoices were reliquidated in the liquidating division
and the refund paid in the ordinary course.
The result of this system is that while there is an accurate
classified record of all refunds paid on certified statements l there
Is no record at all classified by description of merchandise of the
amounts of refunds paid on protests which were not in suit at the
time of reclassification and reliquidation.
of the total sum paid.

There is only a record

It is, therefore, impracticable to discover

at this time what amount of refunds has actually been paid in the
hat trimming cases, or in any other class of merchandise upon which
large refunds were made arising under the tariff of 1883.

Under the present system, the notice of dissatisfaction with
the Collector's classification is still commonly called a protest,
and we shall use that term in this report.

On receipt, it is irlme-

diately stamped with the date of receipt. Under the statute, the
Collector's duty is to for-ward it with the papers in the case to
the

Board of General Appraisers.

The Collector 3ends the protested

entries first to the local Appraiser for his report, except where
the protest belongs to a large class which have been under consideration and upon which the liquidating division can act without any
further information.

The local appraiser returns the invoice with

the protest to the Collector with such report as the case may require in respect to the description of the goods and the proper
classification.

As under the previous procedure, it is only in ex-

ceptional cases that the local appraiser returns a sample with the
protest.

From the liquidating division of the Collector's office

the papers are then forwarded to the Board of General Appraisers
with such statement as the case may require.
The procedure by which these questions are brought before the
courts under the Act of 1890, is radically different from any previous system.

When the Board of General Appraisers have rendered a

decision and within thirty days thereafter the importer who wishes to test the question files in the Circuit Court a petition setting
forth the assignments or error of which he complains in the decision
The court then makes an order calling upon the general Appraisers
to return the record and testimony with a certified statement of
Irk

their findings and decision.

When the return has been filed, the

statute permits either party to obtain an order to take additional

testimony.

When the testimony has been completed the cause
is heard

on the record and the testimony and exhibits befor
e a Circuit Judge
sitting without a jury.

Under the old system the action against the

Collector was tried by a jury.
The Board of General Appraisers, where the prote
sts on a particular issue are numerous, have adopted a pract
ice if the Collector
or importer petitions their first decision
into the Circuit Court
of suspending decision on all simil
ar issues until the case has been
decided. This plan is, not of rigid applicat
ion, but the Board
is
carries it out as far asA
/)practicable. If the circuit court decides
in favor of the importer and that
tOte decision or some final decision of an appellate court adverse
to the Collector's classification
is adopted by the Department
as a rule of action, the Board of
General Appraisers then calls up
all the 3uspended cases and decides them in accordance
with the rule formulated by the Department.
At this stage of the procedure
there is a division of duty with
respect to reliquidating
invoices between the Bureau of Certified

4i34I-17-0 aHo..-no11
00
'•• •

+ 43uo.td
--"7

Statements and the Liquidating Divi
sion, much similar to that which

mo%1 J:i9-121
vstfincl-.7A
1:1.1-soacn
_.
, A-roqm1

•

All cases in which petitions

J have been filed are treated as actions were under the former pro-

oriJ 'rertLe'torf
i
,k; noi:eloeb

POW

prevailed prior to the Act of 1890.

cedure.

If the Department's instructions are that those case
s are

to be settled, they are settl
ed on certified statements made up by
the Bureau of Certified State
ments, as formerly. All the other
similar cases decided by the
Board of General Appraisers in accordance with the decision of
the Court adopted by the Department, are

eft,

taken up in the Liquidating Divis
ion where they are reliquidated
•••••••••••••,......••••••.,••Nrom•010
......
•1••••
.
1 11......)••
,
,
•
.!••••••••••••P•17,11r•

and the refunds paid in the usual
course.
In the Auditor's Division of the Collector'
s office a record

War7P"gwr
-a_

.s kept of the total amount of these refunds paid
on reliquidations
lade in the Liquidating Division.

This record does not separate

;he different articles or classes of merchandise upon
which the
gerunds are paid.

In respect to the cases in which petitions have

peen filed and which are paid upon certified state
ments, there is,
Df course, the same accurate record that there
was in respect to
"suit cases" , so-called, under the forme
r procedure.
The total amount of refunds paid through the liqu
idating
•

sion and of which no classified record is kept
is very great and
".,•••••••,•*"..

constantly increasing.

We will designate this class of refunds as

refunds made upon decisions of the Board
of General Appraisers,
meaning thereby the refunds
paid through the liquidating division
without certified statement.

The following table will show the

course of this class of
refunds:
Statement of Total Amounts of Refunds paid by
the
Collector at the Port of New York.
On Board of U. S.
General Appraisers'
decisions.

i•1

On S.S. 4972.

From Oct.00
to June 30/91.

$31,269.32

$447,966.32

From July 191
to June 30/92.

70,890.95

134,330.40

From July
92
to June 30/93.

355,732.11

80,626.81

From July 03
to October 34/93.

549,155.07

67,728.96

This table shows that during the first year
after the estab-

111111

lishment of the Board of General Appraisers
the rerunds made in
this way upon their decisions amoun
ted to only

31,269.32, while

MINN

the refunds made in the liquidating division upon invoi
ces unliquidated or already liquidated and covered by protest and appea
l amounted to nearly $448,000.

We have already described how these refunds

were made upon reliquidations made in the liquidating
division in
11- 41.4
44'4

*CEIGE7 nt F.iw f.).
19ric! /L:4,1 jrlooE.!
.t7- Jutfoo
rik 4

frr%tr

tf,t3,0

1rOVrAl,

eriJ

respect to protested entries not covered by suits.

1.,•
er
IU

hell.“D-oa

''°o

zLoriw IO nnE not
1:1
, ,tm:tr
=no
-

•

Itilfms0 I0 b140R orl3 lo aaolninep nov
021*Ma1up11 ad/ dauuled biBq ebnule.1 ei %delerft
trnLtoera

July 1st and October3lst, 1893, the total amount of
refunds made
upon reliquidations in the liquidEtting division witho
ut certified

"ZISE115;)
€4T'

.etek.at-

But between

ebruile
thBe

berillso 4!40Ai1"
nfe'IoEaBlo clfi/ In _c-uro

statements, upon decisions of the Board of General
Appraisers, is
$549,155.07; while the refunds upon reliquidations made in
the
liquidading division without certified statements and witho
ut a
decision of the General Appraisers amounted to only $67,7
28.96. This
shows that the reliquidation

without certified statements are now

to a great extent made upon actua
l decisions of the General Apprais
ers in specific cases.

The continuous increase of the amount of

this class of refunds based
upon reliquidations made upon decisions
of the General Appraisers shows
also that the liquidating division
.

Pc/

'i.16Lis/qqA Ile10116ii
.atiolatof)b

keeps well up with its work in
forwarding the protested entries to
the Board of General Appraisers
for action.
Mr. Esterbrook, the head of the Liquidatin Divis
g
ion, reports
that there are substantially no reliquidat
ions of invoices for the
purpose of refunds on hat trimmings or charges
or tobacco now in
his division; that all the prote
sts on entries discovering these
descriptions of merchandise are in suit and such refunds in futur
e
will nearly all be on certi
fied statements.
The following schedule shows the total amoun
t of certified
statements transmitted to the Department betwe
en January and
November, 1893:

"Memorandum of CERTIFIED STATEMENTS transmitted to the Treasury
Department by the Collector

the Port of New York, from January 1,

to November 301 1893, inclusive.
Number of statements,

860.

Duties to be refunded, covered by said statements,...$393,272.2
7
Interest

91,576.07

Costs

41 731.30
Total

$4891 599.64

Charges and coverings included $80445.65
44.04
44-'
- riT .3C.3!
,:T t Wie
so that the refunds paid on reliquidations made in the liquid
ating
'

lo
FiliT

00-fri4

division, without certified statements, and of which no classi
fied

21:101.0

CLI.

8fI0

record is kept, amount in four months to over $600,000.00,
while the

z.)

J1:
s t

'tc)

.12)1

refunds

r;)

record is kept, amount in eleven months to but $489,599.00.

lo
nl g-tow all AJlw qu
.rtollo, wtealqqA rwl:eD
t du.LciVia

fort4

3n1‘%E;hiapIJ en

cio
f”.F)ris
f'
.
!!'*!et

'fo ne::mrio

E!iiiO no
doue baz

been settled by the courts, it
is likely that much the greater part

er(.3

of future refunds will be paid throug
h the Liquidating Division

olowtd-,

;- ,-',1:)v1..t to anolpfl

orT.
al

:
4
Ori9f

acting upon specific decisions made by the General Appraisers.
These

7to

comparative statements show that the amount of refunds paid on such
reliquidations already greatly exceeds the amount paid on certified

1!1;;;

- statements, and
this disproportion must increase, because the num-

vanoiSrf.t.
ao ed 11.3 %Pmen fr,:o

b3i11:,":60 10

'Jaz

5',..fAbHifV2•zintwoi r o't

ric)ewled

Under

the system of suspending decisi
ons until the test case has

aclee

/0 baa

upon certified statements of which a completely classified

ber of petitioned cases,
which alone are handled by the bureaus of
Certified Statements, are comparatively few in number
.

effT

edl oS

- uggest, therefore, that in order to render it praticable

for the Department tolear
n the amount of refunds paid on any parti-

tladmevoV
4

particular line of merchandise, or under any particular aecision,
the Collector be instructed to have a properly classiried record
kept of the refunds paid without certified statements.
HAT TRIMMINGS CASES.
We do not apprehend that the Department de:3ires from us any statement of the history of these cases.

The correspondence in respect

to them is very voluminous and the reports made upon them by special
agents and other officers of the Department, very numerous.

In the

actions in the Supreme Court decided in the spring of this year,
the Solicitor General filed with his brief a pamphlet entitled
"History of the Hat Trimmings controversy", which contains in a compendious form all the principal documents and is preceded by a brief
and concise narrative explaining the history of the controversy.
We have directed our inquiries to discovering as far as praticontained in the complaints
cable, the total amount involved in as
these claims Aand bills of parti/1
culars filed in the actions, and to estimating as far as practicable

Jud oi Rri.:nom

how much of this gross sum is claimed on articles which have up to

()itt 11:rau aaotaloeb
0 %4.44 't(41-

14-f -et

efts dour zti3:4-t 119411 al

this time, been determined by verdicts, to be hat trimmings. We

t r.3-f;r0

f:eod,

lorpvo.a
JItehaulel

...feattirtqqA IBlenoD eiV
obr... cao2:F.
btaq Mulls/el lo

0100404#

erf

no btkiq saimmit
eaulioed

oninf)ria aocp

veria aJrlomezttv±

abE.J1oxe

6E01Eroiw

'tc.1#110.1% -..

which actions such proceedings were had between January, 1892, and
qrioo

the spring of 1893, that certified statements were prepared and refunds amounting in principal and interest to over $196,000 were

t s/noLiets/a

t CORBO

ai wel
01

the plaintiffs are Fleitman & 6o., a firm of New York importers, in

V)Le-f.E

taum nolVIocio-!cialb

10 ause/ud ad:

1:.1- 111 lo

have also made a special inquiry into four certain actions in which

benni:tf,Ine

apparently about to be paid, but payment of which has been suspended

.TEmi

t alaams,Ble hefILI-le0

THE SUM CLAIMED BY THE PLAINTIFFS ON HAT TRIMMINGS.
In this inquiry we were greatly assisted by mr. Nathaniel

rt.kre-,*'

George, Head of the Bureau of Certified Statements in the Naval

office in this port.

ate
We found that Mr. George had made an estim

these suits down to December,
of the probable amount involved in
Nis basis cf estimate was as follows:
suits
of two descriptions;those
He found that the hat trimmings were

1890.

es collected were made upon
in which the claims for excess of duti
another class, mixed as-tt-i-11
entries involving hat trimmings alone, and
s were made in respect to
suits, in which claims for excess of dutie
In the class of mixed
other merchandise as well as hat trimmings.
the claims for alleged excess
suits, however, Mr. George found that
than hat trimmings were not
of duties collected on merchandise other
proportion
At that
of the claims in those suits.
a very considerable _
of refunds had been
time, December, 1890, a considerable amount
a large number
paid, distributed in greater or less amounts, among
of the plaintiffs.

according to the
Mr. George divided the suits

attorneys of the record.

the claims in
He took the gross amount of

attorney, and the
the hat material suits, controlled by the same
adding them togross amount of that attornelis mixed suits, and,
brought by such
gether, arrived at the total sum 'demanded in suits
attorney, including claims on hat trimmings.

He then computed the

attorney's client Lore to
percentage which the refunds paid to that
which these refunds
the total claims in the hat trimmings suits in
upon the total
This percentage he then computed
same attorney still
claims in the hat trimmings suits brought by the
had been paid up to
unsettled; that is tosay, in which no refunds
We annex a schedule
December, 1890, when the estimate was prepared.

had le en paid.

Exhibit 1, showing this computation.
statement is TremainE
The first firm of attorneys named in this
involving
& Tyler. The schedule shows that they control 554 suits

claims on hat trimmings only, to the gross amount of $26,489,647.90
and 116 mixed actions, in which the total claims amount to $10,579,
216.73, making total claims in their suits of

37,068,864.63.

Mt.

George found that the refunds collected by these attorney's amounted
to .298 of the total claims in the suits in which the refunds had
;9 been paid.

tf) -

This percentage would give them upon their total unset-

tled claims an estimated refund of $11,046,521.60.

..,

tinued this schedule down to July 31, 1893.

Mr. George con-

The summary shows that\

there were pending 1687 suits; total claims in bills of particulars4,
:10

F.)

$55,427,564.35;
.

total estimated refunds, $18,073,459.97.

Where ani

attorney controlling some of the pending suits had not collected

; -c?:•1

t c,m1

any refunds, Mr. George estimated the probable refunds in such cases

tbl'

by the average percentage of all the payments made to the several
attorneys or firms of attorneys who had collected refunds.

m±sia, ert3 10

t•-.44i; J00.4 etT.

elecriodi3 5-1Ba 91i.;; ::cf i):1:1_10%!1100 ,:i'LqC
1.ill

:.L.1:i er.1,S.

•nt m911.1 aiatbbis e lm.ia ,;;;I.tua i)exin
atc4nloJE .:ir '_t) Jf:ro.-Lt-7,

The percentages obtained in this schedule had been calculated a
on a comparison of the payments of principal only, exclusive of in-

H.4a-:, terest and costs.

At our request Mt. George prepared a new schedule

brought down to date, which we annex as 'Schedule Exhibit 2.

This

schedule in the upper half gives the number of certified statements
prepared in the hat trimmings cases for each attorney or firm of
attorneys of record, the total amount claimed in those suits, the
principal of the refunds paid, the amount of interest and costs;
then the total refund, then the percentage, which this total refund
bears to the total claims in the suits in which certited statements
were made up.
The lower half of the schedule gives the gross claims in suits
brought to recover excessive duties claimed on hat materials only,

cor
ao

the gross claims in mixed suits, the total gross claims, then the

311

oil' do

percentage arrived at as shown in the upper half of the schedule,

ami;;Io
Zo.71-ir131

jt .0:!.`f0.17

971:t

-1001

then the estimated refund obtained by applying this percentage to tle
total gross amount of the claims.

5- 1/17, bru,1-.7 c

-.aanu

.b1.6(1 1:Ho(

From this schedule it appears

that the amount of certified statements prepared to date on hat trim
mings is $2,828,176.74.

This amount is arithmetically accurate,

both in respect to the sum and in respect to the class of materials
upon which refunds were paid.

Of this sum $196,435.82 being the

total refunds with interest and costs in the four Fleitmann suits
already mentioned, has not yet been paid.

The lower half of the

schedule shows the total estimated refund to amount to $19,405,667.
64.

The increase over the amount in the computation ir4schedu1e

No. 1, is due to the increased percentages obtained by including the
cv.)ad ia.ir

SiLUI)31i,377.

interest and costs, as well as the principal of the refund.

Lit

eviRulohe t esa.:1:) ILq1;),11.1.4 ato
weli i3 bfrizqolq eaqo°
.1 lidirixN 8
bet/l/neo

ing from this gross estimated refund the amount of the certified

nedmmn erit E °Yin
tO

asiso Raftiffiv '1

eaodlnt Icismc;;Io
sookow
„

bns

lo :cromss 6
:.)...

statement, we obtain a net probable refund of $16,577,490.90. This

tuoJr:91- lc

deduction is made because in many of the suits in which refunds

8r0P En X9=11:5 SW doi'v* is:;d) o..Iwou J'fiL

.i'airtoJJB dolie

t ;1

-.,.g)
.
10 71

E)1-1!; al el;rbodoc

:nH ad: lit kJ:m.140%g

eff2 t bqopo-i lo a%artIoJ.to

0 :1 1

•

.t bfl:;g:f.rf J"._P-to., 9.7f

.qu

r =CP.

eiino al31/ellam 3.sri ro bemnio

were paid there was only a partial discontinuance, and the suits
were continued as to the articles upon which refunds had not been
allowed.

1ivi13a1q4

t bIng

r!orl,

s'ii/.ril ;rf.ilzio 1.fioJ 91ij ol c.:(;

400 Oh P.

Deduct-

rto
tf.r.oxe

i).i:1 slew

-rewel eHT
19VOO91 Oct !Ii3U0 rid

Therefore a large part of the total claims in the suits

ich refunds were paid, is included in the total of claims
iv4h
pending.In estimating the probable refund on the suits of attorneys
in whose cases no refunds had been paid, an average percentage,
computed as already described, was taken.

In the first schedule,

In which interest
and costs were omitted, this average percentage

was .319, and in the second schedule, which included interest and
costs paid, the average was .345.
In estimating the probable amount of refunds for which the
Government may be liable in these hat trimminOases, interest is a
very important consideration. Interest runs from six per cent from
the date of payment of duties on all claims protested prior to Feb.
1, 1888.

In cases in which protest was filed after that date, by a

special act of congress the interest is three per cent.

As the in-

terest runs until the claim is paid, a corresponding addition must
On:

be made to all estimates of liability.

Now these are undoubtedly the most accurate computations that

?aa,ao,cit
9:

have yet been made of the probable refunds to be paid in these cases

fs,7ioLni

re7o oz.

•.

art

And yet they involve much uncertainty.

es
...I 4

911::

7LL¼J.1.kt

Z1B

jeo

In both schedules the amount

of refunds paid includes only those paid on certified statements and

Ilow
excludes all the refunds paid on protests not in suit at the time of

,3*1
w.v*Ie t VY*

;:.,0•13

10 ixt11t91 sidsdo.fq 'art

N)-(1 -nt

111do ew e:Yrtnet.s:'E

9n;7Loed 91.)am
8,4ksild

enJ Dfls
PN "kr

Sri!

abnuls1

1.:q i

pfiwfrn

noclu

amfBlo Isle3 ecL
a

VrEo ;:.311r

bi..1;(1 e-re. •
71):.)

o ,t.I.sq

lalol sd:

iv-it;.'nubeb

,;)i

•ololn-feriT

.beeo.UB

9'19'7 =.1.):111
.
'E"E

fot
.

ronloJJa

tea4,taao•v__

`t 1";'•

eri:1
"—

;*F9.;-1

ix":Lr.

