U.S. Supreme Court
Earnshaw v. Cadwalader, 145 U.S. 247 (1892)
Earnshaw v. Cadwalader
Argued April 29, 1892
Decided May 16, 1892
145 U.S. 247
Under schedule C of § 2502 of the Revised Statutes, as enacted by § 6 of the Act of March 3, 1883, c. 121, 22 Stat. 497, iron ore was charged with a duty of 75 cents per ton, and that duty was assessable on the number of pounds of iron ore reported by the United States weigher, and not on the ore after the moisture was dried out of it.
This is an action brought in January, 1888, in the Circuit Court of the United States for the Eastern District of Pennsylvania, by John W. S. Earnshaw against John Cadwalader, Collector of Customs for the District of Philadelphia, to recover $71.61, as an alleged excess of duties exacted by the collector on three importations of iron ore, made in February and April, 1887, by the plaintiff, into the port of Philadelphia, from Porman, Spain. The case was tried before a jury in October, 1888, who rendered a verdict for the defendant, and he had a judgment, to review which the plaintiff has brought a writ of error.
The iron ore was dutiable under Schedule C of § 2502 of the Revised Statutes, as enacted by § 6 of the Act of March 3, 1883, c. 121, 22 Stat. 497, under the provision imposing a duty as follows: "Iron ore, including manganiferous iron ore, also the dross or residuum from burnt pyrites, seventy-five cents per ton." The plaintiff seasonably paid, protested, appealed, and brought suit. The form of his protest as to each of the three importations was the same. The collector imposed a duty of 75 cents per ton on the number of pounds of iron ore reported by the United States weigher. The protest stated that the importer claimed that the collector erred in exacting duty on the full weight reported by the weigher, and that the importer paid the same under protest,
"because the importation is dutiable as merchandise which is described as 'iron ore' in Act of
March 3, 1883, c. 121, sec. 6, Schedule C, and 'iron ore' was and is understood among dealers in and consumers of such iron ore in this country to refer, and did refer, to iron ore in the condition of dryness in which it is sold in trade, which condition of dryness is usually ascertained in trade by subjecting the iron ore to a temperature of 212ˇ Fahrenheit; but you have levied the rate of seventy-five cents per ton on my importation when mixed with, and the weight increased by, a considerable percent of water, thereby making me pay, in violation of law, that rate of duty on water; because the iron ore of commerce, to which the said tariff law applies, is iron ore in a dry state -- i.e., free from water not chemically combined -- and because, although the method of ascertaining the amount of such mechanically mixed moisture is well known, easily applied, and actually used between buyers and sellers of such ores in this country, you have refused to ascertain the true taxable weight of the iron ore of this entry in this or any other way, or make any allowance for such mechanically and accidentally combined moisture, in ascertaining the weight."
The plaintiff introduced evidence tending to show that samples representative of the whole mass were taken by three different samplers on the arrival of the different cargoes, which samples were delivered to two chemists in the same condition as taken, in order that the amount of moisture mechanically present, and the amount of metallic iron, might be ascertained. The plaintiff then introduced evidence tending to show that the cargoes of iron ore so imported contained water mechanically present, and not chemically combined with the ore, and claimed that such water was not subject to duty as "iron ore." Evidence was given as to the quantity of such water, and there was no dispute as to the propriety of the method of ascertaining it, which was to dry the samples at the heat of 212ˇ Fahrenheit, and thus expel the water or moisture mechanically present, without having any effect on the chemical ingredients of the ore.
The plaintiff asked the court to rule that "the term iron ore,' in its ordinary meaning, does not include water which is mechanically present, and not chemically combined with chanroblesvirtualawlibrary
the ore." The court refused so to rule, and the plaintiff excepted.
In the course of the trial, the court, against the objection of the plaintiff, admitted evidence tending to show that the iron ores of the United States, which resembled, and were like, and had the same characteristics as, the imported iron ore involved in this suit, were dealt in in this country without an allowance for moisture. The court, in ruling in favor of the admission of such evidence, stated that the purpose of the testimony was to show whether it was true, as was said by some of the witnesses, that the signification of "iron ore," when applied to the description of ore in question, meant the dry ore, because, as the court said, if it were shown that in dealing in precisely the same character of ore mined in the United States, there was no such limitation of the meaning, and no such dealing, that bore directly on the weight and credibility of the testimony given by the plaintiff for the purpose of making an exception in favor of the particular description of ore in question; that it was a legitimate argument that if the designation or signification of the term "iron ore," when applied to such description of soft ore mined in the United States, included the water, it would be unreasonable to believe that the designation of "iron ore," when applied to precisely the same kind of iron ore, meant the dry ore, without the water, simply because it came from across the sea, and that, although it was not direct testimony as to the iron ore in question, it was testimony in respect to iron ore precisely like it. The plaintiff excepted to the admission of the evidence.
The court, among other things, charged the jury as follows:
"The term 'iron ore,' as defined by lexicographers and used and understood in commerce generally, includes the water as well as other foreign substances held in combination with iron, whether the combination be chemical or physical. It follows, therefore, that the duty imposed and complained of here was properly imposed unless a distinction is to be drawn between this ore and iron ore generally."
The plaintiff excepted to that part of the charge.
The plaintiff requested the court to charge the jury as follows: chanroblesvirtualawlibrary
"If iron ore as imported into the United States, in generally bought and sold on the basis that the water which is only mechanically present, and not chemically united with the constituents of the ore, should be removed, and the usual mode to remove such moisture, to ascertain this basis and determine the true ore, is by drying at 212 degrees Fahrenheit, that course should be adopted to determine what is dutiable iron ore under the tariff."
