468
FEDERAL REPORTER. DETRICK and others v. BALFOUR and others. (Circuit Court, D. California. August 22,1881.,
1.
CONTRACT-CONSTRUCTION-" CHANGE IN DUTIES "-REV. ST.
§ 2838. A written contract entered into at San Francisco, in the state of California, for the sale of goods to arrive from Calcutta, contained this clause: "Any change in duties to be for or against purchasers." The rate of duty on the bags constituting the sUbject-matter of the contract has not been changed since the contract was made. The amount of duty actually paid was, however, considerably less than the amount whieh it would have been necessary to pay on the same goods if they had been entered at the time when the contract was made, owing to a change, meanwhile, in the estimated value of the rupee, in which currency, under section 2838 of the Revised Statutes, the invoice of such merchandise was required to be made out. In an action by the purchaser of the goods to recover the amount of this difference, held. the parties, by the words "change of duties," Intended a change in the rate of duty by authority of congress, not a difference in the amount of duty merely.
2.
SAME-SAME.
Held, further, that the court would put that construction upon these words whether it viewed them in the light of the general and legislative history of the country, or in the light of the common understanding as to the meaning of these words, when used in this connection, among the merchants of the mercantile community where the contract was made; i. e., those San Francisco.
of
SAWYER, C. J. On the fourteenth of November, 1879, the plamtiffs and the defendants, interchangeably, entered into the following 'Contract: " No. 172 p. SAN FRANCISCO, 204 California street, Nov. 14, 1879. "I have this day sold to Messrs. E. Detrick & Co., on account of Messrs. Balfour, Guthrie & Co., five hundred thousand (500,000) standard 22 by 36 grain sacks, ex Evelyn, from Calcutta, at the duty paid price of nine and fiveights cents (9j cents) each, U. S. gold coin, on delivery in good order and condition on the fifteenth day of May next. Marks and numbers to be declared on receipt of invoice, and allowance on damaged bales, (if any,) failing a satisfactory adjustment, to be submitted to arbitration. Contract void, should vessel not arrive by or on the fifteenth of May, 1880. It is at sellers' option, ·on or before first prox., to change the character of this contract to positive delivery, at nine and three-quarters cents (9£ eta.) each, for the first day of .June. "Approved: Balfour, Guthrie & Co. "WILSON WHITE, Broker. "Any change in duties to be for or against purchasers. B., G. & Co., by R.B."
All the material facts of the case, except the testimony as to the meaning attributed by the merchants of San Francisco to the memorandum at the foot of the contract, "any change in duties to be fOl
DETRICK V. BALFOUR.
469
or against purchasers," are contained in the stipulation filed in the cause. The duty on the bags mentioned in the contract was, a.t the time when it was entered into by the respective parties, 40 per cent. ad valorem. This rate of duty has never been changed. Sections 2888 and 3564 of the Revised Statutes of the United States provide as follows: .. Sec. 2838. All invoices of merchandise subject to a duty ad 'lJalorem shall be made out in the currency of the place or the country from whence the importation shall be made, and shall contain a true statement of the actual cost of such merchandise in such foreign currency or currencies, without any respect to the value of the coins of the United States, or of foreign coins by law made current within the United States, such foreign place or country." " Sec. 3564. The value of foreign coin, as expressed in the money account of the United States, shall be that of the pure metal of such coin ofstandard value; and the values of the standard coins in circulation of the various nations of the world shall be estimated annually by the director of the mint, and be proclaimed on the first day of January by the secretary of the treasury."
The merchandise which was the subject of the foregoing contract was purchased in Calcutta, and the invoice value thereof was made out in rupees, the currencJ' of that place. The value of the rupee in the currency of the United States, on the fourteenth day of November, 1879, the time of making the contract, was, as proclaimed by the secretary of the treasury on the first day of January, 1879, 44.40 cents. The value of the rupee in the currency of the United States, at the time when said merchandise was imported into the United States, and entry thereof made at the office of the collector of customs for the port of San Francisco, which was after the first day of January, 1880, was, as proclaimed by the secretary of the treasury on the first day of January, 1880, 39.70. The dutiable value of the merchandise was, therefore, ascertained by reducing the invoice valuation in rupees to the currency of the United States at the rate of 39.70 cents per rupee. The full amount of duties on the merchandise, estimated on the value of the rupee at 39.40 cents, was $9,466, which was the amount actually paid. If the duties had been estimated on the value of the rupee at 44.40 cents, as proclaimed by the secretary of the treasury, January 1,1879, they would have amounted to $10,587.20. The difference in the amount of duties arising from tbe above-mentioned difference in the value of the rupee in the curre'ncy of the United States, was, therefore, $1,121.20. It is to recover this amount that the present action is brought by E Detrick Co., the purchasers of the goods.