3aLtf;171i.;,
b411

reclassification and reliquidation.
The practice of partial discontinuance, to which we have referred, creates another uncertainty.

in suits pending, as stated in these schedules, by reason of that
practice includes a considerable amount of the gross sum included in
the suits in which refunds were paid and from which the percentage
of claims is calculated.

Air

The gross amount of claims

It would have been a work of great diffi-

culty to have extracted from the suits in which refunds were paid
those items only upon which the payments were made and to have es-

r-;9u.:130

timated the percentage upon the total amount of such items; but by
Eaw t im.filon9b AL.bris'11;-1

beztaqmoo
estimating the percentage upon the total claims in those suits, the

tha:t1tm.) slew alaop has

AotAw at

resulting rate is obviously too low.

t eEF).

This practice of partial dis-

F..64
continuance became a gross abuse, and later instructions in respect

doldw 101 anfie

to hat trimmings refunds provided for a total discontinuance on
ilLroms ald2do-lq 9e-t

at1;71::-.3itl
payment of any refunds.

si:oril 11
46.6#

The most serious uncertainty of all however, in these computa-

moll anirl 3i1 . to1,1s19blanoo

OI ',COar.qbo.Lq

,120'wpn

te.44

vi31t
tions, arises from the practice of repeating claims in subsequent

amialo Ils no aelluh *to $11fIl.::1

'3 ball/

- 4

isw lasiolq dolAw

C9Cz

suits.
ai

Of course the gross estimated amount of probable refund in

.8831
these schedules is worth a good deal as an intelligent estimate,

los Islosqa
because the same uncertainties and duplications existed in the suits
in which the refunds were paid as exist in those suits in which
no refunds have been yet paid.

a;.lk
•ajaO

practice to duplicate claims in half a dozen continuous suits. For

SaSt

example, quite commonly on entries for warehouse the importers duly

FUISOM11

But we found that it was a common

protested against the Collector's classification and took their ap-

• -J115110.—_—_

" —

peal

a3c 3OtI flo

to the Secretary and afterwards withdrew the goods entered on

several withdrawal entries at different times.

It has been quite

1:0.Lonia39;)
„-ij41t sw

common to commence suits after the payment of duties on each with-

oS teonflual/noozab Is31J1s1 lo

A:44 410inffla

AstevIn

rfT

.xIats/lenau ledlon.s

drawal, and in every suit to include the prior payments for which
L00

c bcf-te

091ubelioe easd4 al 1)5/Bl3 es; t antbasq a3lu8 al
44tiMai.LUiii

Mad

4A4*.ii114019C1

.L4111)

dem.% offi lo

51dxlehlacoo3 cJliurn:It eLeoivlq

ed3 dolAw moldt ban blilq

liA018 10 )1'10W

flo

ftf eitra

0
1 . *WI

,;81,
191

entered for warehouse, a suit begun on the payment of duties on each

evalmio lo

:
ra
he claim in the first suit duplicated in the second,
the first, second and third suits all repeated in

y.t ,:z10
the fourth.

ehsm o-iow
flout

There are cases where

there have been four or five withdrawal entries of goods originally

a
Withdrawal

ne9d'evilA

)isq slew atri flobJw
03

other suits had previously been commenced.

'I:orcn

nmli eaorf:;'

ctnuots L3o.t Oct' aou s3nlftso'viq f)riJ belmt:r
fiJ

aoqu

p - vm

3a.O'si!lt/e9

Of course no claim can be collected more than once lawfully.
This system of duplication increases the total amounts claimed so
enormously and may vary so much, that any computation arrived at in

this method may be very far astray.
are not mere guess work.

At the same time, these results

They are based upon some actual transact-

ions and have a reasonable amount of probability in their results.
The schedules show with certainty that there are still pending
1690 suits in which claims for excess of duties paid on hat trimmings are made; that there are 1084 suits claiming excess of duties
on hat trimmings only to the amount of $38,118,724.10, and 606 suits
pending in which claims for excess of duties on hat trimmings and
other merchandise are made to the amount of $17,700,156.85;

that

these mixed suits involve chiefly claims on hat trimmings and that
'
the gross amount of pending claims is $55,818,880.95.
We found that there was nobody in the Customs Service here who
had any reasonable idea of the various classes of claims in these
hat trimmings suits in respect to the different materials included

lms

in them.
.ttemi/ Jaelenfb /is a -liTte
aikk lo Inamviq

:eltS 811U8 S3afiMMO

Ad/ pkuincti nI

1.31ve

claims were on ribbons, how many million on piece goods, and of the

"Aor.110

latter class of million how many were on velvets, how many on silks,
how many on cotton back satins, &c.

uavv-ive

. ,Imm1,t,7) 7gArl -.?!inr!fl've-rq
01,00:1 it/

-i.

4o ge/Imb
41111

,opea OA/ a ba/Botiqub
1140tylt

+440-40,

!0,0:t9ecleil fis aitire

£1' 113w7nd:1.-

files of the Custom House and merely to get at the papers and assort
.TW1 bolf)trt,

JF.%n ort; al

period of time.

f)fil i)its fs;
bf-!

them by the suits would be a work of immense labor, consuming a long
We deemed it desirable to put in operation some

plan of work by which this immense liability of the Government could
be more accurately estimated.

111100k

.7111ftwiLE °ono

britoelloo ed me-lo

The invoices and entry papers

were not assorted by suit numbers, but were distributed through the

'1407i

flo au3ed,lism

Nobody had the slightest idea how many millions of the

*.va03

It seemed desirable if practicable,

to find out to what extent this duplication of claims had prevailed
and to reduce the claims to a proper basis.

It seemed advisable tt-l-ffl

also to have the protests and the appeals examined for the purpose

•

of ascertaining if any of the protests were late, or if the appeal
*

r0131.11urTJ Ifv;J'oit 9moa Etcylu

was late, or of there was any other technical objection to the

t")-1*:=J _- *:

ecution of these suits or any part the claims involved in them.

7:1:
Ittla ele

%/n13/1eo

After obtaining this information in respect to any suit, the
0I

-31
:to b/sq senub "to easoxe -tot imlio dolAw :11 ailuLl 0(
,sepice

pro&

atius 1%801 eqa eledst

-aS 01.4.RV01_,30 10 tnuom oril 04 -zirto
amFtt $se no etaSub lo seepxo 101 Lmisio

23:11M

;saw,:

next desirable step would be to have the claims analyzed according
to the class of merchandise upon which they were made, and if, in

making this analysis of the claims according to the description of

nathasq

the merchandise, it should be practicable to indicate what propor-

iiJ

:38.8d1 .0070'14 to 4aisoms: ed4 04 Ei1tli7..ol8 eat;)Iii;Aoslm
•Jctrrf

ocLo

tion of them should be classified as hat trimmings under the decision of the courts as they stand at present, that would be a most
advantageous thing to do.
We therefore prepared certain schedules, of which we enclose
copies.

The first form, being Exhibit 3,

is directed to disclosing

all the information which is obtained from the face of the papers
according to the headings of the columns on the schedule.

The first

column gives the number of the entry, then follows the name of the
vessel, then in separate columns the dates of entry, payment of duti -s, of liquidation, and of the invoice.

The next two

columns

give the amount of duties paid covered by the protest and the liquidated duties as ascertained on the final liquidation.

Then fol-

low the date of the protest, number of the protest, date of appeal,
number of appeal, the date of the decision of the appeal, if any
decision has been made.

A comparison of the date of protest with

the date of liquidation indicates

whether or not the protest was

was filed in time; and so with the date of api)eal, when compared
with the date of protest, and with the date of commencement of suit
•

compared with the date of decision.

The following columns show,

I
I

first, the amount of the
duties claimed alleged to
be excessive.
This column is simp
ly the total possible amount
of claim. It is
the difference be
tween the 50% duty assessed
by the Collector, and
the duty of 20;C
on hat trimmings which the pl
aintiffs claim was th
e
lawful rate.

.•

tl
lO aol.tqi-f3;.1
-logolq /s3Hw
.

j
t

!to 11,)1,
uy
•

al;1- .:%oo

(,.fo"

.tidtHxSiie
P"7

tmr:o7t

belin:tdo El !io.tr
lw

o:i.t no c:Tarioo orf
l 1-o
Ito smart eAl awol
lol nedI t vi-trin
sdi
--imaxsq triJne to
ael.gb sdl e-lraulof.)

fl
f)riS

(),-1

ao
•-••

ens im Jal.Jo-fq
eHJ xd be/evoo
Wag
a(

z
lo ;,7_Lroru;

•

10 p5Ab.

tILe(

HAI

%;(5un

'to

oh: lo flut
b 6HJ lo AIL
J)

tlCCj1

lo noF,1%,Eiqmoo
A
-

.:terfAr

C19:J=,f

..31-qmon n9Aw t lfl
o CTP

-J1';11

11
:
1.1W or:

14,

;er't

,-„

• ,:j
f

The Aext column
, however, is of more importan
ce. It shows the
amounts actually
claimed in the bills of partic
ulars.The totals of
the figures in
this column will give
the total amount of claims as
they are shown in
the bills of particulars.
The succeeding columns
show whether or
not any refund has be
en paid in any suit and the
amount of it, an
d the class of mercha
ndise on which it was paid.
The last two
columns are directed to disclo
sing the amount of
duplicated claims
,
so that the
total amount of
the claims can be reduce
d to a proper basis. The
last column gi
ves the number of
the prior suit in which the entry
under consid
eration is duplicat
ed, and the column immediately preceding it give
s the amount of
the duplication. If, therefore,
the
figures in the
column headed "Amount clai
med in the Bills of
Particulars" be
added up and the total of
the figures in the columns headed "A
mount claimed in an pr
evious suit or suiys", be suby
tracted theref
rom, we will have a fair
ly accurate estimate of the
total amount
of claims.
To obtain
the information indicated
by this schedule was the
first step in
carrying out the plan that
we proposed. The next
step is 1lownby the form at
tached hereto as sbhedule Exhibit 4.Th
is
,gives the en
try number, the name of the vessel
, the date
f eednutlr:
soch
and then a seri
s of columns divided into the different

/7
classes of merchandise upon which these hat trimmings claims are
made.

The headings of the columns sufficiently indicate the char-

acter of the information written upon the schedule.

/rwoms eidiLLaci
4'

If the in-

voices are accurately analyzed, these columns will show the total
value of the merchandise protested, the amount of ribbons included
in each entry which, under the present decisions of the court,should
be considered hat trimmings, and the next column will indicate the
value of ribbons that in the judgment of experts should not be treat
ed as hat trimmings.

And so on, through laces, crepe, velvets and

plushes, plain velvets, fancy velvets, plushes, cotton back satins,
chinas and marcellines and various other classes of merchandise.

the last three columns there is a summary which shows the total
value of the merchandise in the entry which, in the judgment of the
expert preparing the schedule, should not be classified as hat trimsd

mings and the amount which should be so classified.

KS* Er1Io fltit

Ili a.;:;;T.o.

headed "Excess of duty Claimed" .will be simply

a!!:3 1.,

The last column

30% on

the value

stated in the preceding column as the value of the merchandise pro1-7-)

n alitd.nA: at I

.tsio stit:remAll

(No eri,T ni
• sd

•

1-1::

tested which should have been classified as hat trimmings.

nrrit

—

In respect to the first of these schedules Ekhibit l, the information is certain.

papers
It is simply an analysis of the actual

in the suit and can easily be made under the supervision of a comIt will be, of course, if carried
suits,
throughout the whole number of hat trimmingsArka work of immense
rl
labor. The other schedule rests for its value on expert judgment.

petent officer like Mr. George.

The basis upon which the several classifications in the second sched
ule are made is very important.
Having prepared these schedules we proceeded to induce the

Custom House Official
s

r1,1
Eff:Trio
e-11
$n9zy3buL

trintHw

Sad az iAti

io . ed

iIEE;

f;;':Z°.

10 0717

ikEirosiz t elienn% eiiJ

ccI sAT
erfz. au

;':zy:.

%11:11.L

Vub

thnzliolsm ed3 /o
.sytimmit :

amzron
"ttEafil:)

1196. CAr.7( LrfrOi
:

.qm1E, 2i ti

in this Port to go to wo
rk on the cases. We
met with great oppo
sition in the Collecto
r's office. Mr. Couch
contended that before
any analysis could be ma
de of these suits the
Department must form
ulate a rule of paymen
t. He contended vigorously that the on
ly way to do was for th De
e
partment to state plai
nly on what cl
asses of merchandise
it would pay and that then the
Invoices could
be reliquidated accordin
gly, or better still, that
the Department
and the plaintiffs sh
ould tome to an agreement as
to the articles
of merchandise on whic
h payments should be made,
and
that then the
invoices should be reliqu
idated on that basis. Our
position was that
we understood that the De
partment could not make
any propositio
n of settlement or
entertain any proposition unti
l
It knew some
thing about the tota
l amount of all the claims and
the
amount of the
several claims upon the
principal articles of merchandise allege
d to have been classi
fied erroneously; any proposition of sett
lement would be li
kely to be made upon a basis of
including certain
articles of merchand
ise as hat trimmingsfimd excludin
g
certain other
articles; if the department
was called upon to entertain a pr
oposition to settle
upon ribbons of a certain kind, or
upon satins of
a certain kind, the impo
rters agreeing to exclude
velvets and
plushes, or chinas an marc
ellines, or vice versa; it
d
could not tell
what the result of such
an agreement would be, because nobody
knew, except perhaps the im
porters and their attorneys,
what the
value of the go
ods to be itcluded in the settlement
was,
compared with
the value of the goods
to be excluded. Obviously_in
the confus
ed conditio
n in which the cases were,, the acce
ptanceof
any offer
by the Depa
rtment would be a leap in the dark
, and our

.098A0 edI no 2NOW
Apuo0 .dt1!

eit iez
-1“H f
99

ad*

-1- I4 P,ti;Jc

ot•oi

plan was to attempt to
obtain the informatio
n necessary to enable
the Department to deci
de understandingly wh
ether it would settle or
litigate in any case.

o!
(

The Department, at our
instance, instructed Mr
. George of the
Naval office to prepar
e a list of the suit
s pending in which four
of the principal
claimants were plaint
iffs, viz: Fleitman & Co
.,
Dreyfus, Kohn & Co.,
W. H. Graef & Co., W.
H. Oppenheim & Sons.
These importers are
plaintiffs in 173 suit
s involving claims $7,
870,916.70. We select
ed them because their in
voices will cover all
the principal
articles of merchandis
e which are included in the co
ntroversy. Mr. George
then proceeded to make
up the schedules in
the form of
schedule No. 1, in the
Fleitman cases, 47 in all, including the four
suits on which certifie
d statements were sent to
the Depart
ment and on which paym
ent was suspended. It should be
clearly unders
tood that it is only 3ch
edule No. 1 that is prepared
in the Nava
l office that is
the schedule giving the informatio
n obtained on the
face of the papers in re
spect to the date of entry,
the amounts
claimed, the date of liquid
ation and protest, and the
duplication of
claims.
The accompan
ying schedules for each su
it, analyzing he merchandise and
classifying it as hat trimmi
ngs or otherwise, have been
prepared und
er our supervision
by special agent Hanlon and a forc
e
of clerks
. At the
date of this report, Mr. George
of the Naval
Office, has
completed his schedules, in
all the Fleitman cases and
has almost
completed similar schedules
in the cases of Dreyfus, Kohn
& CO. Mr
. Hanlon ha
s completid his analysis and classifica
tion in

the four special suits in which Fleitman & Co. are plaintiffs, viz:
o/ /rimeJtiz o' alntr

sHI

fAniti

;;:xJ;
B

These are the four suits

of the refunds suspended in the spring of this year.

We instructed

classes of merMr. Hanlon to obtaiu accurate samples of the various

t/ilemJ1wiCI eriT
f)0,10

and 16,289.

payment
upon which the certified statements were prepared and the

o„t .traquigeCI ed

xladlimate"f911u

AM bElowl.tani tepatn1 Imo

Nos. 11,402, 12,184, 12,545,

classification
chandise involved in these suits, and to prepare his

LIVB

of
In such a way that we could report to the Department a sample
4

is to say,
each class of goods described on the schedule; that
Hanlon classithat there should be samples of the ribbons which Mr.
classified "Not
fied as hat trimmings and of those ribbons which he
piece goods.
hat trimmings"; and so of velvets and satins and other
professing to
Mr. Hanlon also produced before us several witnesses
s
be experts in the business whose testimony we took upon the sample
presented.
able to express
We do not pretend to have investigated or to be
ficaan opinion upon the accuracy of special agent Hanlon's classi
tion of this merchandise.

such an
We could not have carried out

enormous amount
Inquiry to any satisafctory result without giving an
number
of time to the subject and without having examined a great
of witnesses.

nole17%Tul .N.;o

bry

e /eirlb-s

.JE,Icimo3
1.z) ka.6

aielziwm

- 111Y.0

jury where only
To try one of these causes before a

two or three descriptions of material are involved has taken weeks.
We are anxious that this should be distinctly_understood. We did
whether
not enter at length into an inquiry directed to finding out
or not the samples produced by Mr. Hanlon should properly be classi
fied according to his judgment or otherwise. We took the testimony
of the witnessess he produced and we report it herewith. It certain
ly supports his conslusions in all important respects. It was taken

entirely ex parte; ot
herwise we would ha
ve been compelled to
enter
into a trial of thes
e cases, without ha
ving any judicial
authority
whatever. Undoubte
dly the importers wi
ll declare that Mr
. Hanlon's
c1as31fication of
these materials is en
tirely unjust. Th
ey will
declare further,
undoubtedly, that it
is not in accordance
with the
decisions of th
e Committee of Genera
l Appraisers. For ex
ample, Mr.
Hanlon classifi
es as "Not hat trimmi
ngs" the cotton back
satins,
which formed so
large an item in the re
funds in the four Fl
eitman
cases amounting
to $105,925.72 out
of a total principal of
$155,
851.00.

.')6
d'

9 4,1 1Looz

.aloegabl Irm:-.
0qmf 1113 .1

anolaulanoo

The point is,
however, that this clas
sification is made by
a
Government offi
cial on behalf of
the Government, and who co
ntends
that he can
support in court
his corclusions in respec
t to this merchandise. He
places on this sc
hedule the information whic
h:hewould
give to a Di
strict Attorney
preparing one of these case
s for trial.
He indicates
to the Govern
ment what he considers to
be its liability
to these
importers, and he
points out also the claims up
on which he
considers the
government is not li
able and upon which in his ju
dgment in a pr
operly tried
suit the government will succ
eed in defeating the impo
rters. Mr. Ha
nlon claims also to have clas
sified as
hat trimmi
ngs in these
schedules all merchandise iden
tical with the
articles upon
which importers ha
ve obtained verdicts in all the
cases that
have gone to
the Supreme Court.
It has
been suggeste
d that a statement pl'epared in
this
manner woul
d be of
more use for purposes of defe
nse than for "amicable
adjustment".
There can be no doubt that
if the schedules are

•••
,
,a='Z•.•••
-.A6.-T=Ir•

17
j
our supervisprepared in the manner planned by us and begun under
needs both for purion, the Department will have the information it
ent. The Inposes of defense and for purposes of amicable adjustm
•

_L.:LI" •

1J4

necessary for
formation thus obtained will be as useful and is as
the one purpose as the other.

