United States v. Blair

190 F. 372 | U.S. Circuit Court for the District of Southern New York | 1911

HOUGH, District Judge

(after stating the facts as above). These actions raise a point not discussed in the decision of Noyes, J. (190. Fed. 359), lately filed in these cases, viz., what is meant by the phrase '‘foreign-built yacht.” The Blair case also requires answer to the inquiry: What is the force and effect of the statutory words that the tax “shall be levied and collected by the collector of customs of the district nearest the residence of the managing owner”? The action against the Investors’ & Traders’ Company also suggests (though it was not argued) the inquiry as to how the gross tonnage by which' the tax is measured is to be ascertained.

[ 1 ] I. The meaning of the phrase “foreign-built”: This may be considered from three points of view: (a) What is its signification in the shipping trade and among those familiar with maritime affairs? (b) What light is cast on the inquiry by general usuage. as evidenced by lexicographers? (c) Are there any decisions of authority? •

(a) No expert evidence as to the meaning of the phrase was introduced at the trial, -but ah investigation of congressional publications shows that it was suggested to Congress by those who petitioned for the legislation which finally became the section now'under consideration. It appears from House document 1505, 60th Congress, 2d Session (Tariff Hearings, vol. 7, p. 7526 et seq.) that a considerable number of ship chandlers, and one shipbuilder, petitioned for the passage of- an act laying an ad valorem duty of 75 per cent, on any. foreign-built yacht thereafter purchased by any citizen of the United States, and several amusing if not instructive reasons were advanced in favor of the proposed law, one of them being that the tariff would not be prohibitive because “a certain proportion of the very rich men of America are apparently determined to possess foreign-built yachts at any price without regard to circumstances.” Congress was furnished with a long list of obnoxious vessels alleged to be foreign built and American'owned, which list is thought to include every yacht now under consideration. It may fairly be presumed that in legislating upon the prayer of any portion ’ of the shipbuilding community Congress used language in the sense in which it was proposed, and it is in my judgment common knowledge that any person using the language of the sea means by a “foreign-built” vessel one originally constructed outside the United States, no matter how extensive the changes, alterations, or repairs bestowed upon her here may have been.

[4] (b) Anything which is built is formed “by uniting materials into a regular structure,” and that which is rebuilt is constructed “after having been demolished.” Changing the name of the Algonquin to Allita, or of the Delaware to Diana, effected nothing. Neither of these vessels was strictly speaking even rebuilt, for neither had been demolished. The Allita was merely enlarged, while the Diana was both repaired and enlarged.

(c) It appears to me that the reasoning of The Grace Meade, Fed. Cas. No. 15,243, is plainly applicable here. Rev. St. § 4179 (U. S. Comp. St. 1901, p. 2831) prohibits changing the name of any “vessel of the United States”; vi.e., of any vessel lawfully registered, enrolled, or licensed pursuant to legislative authority. The object of that statute is plainly to mark and preserve the identity of any named vessel. As long as the vessel is the same the name must be the same unless changed pursuant to other (and here unimportant) statutes. That decision laid clown very clearly the rules by which identity should be determined:

“It máy be held as a principle that where the keel, stem and sternposts and ribs oí an old vessel, without being broken up and forming an Intact frame, are built upon as a skeleton, the case is one of an old vessel rebuilt and not of a new vessel. Indeed without regard to the particular parts reused, if any considerable part of the hull and skeleton of an old vessel in its intact condition, without being broken up is built upon, the law holds that in such a case it is the old vessel rebuilt and not a new vessel.” ■

The Diana and the Allita in their present condition are either foreign built or home built. If they arc home built they must have been constructed when Messrs. Chubb and Flagler respectively expended such extraordinary sums on them. The same vessel can only be built once; she may be rebuilt many times, but that does not destroy identity under the decision quoted. If they were not new vessels, and new vessels in the technical sense of that word, when they were respectively put into commission after lengthening the Algonquin and after the fire on the Delaware, then they are the same vessels as they were before, however greatly changed in outward appearance, in value, or material. If these two yachts had been originally home built,-and that had been done to them which was done, could their respective owners have given new names to them without • due application to the Commissioner of Navigation? Plainly not, under the language of the decision above quoted. And if the identity of the vessels was not sufficiently destroyed to authorize rechrisiening if they had been vessels of the United States, they must remain foreign built. Even American rebuilding cannot change that. It is therefore held 1hat both the Allita and the Diana are foreign-built yachts as that phrase is used in the statute under consideration.

[2] II. The force of the phrase designating the officers by whom the tax “shall be levied and collected.” However shadowy in practice the difference is between a tax upon the potential use of a yacht and the yacht itself, especially when such tax may be perpetually commuted by the payment of an ad valorem duty, it is admittedly essential to the government’s position that the taxation be directed against the privilege of use, and therefore assessable to and collectible from the personal user. It is then highly appropriate that, like almost every other personal tax, the place of taxation shall be the residence of the person taxed, and such is the plain direction of the statute. It is therefore obvious to me that when the act declares that a particular collector shall levy and collect the tax, it means that he must do something by way of apprising the person who is called upon to pay of the claim made. It seems elementary that if one particular officer is charged with the duty, no other officer can lawfully perform that duty.

The word “levy” in law has had many meanings attributed to it (see a collection of them, Words and Phrases, tit. “Levy”), but nothing suitable to any meaning given was done by the collector ■nearest the residence of’Mr. Blair. Whatever was done was the act of the corresponding functionary in New York. It is not for the defendant to declare what is necessary; it is enough that the designated official did nothing, so that the government to prevail in this action must assert (as is done arguendo) that if in any way, or- by any person, notice of the tax is given to the yacht owner and he does not pay, an action such as this can be maintained. For this claim no basis is perceived.

[3] III. The measurement of tonnage. The complaint against the Investors’ & Traders’ Company alleges that the collector of customs “duly levied upon the use of the said yacht * * * a sum equivalent to a tonnage tax of $7 per ton, to wit $504.” This is evidently $7 a ton on the original tonnage of the vessel. It is common knowledge that the result of what was done to the Allita was to increase her tonnage; yet in her last recorded bill of sale she is still described as being of the same tonnage that she was when she was 26 feet shorter. The fact appears to be that the tonnage has been taken from her documenting, and the documents not being required by arty statute of the United States have been continued without any remeas-urement. This tax is therefore incorrect, but as it is plainly less than the government would be entitled to demand, the defendant is not in á position to object.

Judgment is directed in accordance with these findings.