The court refused so to charge, and remarked that there was no evidence to warrant a finding that the iron ore in question "is generally bought and sold on the basis that the water which is only mechanically present should be removed," except where that basis was stipulated for by special contract, and that such transactions (founded on contract) were unimportant, standing alone, in thewhere that basis was stipulated for by special contract, and that such transactions (founded on contract) were unimportant, standing alone, in thewhere that basis was stipulated for by special contract, and that such transactions (founded on contract) were unimportant, standing alone, in the consideration of the case. To such ruling of the court the plaintiff excepted.
The plaintiff also requested the court to charge the jury as follows:
"If, upon the whole evidence, you are in doubt whether the iron ore of commerce is iron ore free from water, not chemically combined with it, it is your duty to give the importer, the plaintiff in this case, the benefit of the doubt, and your verdict should be for the plaintiff."
The court refused so to charge, and stated that the question must be decided according to the weight of the evidence.
In the course of the charge given, the court submitted to the jury the question as to what the term "iron ore" was understood to mean commercially, and on this subject the court said to the jury:
"In the enactment of tariff statutes, Congress must be understood, when employing terms to describe articles of commerce, to employ them in the sense in which they are commercially understood and employed by persons dealing in such articles and familiar with the subject -- in other words, as they are understood and employed in the commerce to which they relate. If, therefore, the plaintiff has proved that the term "iron ore," when applied to the imported ore here in question, signifies to those dealing in it, and familiar with the subject, dry ore only -- that is, ore from which the water has been extracted -- this signification must be given to the term as applied to this ore. To warrant this construction, however, chanroblesvirtualawlibrary
the evidence must satisfy you that the term has this signification generally -- that is, habitually, commonly -- in the commerce respecting this ore, so as to be obligatory upon parties dealing in the ore, without special contract on the subject. Does the evidence satisfy you that it has? Looking at the question in the light of the plaintiff's testimony alone, in the first instance, is the existence of this signification, under the circumstances stated, proved? His witnesses, when first examined, went little further than to say that in buying and selling and dealing generally in this ore, parties act upon the understanding that the ore is dry -- in other words, that the water is excluded from the weight. They further say, however, that special contracts are entered into respecting it, generally if not always, whereby the rights of purchasers to have the water so excluded is secured. If the case had rested here, as it did when the plaintiff first closed his testimony and the defendant moved for a nonsuit, the court would, as it intimated, have held that the evidence was insufficient to justify a finding in the plaintiff's favor. The evidence seemed to show no more than a course or custom of dealing by express contract respecting the ore, which, standing alone, should have no influence in ascertaining the signification of the term in question as applied to it. Subsequently the plaintiff called these witnesses back and inquired of them: "What is the term iron ore' understood to mean commercially among importers and dealers in imported ore?" In other words, what is the iron ore of commerce -- imported ore? And the witnesses answered substantially that it is understood to be ore without the water -- dry ore. The witnesses repeat their former testimony respecting the custom or habit of dealing in the ore, that parties proceed upon the understanding that the water is to be excluded, and that their contracts contain a stipulation securing its exclusion. There were three or four witnesses, very intelligent men, called back, who thus testified respecting the signification of the term as applied to this ore. This testimony, in terms at least, seemed to have a broader scope than that previously heard, and to warrant a submission of the question to you. In considering it, however, you must bear in mind chanroblesvirtualawlibrary
what these witnesses said when first examined as well as subsequently, and inquire whether their testimony, thus take altogether, shows more than a course or custom of dealing in which parties habitually contract, by special provision, for the exclusion of water from dry ore. If it shows no more than this, it is of no value. To sustain the plaintiff's case, the testimony must show, as before stated, that the term "iron ore," as applied to the ore in question, signifies, to persons familiar with the commerce respecting it, dry ore only; that this is the common, well known, and recognized signification of the term when so applied, upon which signification parties buying and selling or otherwise dealing in the ore have a clear right to depend without any contract or "
stipulation respecting it. Does the plaintiff's testimony, even when considered alone, show that the term, so applied, has this signification? In determining this, it is important to remember that parties dealing in the ore, according to the plaintiff's testimony, do not seem to rely alone upon the existence of this signification in dealing, but resort to contract for excluding the water. Neither you nor the court can overlook the fact that this manner of dealing by special contract seems to be inconsistent with the alleged existence of a common, well understood signification of the term "iron ore," such as is here set up. I have thus called your attention to the question in the light of the plaintiff's testimony alone. It is not to be decided, however, without considering as well the testimony produced by the defendant. The government has called several witnesses -- a larger number than were called by the plaintiff, and equally intelligent, apparently -- who say in substance that they are familiar with the ore in question, several of them being dealers in it, and that the signification of the term "iron ore," as applied to it, includes the water, as well as everything else contained in the mass, just as the term does when applied to any other description of iron ore; that there is no such commodity known to commerce as dry iron ore; that while the soft foreign ore is sometimes bought with the water excluded, it is also bought without respect to the water, as all other iron ore is bought, and that when it is so bought with the water excluded, chanroblesvirtualawlibrary
this is always specially provided by the term "ores," as when applied to hard and all other descriptions of ore. Now you must determine from all the evidence in the case whether it is proved that the term "iron ore," when applied to the description of imported ore here involved, has the limited signification attributed to it by the plaintiff -- that is, that it signifies dry ore, ore with the water excluded. If you find it has this signification generally, commonly, when so applied, your verdict will be for the plaintiff for the amounts claimed; otherwise, your verdict will be for the defendant.
There was no other exception by the plaintiff to any part of the charge than the exception above specifically mentioned. chanroblesvirtualawlibrary