•

to do this work.

Now, in respect to the time required

Naval Office
As we have stated, Mr. George of the

suits.
has completed his schedule of all of Fleitmann & Company's

•

There are forty-seven of these suits, two of which have no relation
to hat trimmings, so that there are 45 scheQulee.

11.,371'

Mr. George has

, Kohn &
almost finished his schedules of the suits in the Dreyfus
Company cases, 34 in number.

work
He has still to complete his

on the suits of William H. Graef & Co., 32 in number; and upon those
of William Openhyn & Co., 60 in number.

He states that it has re-

* quired the work of four men during 43 working days to prepare the
and
schedules in the Fleitmann cases, and that with the same force,

bill0- 91i 4,

making allowance for unav(ddable interruptions, he will not complete
the schedules in the remainder of the suits of these four importers

slti3;)
ri •

much before the 1st of April, 1894.

Mr. Hanlon states that with

such clerical assistance as he needs he can prepare his schedules

-7,but

of the different articles and their proper classification within

_
•

the same period.

•

larger force
Of course if Mr. Georege is given a

all the
anciprovided with a fit room in which to work and in which
fti

Si1J

EIJOWIOV

clerks assigned to this work can be kept together, he can do his
f:7.tfr:(1u8 of:3

be-1.6qe.!ci
.r.v•

r•• enD If

wire,I.

••••

part of the work more quickly.
The total number of suits in which these four importers are
needs
plaintiffs is 173. We do not think the work suggested by us
to be extended
beyond their suits.

of
173 suits, involving claims

ms
probably a fifth of all the clai
nearly eight millions of dollars,
conof merchandise involved in the
covering every important class
approxd enough basis for satisfactory
troversy, will provide a broa
amount involved Upon each class:of
imate calculations as to the
number of suits pending, which is
merchandise throughout the total
duplication in these suits will proabout 1690. The percentage of
oximation of the per-centage of
vide a sufficiently accurate appr
suits, and the proportion of
duplication in the whole number of
ise in these suits can with
claims upon each class of merchand
proportion which the claims
reasonable accuracy be accepted as the
s to the total amount of
upon each article in all the suits bear
Department to continue this work
claims. We strongly urge upon the
s we have planned.
throughout these 173 suits on the line
Mr. Hanlon should be
With the schedule of each set of suits
representative samples with
Instructed, to file a complete line of
statement showing that
some satisfactory proof or carefully prepared
different classes of
the samples filed are representative of the
to which claims for
goods described in the invoices and in respect
ement that the articles
If this is done, his stat
course a matter of expert
are or are not hat trimmings, which is of

refunds are made.

Department.
opinion, can be tested and verified by the
APPEALS STILL PENDING UNDECIDED.

S7071 );.'10W

/ doiriw

'10

adlua lo /edmurt
a7f1131Czici
.a.11118 Ife-J iono%ed bebno:xe od o/

als in the hat trimmings
There are still a large number of appe
re the Department
cases pending undecided by the Department. Befo
these claims are
can be certain that any calculations in respect to
ubtedly a very large
final, it must dispose of these appeals. Undo
number

als are pending
of the prote3ts upon which undecided appe

vcize
nmt-revo
110..

t7.01 vu'lkiL.jW e %valvol

4.1

edJ ol an anoLtBluolno
Into* t
r 46ire

.„„...i.q.k.J.J

opeal

eastasoleg era

tuod

e$isluoos 141$aeloill“a

it*

ebf

elnAw ad/ ni :101$noticlu
'to nanlo dose noqu

saAiNiA.V.auk

Mrtr

' ad

:zon-luon13 sldgoafie

• at elo.U/n fin.;e aoq
• Wings,ir Nip id •-•

.
1Aifi".41.
1, 441*"..`

ftrrA

'1rio'j

.amis;1

4
,
1 8REIA: tul.f3uo-1-1.

ad: riJIW
4

o$ be/outz.a
-,
oztoulailaE &mos

"-III afalqmfla
.1.+1

ill

rç

-! bediloa3h
.

9/a

e Aai-70-4 tad
/oa9I4 /0 em
go taotri±-s.

an cases show
Our.schedules of the Fleitm
hat trimmings
this; but it is very important to bring all these
to an end.
ims may be founded,
Proceedings upon which additional cla
actions may still be
It is not at all fanciful to suggest that
unds on hat trimmings. The
brought in respect to the claims for ref
between February and June,
annexed schedule, Exhibit 5, shows that
e
refunds on hat trimmings, wer
1893, seventeen new suits, claiming
d thousand dollars. We
begun, involving claims of several hundre
this
ortant it is to bring
enclose this schedule to show how imp
elaborate schedules which
b usiness to an end.
The value of these
propose, will be
we have prepared, and the continuance of which we
of dolhundreds of thousands
th
mon
by
th
mon
if
ed
air
gre atlY imp
e criteady pending. The sam
1
lars are to be added to the claims alr
there are any appeals pendi cism is true in respect to charges, (if
old law) and, in fact, to
ing undecided on that subject under the
have been put in suit.

ure.
all appeals taken under the old proced
ment whether
decided by the Depart
These appeals should mat- be
sued upon again so
in suit or not. Those that are in suit may be
ision extending the
ded, and any dec
1°ng as the appeal is undeci
l render it ads may be made wil
b asis upon which claims for refund
continue and bring
many cases to dis
vantageous to the importer in
interest which forms
ensive claim. The
ext
e
mor
a
t
new
ing
sui
mak
a
runs from the date
those controversies
n°w such an important part of
an action that
lost by discontinuing
is
st
ere
int
no
°r PaYment, and
one. It was the
and bringing a new
rs,
yea
l
era
sev
g
din
pen
has been
apup with its work in deciding
p
kee
to
t
men
art
Dep
failure of the

•.!

appeals that caused the virtual break-down of the old system of procedure in respect to protests.
1890.
REFUNDS ON HAT TRIMMINGS BETWEEN 1888 AND DECEMBER,
The cast of Hartranft, plaintiff in error, against Langfeldt
was decided in the U. S. Suprel:e Court in March, 1888.

In April,

ia,
1888, the Department notified at the collector at Philadelph
Where the case had arisen, to proceed to apply the decision in the
Langfeldt case to all similar cases. (Synopsis 8803)
rence of local apDuring the summer of 1888 there was a confe
Department for the
praisers in the city of New York, called by the
purpose of determining a uniform classification of hat trimmings.
a previous
This conference acted upon the sample books prepared at
Department notified the
co
nference in 1886. On August 31, 1888, the
Collector at Philadelphia that it had received the report of this
that the
c onference of appraisers, and instructed the collector
cla ssifications established at this conference should be followed.
modified by a communica(SYnopsis 9003)
This letter was quiclay
New York on
tion from the Department to the collector of customs at
red that the Collector
November 26, 1888. (Synopsis 9136) It appea
had decided
and the Naval Officer and the Appraiser at this port
other manufactures
that merchandise consisting of silk ribbons and
their construction
°I. silk was dutiable at fifty per cent, under
them that their decision
This letter notified
by in the liquiwas accepted and that they should be governed there
was some reclassification of
dation of entries at this port. There
refunds were made to a considerainv(lices between 1888 and 1890 and
of Robertson, plaintiff in
ble
amount. In January, 1890, the case
Or T.'. 383 and 448.

r‘rr

MENIIMINEW

error, against Edelhoff, was decided by the Supreme Court of the
United States, 132 U. S., 614.

The class of merchandise involved

in this suit when it reached the Supreme Court was ribbons composed
of silk and cotton, silk, chief value.

The case was decided in fav-

or of the importer, and on February 11, 1890, the Department through
collectors that
Assistant Secretary George C. Tichenor, notified
the decision must be followed thereafter, regardless of the fact
that the ribbons or merchandise was of silk, or of silk and cotton,
Silk, chief value.

(Synopsis 9854)

In this letter tie DeparLment

with this decisinstructed collectors to reliquidate in accordance
ylvosi
ons,
ion entries embraced in other suits involving the same questi
and
the
then instructed them in all cases first to submit
of the
to the U. S. Appraiser for his report as to the character
merchandise. The letter instructed collectors further that this recases, but in the liliquidation
should proceed not only in suit
respect to entries
quidation of entries as yet unliquidated, and in
alread y liquidated, with due protest and appeal pending, but in
Which no

suit had yet been begun.

A conference of appraisers was ordered to meet in New York to
conference met in New
arrive at a
uniform classification. This
York in March, 1890, and reported to the Department a schedule a
be classified as
schedule of materials which they thought should
hat
formulated in Department letter
trimmings. This scheaule was
tors. The schedule
(Synopsis 9915) as a rule of action for collec
is as
follows:
II\

cially known as trimmings.
"Class 1.---Ribbons, commer
value
"All ribbons of silk and silk and cotton; silk, chief

ilo
oTo twenty lines to sixty lines inclusive, except gauze
:1:r
":
11:7:1:b
.ons of every description.
"Satin- back velvet ribbons.
"Class 2.--Laces specially enurlerated in paragraph 448.
:Fancy colored laces (excepting all black) not exceeding sixty.4
of chief
lyeIn width, of which silk is the component
"Value.
materials,
Class 3.-- Piece goods, known as millinery
"but not commercially known as trimmings (in the condition in
"Which imported), but conceded to be intended chiefly for mak'ing and ornamenting hats, eta., comprising-11
width.
::::::elvets not exceeding 18-1/2 inches in
Width or
in
inches
24
exceeding
Cotton-back satins, not
"valued at not exceeding 4 francs per metre, subject to trade
"

Millinery gauzes, except veilings."

This conference of local appraisers seems to have gone very much
be Yondwhat the decided cases, up to that time

warranted.

The case

of Hartranft, plaintiff in error, against Langfeldt, involved, accourt, velvet ribcor ding to the reported decision of the supreme
bon-

Court seems
made of silk and cotton, and the decision of the

to be directed to such articles.

It is well known that the case

cotton", the jury
really involved "piece goods made of silk and
Government on the
having by their verdict found in favor of the
velvet ribbons.

plaintiff in error, against
The case of Robertson,

&lelhoff, involved in the Supreme Court only ribbons composed of
Silk and cotton in which silk was the component material of chief
3uch ribbons were used
value, and it was conceded on the trial that
ex clusively as hat trimmings.

The whole argument for the U. S. in

silk was the component material
that case was that articles in which
T.I.448. Yet this conference
of c hief value did not fall within
as hat trims
established
a schedule of articles to be classified

trimmings in which were included a great many descriptions of merchandise which had not been determined to be within T.1.448, by any
decision, and which collectors had been classifying at fifty per
cent.
a± be/slouno y.11310;.„
swcs. :an (AollIc-1. LIB ziniJcisoxs)
nenoqmoo . ed: ci Alia doldw lo

great many of these articles had rested upon the contention that -t-h-

850B1

a - all evi'"
.9U1SV"

0aillirl Eft nwonA t aboo
,tirtilbaeo ed: - 1) agniaankx: a8 riworpt soon --.& aa1310
1411,31016141300 :oil Iqd"
- -

Insido ...bas/al sof ol bebsono:) 31sd t(LoIlocimi dotriw"
-- aatal'UMBoo t.1149 taIkut arillrFmTwrno bru3 rti"
dont a\I-8i aalbseoxp Inrf n -+''Trrnv ntelq "
Ablw at asitont
anibssoxe ,ton
"
4/ *ostdua ,81:sm log nonEll
gainssoxs.:oa
bf-“r11.1v"
.4.:!uooaib"
".azintlisv :Isoxe t asnuan
"
*:1104 40:01m

arnse

eItqq

Undoubtedly they considered that their classification of a

1E5301 'to

907W:)11-V1 D

though they were chiefly used for hat trimmings, yet, silk being the
Chief value, they did not fall within T.1.448, and the case of
Robertson against Edelhoff had determined the law differently. Notwithstanding this, it seems at this time very extraordinary that
this conference of appraisers should have included some articles
itemized in class three of their schedule.
the clause in

t aenzo c)oblosi-) 814-i tariwbao

We refer especially to

that schedule "Cotton-back satins, not exceeding 24

towi
tzeor
in
di::::::."at not exceeding 4 francs per metre,

tt.slq trtmyr:•-risH
aZoeb ba/loqe's

It:
ill be noticed that class three of the foregoing schedule

AJ,4.4. Alla lo obiam an

• ..., ....141•••

doua ot be:f,sltb ed

not commercially
known as tldmmings (in the condition in which Im-

eosig" bsvlovf!!

ported)

aoth-fp,
7

HO *110fl'ffr,

tnvr

of the Government, was the end of the importers' case.

law :1 bas oul
t3A

Certainly at that time this was supposed

to be a very
important point, and one which, if determined in favor

.A.kfm =info— -t
no.t.too bal.; Al
Oft

73fit

f'--rlovat Motile

begins by stating, "Piece goods, known as millinery materials, but

X1eVicUi0
4.4 i.;)•s

4aalav
opritr,
(0/

Until the

d
m:::::on in Hartranft, plaintiff in error, verses Meyer, et. al.,
decided in May, 1893, it had been supposed that it was of fundaimportance for the plaintiff in these cases to prove that the,
articles in question had been commercially known as trimmings at
the time of
the passage of the tariff act of 1883; but this conference of local appraisers seems to have disregarded that point
entirely and to have classified as hat trimmings, on the .ole ttst

3
I. ealol$Onoaeb Noma :se.ta a
bebuloal elew dotAw at wIrmt
of chief use, classed of articles which they admit in their statemtmis'Id 41814.T.T nidilw ed o/ benimeleb
need :on DBriifiw Gann
ment were not commercially known as trimmings in the cendition in
leg
*a an/yliacalo need bad
elwoelloo doldw bus inotato
Which imported. The law may be now that the test of chief use deso noi:sonfaazio lied/ :MI
bslebtanon \:erf. '411).9.tduoi:aU ./a
termines everything; that if the proof shows that the articles were
ltdati4 not*TTsrer,- ad: noqu
he/aen Juld aelol:qa .18:i 10 ,:rti,:: .1- .1e
in fact, chiefly used for trimming hats, then they are within T.T.
1
s .111 lol• beau %,:rteld.,' elew 'erf,t rinuoi
, 448,
they were known as trimmings when imported or not. It
Ls1 /on bib vi)fi.t
*Pr!

. 1144kt414

89110,07W'Icr

A!rrpv The.4110
TO

el
;

4 IPVP
•

167010

•

10 e0a9191acr3

a±110

;••

tlt.1

efr' !

4*Bri/ .at e8u3iLi

Hartranft

VS. Meyer, et. al., meant to take this position so broadly.

7tt tatril 3.7.1tba".

1.1± bestm
.44d,Li-110,4

is by no means clear, however, that the Supreme Court in

The reclassification and reliquidation of invoices and entries
Proceeded rapidly throughout 1890 on the basis of Synopsis 9915.
Great numbers of invoices were sent from the Collector's office in
We
Apprquired carefully into the methods followed in the United States
iser's office in this Port in making this reclassification.
Arnold, Vol. IX, pp.23-116.)
ul
Mr. Corbett describes the method pursued. They took the schede
of articles set forth in Synopsis 9915 as their guide abso1,
-'"elY, according to the instructions of the Department. Mr. Ludlam
a clerk in the third division of the Appraiser's office, at the head

which was Assistant Appraiser Corbett, performed most of the

clerical work.

His system was to read the invoices, and where he

found goods falling within the schedule of March, 1890, to draw a
red ink bracket and write in front in red ink a capital "A". These
inv°ices were then sent back to the collector, where, if they were
covered by a suit, they were sent to the Bureau of Certified Statementswhere certified statements were prepared.

If they were invoices

included ,in entries as yet unliquidated, or liquidated with protest
and appeal pending but not vet in suit, they were sent to the Liquidating Division and there liquidated or reliquidated according

to the new
classification.

This work of reclassification was not

based to any great extent on a comparison or examination of samples.
This will not be evident at .first in reading Mr. Corbett's te3t1monY; but if his testimony be read through on this point, it will
be found that he admits that the clerks did the most of it, and were
guided chiefly by the description in the invoices.

They did use

some samples that they had in the office, and in some cases they
Obtained samples from the importers.
substantially
the

In fact, it may be said

that

all the samples that they did use were provided by

importers.
6reh:77:::::::. Corbett very minutely

though

on this point, and

y is indefinite and lacks positiveness, he admits

sub stantially thtt the description in the Invoices was what they
f°110wed.
doubt

All, that he did personally was to decide questions of

when consulted by the clerks who did .the work of reclassifi-

Mr. Ludlam testified that he was guided chiefly by the
eati".
descr4_
lption in the invoices; that sometimes he got samples from the
Extlyni,
- -lers and sometimes from •the importers; he thought he might have
°btained samples a half-dozen, possibly a dozen times. This of
course
was a trifling proportion to the immense number of invoices
reclassiried.

It is noticeable too, that no examiner was called

upon to reclassify under Synopiis 9915, but the work was leftnto

clerks.

Mr. Corbett and Mr. Ludlam both stated quite positively

that they were perfectly familiar with the description in the invoic,
t.89 and that the description was sufficiently full to enable
them to
identify the goods under the schedule contained in Synopsis II

_
-oloalwrot

9915.

an expert at
Mr. Ludlam stated that he had no knowledge as

but
all, and that the samples obtained by him were of no use to him,
n in the
that when he could not satisfy himself from the descriptio
to Mr. Corbett for
invoice, he took such samples as he could obtain
his decision.

searched for a number of
Mr. Ludlam by our directions

such affidavits of verisa::Iples he had obtained from importers with
at the time. He sent
fication as were obtained from the importer
us six of these affidavits, and we anrex them all.

(Exs. XV and

state that the goods
It will be seen that some of them merely
purposes; others state that
Imported by them were used for millinery

XVe)

hats, bonnets and
the chief use of their goods was for trimming
from the parties directly
hoods. Of course these affidavits, coming
i nterested, and drawn in such a general form, are of little value.
We think the precautions taken to

identify the goods described

cient proof to
in the invoice by actual samples shown by some suffi
d.At the time we
be truly representative, were very inadequate indee
to a considerable extent
think that Mr. Corbett and his clerks could
articles in the schedule
identify the invoice description with the
have been
in Synopsis 9915 without samples. It would, however,
of these goods
much more satisfactory if carefully proved samples
and reported
had been obtained and had been attached to the invoices
to the collector on the return of the invoices.

These officials

all knew the immense importance of the work they were doing.

They

e them, that milwere necessarily aware, having the invoices befor
all
lions of dollars were involved, and yet they proceeded to do
and careless
this important work of reclassification in a slip shod
Manner.

cation made
There was a partial check upon the reclassifi

by the
local appraiser under Sun. 9915 of March, 1890. That order
in respect
re
to certain important classes of goods states that the
limit of classification either by measurement or by prices.
assured

We are

the
the heads of the Bureau of Certified Statements in

collector's office and the Naval Office that a careful comparison
Of the
made upon
invoices With the appraisers reclassification was
these points, and if it appeared that the appraiser had reclassified:.
any of these articles not within the limits of size and price stated
in S. 9915,
theinvoices were sent back for corfection.
The schedule of articles contained in Synopsis 9915 involved
classified at a rate
an immense
amount of merchandise that had been
Or

fifty per cent.

immensely.
The refunds kept growing

Import ers

accepted the refunds on the articles stated in the schedule, upon
the basis of which reclassification was made; but instead of disco

they continued the
ntinuirig the suits in which refunds were made,

suits in respect to the other articles claimed upon, which they had
Department should
Yet succeeded in persuading the courts or the
"
n
be classified as hat trimmings.
On Decenber 29, 1890, Secretary Windom issued an order suspending reliquidations of protested articles claimed to be hat trimmings
At that time there were a very large number of invoices in the apmanner already dePraisers office awaiting reclassification in the
scribed.

1891, there were no
Between December 1890, and September,

reliquidations of hat trimmings invoices.

The claimants and their

attorney _,
negotiating with the
s however, were actively engaged in
decision in RobotGover nment, having become fully alive since the
afforded for immense
a°11 aZainst Edelhoff, to the opportunities now

refunds.
In July, 1891, a case was tried in the Circuit Court for the
Eastern District of Pennsylvania, Meyer against •Cadwalader, 49 Fed.
Reporter, 26, 32.

This case involved gauzes, velvets and other ma-

terials, among them cotton-back satin piece goods.

This case was

tried with great care, taking over two weeks, and the Government
obtained a verdict.

This was the first case actually tried in which

the satin piece goods were involved.
"Philadelphia case".

This ca3e became known as the

The verdict was set aside in December by the

court on evidence that certain newspaper articles published during
the trial had possibly unduly influenced the minds of the jury, but
this verdict has a very important relation to subsequent proceedings
On September 22, 1891, two months after the verdict in the
Philadelphia case, and before that verdict had been set aside by
the court, the Department issued Synopsis 11,798.
"r()

•

By this letter of September 22, 1891, (Synopsis 11,798) the
former rule of action contained in Synopsis 9,915, formulated for
the guidance of collectors the schedules of articles established
by the Conference of Appraisers in March, 1890, was revoked and an
entirely new method of deciding these hat trimmings cases was established:
Treasury Department, September 22, 1891.
Sir:-

The instructions of thisDepartment of December 29, 1890,

suspending the reliquidation of protested articles claimed to be hat
trimmings, are hereby revoked, and upon the reclassification by the
local Appraisers

as to "chief use", subject to the limitations

hereinafter specified,

and in accordance with the principle an-

•

V""

I
I

announced in the circular dated February 11, 1890, (Synopsis 9854)
the entry shall be reliquidated, and certified sttements shall be
of
Prepared and forwarded to this Department upon discontinuance
suits.

nied by
The return of the local appraisers will be accompa

samPles of the merchandise passed as hat trimmings in each case
ref
if required
erred to the general Appraisers and in other cases
bY the Department.

Invoices, however, covering plushes, velvets,and

those articles, be
satins, and all other piece goods, shall, as to
submitted to "General Appraisers Tichenor, Ham, and Jewell for their
de termination as to

whether they are covered by paragraph 448 of

the Act of March 3, 1883, and can properly be classified as hat trim
el

Mings.
ers shall
This reference to the above named general apprais

n21.,

s
include the articl'is or goods identical with the article which
were found not to be hat trimmings by the verdict in the case of
MeYer et. al, vs. Cadwalader, tried at the April Term of the United
betng held by the
States Circuit Court at Philadelphia (the same
13ePartment not to be hat trimmings.)
The general appraisers shall pass on the classification of the
Ille chandise submitted to them, and their determination shall be final) and the reliquidation shall be made upon such finding.
No payments will be made under this order until suits shall be
dis continued in full as to all articles protested as hat trimmings,
stiputhe attorneys of record, or the importers, shall sign a
4
"
recovet refunds
lation that no further suits shall be instituted to
041 articles claimed as hat trimmings covered by invoices heretofol.e

the basis of such suits.
b\-

L)
Application having been made by Messrs. Charls Curie, Tremain
ee Tyler, and Alexander T. Ketchum, attorneys for various plaintiffs,
for settlement upon the fo-egoing conditions, you are instructed to
prepare and forward certified statements in accordance with this
order in
:
t er:::e
ncsi. in which said parties appear as attorneys and
apply

You will also pursue the same course with reference to the
claims of any other attorneys who may signify their willingness,
in writing, to have lheir cases adjusted on the basis of this letter,
synopsis 9915 is hereby revoked.
Respect -ully yours,
CHARLES

FOSTER,

Secretary."
a ollector of Customs,
Nev, York.
(3104-E)

It will be noticed that except in respect to velvets,plushes,
SatinS

and all other piece goods this order referred the local Ap-

Praisers to the Department letter of February 11, 1890, tSynopsis
9854)1 issued immediately after the decision in Robertson against
?4lelh°fr, by which they had been instructed to reclassify according
t° that decision.

The letter of February 11, 1890, having been fol-

lowed within
a month by the report of the Conference of local ApPr4isers and the schedule of articles set forth in S. 9915, had left
17erY little to the discretion of the local appraisers.
11111111ift

fic
This conference had established a description of the articles
which were
chiefly used as hat trimmings, and all that the local appraisers In the several ports had to do afterwards was to follow that
list.
were

oB
d ut
toby
de t e
hr
im
sil
n:tt: r of September, 1891, the local appraisers

Prohibited from folloiTing any longer Synopsis 9915, and were

instruct

the chief use for themselves.

au5 for

This letter

to:termination of the question whether the articles of

Illar chandise were
commercially known as trimmings in the condition in
Which
Imported
In respect to the piece goods, three of the General Appraisers
est
ablished by the Administrative Act of June 10, 1890, were appointt
"a committee, to
whom under the procedure set forth in this letter
all invoices of piece goods should be submitted for their determinati
"in respect to the proper classification of such goods.

This

letter stated
that the determinations of these General Appraisers
should be final, and that reliquidation should be made upon their
findi ngs.

It further provided that no refunds should be made in any
n o s procedure until a
thi
articles

Ttiscontinuance in full as to all

protested as hat trimmings was filed and a stipulation

signed
silltun
:
further suits should be instituted to recover refunds on
articles
er: wdescribed in the invoices included in the suits
rur
ionhzieeshca
The attorneys named in this letter,
Teain & Tyler, and Alexander P. Ketchum, controlled
ilvesixths of the suits as will appear from either of: the schedules
I °r 2.

!Ebbw.

In respect to merchandise other than piece goods, it will be
loti cea
that this order instructs the local appraiser to reclassify

on the basis of chief use, and that on such return the entry should
be reliquidated and certified statements prepared and forwarded to
the Department upon discontinuance of suits.

This order, therefore,

Permitted no further reliquidation or entries in which due protest
had been made and appeal taken, but not yet in suit.
suits only.

It applies to

This order having been issued before the verdict in the

Philadelphia case had been set aside, contains the following restriction:
"This reference to the above named General Appraisers shall not include the articles, or goods
identical with the articles, which were found not to
be hat trimmings by the verdict in the case of Meyer
and others against Cadwalader, tried at the April
Term of the United States Circuit Court at Philadelphia (the samebeing held by the Department not to be
hat trimmings)."
We are unable to give the Department much information in respect to the negotiations that led to this order of September 22,
1891.

The scheme appears to have been planned by the attorneys

named and the late Assistant Secretary Spaulding.

Mr. Tichenor,

The president of the Board of General Appraisers, testified

(Vol.

A, Dry Goods Chronicle Charges, p 329-33) that being in Washington
in the late summer of 1891, the proposition was made to him by Mr.
Spaulding; that he was at first rather averse to undertaking it as
It was not within the line of their legal duties, but finally agreed
to come back to,New York and consult with his colleagues.

He did

consult with them and the result was obviously their consent to act.
There appears to be no formal records of these negotiations or proceedings.

But the correspondence forwarded to us by the Department

contains various propositions made from time to time by Messrs.
Tremain & Tyler in respect to some settlement of their cases, and
we suppose the plan formulated in September, 1891, was the result
of these negotiations.

The General Appraisers who acted first were

Tiehenor, Ham and Jewell.

Afterwards General Appraiser Ham apparent

ly became ill and General Appraiser Lunt was, by the consent of
attorneys named, substituted in his place.
The order of September 22, 1891, indicated as a procedure to
be followed, a return from the local appraiser to the collector of
thelinvoices reclassified according to his judgment, and accompanied
by samples in all cases to be submitted to this committee of three
General Appraisers.

The samples were not required upon the return

of the local Appraiser in other cases, unless ordered by the Department.

The Collector, it was intended, should then send this report

of the local appraiser, with the samples, to the General Appraisers,
who should, when they made their findings, report it to the collector.

On October 2, 1891, Mr. N. W. Cooper, then U.S.Appraiser,

wrote to the Department the following letter:

PORT OF NEW YORK,
Appraisers Office,
402 Washington Street, October 2, 1891.
Hon. Charles Foster,
Secretary of the Treasury.
Sir:

In connection with the Department's letter (A.J.) of the 22nd
Ultimo on hat trimmings, I would suggest that the disputed

goods

mentioned therein may be submitted at once to the Committee of Gener.
al Appraisers for their determinations to the questions involved,
in order to facilitate a more orderly and speedy dispatch of the
business connected

therewith.

This office could act at once on the invoices to be reclassifie

upon the decision of the Board and thereby save them a repeti-

tion and action on each invoice covering the same line of goods.

Would also suggest that authority be given me to refer to the committee disputed goods claimed by the importers as hat trimmings,
such as laces, ornaments, &c., not mentioned in your letter, as a
means of more satisfactory settlement of the whole subject.
Very respectfully,
M. W. Cooper.
Appraiser".
It will be noticed that Mr. Cooper suggests that the local
Appraiser should send the invoices and samples directly to the general appraisers in cases involving merchandise to be submitted to
them pursuant to the letter of September 22, 1891, and that the decision of the Board should be reported directly to the local Appraiser, who should act thereupon immediately in all similar cases.
He also asks authority to submit to the Board for their decision
other classes of merchandise than piece goods claimed to be hat
trimmings.
On October 6, Ast3istant Secretary

Spaulding wrote to General

Appraiser Tichenor enclosing a copy of the letter of September 22,

found
classes of goods
e
th
to
t
ec
sp
restriction in re
repeating the
d stating Mr.
adelphia case an
il
Ph
e
th
in
s
ming
not to be hat trim
with permission
of October 2nd,
er
tt
le
s
hi
in
ons
Cooper's suggesti
s if they deemed
such suggestion
t
op
ad
to
rs
se
ai
to the general Appr
diately proceedAppraisers imme
l
ra
ne
Ge
e
Th
so.
it advisable to do
ted by Mr. Cooper
oceedure sugges
pr
e
th
th
wi
ance
ed to act in accord
goods, to
respect to piece
in
th
bo
d,
2n
October
in his letter of
r 22nd, 1891,
der of Septembe
or
e
th
by
ed
restrict
Which they were
e referred to them
s of merchandis
se
as
cl
r
he
ot
t to
and also in respec
aiser.
by the U. S. Appr

to the meanquestion arose as
a
ng
di
ee
oc
pr
Very early in the
ember 22nd,
the letter of Sept
in
"
th
wi
al
ic
nt
"ide
ing of the phrase
ng upon articles
board from: acti
e
th
g
in
in
ra
st
h re
and in the paragrap
. The local
Philadelphia case
e
th
in
ed
lv
vo
those in
"Identical with"
an articles of
at phrase to me
th
d
te
re
rp
te
in
rally
appraiser had natu
their us, however, with
rs
te
or
mp
ei
th
n,
scriptio
the same general de
ticles in
restricted to ar
be
st
mu
it
at
th
contended
ual liberality,
that case.
me as those in
all respects the sa
the conchenor asked for
Ti
r
se
ai
pr
Ap
al
er
On October 16thiGen
osing a
this phrase, encl
to
t
ec
s_
re
in
,
Department
struction of the
supported
ich that attorney
wh
in
m,
hu
tc
Ke
. A. P.
long letter from Mr
ment,
r 23d, the Depart
be
to
Oc
on
d
an
porters,
the claim of the im
follows:
to Mr. Tichenor as
e
ot
wr
g,
in
ld
au
through Mr. Sp
t intended that it was no rrow
rm
fo
in
ly
ul
tf
ec
"you are resp
with" in its na
phrase "identical
e
th
oy
goods of the
pl
em
to
ed
a concise manner
in
ng
ti
ca
di
in
sense, but as
n."
acter or descriptio
same general char

In this letter the General Appraisers are informed that it was the
desire of the Department that the local Appraiser should in all cases of doubt consult them.
We call attention to this approval and extention of the restriction in the letter of September 22, 18911 as late as October
23rd of the same year, because it seems to us of importance in view
of the way in which by later instructions in special cases that restriction

was removed.

The local Appraiser kept referring large numbers of invoices
to the General Appraisers which were considered and returned to him
with their decisions.

The procedure was for the local Appraiser

to write a letter to the General Appraisers stating the invoices
and samples sent and for the General Appraisers, when they had decided the case, to return to him the samples with their decision
Upon each sample.

The local appraiser then proceeded to reclassify

all similar goods and to forward the entry papers to the collector
for reliquidation.

I
oti

The result of this procedure, it will be observed, was that the 4
local appraiser did not decide the question of fact as to chief use,
r;.'f

but that this was determined by the Board of three General Appraises

h3;"'Io
e t:

7J*-7:3

•..a

in every instance upon the samples submitted.

•

1 7*

We have obtained from the General Appraisers copies, of all
their correspondence with the Department and with Mr. Cooper in
"17:J1.-:;
9fij

nov f:

:c:n
".(1 )iJt1;..;

respect to the cases submitted to them under the letters of September 22, 1891, and October 61 1891, and forward them herewith.
On December 92 1891, the Attorney General, by letter "S.G.7551-

1886" to the Secretary of the Treasury, reported that the Court had
granted the motion for a new trial in the Philadelphia case.

this letter the Attorney General states::
"The verdict was set aside, not on the merits of the
case, but simply because or certain newspaper articles which were inspired by special agent Hanlon and
held by the court to have influenced the jury.

the basis of the verdict rendered in Philadelphia,
you issued an order to the General

Appraisers to ad-

just the claims known as the hat trimmings claims,
many of whom were involved in the Meyer and Dickenson
suit.

The veridct having now been set aside which

was the basis of your order, I recommend and seriously urge upon you the necessity of suspending any
action under that order pending the re-trial of the
case.

It is my leliberate opinion that the evidence

produced on behalf of the importers in all cases of
this class, is wholly untrustworthy and ought not
to be acted upon.

I do not think that without the
the verditt in
lines which were marked out by.the Meyer and Dickinson case, it will be at all safe for the interests
of the Govdrnment to entrust the settlement of the
matter to the General Appraisers.

Practically, the

only testimony available for them will be that of the
importer and of the local appraiser, who are all sat-0
urated with a prejudice in favor of the importers,

ifs\
and whose knowledge of the use of these articles is
not from any business experience, but frnm the statements made to them by those who are interested to
bring the goods in at a low rate of duty.

In my op-

inion nothing but the sifting process of a lorka jary
trial can ever establish the exact fact,§j",y.ath,. regard to the use of these articles, and I respectfully
'
urge upon you and your Department, that no steps
whatever be taken to pay money out of the Treasury
of the United Stites on these claims pending a retrial, but that the order above referred to be prompt
ly revoked.
Yours respectfully,
W. H. Miller,
Attorney General".
We have not received from the Department any copy of the answer
made
to this letter, but we find that on December 16, 1891, Mr. Spaulding
wrote to the General Appraisers instructing them to suspend reclassifications of marcellines and chinas pending further consideration of the subject.

This order was undoubtedly brought about by

the letter of the Attorney General of

December 9th, and the letter

of Special Agent Hanlon to the Secretary of the Treasury of
December 12th.

In that letter Special Agent Hanlon states that "Examiner

Wiswall" by direction of General Appraisers Tichenor, Ham and
Jewell
has been classifying as hat trimmings, chinas and marcollines
simiinto those involved in a case tried in Philadelphia, and then
be-

.611.

1/1
before the U. S. Supreme Court.

But the full recommendation of the

Attorney General that reclassifications under this order of September 22, 1891, should cease, was apparently not adopted because re-.
classifications under that letter continued.
It is proper here to comment briefly on the procedure by which
invoices were reported from the local Appraisers to the General
t)P;

Appraisers under these letters of September, 1891, and October 6,
1891.

In our report on the Dry Goods Chronicle Charges, we have

shown the relations which Examiner Wiswall bore to the local Ap44

praiser and the General Appraisers in respect to the reclassifications of these hat trimmings invoices.

Further light is thrown upon

it by Mr. Corbett's testimony in respect to hat trimmings. (Vol.IX,

p 79e and seq.)
Mr. Wiswall was apparently an agent of this Board of General
Appraisers in the local Appraiser's office.

He was an examiner and

had been suspended by Mr. Cooper, reinstated by order of the Department, and assigned to this special work.
to do with reclassifying the invoices.

Apparently, he had nothing

That was done in the third

division, under Mr. Corbett's supervision.

But W. Wiswall appears

to have had the power to take any of the invoices from the local
appraisers office to the Board of General Appraisers and submit them
for a decision, and his relations, with the 7.-)oard, are not contained
In any record.

He did not correspond with them but connected with

them personally, and when the U. S. Appraiser had, in a formal way,
referred certain invoices and samples to the General Appraisers
by letter, Wiswall was commonly consulted by the Board of General

1/7
Appraisers in respect to the samples and sent around by them among
the importers to obtain information for than and to get them additional samples if needed.
Here again we are constrained to comment upon what seems to
Us the dangerous looseness of procedure in re3pect to claims involving millions of dollars.

The General Appraisers were fully aware of

the inmense magnitude of these claims and should not, we think, have
allowed Mr. Wiswall to have nearly so much power in respect to the
cases to be brought before them for decision.

We asked Mr. Corbitt

(Vol IX p

) in what order these invoices were taken up

for reclassification.

He replied that it was done when they got

samples and that was about as definite an answer as could be obtained.

Apparently, they were sent according to the prefecences of Mr.

Corbitt and the U. S. Appraiser, or according to the preferences of
Mr. Wiswall.

This afforded an immense opportunity for favoritism,

and was, we think, a loose and unsatisfactory method.
After General Appraiser Lunt became one of this Committee of
General Appraisers, he appar-ntly did most of the work.

Mr. Tiche-

nor, who was the executive officer of the Board of General Appraisers, did not take so active a part in the examination and decision
of the cases.

We brought General Appraiser Lunt and Gendral Ap-

praiser Jewell before us to t;stify on this subject, and Mr. Lunt
has testified at length (Vol. IX, pp124 ) in respect to their method
of investigating these cases.-- -infra pp 78-84, 108-113.

THE FOUR FLEITMAN SUITS NUMBERS 11,402, 12,184, 12,545, 16,289.

1/
We are now in a position to consider specifically these four
suits.

The letter of September 22, 1891, had re:;trained the Gen-

eral Appraisers from considering and the local Appraiser from reclassifying any articles of merchandise identical with the articles
before the jury in the Philadelphia case.

We have shown that the

order was reaffirmed and the phrase "identical with" given a liberal and proper interpretation by the Department on October 23d; and
further we have shown that in December, 1891, when the Circuit Court
set aside the verdict in the Philadelphia case on grounds not bearing upon the merits at all, the Attorney General urged upon the Secretary of the Treasury that he should revoke his order of Septemb-r
22, 1891.
These four suits, and suits in which certain other importers
were plaintiffs, were considered under exceptional orders issued by
the Department through Assistant Secretary Spaulding.

We find among

the papers sent to us by the Department, a letter dated New York,
January 25th, 1892, addressed to the Secretary on behalf of Messrs.
Pleitman and Company and signed by Mr. John Proctor Clarke and Mr.
Benjamin Barker, Jr., as special counsel for these importers.

-qA

this letter it is stated that the merchandise involved in these
suits falls into three classes:

e XT .
f
• :3

first, ribbons; second, satin

piece goods, marcelLines and chinas; third, velvet piece goods.
Reference is then made to the conference of Local Appraisers, March
11, 1890, in which these piece goods were decided to be hat trimmings.

These attorneys then offered as follows:

The claims on ribbons to be allowed without further

dispute.
2.

The claims on velvet to be abandoned by the plaintiffl and

The satin piece goods to be submitted with the invoices

and samples to any expert in the Treasury, or in the Appraiser's
office in New York, or to any special agents in whom the Govel- nment
had confidence, for investigation.
The offer concludes as follows:
"With this agreement and understanding that if the report
of such a person shall show that our conlention is correct, the
Department will with reasonable dispatch refund to us the
excessive
duties, sought to be recovered in these suits upon the ribbons
and
satins of the kind, nature and use before mentioned; we on our
part
Zfir'(

to totally discontinue said suits, for payment, abandoning
all
rd,

claims upon the velvets involved therein."
ao

There were undoubtedly preliminary negotiations leadin
g up to
this preliminary proposal for it otherwise could hardly
have been

flj

acted upon within twenty-four hours after the date
of this letter,
ni

as it will appear was the case.

e.3,;LJ
,bnonr,2 ;ano ,dt-

TREA3URY DEPART/TENT,
3104-E.

1:-f)0J
n

f)f-A-, j.t, o1.)

Office of the Secretary,
Washington, D.C., January 26 1 1892.

riz

'14
1....7

If!) •

Collector of Customs,
New York.
Sir:
vnil will

nlmaan
L.4

rarrnrri

ac rcan.11
nri
%."

tA.

+Inn
G

1n4-4-,Nin
4.•

instructions

addressed to you yesterday, regarding certain suits of Herman,
Pleitman & Co., and will accept the following directions as a substitute for those contained in said letter.
'You are hereby directd to at once take up and investigate the
invoices covered by the suits of Herman, Fleitman et al, vs. the
collector, Nos. 12,184,

11,402,

16,289,

and 12,545, confining Famr

your investigation thereon to the satin piece goods

heretofore

classified by the appraiser as hat materials and report with all
convenient dispatch on these goods as follows:1st. Their description as fully as possible, width, quality,
method of manufacture, and particularly as to whether "dyed in the
piece" or "dyed in the skein".
2nd. Whether Or not these goods.were imported or used for
dress goods.
3-d. Whether the particular goods in these cases are trimmings
in the condition in which imported, and whether their chief use is
for making or ornamenting hats, bonnets or hoods for men,
women and
children.
You will examine the importer and such evidence as he may
adduce before you, and mike your report to this Department as
soon as
completed.'
Your action in this case will be in accordance with the
mode
of procedure set forth in the first paragraph of Synopsis
11,798.
The goods which are to be affected by these instructions
are satins,

chinas, and marcellines, and after the report of the Apprais
er has

been made upon the same, they will be submitted with samples to
General Appraisers Tichenor, Ham and Jewell for their determination
as to their classification as hat trimmings.

See also Department's

letter of September 22, 1891, addressed to the appraiser at your
Port.
Respectfully, yours,
0. L. SpaulcUng,
Acting Secretary.
J.M.C.

This letter, it will be observed, instructs

the collector to

take up and investigate the invoices in these four suits, confining
his investigations to the satin piece goods heretofore classified
by the Appraiser as hat materials.

It is evident, therefore, that

these invoices had already been classified by the local Appraiser u]
der"synopsis 9915 of March, 1830, in which the schedule adopted by
the Conference of local Appraisers had been formulated.

After spec

ifying the propositions to be determined in respect to these goods,
the letter continues:
"Your action in this case will be in accordance
with the mode of procedure set forth in the first
paragraph of S. 11,798".
The collector is then instructed, after receiving the report
of the local apprgiser, to submit them with samples to the General
Appraisers Tichenor, Ham and Jewell, for their Determination and
classification as hat trimmings.

This committee consisted at that

time of General Appraisers Tichenor, Ham and Jewell, but shortly
afterwards Mr. Lunt was substituted for Mr. Ham.

Pursuant to this

instruction, the collector sent 121 invoices to the local appraiser
enclosing alcopy of the letter of January 26th.
OFFICE OF THE COLLECTOR OF CUSTOMS,
Port of New York,
January 29, 1892.

Mr. M.

W. Cooper, Appraiser,

Sir:
Referring to the enclosed letter of the Hon. Secretary of
the Treasury, I submit herewith, one hundred and twenty-one inv ices
(121)which are included in the four suits of Messrs. Fleitman & Co.,
•

quoted, with the request that you take the required action.
Very respectfully,
F.Hendricks,
Collector."
(One hundred and twenty-two (122) enclosures.)
Mr. Corbetts testimony, Vol. IX, p. 58, shows that these invoices were received and that the re-examination of them took about
one hour.

This (toes not necessarily show any negligence on the part

of the local appraiser, because these invoices had already been
classified after the letter (S. 9915) of :larch, 1890, had been
issued.

All that was done in the local appraisers office at this

time was to run hurriedly over the classification to see if it was
correct.

If, as Mr. Corbett testifies, the work was done in one

hour, the invoices were not subjected to any re-examination at all
^P.

On February 4th, the local Appraiser returned these invoices
to the collector with certain samples.

The following is the letter

accompanying the invoices when returned to the collector:
Appraiser's Office, February 4, 1892.

M. W. Cooper, Esq.,
Appraiser.
Sir:
Respectfully referring to Department's letter (J.M.C.) of the
26th ultimo, in reference to certain invoices of Herman, Fleitman &
Co., I have to report that the satins reclassified on these invoices
consists of satins woven in the grey with silk warp and cotton fitling, 18 to 24 inches wide, and dyed in the piece, known as piece
dyed satins and also termed hatters' satins.

These goods were not

imported or used for dress goods.
Their chief use, in my judgment, was for ornamenting and trimming hats, bonnets and hoods.
-ni

t h.1

•

:;-:(-)0J

I:m..1

Invoice and samples returned herewith.

_i_L!

k ,,•

Very respectfully,

Ni
M. J. Corbitt,
%:;;-'1;; ,;.;;;L

oz.41

t 0.1: 1.i71 (16

oLia;;;0,

(z;lec .E)

L000l
E2W•1±

Assistant Appraiser.
Respectfully forwarded to the collector approved.

ni or!AJ_

M.W.Cooper,
Appraiser.

fioe 0.1

e-To ILL 01!0!, EJAY

The important phrase in this letter is the statement made by

t ar)111Jak,j
.

I.:3 11; golJB:TIru;xs-e% 1013 01 1)Jusi,due
Joa $1ew

011C
"t4Ify

Mr. Corbitt in the last paragraph, approved by Mr. Cooper:
"Their chief use, in my judgment, was for ornamenting
and trimming hats, bonnets and hoods."

...

We have examined Mr. Corbett
Upon Which he based this opinion.
of opinion.

with respect to the information
It is a very important statement

Mr. Corbet could give no other sources of information

in support of that opinion except that he had aAced :;ome importers,
including Messrs. Pleitman & Co., what the chief use of these goods
was, and they had told him for trimming hats, bonnets and hoods. He
did not make any especial examination at the time of writing this
letter, but he had acquired this information during the pendency of
the controversy.

And yet he was confronted with the fact that prior

to the decision of Robertson against Edelhoff and the meeting of
the
Conference of local Appraisers in this port in March, 1890, the
collector, the Naval Office and the Appraiser at this port had decided that these goods were not hat trimmings and should be classified under T.I.383, and that they had been in fact so classified
until March, 1890.
Mr. Corbett had testified in July, 1891, on the trial of the
Philadelphia case and had distinctly refused to state that the
chief
use of this class of satins was for making or trimming
hats.

•

t'
2) •

•

testified that that was one of the uses to which this class
of merchandise was put, but said that he would not state that that
was the
r

chief use.

He testified that he had not information enough to ex-

press an opinion on that point.
2
(Testimony, Meyer et al. against Cadwalader, Vol., page

772,

to 775)
Mr. Corbett's teestimony in that case and his testimo
ny before
us

(Vol IX, pages 76

) supports the .conclusion that he classified

these goods as hat trimmin s onl

because the conference of local

----.11111111111.1111.1111.11110fts....._

PI\

appraisers had declared them to be hat trimmings in March, 1890. He
aid not act upon any conclusion of his own, reached after a careful
Investigation.

He had not, in our opinion, any sufficient founda-

tion of experience or information in support of this opinion.
It will be noticed that this letter of January 26th refers to
the General Appraisers not only the question of chief use, but also
the question "whether the particular goods in these cases are trimMings in the condition in which imported!
The Collector on receiving these invoices from the local appraiser witn the last mentioned letter, on February 5, 1892, forwarded the invoices and samples to the Board of three General Appraisers:
Office of the Collector of Customs,
Port of New York, February 5, 1892.
Tke Board or General Appraisers,
New Yor

City.
4

Gentlemen:
Referring to Department's letter or tne

6-cn ultimo, aria to

report or Assistant Appraiser M. J. Corbett, aateu tne 4-cn intant,
F

both enclosed, I transmit herewith the one hundred and twenty-one
invoices covered, with three sets of samples, for your consideration
and report in accordance with above mentioned letter.
Very respectfully,
J. J. Couch,
Special Deputy Collector.
(One hundred and twenty-six enclosures.)"

closes three
ates that he en
st
r
to
ec
ll
co
e
In this letter th
ngs occured when
these proceedi
in
h
tc
hi
t
rs
e fi
sets of samples. Th
llector's letter.
received the Co
rs
se
ai
pr
Ap
the Board of General
in the restriction
there were with
to
ed
rr
fe
re
s
The satin piece good
from considerprohibiting them
,
91
18
,
22
r
be
ptem
of the letter of Se
the jury in the
d been before
ha
at
th
e
os
th
r to
ing articles simila
bruary 12, 1892,
therefore, on Fe
,
or
en
ch
Ti
Mr.
Philadelphia case.
Spaulding:
t Secretary
an
st
si
As
to
s
ow
wrote as fo]l
PRAISERS,
S. GENERAL AP
OFFICE OF THE U.
ry 12, 1892.
New York, Februa
,
et
re
St
l
na
534 Ca
g,
Hon. O. L. Spauldin
of the Treasury,
Acting Secretary
Washington, D.C.
Sir:

f r

"C •

)

rs. Ham,
consisting of Mess
rs
se
ai
pr
Ap
l
nera
The committee of Ge
its
the Department in
by
ed
at
gn
si
de
s
, which wa
Jewell and myself
to contor at thisPort,
ec
ll
co
e
th
to
,
r 22, 1891
letter of Septembe
rtmentb
s confirmed by Depa
wa
d
an
s,
ng
mi
im
of hat tr
sider the subject
ceived
ber 6, 1891, has re
to
Oc
of
e
dt
r
de
to me un
letter addressed
of the
's letter (J.M.C.)
nt
me
rt
pa
De
rt
po
at this
from the collector
Co.,
tman
s of Herman, Flei
it
su
n
ai
rt
ce
to
lation
26th ultimo, in re
rtain merchandise
assification of ce
cl
of
on
ti
es
qu
e
invloving th
Act of
der paragraph 448,
un
s
ng
mi
im
tr
t
ha
able as
claimed to be duti
handise
mples of the merc
sa
d
an
es
ic
vo
in
also
March 3, 1883, and
of varpiece dyed satins
of
t
is
ns
co
to
d
h is foun
in question, whic
inches.
width from 19 to 24
ious colors, ranging in

Before taking final action in this matter the committee desirs to be informed whether in the determination thereof, it is to
be governed by the terms and limitations contained in the Department's aforesaid letters of September 22nd and October 6th.

That

Is to say, whether goods of the same general character as those involved in the

Philadelphia case mentioned, are to be excluded from

consideration, or whether we are to ascertain and determine the
chief use of these goods

independent of or without regard to that

case.
We have been led to infer fromthe statement made to us by the
r

attorney of the importers, that those particular invoices and samples were specially submitted under some stipulation or agreement
to compromise the suits in question.
The local Appraiser has reported that the satins in question
are woven in the grey with silk warp and cotton filling and are dyed

drv

in the piece, and known as piece and also as hatter's satins, but
-ftoo ()!

they were not imported or used for dress goods, and

.t•
• '1';

that their

chief use in his judgment was for ornamenting and trimming hats,
bonnets and hoods.

It is desired we shall limit our inquiries to

the chief uses

of the particular descriptions, of satins in question or to the
uses for which these particular importations were sold, the determination of the matter can be reached without great difficulty.
Before proceeding thereto, however, we desire to be fully advised by the Department upon the points presented.
Respectfully yours,
Geo. C. Tichenor,
General Appraiser."

It will be noticed that Mr. Tichenor in this letter calls for
an express instruction whether in considering these four suits goods
•

Of the same general character as those involved in the Philadelphia
case are to be excluded from consideration or whether the Board
should proceed without regard to that case.

He also asks whether the

Board should limit its inquiries to the chief use of the satins
submitted to them, or to

the uses for which Fleitmann's particular

importations were sold.
The first answer to this letter was dated February 23rd, from
Mr. Spaulding to Mr. Tichenor:

TREASURY DIU)ARTMENT,
Office of the Secretary,
Washington, D.C., February 23, 1692.
Col. George C. Tichenor,
U. S. General Appraiser,
No. 534 Canal Street, New York,

N.Y.

Sir:
The Department is in receipt of your letter of the 12th instant
in which you inquire whether the Committee of General Appraisers
designated by the Department in its letter of September 22nd, last,
to consider the subject of hat trimmings, is to be governed, as
regards the suits of Herman, Pleitman & Co., by the terms and
limitations contained in the Department's lettefs of September 22nd
and October 6th last, or whether goods of the same general character
as those in the Philadelphia case are to be excluded from consideration, or the committee is to ascertain and determine the chief
use
of the •oods

inde endent of

or without rerrard

t at ca.

tie

ascertain
e requested to
ar
u
yo
at
th
ve to state,
In reply, I ha
goods
ief use of the
ch
e
th
d,
ie
if
the case spec
without
and determine in
your committee,
of
n
io
at
er
id
cons
ed for the
Which are referr
se.
Philadelphia ca
regard to the
yours,
Respectfully
ing,
0. L. Spauld
Acting Secretary.

eri;!

wio••••1
1••11

••

J.M.C."
termine in
ascertain and de
to
ed
ct
ru
he was inst
In that letter
ed for
which are referr
s
od
go
e
th
of
the chief use
these four cases
iladelregard to the Ph
t
ou
th
wi
e
itte
n of the Comm
the consideratio
llows
telegraphed as fo
g
in
ld
au
Sp
.
Mr
days afterwards
phia case. Two
to Mr. Tichenor:

poi

fit

Itv f)elt.trT100

a-f_sqc:A
:p•_,
t

• .•

917

,
rti Ifv)mJ'inqo(7

lo
cr -f 7

J•t),
.)dur,:

-•
•

110

9rf:.t

3b1)0

e ed ol Eric oaeo
NcY:1 ;)eborox
spall 41:t
enimleIsb baB niWn
jr

•

to Fleitmann
your inquiry as
to
r
he
rt
fu
"Replying
inquiries are to
you that your
se
vi
ad
to
ve
cases, ha
in these particulrticular goods
pa
e
th
to
d
be limite
r chief use."
ar cases and thei
in these cases
correspondence
of
se
ur
co
e
t th
We must interrup
Old. On Febral Appraisers
ne
Ge
of
e
te
it
the Comm
to describe what
chenor granting
hed to Col. Ti
ap
gr
le
te
d
ha
g
Spauldin
ruary 17th, Mr.
Appraiser
Ham by General
r
se
ai
pr
Ap
l
ra
place Gene
permission to re
ain their
beforeVis to expl
ed
ar
pe
ap
ll
we
and Mr. Je
Lunt. Mr. Lunt
tter of Sepral under the le
ne
ge
in
d
an
s
se
these ca
procedure upon
nt's testimony
to add to Mr. Lu
g
in
th
no
d
ha
ll
Mr. Jewe
tember, 1891.
e
igation in thes
made the invest
nt
Lu
.
Mr
at
th
early
and it appears cl
., pp. 124
found in Vol. IX
be
ll
wi
y
on
im
st
's te
cases. Mr. Lunt

).
6

testimony was
ied that the
if
st
te
nt
Lu
ace Mr.
In the first pl
praisers had
e general ap
th
at
th
;
wn
do
!ot written
taken orally but
ated their
which they st
in
ns
io
at
ic
un
mm
itten co
copies of their wr
parties whose
s of t1
me
na
e
th
th
wi
their advice
opinions or gave
e the only
e letters ar
es
Th
n.
io
at
er
under consid
merchandise was
no formal
praisers kept
Ap
of
e
te
it
case. The Comm
records of the

'0:

•

f,.11

•
'1()

'". •

•

., p. 128 ect.
records; Vol. IX
inquiry
the method of
il
ta
de
in
e
sed to stat
Mr. Lunt was ak
imony on this
s. His test
it
su
ur
fo
e
ittee in thes
made by this Comm
porter produced
s for the im
ey
rn
to
at
e
page 131. Th
subject begins at
General
exatined by the
re
we
o
wh
the Committee
witnesses before
sers requested
General Apprai
e
th
at
th
in addition to
Appraisers, and
rial
consume such mate
to
ly
ke
li
es
in various trad
parties engaged
terviewCommittee also in
e
th
of
s
er
them. The memb
to appear before
in other cities.
s of business
ne
li
r
la
mi
si
d in
ed others engage
particular use of
ire into the
qu
in
to
so
al
cted
Having been instru
into that subject.
ittee inquired
mm
Co
e
th
,
ns
io
at
Fleitmannts import
l claimto the principa
e
te
it
mm
Co
e
was sent by th
A general letter
portaement of their im
at
st
ed
il
ta
de
them to make a
ants requesting
tities imported
showing the quan
s,
od
go
e
ec
pi
n
ti
tions of these sa
nature of the
sold, with the
re
we
ey
th
om
wh
and the persons to
ular will be
p.134) (The circ
.,
IX
.
ol
(V
.
rs
ye
business of the bu
stateular brought out
rc
ci
is
Th
.)
rt
of this repo
found at page _85
and other large
Fleitmann & Co.,
om
fr
te
le
mp
co
ss
ments more or le
atement
before us the st
ed
uc
od
pr
nt
Lu
.
e goods. Mr
importers of thes
nous statement
was a very volumi
It
.
Co
&
an
tm
furnished by Flei

I)?

•

••

;

11
, 044
;

f„

n piece goods
of all the sati
n
io
it
os
sp
di
show the
and purported to
Pleitmann's
pitulation of
ca
re
e
Th
.
since 1883
imported by them
hatters,
pieces; sold to
17
,4
39
ns
io
at
tal import
invoices show to
other than trimand for uses
2;
80
6,
es
us
r millinery
20,355; sold fo
of the total
The percentage
r.
de
in
ma
re
hats, the
mings for .a.king
ng 68% of
ery 17.26, maki
in
ll
mi
r
fo
was 51.64 and
sold to hatters
ngs.
for hat trimmi
ld
so
ns
io
at
the import
s, Kohn &
t from Dreyfu
en
em
at
st
r
la
ted a simi
Mr. Lunt presen
ving Mr.
consisted of ha
t
en
em
at
st
ation of this
Co. The aertific
rried on by
the business ca
t
ou
nd
fi
to
a directory
Wiswall examine
rs of these
le as the buye
du
he
sc
s
n'
an
ed in Fleitm
the persons stat
ively on these
t rely exclus
no
d
di
ey
th
stated that
goods. Mr. Lunt
their own imthe use made of
to
t
ec
sp
re
porters in
7tatements of im
bearing
as some evidence
em
th
ed
er
id
ns
that they co
portations, but
s of merchandise.
e of this clas
us
f
ie
ch
e
th
of
on the question
arison
involved the comp
h
ic
wh
,
rk
wo
all that
Mr. Wiswall did
sers were
e alleged purcha
th
h
ic
wh
in
ion of business
of the descript
, and made
rticular trades
pa
e
os
th
of
s
e directorie
engaged, with th
hasers
the alleged purc
of
ny
Ma
e.
to the Committe
his statements
ination
urse of their exam
co
e
th
in
e
te
n to the Commit
had become know
l alone
short, Mr. Wiswal
In
s.
se
es
tn
having been wi
of the question,
bmitted
of the samples su
ne
No
1)
15
e
atements. (pag
verified these st
ancs per metre,
price as four fr
in
gh
hi
as
n
ru
e
te
to this Commit
e Conference
le adopted by th
du
he
sc
e
th
in
mit stated
which was the li
. Lunt's
t statement in Mr
an
rt
po
im
An
.
in March, 1890
of Appraisers
the Genmparison made by
co
e
th
to
t
ec
sp
2) is in re
testimony (p. 15

Mr. Lunt
the invoices.
d
an
s
le
mp
sa
between the
General Appraisers
pt that they
invoices "e:(ce
e
th
of
e
us
made no more
states that they
mples with
marks on the sa
e
th
g
in
ar
mp
amined in co
were casually ex
e could not
at the Committe
th
e;
ic
vo
in
line in the
the marks on the
ished by the
al samples furn
ci
fi
of
e
th
to accept
do any more than
ices which he
d by the invo
re
ve
co
s
od
go
mples of the
Appraiser as sa
sent."

ination
very careful exat
a
de
ma
he
aims that
Now, Hr. Lunt cl
ectness of his
ubt of the corr
do
no
d
ha
, and that he
of this question
tee. Beyd to the Commit
te
it
bm
su
s
le
upon the samp
conclusion based
in justice to
ary to state,
ss
ce
ne
is
t go, and it
ond that he did no
are absotheir findings
at
th
rs
se
ai
pr
General Ap
this Committee of
iderato them for cons
d
te
it
bm
su
s
le
ed to the samp
lutely restrict
y how looserbett,s testimon
Co
.
Mr
om
fr
already shown
tion. We have
en to insinuate in
do not mean ev
We
.
ed
in
ta
were ob
ly the samples
the
representative of
y
ul
tr
t
no
re
the samples we
this report that
r, to rant out
desire, howeve
We
e.
ic
vo
in
e
in th
goods described
were chosen in
these samples
h
ic
wh
by
od
th
ose me
the extremely lo
neral Appraisers
Committee of Ge
e
Th
.
ce
fi
of
r's
the local appraise
to the Fleitmann
on in respect
si
ci
de
r
ei
th
d
ache
appear to have re
their
letter containing
e
th
at
th
d
ne
Mr. Lunt explai
cases in March.
n's statement of
t that Fleitman
bu
h,
rc
Ma
in
n
te
decision was writ
not
ed; that it was
iv
ce
re
en
be
t
no
portations had
the use of his im
on was actually
d that the decisi
an
l,
ri
Ap
in
y
earl
received until
.
ector on April 30th
sent to the coll
SERS,
S. GENERAL APPRAI
U.
E
TH
OP
CE
7I
0P
, 1892.
w York, March
554 Canal St., Ne

ndricks,
Hon. Francis He
rk.
Customs, New Yo
Collector of
892;
of January 26,1
er
tt
le
's
nt
me
rt
th the Depa
We return herewi
rt relase . of the po
ai
pr
Ap
e
th
st from
February 4 la
soalso letter of
., respecting
Co
A'
n
an
tm
an Plei
suits of Herm
samtive to certain
rn invoices and
tu
re
so
al
mings. We
ritas or trim
called hat mate
lates and conespondence re
rr
co
e
th
h
, &c., to whic
ples of satins
follows:
to report as
ve
ha
we
h
ic
cerning wh
samples except
d by all the
te
en
es
pr
re
ndise
1st. The mercha
om about 18
ns varying fr
ti
sa
of
ts
erge' consis
the one marked 's
silk warp and
e grey, with
th
in
n
ve
wo
vv
ches in width,
,
as
e
inches to 24 in
ad
tr
e
th
in
d is known
the piece, an
in
ed
dy
g,
in
cotton fill

Sir:

.
hatters' satins

-Y

.';

ff.!

itable
t
class are no su
is
th
of
ns
ti
dgment, sa
2nd. In our ju
r other purrments, or fo
ga
ng
ni
li
r
s goods, or fo
for use as dres
g too light
required, bein
e
ar
ty
li
bi
ngth and dura
poses where stre
signed and
be specially de
to
ar
pe
ap
ey
such uses. Th
and flimsy for
nnets and
imming hats, bo
tr
e
is
rw
he
ot
e in lining or
adapted for us
r making
necktirJi, and fo
d
an
s
xe
bo
y
ng cottons, fanc
hoods;for lini
imming
for lining or tr
en
be
ng
vi
ha
e
their chief us
small articles,
and hoods.
hats, bonnets,
ch the
have obtained mu
we
n
io
at
rm
fo
g to the in
3rd. Accor in
ese suits,
, subject of th
ns
ti
sa
ar
ul
ic
on of the part
larger proporti
such use
mens hats, and in
ng
ni
li
r
fo
, sold and used
were imported
t making trade.
mings in the ha
im
tr
as
ed
at
gn
si
are generally de

mple marked
ented by the sa
es
pr
re
s
as
cl
the
4th. Goods of
the
caps, we are of
or
ts
ha
ng
ni
li
times used for
'serge' are some
other purposes.
fly used for
ie
ch
e
ar
ey
Opinion that th
urs,
Respectfully yo
enor,
George C. Tich
W. F. Lunt,
,
J. A. Jewell
sers."
General Apprai

finding favorable
cision makes a
de
is
th
at
d th
It will be notice
of the merchandise
the chief use
to
t
ec
sp
re
both in
to the importers
rable to the ima finding favo
so
al
d
an
s,
e sample
represented by th
tmann's importuse made of Flei
ar
ul
ic
rt
pa
t to the
porters in respec
aulding's
g that by Mr. Sp
in
nd
fi
er
tt
la
only the
ations. It was
The
to make.
were required
ey
th
ry
ua
br
th of Fe
telegram of the 25
of the first
direct decison
no
ke
ma
rs
se
ral Apprai
Committee of Gene
, to-wit:
of January 26th
er
tt
le
e
th
in
d to them
question submitte
ngs in the
cases are trimmi
e
es
th
in
s
od
icular go
"Whether the part
question
reference to that
ly
on
e
Th
."
h imported
condition in whic
ing to
in which, referr
,
on
si
ci
de
r
ei
graph of th
Is in the 3d para
ions, they say:
rticular importat
pa
s
n'
an
tm
ei
Fl
the use made of
mens
d used for lining
an
ed
rt
po
im
e
H xxxxxwer
mings in
designated as trim
y
ll
ra
ne
ge
e
ar
e
us
"hats and in such

x
'102

•-ci'
oau

0.7ct

e.-zft:1.11
c?1, a:

-fo't

jirr,p

ade."
"the hat making tr

March,
cal Appraisers in
Lo
of
ce
en
er
nf
the Co
On this question
trimmings
iefly used as hat
ch
es
cl
ti
ar
of
le
schedu
1890, in their

/61k I
known
not commercially
re
we
ns
ti
sa
ck
these cotton ba
had stated that
imported.
ition in which
nd
co
e
th
in
as trimmings
return
state that they
rs
se
ai
pr
Ap
l
the Genera
In their letter
y about
diligent inquir
a
de
ma
We
e Collector.
the samples to th
ified
the Bureau of Cert
of
ad
he
e
th
,
t Mr. Crawford
these samples, bu
at they had been
fice, stated th
of
s
r'
to
ec
ll
Co
Statements of the
up, being
had been made
ts
en
em
at
st
the certified
destroyed after
further use.
considered of no
t 6.)
nexed as Exhibi
an
to
re
he
er
(See his lett
ment as follows:
to the Depart
ed
rt
po
re
r
to
ec
ll
On May 3d the Co
er,
Hon. Charles Fost
Treasury,
Secretary of the
Washington, D.C.
Sir:

ary 26th last,
letter of Janu
ur
yo
to
g
in
rr
Refe
the Appraisers
the report of
th
wi
re
he
it
bm
I su
the report of
braury 4th, and
Fe
of
te
da
r
unde
ted the 30th
l Appraisers da
ra
ne
Ge
of
d
ar
the Bo
by the suits
invoices covered
e
th
to
as
,
mo
ulti
tor, Nos. 12,184,1
nst the Collec
ai
ag
n
an
tm
ei
Fl
of
lving the
and 12,545, invo
,
89
,2
16
,
02
,4
11
e as hat
certain merchandis
of
on
ti
ca
fi
si
clas
materials."

-r.

on this
the Department up
by
n
ke
ta
s
wa
on
ti
Apparently no ac
Assistant
ary 14th, 1893,
nu
Ja
on
d
an
,
93
18
nuary,
report until Ja
, as follows:
llector at New York
Co
e
th
to
e
ot
wr
ing
Secretary Spauld

e't
RTMENT,
TIU1ASURY DEPA
1893.
January 14th,
Customs,
Collector of
New York.
Sir:

ontinthe proper disc
of
ng
li
fi
e
Upon th
quired by
stipulations re
l
ia
ec
sp
uance and the
ptember 22,
,.uctions of Se
st
in
's
nt
the Departme
rtment
rward to the Depa
fo
se
ea
pl
ll
1891, you wi
of refund
the amounts
of
ts
en
em
at
certified st
rman. Pleite cases.of He
th
in
fs
if
nt
due the plai
suits Nos.1
e Collector,
th
t
ns
ai
ag
rs
man and othe
16,289.
, 12,184 and
45
,4
12
1
,
02
11,4
-re
e
th
on
up
d
se
should he ba
The statements
ices which .
aintiff's invo
pl
e
th
of
classification
port of
d upon the re
an
,
de
ma
en
has already be
ted April
Appraisers, da
l
ra
ne
Ge
of
the Committee
ement of
include a stat
t
no
l
al
sh
30, 1892, but
ets.
voices of velv
in
on
.
s
nd
fu
any re
yours,
Respectfully,
g,
O. L. Spauldin

etary".
Assistant Secr
t•;:. c
•

•

Clark,
. John Proctor
Mr
to
e
ot
wr
y
the Secretar
On the same day
follows:
e four suits as
es
th
in
.,
Co
&
eitmann
Attorney for Fl
arke, Esq.,
John Proctor Cl
New York, N. Y.

ve been
instructions ha
at
th
u
yo
rm
I have to info
rward to
New York to fo
at
r
to
ec
ll
sent ID the Co
the
statements of
d
ie
if
rt
ce
the Department
eitmann
suits of H. Fl
in
fs
if
nt
ai
amounts due pl
, 12,545
States, 11,402
ed
it
Un
e
th
& Co. against
e not to
statements ar
id
sa
t
bu
,
12,184, 16,289
s.
s of velvet
include refund
g."
O. L. Spauldin
ted to the
and transmit
up
de
ma
re
statements we
These certiried
ions
special stipulat
d
an
s
ce
an
ontinu
e proper disc
Department. Th

T-T

were filed.

reau,
the Customs Bu
ed
ss
pa
ts
en
nt the statem
At the Departme
stoms for
mmisioner of Cu
Co
e
th
d
he
reac
sion and had
, susthe Auditors Divi
February 3, 1893
on
ed
iv
ce
s re
en the order wa
his signature wh

tion.
r
e four
pending furthe ac
respect to thes
in
s
ct
fa
e statement of
This completes th
e cases
respect to thes
in
t
en
mm
co
her
making any furt
cases. Before
e refunds.
story of thes
hi
e
th
te
le
mp
we desire to co
rtsent by the Depa
s
wa
er
tt
le
, a circular
January 14, 1893
n
O

•

ment as

follows:
Circular.
HAT

•

1893.
.
Department No
stom.
Cu
Division of

MATERIAL

NT,
TREASURY DEPARTME
cretary,
Office of the Se
1893.
C., January 14,
Washington, D.

s:
of the Custom
rs
ce
fi
Of
r
he
d ot
stipTo Collectors an
suit and of a
of
ce
an
nu
ti
scon
of total di
refunds
Upon the filing
ed to recover
ut
it
st
in
be
s shall
further suit
cluded
ulation that no
by invoices in
d
re
ve
co
s,
trimming
med as hat
ecion articlt-:s clai
e following sp
th
of
ch
su
made upon
fund will be
und
in said suit re
en or may be fo
be
ve
ha
as
articles
d such other
y
fied articles an
rs to be chiefl
ral Appraise
ne
Ge
of
d
e of the Boar
by the Committe
&c.
nnets, hoods,
bo
,
ts
ha
or ornamenting
manuused in making
as trimmings,
n
ow
kn
ly
al
erci
Ribbons comm
d cotton, silk
or of silk an
lk
si
of
factured
usive
to 60 lines incl
's
rp
li
20
from
chief value,
ribbons.
except gauze
ription.
of every desc
Gauze ribbons
to 60 lines,
on, 13 lines
bb
ri
et
lv
ve
Satin back
inclusive.
Hat Bands.

metal laces,
on, linen or
tt
co
an
th
r
Laces, othe
lines in width.
not exceeding 65
e component
ich silk is th
wh
of
l
al
s
Silk lace
ing 65 lines
lue, not exceed
va
f
ie
ch
of
material
in width.
rp and
ey with silk wa
gr
e
th
in
n
ve
Satins wo
as piece
n in the trade
ow
kn
g,
in
Ll
fi
cotton
ceeding
s' satins, not ex
er
tt
ha
or
ns
ti
dyed sa
ove 2.50
d not costing ab
an
h,
dt
wi
in
24 inches
.
ss trade discount
fr. per aune le

n in the
chappe) know
ot
(n
s
et
lv
ve
Silk faced
weight,
et, of light
lv
ve
y
er
in
ll
trade as mi
ly and are
ich shir easi
wh
,
le
pi
e
os
short and lo
t exceedthan wear, no
ow
sh
r
fo
ther
designed ra
dth.
inches in wi
ing 18-1/2
tufted
ods, such as
go
e
ic
pe
ery
Fancy millin
s made of
ery noveltie
in
ll
mi
r
othe
gauzes and
f value,
on, silk chie
tt
co
d
an
lk
silk or of si
ol or wool and
silk and wo
ol
wo
or
all wool silk
h. Crepe
inches in widt
18
g
in
ed
ce
ex
cotton, not
s in width,
55 centimeter
g
in
ed
ce
ex
t
francaise no
less
es per aurne
im
nt
ce
75
e
abov
costing not
nt.
trade discou

, silk
lk and cotton
si
of
ed
ur
ct
China, manufa
in width
g 32 inches
in
ed
ce
ex
t
no
chief value,
e,less
centimes per aurn
60
e
ov
ab
t
no
and costing
.
trade discount

in width,
g 19 inches
in
ed
ce
ex
t
no
Marcellines,
, less
imes per aune
nt
ce
90
e
ov
costing not ab
trade discount.

h, costinches in widt
27
g
in
ed
ce
Malines not ex
trade
per meter, less
es
im
nt
ce
40
ing not above
discount.
g,
0. L. Spauldin

ary."
Assistant Secret
ular and on
under this circ
de
ma
en
be
d
ha
s
fund
Before any re

715
February 2, 1893, by telegram followed on the 3d, by a letter, all
refunds in hat trimmings cases were suspended, as we understand, no#.
refunds have since been made.
The amount of reF'unds, according to the certif'ed statements
in these four suits is as follows:Principal

$155,851.00

Interest

40,544.82

Costs

40.00
. .771-W,T3-5.82

Total .

This summary has been furnished to us by Mr. George of the
Naval Office.

Mr. George has completed his work on the schedules

herinbefore described upon all the Fleitmann cases including
these

611

four and Mr. Hanlon has completed his analysis of the
merchandise.
On an examination of Mr. George's schedules, we find in
these
four suits a number of prote3ts

that were

late and a number of

entries to which other technical objections could be made.Th
is,
however, is unimportant, because none of these objectional
entries
have been included in the certified statements.

Our investigation

does not disclose any entry included in the certified stateme
nts
which had already been refunded upon, or which was open to
any technical objection in respect to the date of filing of
protest, taking
the appeal or commencing the suit.
Mr. Hanlon has analyzed all this merchandise in the
manner
hereinbefore described with the following result:
"1.

U. S. CIRCUIT COURT.

No. suit 11,402.

HERMAN PLEITMANN &c.
A ./

)?//
Instituted January 3, 1887.

VS.

EDWARD L. HEDDEN.
Total value of

of merchandise dutiable at 50%

in this suit which can reasonably

be classified :

•
: $17,3oo.

as hat materials,

Amount of refunds due plaintiffs on this basis-principal, $5,190

...

interest
U. S. CIRCUIT COURT.

No. S. 12,545.

HERMAN FLEITMANN
vs.

Instituted June 7, 18b8.

DANIEL MAGONE.

Total value of merchandise dutiable at

sof, in

this suit which can reasonably be classified
as hat materials,

$2,410.00

Amount of refund due plaintiffs on this basis, principal $723.00
interest,
U. S. CIRCUIT COURT,
No. Suit 12,184.
H. FLEIT:1AN (9- CO.
vs.

Instituted March 6th, 1888.

DANIEL MAGONE.
Total value of merchandise dutiable at

sqg in:

this suit, which can reasonably be classified:
;
as hat trimmings,
:
a

$1,720.00

Amount of refund due plintiffs on this basis, principal 1516.00
interest

U. S. CIRCUIT COURT.

No, of suit 16,289.

H.Pleitman & CO.
vs.

Instituted March27, '90.

Daniel Magone.

Total value of merchandise dutiable at

50g

in:
•

this suit which can reasonably be classified :
as hat trimmings,

$33,078.00

Total value of merchandise dutiable at 35%

in this suit which can reasonably be clas-

•

sified as hat trimmings,

•

Flushes, Hat Trimmings
of refund
AmountAdue plaintiff on this basis,

$319.00
147.00

principa1 1$10,015.35
interest.

Mr. Hanlon finds just !'?.54,974.00 as the value of merchan
dise
'overed by these suits upon which refunds should, in his
opinion, be
Pe.id.

He includes in that all the articles upon which the
importers have

o btained verdicts in the
several suits up to this date decided by the
11Preme Court.

He excludes the cotton-back satins which it will be
seen

4N the chief item in these four suits, and exclude
s also the velvets
11Pon which no refunds were to be made.

h his

The total amount of rerriands on

examination, according to mr. Hanlon's computation,
is $16,444.35,

Xcl_lasi7e of interest and costs. This, of course,
is a very small pro-

411

'f.

75
13r0portion of the sum allowed in the certified statements, amounting in
Pl'incipal alone to $155,851.

The refunds on cotton-back satins in these

four suits amount to 1105,925.72.

The amount of plain velvets not over

18-1/2 inches wide, included in these four suits, and which the importers
)

4bandoned as the basis of their proposed compromise, was, according to
*. Hanlon's estimatei30,055.61, and of this quantity of velvets Mr.
Ranlon claims that none can properly be classified as hat trimmings.
The value of all the velvets not over 18-1A inches wide in all
the entries in the former suits was $82,544.00.

Some of these en-

tries were not included in the certified statements be cause they
do not include merchandise subject 1:o refunds.
Mr. Hanlon's summary of his analysis of the suits is annexed;
and the schedules have ben forwarded with the exhibits and samples.
4

The upper half of these pages marked "1st schedule" is immateria
l.
It is the result of an earlier examination and should have been
left
out of the summary.

Recapitulation.
Pleitmann & Co.,
vs.
Daniel Magone.
Suits 11,402, 12,148,

12,545,

16,289.

Excess of duty in certified statements principal, $155,851.00.
1st schedule.
-

Excess of duty allowed on satins
t

Value of satins

$105,925.72
$353,085.74.

Excess of duty on ribbons not H. T
Value of ribbons not H.T

$23,594.72
$78,649.08

Excess of duty on ribbons H.T.

26,097.46

Value of ribbons H.T

86,991.52.

Excess of duty on plushes H.T

233.10.
0155,851.00

Value of plain velvets 18-1/2 inches and less $30,055.61.
2nd Schedule.
Value of ribbons, &c. H.T

54,508.00.

Excess of duty
Value of 35%
!xcess duty

35%

$16,352.40.
319,00.

47.85.

Value of ribbons not H.T.

$128,839.36.

Value of plushes H.T

147.00.

Excess of duty on plushes H.T

44.10.

Value of plain velvets 18-1/2 inches and less $82,544 00.
Value of plain satins &c. 24 inches and less..345,075 00
Included in the above satins there )
)
are satins costing 1 franc per
)
) $47,028.00
meter and lesssubject to trade
)
)
discount-value.
)

H. Flejtman & Co.,
vs.
Daniel Magone.
• • •

$16,444.35.

Suit 11,402.

Excess of duty in certified 'statements principal, $53,767.55.
1st Schedule.

Excess of duty allowed on satins
Value of satins

$33,632.42
$112,108.07.

Excess of duty allowed on ribbons not H.T
Value of ribbons not H.T

15,308.21.

51,027.37.

Excess of duty on ribbons H T

4,826.92.

Value of ribbons H.T

16,089.73.

Value of plain velvets, 18-1A

19,102.00.

2nd Schedule.

Value of Ribbons, &c., P.T.

$17,300.00.

Excess of duty on ribbons H.T
Value of ribbons not H.T

$5,190.00.
69,114.36.

Value of plain velvets 18-1/2 inch
and less49,126.00.
•• •
•

•

• ..... • •

Value of satins 24 inches or less.130,715.00.
•

• •

Included in the above satin:i there are)
satins costing 1 franc per meter) )

• • •

and less subject to trade discount) 8,118.00.
value.

$5,190.00.

H. Fleitman & Co.

•

vs.
Suit No. 12,164.
Daniel Mag one.
Excess of duty in certified statements, principal

$12,397.70.

1st Schedule.
Excess of duty allowed on satins
Value of satins

$8,383.10.
$27,943.67.

Excess of duty allowed on ribbons not HT

21 058.60.
t•.

•

$6,862.00.

Value of ribbons not H.T

(12,397.70)
$1,956.00.

Excess of duty on ribbons H.T

A
6,520.00.
41,325.67.

Value of ribbons H.T
r

Value of plain velvets 18-1/2
inches and less.4 1 573.61.
2nd Schedule.
$1,720.00.

Value of ribbons, &c., Tf.T.

$516.00.

Excess of dtty on ribbons &c.H.T.
Value of ribbons not H.T

2,113.00.

Value of plain velvets 18-1A
inches and less..7 2043.00.
Value of satins2 24 inches
and less

16,466.00.
$516.00.

H. Fleitman & CO.
vs.
Suit 12,545.
Daniel Magone.
Excess of duty in certified statements, principal

#92 074.70.

1st Schedule.
Excess of duty allowed on satjns
Value of satins

$42 704.60.
$152 682.00.

Excess of duty allowed on ribbons not H.T
Value of ribbons not H.T

•

22985.10.

92 950.34.

Value of ribbons 35% $216 included in value of ribbons H.T. below.
Excess of duty on ribbons H.T
•

..
........
.... .

...

•

Value of ribbons H.T

12 385.00.
42724.66.

Value of plain velvets 18-1A
inches or less...1,177.00.

2nd Schedule.
Value of ribbons &c.
$723.00.

Excess of duty on ribbons &c., H. T
$2,242.00.

Value of ribbons not H.T.
Value of plain velvets 18-1A

inches and less..5,065.00.
Value of satins,24 inches and less 7,867.00.
$723.00..

H. Fleitman & CO.
vs.
Daniel Magone.

Suit No. 16,289.

Excess of duty in certified statements, principal, $80,611.05.
r-

1st Schedule.
Excess of duty allowed on satins
Value of satins

$59,205.60.
$197,352.00.

Excess of duty allowed on ribbons not H.T
Value of ribbons not H.T.

3,242.81.

10,809.37.

Excess of duty on ribbons H.T
Value of ribbons H.T

17,929.54.
59,965.13.

Excess of duty on plushes H.T

233,10.

Value of plain velvets 18-1A inch..8,203.
2nd Schedule.
Value of ribbons &c. P.T

33,078.00.

Excesi3 duty ribbons &c. F. T
Value of 35% ribbons &c.

H.T

Excess of duty on 35% ribbons &c.,

$9,923.40.
319.00.
47.85.

Value of ribbons not H.T
Value of Flushes H.T

$55,370..00.
11-7.00.
$44.10.

Excess of duty, plushes H.T
Value of plain velvets 18-1A
inches and less...21,310.00.
Value of satins 24 inches and
less-190,027.00.
Included in the above satins)
there are satins costing one)
$38,910.00.
franc per meter and less sub}
ject to trade discount value)

$10,015.35.

•

•
•

• .....

•

UNUSUAL PROCEDURE IN RESPECT TO THESE SUITS.
We are unable to find in the papers submitted to us any satisfactory explanation of Assistant Secretary Spaulding's letter of
January 26th, and his subsequent letters in respect to these suits.
We have shown that much the greater part, almost two-thirds,

the total refunds in these suits was upon cotton-back satins.

That

• ...... •

class of goods had been before the jury in the Philadelphia case
in which the Governnent obtained a verdict. There was no other
judicial decision in respect to that variety of merchandise.

The

letter of September 22, 1891, restrained the Committee of General
Appraisers from considering any articles "identical with" those
which had been before the jury in that case.

This prohibition had

been extended to include articles of the same general nature as

those involved in the philadelphia case; but Mr. Spaulding when the
Committee of General Appraisers asked for an express

instruction

on this point after they had received from the Collector the letters and samples, instructed the Committee that they were to decide
the questions in these suits without regard to the Philadelphia
decision.

It is true that in Decenber the verdict obtained by the

Government in the Meyer and Dickenson suit had been set aside; but
it is a matter of record that it was Milk set aside because in the
opinion of the judge certain newspapers articles had possibly influenced the minds of the jury.

After this verdict had been set

aside, the Attorney General in the letter of December 9, 1891, already quoted in fulll, strenuously urged the Secretary of the
Treasury not to proceed even under the restricted letter of September 22, 1891,

Therefore when Mr. Spaulding instructed the Committee

of Appraisers to proceed without regard to the decision in the
Philadelphia case, he instructed them, in substance, to disregard a
ruling in favor of the Government, which he had formulated in the
letter of 3eptember 22, 1891, and to disregard the only judicial decision that had been made in respect to a class of merchandise upon
which immense claims against the Government were pending.

It may

be UMW that the paragraph in tne letter of September 22, 18A., restraining the General Appraisers from considering such classes of
merchandise as had been before the jury in the Philadelphia case
was not a ruling or decision within Section 2, of the Act of March
3, 1875, requiring the consent of the Attorney General to the reversal or modification adversely to the United States of a ruling or
decision once made by the Secretary giving construction to any law

.•

imposing ci-stoms duties, but the Department endeavored to obtain from
the Attorney General his concurrence before instructions were sent
in January, 1893, to the Collector at this port to prepare the certified statements in these four suits.

On December 29th, 1692,

the Attorney General wr6te to the Secretary of the Treasury two
letters, one referring specifically to the proposition of Mr. John
Proctor Clarke in the Fleitmann cases, and another relating generally to the whole class of

at trimmings suits, as follows:

"S.G.
"7551--1886.

W.J.F.
DEPARTMENT OF JUSTICE,
Washington, D.C., December 29, 1692.

"The Honorable,
The Secretary of the Treasury.
Sir:I have the honor to acknowledge the receipt of your letter of
"October 4th, containing the proposition submitted by !fr. John Proc"tor Clarke in behalf of Messrs. Fleitmann & Co., for settlement of
"their suits involving refunds of duty paid on goods alleged to be
"hat lrimmings. In my opinion this involves a question of adminis"tration, not calling for a legal opinion on my part, and I there"fore decline to express any, further than I have done in my letter
"of December 9, 1891, and in my letter of this date upon the gener"al subject of the litigations known as"The Hat Trimmings cases".
I am, very respectfully yours,
H. H. H. MILLER,
Attorney General.

"3.G.
"7551--1886.

W.J.P.
DEPARTMENT OF JUSTICE,
Washington, D.C., December 29, 1692.

"The Honorable,
The Secretary of the Treasury.

"Sir:
I lizAre received your several communications enclosing various
prepositions made by Messrs. Tremain & Tyler looking to a settlement
"of the so-cal)ed "hat trimmings litigation". A reference to my
"letter of December 9, 1891, shows the attitude of this Department
"toward this litigation, and no facts have since come to my know"ledge leading me to change the position then taken. Your letters
"present no question of law for my action.Under the decisions, the
"questions in each case are questions of factAand therefore do not
"call for an opinion by me. The determination of one case is not /1
"necessarily decisive of any other.
With reference to the cases where statements for refund have
"been completed at the date of your Department's letter of December
"29, 1890, in my opinion the same answer must be made. Such ques"tions are matters of administration, for which you alone are re"sponsible, and I have neither the right nor the disposition to in"terfere therewith.
Very respectfully yours,
W.H.H.Miller,
Attorney General.

The papers show that after the Fleitmann cases had been submitted, and before they had been decided, the proposition was made

to the Department by Tremain & Tyler and by H. E. Tremain on behalr
of William Openhym & Sons, suggesting that their cases be submitted
to this Committee.

Similar letters were written by Mr. Tremain on

behalf of his clients Hoenighaus & Curtis, and W. H. Graef & Co. In
these letters

itr. Tremain suggests that the invoices in the cases

in which these importers were plaintiffs should be submitted to the
Committee of General Appraisers to ascertain the chief use of the
articles described in the invoices, and all these cases were from
•

•

time to time: submitted to the Committee and reports were made upon
them by the Committee similar in form to the report in the four
Fleitmann cases.
We annex /I copy of Mr. Tremainfs letter to Mr. Spaidding,dated
February 2, 1892, in respect to the Openhym cases.

His letter in

respect to the cases of Hoenighaus & Curtis, dated February 26,1892,
to Mr. Spaulding, was similar in form, and so we presume was the
letter in respect to the cases of Graef & Co., though we have not a
copy of that before us.

We quote the letter of February 2, 1892,

so that you may note that these reports of the Committee were to
be"without prejudice to the rig_hts. of either party, plaintiff or
defendant".

It is clear therefore, that these reports were to be

adviory only, not binding

upon anybody.

The General Appraisers

understood that their findings were to be advisory merely.
money of

Mr.

(Testi-

Lunt, Vol. IX, page 149, in which he refers in support

of that opinion to Mr. Tremain's letter of February 2, 1892, already referred to.

"Law Office of Tremain & Tyler,
146 Broadway, yew York, February 2, 1892.
Sir:
Referring to my interviews at the Department yesterday and
today with yourself and your subordinates in reference to a possible
compromise or settlement on the part of one of our clients (Messrs.
Wm. Openhym & Sons) of all the suits brought by that importing
house against the various collectors, Robertson, Redden, flagon° and
Erhardt, for excessive duties on hat materials; and understanding
that under the circumstances detailed the department deems it necessary to ascertain for itself the particulars of the importers'
several claims as well as the aggregate thereof, and the several
articles of merchandise upon which the importerclaims refunds, it is

respectfully submitted for official consideration:
That all of the articles claimed upon in the suits brought by
said plaintiffs be submitted together with the invoices if that
should be deemed necessary, or representativq invoices to the ap-

$11

praiser and the Committee of General Appraisers designated in the
order of September 22, 1891, (S.S.11,798) with a request to ascertain the chief use of all said articles; and that upon said articles
found to be chiefly used for hats, bonnets and hooes as prescribed
by the statute the collector estimate and report to the Department
the aggregate amount (without interest) that might be refundable
I

in all of said suits, indicating ;eparately as far as practicable
the merchandise upon which the excess of duty arises.
It is believed that upon the coming in of such report (which
it should be understood is to be without prejudice to the rights
of either party, plaintiff or defendant) a basis might be furnished
whereby a compromise with a view to final settlement of all of said
suits of said firm may be proposed to and entertained by the Department in case its ofricers shall ultimately conclude that any
part of said claims ought not to be paid.
The physical impossibility of trying before successive juries
within any reasonable time the upwards of sixt4 suits of this house
involving over two thousand invoices, without considering the interest account now running against the treasury upon these overpayments, would seem sufficient reason to commend the foregoing to
the favorable consideration of the Department.
Yours respectfully,

H. E. Tremain,
in behalf of Wm. Openhym & Sons.
To Hon. 0. L. Spaulding,
Aacting Secretary of the Treasury.
^

(Draft proposed order.)
Washington, D.C. &c.
Sir:
Application having been made in behalf of Wm. Openhym & Sons
that the Department ascertain sufficient particulars to

enable

to ascertain a proposal to compromise and settle all the suits of
that firm againsiyour predecessors arising out of excessive duties
exacted on hat materials, you will please submit the invoices or
representative invoices involved in said suits to the appraiser with
a request that the committee of General Appraisers designated in
Department's inst -uctions of September 22, 1891, (S.S. 11,798) ascertain the chief use of the articles claimed upon.
Upon the articles thus found to be chiefly used for hats,
bonnets and hoods as prescribed by the statute, you will estimate
and report to the Department the aggregate amount (without interest)
that would be refundable in all of said suits, indicating separately
as far as practicable the merchandise upon which the excess of duty
arises.
To The Collector of Customs,
Secretary.
New York.

How thoroughly the Committee of General Appraisers investigated
this question of chief use of this class of satin piece goods, it
is difficult for us to determine.

We have pointed out that they maab

no decisio+pon the question whether this class of merchandise was
commercially known as trimmings in the condition in which imported.
General Appraiser Lunt stated that he felt that he had made a very
' chief use; but the only
thorough investigation of the question o4
evidence remaining of record was the statements made up by the importers in reply to the circular letter sent out by the General
Appraisers on March 24, 1892, of which the following is a copy:

"OFFICE OF THE U. S. GENERAL APPRAISERS,
534 Canal Street, New York, March 24th, 1892.
"Dear Sir:
"We who have under consideration the claims of sundry importers for
"refunds on piece dyed satins, in view of the magnitude of the
"Interests involved, do not feel justified in making a report upon
"the questions of fact involved, unless the import-rs will present
to us more detailed information than they have heretofore done.
ft
We suggest, therefore, in order that our information may be
"comprehensive and our investigation reasonably exhaustive, that
several imporAers in New York, having claims for refunds, should
furnish us as soon as possible with a detailed statement showing
"the dates and amounts of their importations, their sales, giving
"dateg of sales, names residenteand place of business of purchasers
"nature of business, number of pieces and prices.
From such statements, supported by the affidavit of persons
"cognizant of the book entries and other facts therein stated, we
"believe a speedy and just decision may be reached and our findings,
"if ever questioned, could be demonstrated to be correct by the
"evidence upon which we acted. It would not be sifficient for us
to take the sales of one or two houses , who have dealt perhaps
-911rithTonly one or.twoLclasses dr - trade.
If. all the New York.importurt'of piece dyed satins would.comply
"with this request, the result will go far to finally settle these
vexed questions.
Very truly yours,
GEO. C. TICHENOR.

The copy of the decision of the General Appraisers in these
suits sent to us by them was dated in March, and Mr. Lunt testified
that it had been prepared, but that they held it back

until they

obtained from the importers statements in reply to the circular
letter.

Apparently, therefore, this Committee of General Appraisers

had concluded in March to report as they finally did report on the
30th of April, but, distr-usting the correctness of their own conclusions, they called upon the importers to obtain for them some
further evidence

in support of their decision.

They say in their

letter that if they can obtain such statements, they believe that
their findings, "if ever questioned, could be demonstrated to be

•

correct

by the evidence upon which
_ we acted."; and further: If all

the Nair York importers of

piece dyed satins would comply with this

request, the result would go far to finally settle these vexed
questions."
Mr. Lunt testified that the Committee on receiving these statements did not treat them as conclusive evidence, but merely as evidence on the question at issue.

We do not think that this Committee

of General Appraisers obtained all the evidence on this que ;tion
that was available.

On the trial of the Meyer and Dickenson case

in Philadelphia, twenty witnesses testified for the plaintiffs that
this class of satins was hat trimmings, and sixty-two witnesses tes•1

tified for the Govenment that the chief use of such satins was not
r
L

for hat trimmings.
-

All this evidence should have been repeated be-

fore the Committee of General Appraisers.
Immediately after the order of September 22, 1891, was issued,

""011
.
1111111116.....--

Mr. Hanlon,

under instructions from the Department called on the

Board of General Appraisers.

He gave them a copy of the minutes

of the testimony in the Philadelphia case and the samples used on
the trial.

Mr. Hanlon called upon the General Appraisers two or

three times, and on one occasion took with him Mrs. Barradale, a
Special employee, who had been of great service in preparing the
Philadelphia case for trial and knew how to find the witnesses who
had

testified for the Government in respect to these satin piece

goods.

Mr. Hanlon showed the General Appraisers his letter of in-

structions and offered them his services, but was never called upon

ed _

by the Committee of Appraisers, or by their Examiner, Mr. Wiswall,
•

;

loe-rloo
to render any assistance in the matter.
1-rov wc414
When the four Fleitmann suits were before the Committee, under
the letter of January 26, 1892, Mr. Hanlon was not sent for, and the
Board made no use apparently, of the experience which the Government
officials had obtained from the elaborate preparation and long trial
of the Philadelphia case.

The services of Mrs. Barradale were not

availed of by the Committee in any respect.

Mr. Lunt, (Vol. Ix,

pages 153 and 154) testified in answer to our question whether he

knew that the classes of satins considered by him in the Fleitmann

cases was precisely the class of goods that had been before the
jury in.the Philadelph1a case, as follows.:
"A. I have never had the- clearest notion, but in a general_
nwa4I understood that they considered some piece dyed satins
"in that case in Philadelphia.

As to what the value per meter

of those Philadelphia goods was, I do not now remember, and I

"do not know that I had my attention called to it, but I have
"some samples here."
Mr. Lunt testified that he understood that they were to
conduct their investigation in respect to the chief uses of the
piece dyed-satins without regard to the Philadelphia case.

course that instruction was that they were to conduct it without re-

110

gard to the verdict.

It did not mean that they were not to avail

themselves of all the information which the

officials wh() had con-

ducted that case could furnish. Though the Committee had a copy of
the minutes in the Philadelphia case before them, it is very evident
from !Tr. Lunt's answer, just quoted, that they had not made themselv. s at all familiar with the testimony, otherwise they would have
known more about the class of goods that was before the jury on
that trial.
We do not feel assured that the verification of the statements
furnished by the importers was as thorough as should have been made
In a controversy of such great importance.

Mr. Lunt testified

(Vol. IX, page 151)
"Mr. Wiswall did

all that work which involved the com-

"parison of the description of business in which the alleged
"purchasers were engaged with the directories of those parti)

c no

.rtit

"cular trades and made his statements.

Many of them became

"known to the members of the Board, becallse of their exatina"tion of witnesses in person."
Q.

Mr. Wiswall was the only person, as I understand youl who

"made any investigation to authenticate the statements of the

"importers with respect to the persons who had purchased from
11

them their importations of these satin piece goods?

Yes,

"sir; outside of what examination the General Appraisers them"selves may have

given to the papers.

"look up the nature of the business.

This did not go to

Mr. Wiswall was the ac-

"credited Officer in charge of that business."
The verification of these statements should have been very
thorough in view of the great weight which, judging from the circular calling for them,

WPF

given to them

by the Committee.

The importers contend, we are informed, that whatever action
the government may take in respect to other hat trimmings suits them
there was an agreement in respect to these four which the Government
is morally bound to perform.

There appears to be no express accept-

ance of the offer made on behalf of Fleitmann & Co. in January,
1892.

It may be claimed, however, that the letter of Mr. Spaulding

to Mr. Clarke, one of Fleitmann's attorneys, on January 141 1893,
informing him that the collector had been ordered to prepare and
forward to the Department the certified statements, and the action
of the Collector upon receipt of 3uch instructions, taking from the
importers the discontinuances and stipulations required pursuant to
the letter of September, 1891,

was a complete acceptance of the

proposed compromise.
Irrespective of the effect of that letter and the acceptance
of discontinuances, and stipulations, the action of the General
Appraisers seems to have been merely advosory.

Their report made

to the collector and forwarded by him to the Department in May,
1892, and no action was taken upon it by the Department until

•

January, 1893.
When the present administration began, the correspondence shows
that attempts were made by other attorneys representing Fleitmann &
Co. to collect the refunds in these four suits and on receiving
notice that payment had been suspended, Tremain & Tyler, the attorneys of record for Fleitmann & Co. telegraphed to the Department
that unless payment was made, all their discontinuance stipulations
should be vacated and the cases set for immediate trial, and on
April 4th they telegraphed to the Department requesting action or
cancellation of their stipulations without further delay.

The

Department then telegraphed to them that no objection would be interposed to the reinstatement of their cases upon the Calendar, and
on April 4th the Department instructed the collector of customs at
New York as follows:
Collector of Customs,
New York.
Sir:-

I return herewith four certified statements for

refund of duties on hat materials in favor of Fleitmann &
Co., submitted with your letter of February 1, last.
Messrs. Tremain & Tyler, the attorneys of record in
the said cases, having declined to await the decision of
the Supreme Court on cases

nuv

pending, this Department

will interpose no objections to the reinstatement of the
above mentioned suits.
Respectfully yours,
Assistant Secretary.

?)
AS TO RECOMMENDATIONS.
The Department letter instructing us to investigate this subject suggested that we should report recommendations in regard to
the methods prevailing

at this port in respect to estimating and

paying refunds.
The Bureaus of Certified Statements in the Collector's office
and the Naval Office appear to us to be in very competent hands and
to do their work very carefully and accurately.

The same is true

of the Liquidating Division in reliquidating protested ent2.ies.

have no suggestions to make in respect to these methods, except that
for purposes of information a record be kept in the Custom House,
classified according to descriptions of merchandise, of the refunds
paid upon reliquidations of entries made in the Liquidating Division
without certified statements.

It is likely that the amount of re-

funds paid on such reliquidation will continually increase, while
the amount paid on certified statements, except in ola cases, will
continually decrease.
In respect to samples, the General Appraisers in their new
quarters have established a place for samples and are likely to preserve them carefully.
The letter of September 22, 1891, provided that attorneys on
receiving refunds should stipulate that no further suits shall be
stituted to recover refunds on articles claimed

hat trimmings,

covered by invoices heretofore the basis of such suits. We enclose
copy of this stipulation, Exhibit 7,

If this procedure is followed

in the future, either in respect to cases already determined by the

paid, or in respect to other cases, the form
should be changed.

of this stipulation

Our examination of this 3ubject has shown that

a large number of the entries in a particular suit may be included
in other suits previously commenced, and it is doubtful whether this
stipulation would prevent an attorney from recovering on a claim
covered by a suit commenced at an earlier date thin the suit in
which the refund is paid.The stipulation is merely that "no further
suits thall be instituted" to recover on articles covered by the
Invoices; but if prior suits included items in those invoices

upon

which no refunds were paid, the attorney could hardly be said to be
instituting a further suit, if he merely brought on for trial a
prior suit in which were included articles covered by the same invoices.

That is to say, that the stipulation only burs future pro-

ceedings and does not meet the case of a prior suit including other
articles covered by the same invoices as those ingluded in the suit
In which the refunds were paid. Of course the plaintiffs cannot recover twice on the same item in a particular invoice,

but the ob-

ject of this stipulation was to obtain a discontinuance or release
of all claims that could be based upon such invoices, not only in
respect to the articles upon which the refund was paid.

That would

have been simply perpetuating the old evil of partial discontinuanceS.

The stipulation in its present form does not release the

Government from all claims upon the invoices, but only stipulates
not to institute further suits upon them; and, as we have suggested,
this might not meet the case of a prior suit.
A rule laiWown by the Supreme Court in the cases of the
United States against Schlesinger, 120, U. S . 109; Porter against

Beard, 124 U. S. 429; Rossman against Hedden, 145 U. S. 561 which
has never been followed by the collector in this port in estimating
the amount of refunds payable either on reliquidations made in the
Liquidating Division, or on certified statements prepared in suits.
The rule laid down in these cases is that under Section 3011 of the
Revised Statutes, now repealed, an action to recover excess of duties paid was maintainable only when the duty was paid in order to
get possession of the goods; that is to say, in addition to due protest and appeal, as prescribed in Section 2931, R. S., the importer
must have paid the duties before he had obtained his merchandise,
and in order to get it.

Under these decisions, therefore, wherever

on the final liquidation in consumption entries there was an increas
of duty over the amount estimated at the time of entry and paid on
the preliminary deposit, the importer could not recover any part of
this increased duty if at the time of paying it he had already obtgined po3session of his merchandise.

If he had obtained possession

of his merchandise, he could refuse to pay this increased duty
claimed by the Government on final liquidation, and if sued by the
United States, could set up in defence an erroneous classification.
It appears to have been the practice, however, in reliquidating invoices for the purpose of estimating the amount of refunds to be
paid, to hale estimated the percentage unlawfully collected upon
the whole amount of duties paid both at the time of entry and after
the final liquidation.

There may have been some reason for not ap-

plying the doctrine of these cases prior to the Act of 1890.

Im-

porters when notified that the Government claimed an increase of

duties on final liquidation would in all cases where they were protesting against the classification, have refused to pay, and the
Government would have been compelled to sue in such cases for every
increase of duty established by the final liquidation of the entry.
The Act of 1890, however, repeals these eections of the Revised
Statutes (Section 14) and requires that the importer shall in all
cases pay the full amount of duties before his notice of dissatisfaction or protest which entitles him to take his case to the Board
of General Appraisers become effectual. How much money might have
or may still be saved
been savedAy applying the rule established by the Supreme Court
in the cases eited to those entrice under the tariff of 1883 upon
vet
which claims for refunds are pending but have ndWeen paid can be
determined only by a careful reexamination of the entries by experienced liquidators, a work involving much labor, but quite practicable.
The decisions have always been followed by the U. S. Attorney
for the Southern District of New York, in suits.

He has a regular

form which is filled out in the Law Division of the Collector's
office, stating the entry number, the name of the vessel by which
imported, the date of entry, whether on the final liquidation there
was any increase of duty, and whether at the time of payment of such
Increased duty the importer had received all his merchandise.
These forms, however, do not state the amount of the increased duty.
The U. S. Attorney's office apparently leaves that until the suit
comes on for trial and the entry papers are in court open to inspection.

Obviously the amount paid after final liquidation is

.mew -

considerable where the classification or rate of duty established
at the time of a final liquidation is greater than the classification upon which the goods were entered.

Tf we take the hat trim-

mings cases as an illustration, the amount of increased duty paid
after final liquidation would be very large if there are many entries upon which at the time of entry the rate was fixed at 20 per
cent. and thereafter by the Appraiser and the liquidators raised to
50 per cent.
It is probable that there are some hat trimmings entries in
which the rate at the time of entry was 20 per cent, raised at the
time of final liquidation to 50 per cent.

There are also a great

many entries in which increased duties were established by the final
liquidation on account of increased valuations made by the Appraiser
On examining the statements made for the U. S. Attorney in the
four Fleitmann cases, Nos. 11,402, 12,184; 12,545 and 16,289, we
found that on nearly every entry there were some increased duties
paid after final liquidation, and after the importer had obtained
all his merchandise.

We have had all the entries in the certified

statements in these four cases examined in order to discover the
amount of refunds allowed but objectionable under the Schlesinger
case (See Schedule Ex. 6).
The amount of excess of duty paid after final liquidation and
after the goods had been delivered was $7,052.95 out of a total excess allowed in certified statements of $155,851.00 i.e., about 4.5
per cent.

These four suits are wholly insufficient to afford a

basis for an approximate estimate of the amount that may be objec-

objectionable under the cases cited.

There were only two or three

unimportant entries in these four suits made at 20 per cent and
raised to 50 per cent.

Recarries in suits including large en-

r11'1k)
i raised to 50 per cent, may be greatly reduced in
tries,y
amount 'by the application of this rule.

Mr. George of the Naval

Office might wisely be instructed to make a similar examination of
a larger number of the suits which he is now analyzing for another
purpose.
APPLICATION OF SCHLESINGER CASE TO TOBACCO REFUNDS.
In respect to the tobacco refunds under the Blumlein decision
the increased valuation made at the time of final
perhaps large.

liquidation is

It is likely that some entries of tobacco were made

at 35 cents, and in such cases, under the system of classification
adopted at that time in this port, a considerable portion of the
merchandise was raised from 35 cents per pound to 75 cents on the
final liquidation.

If any of this increased duty was paid by the

importer after he had received all his merchandise, the decisions
hereinbefore cited prevent him from recovering any part of this
increase.

On the other hand, in these tobacco entries it must be

remembered that a very large proportion consisted of warehouse entries.

In much the larger number of warehouse entries the final

liquidation has taken place before there have been any withdrawals.
In such cases the importer would have paid the increased duties before obtaining his merchandise, or rather, in order to obtain possession of it, and the principal of the Schlesinger case would not
apply.

Liquidating Division since

Upon reliquidations made in the

July 1st, 1893, upon tobaco entries refunds have been paid to the
amount of ,y99,808.15 (3ch. ex. 9).

All these entries were reli-

quidated under decisions of the Board of Appraisers pursuant to
Section 14, Act of June 10, 1890.

The protests were all under that

Act having been filed subsequent to August 1st, 1890.

The Schles-

inger case, thereore, does not apply to these entries.
Upon certified statements tobacco refunds have been estimated
as follows:
33 Cert. sts. forwarded to Dept...94,181.32
Cert. sts. completed and held
97,055.20
for discontinuances
Cert. sts. prepared but not yet
759,361.53
verified by Naval Office
0501- 98.0g

There have been paid from C. S.
sent to Department
Without Cert. St
Adding to the total amount
of certified statements
The amount of refunds without
certified statement.

$7,178.46
99,807.15

$106,985.61.

950,598.05
99 807.15

The total refund upon tobacco
$1,050,405.20
payable and paid is
Probably all the antries have been reliquidated by this time
and are included in the foregoing figures.
The application of the Schlesinger case to the Entries included
in the $950,598.05 (of which as yet only $7,178.46 has been paid)
can be determined only by having the entries in each suit examined

as has been done in the four Fleitmann hat trimmings suits.

this way the number of consumption entries will be disclosed as well
as payments (if any) on liquidations of warehouse entries after all
the goods had been withdrawn.
OTHER SUBJECTS OF REFUNDS.
The principal subjects of refunds besides hat trimmings are at
present charge3 and tobacco, both arising under the act of 1883.
The charges refunds appear to be made under the decision in the
Oberteuffer case made in 1886, and under the Bradbury case, decided
• • •

in December, 1889.
•• v

The tobacco refunds are being made under the

decision in the ease of A. Blumlein & Co., decided by the Circuit
Court of Appeals in April, 1893, communicated on June 12, 1893, to
the Collector by the Department, with instructions to settle on the
basis of that decision.
The annexed schedule, Exhibit No. XI shows the total amount of
refunds on chargs by certified statement to the end of the year

OOOOO

• • • •

. •

1892.
The conjectures frequently made in respect to the probable
amount of refunds on charges appear to be grossly exaggerated. From
1886 to 1892, inclusive, the amount of renunds on charges and coverings was $2,029,628.11 by certified statements.

During the year

1893 $80,145.65 have been paid in refunds on the s;ime subject.

do not know what amount was paid through the Liquidating Division
without certified statements, but we do not believe that it was very
large.

These protests and appeals were almost all in the hands of

attorneys, and after the Oberteuffer decision the attorneys hurried

to get all their protests in suit.

Their object in preferring to

have them in suit was to recover interest and costs.

Mr. Crawford,

or's
the head of the Bureau of Certified Statements in the Collect
, says
office, who had had great experience in every class of refunds
that the Charges and Coverings refunds have nearly all been paid.
ing that
He informed us that he was willing to be quoted as predict
the refunds and coverings in the future will not exceed $25,000.
Of course this is to a certain extent conjectural, but Mr. Crawford
large
has satisfied us that there is no probability that any very
sum will have to be paid in the future on charges and coverings.
Schedule, Exhibit No. XII, shows the merchandise imported under
the Act of October 1st, 1890, on which certified statements have
been issued up to August 10, 1893, together with the classification,
court decisions, date of Department instructions, and amount of refunds paid.

This schedule shows that under the Mc.Kinley Act, up

to August 10th, 1893, certified statements to the amount of $22,029.
15 only had been issued.
We have pointed out already that refunds under the present procedure will be paid principally upon reliquidations made in the
Liquidating Division, upon decisions rendered by the General Appraisers.

As shown in this schedule, the amount paid by certified

statements, which include only the cases actually petitioned into
court, is v.n-y small.
Schedule, Exhibit No. XIII shows the nature and amount of refunds by certified statements during the year 1892, divided according .to materials.

interest
Schedule Exhibit XIV shows the refunds, principal,
and costs paid in twelve years upon certified statements only.

liquidations
very large amount must be added for refunds paid on
without certified statements.

Charges refunded during the years 1886 to 1892.
1886

$125,082.63.

1887

453,587.78.

1888

On certified state660,531.38. ments only.

1889

218,009.10.

1890

84,404.84.

1891

235,892.58.

1892.

252,119.80.
$2,029,628.11.

IN CONCLUSION.
The enormous sums repaid to importers as refunds naturally
some
suggest the question whether it is not possible to establish
to
method of classifying merchandise which will either put an end
refunds or at least greatly reduce the amounts to be paid.
Schedule Exhibit XIV shows that on certified statements alone
in twelve years $13,549,596.00 have been paid.

A sum very nearly

as large must be added to cover rerunds made without certified state
ments.

Estimating the possible amount still to be paid on hat trim-

mings in even a conservative manner it appears that there is a

to five
probable liability of over fifteen millions in addition
millions (estimated) already paid.
On tobacco over a million of dollars is due and payable.
the
The most deplorable characteristic of this system is that
consumer pays twice.

Almost invariably the importers (for all are

the
treated alike) receive the whole duty in the price for which
goods are sold;

and when the Government has to pay back the amount

levied in excess, the people pay again in the form of taxes.
Generally the refund is all gain to the recipients.
The broker or attorney who has worked up the question, collects
the cases from the importers, guaranteeing them frequently against
all cost and expenses.

The importer agrees to pay a percentage,

commonly 50 per cent of the recovery to the broker or attorney or
to both to be divided between them.

The importer can usually afford

also to pay additional percentages to other attorneys or agents who
can be useful in facilitating collection.
The first and most important thing to be done to put a stop to
refunds is to make the conclusions of the General Appraisers conclusive on all questions of fact, as now proposed.

It is: reasonable

to assume that this will reduce the opportunities for extensive refunds ve:-y greatly.

If this suggestion becomes law, and the system

works well, it may be found advisable to make the conclusions of the
General Appraisers final both in law and in fact and to prohibit all
further review of classifications.
This is a much more practicable method than to make the importer's right to a refund of duties unlawfully exacted depend upon

proof that the excess did not
enter into the price of the merchandise. The latter may be pur
e justice, but it appears to be almost
impracticable to establish a sat
isfactory method of obtaining such
proof.
of the problem
The true solutionl
is to put an end t the opportunity to litigate endlessly the accura
cy of the original classification; and
th
will largely be accomplis
hed by prohibiting any review beyond the
Board of General Appraiser
s.
Dated at New York, January
4th, 1894.
Charles S. Fairchild, Chairman.
D. Magone.
Wallace Macfarland.
Poindexter Dunn.

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Full text of Charles S. Hamlin Papers : Printed Matter -- "Report of the Fairchild Commission on Hat Material Refunds," Jan. 1894, Box 356, Folder 8

FRASER