470 The plaintiff's ,'Very an.l1 plausible argument to show that the words "change in duties," in the clause in. question, me,an!! not a change in the'l'ute ot cLuticsIDa\le by law, but a change in the anwMt ,of dutiEils from whlioteye:r cause the amoun.t of duties to be pl;tidmay btl affected. But, after·a, e;areful considera-, tion of tb.e 8IJbject, I fj.nd IDYfJelf unable to adopt that view. T,he word "duties," as used in this clause, doubtless, mean,1l the tax, chll,rge, cu,stoms". toll, or tariff levied by a'ct of congress uron the case;. bags-iII1-ported. Congress., in-its action upon the subject, regulates the duties, properly so if expressly and directly by prescribing some uniform rate of duties, either specific or ad valorem. And generally, doubtless, unless there' is something in the surroundillg circumstance,s indicate a different sense, men,also; in bUSIness transaction\\, and in ordinary conversation in speaking of the duties on, imports, use the term with reference to the charge so directly and expressly imposed according to the rate and rule prescribed. They are spoken of and considered. in their immediate, direct, and not in their remote or incidental relations. We all know, as a matter of general, nationfl,l, political, as well as legislative and statutory history of the country, that during the late civil war the demands for large revenues inducf.)d freqnent and COlltinual changes in onr revenue laws. The rates of duties, as well aJ;! the subjectsupon which they were imposed, wereconstant.lychanged, as necessity and experience modifications, and these cb,anges continued after the of tbe civil war, as the demands for large revenues diminished, while we were getting hack to a peace qasis again. These frequent changes in the presented a new element of uncertainty for the merchant to take into consideration in making contracts to be fulfilled in the future, and, doubtless, theintroduc.tion of the clause in question had its a,rigin in such a condition of things. The direct and usual, if not the only, mode of changing duties, when that is the purpose to be aCC(Hnr plii:lhed, is to change the ra£, whether the duties are specific or ad valorem, and the langnage adopted in the contracts, "change of du';ies. "to provide a.gaiust these contingencies, is, well adapted to the pUrpOSfll. and was doubtles3 adopted, with reference to such inten.. tional, ,direct, and changes of duties. When the purpose of congress is to change the duties .itmanife'lts that purpose by legislat. ing directly upon subject. If, inot4er legislation, it in SOJlle instances affects the amounts of duties req,uired to be paid, that effed
V. BALFOUR.
471 '
and purely And when parties contract with reference to changes :0£ in all probll>bility tb..eY would only C011te:rp.plate ,the changes in the usually depending on cha:nges of an,d:,nott.l;lOse rare, instar1ces the amount oftpe duties is accidentallyaffect'ed .as incidental to legislation or' official action designed to effect other objects. If parties contemplated protecting themselves against remote, accidentar effects, they' 'WR\Ji'd qe very apt to use la.ngqage to olearly,mani-. fest such, a ; TQepla,intiff's couosel insist that the parties could not hav;ec()ntwnplated ,,&. chll-nge in the of duties; that if they had they. w9uldhate the word "rate" in their con_ tract, and ae used the word it cannot be interpolated. ItJllay just as argqed that they did not mean the "amount" of duties; if they; had, the word "amount" would have been ulled, arid' we are more. authorized, to m'terpolate the. word "aIQ,ount" th'an "rate." , , " " ., " 'A plain, vie'\V of the question must be taken. The in ,a,ll1?unt of the' duties in this instance resulted from the yalue, of rupee, or the money of the country 8.ection 2838, Rev. St" whence the gOOds were the invoice t()b, currency of, oJ.;,country"f:rOIQ, whence the impOI:tation made,. and shall contain a tr¥'6. statement of the actual cost:of Buch'merchandise in such foreign And eecti,oIl 2906, Rev., St., requires the collector to the "actual market value, at the peri.od oj exportation to the United States, in 'the principal of the country whenee, the goods are imported, and the 'period of is the day .of JHti,}ing from the :l;W How.,57l. And duties Ipust foreign port.' ' : .. '.'. , , 1 , ,: be paid in money of the Ut;lited" . 1 Rev. St. § 3473..' The value .' {)f all foreign .coins must be e,stiIllated mOney of the United States by the director of the mint,' !!, . proclaimed hy : . , " ' ana the the . treasury on the first of ,January of each year. Rev. St.§ 3564. The {)bjeet seems' to get at the actllal value of. th.ef()l'eign coin in the Dioney aftha United Stfltes. Oollector v. Richp;rds. 23 Wall. the, actual, yalue .of the fpreign <loin in own 246. By 0 we obtain the a.ctual vltlue oftl1e in foreign ddins in tte rribney' of the United. States.' IIi. this case there a of,the of· the and the tIme ofthelmportatIon, by; whIch the value,of,therupee was tessened, t?f i,he, gO,ods was dIniinished.. , 'Was, tue ,yalue ,of the I ,.: , _ I .' , . , ' . '.
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4:72
FEDERAL REPORTER.
diminution in the value upon which duties were to be paid, and not a change in the duties to be paid upon that value. The result was the payment of a smaller amount of duties, not because of a "change of duties," but because the va.lue of the goods upon which the duties were paid was smaller.· This resulted from no action of congress, or of anybody else acting under the authority of congress, intended to affect eitherthe amount or tate of duties, but was 'incidental to the exercise of other powers to regulate' the monJyoftlle cOuntry, and purely accidental. It' might 'as well be. chtiined that a diminished oi' increased arnounfof duties, from'a or apvreciation of the 'of -the.. goods aftei th(l contract and before importation, resulting· from . aD;Y .other' havs'a, tis' witIlin .ihe terms of the clause oftha contridt in'question.; . Had iheparties contemplated a change in thd 'amount'td bepaid'resultiilg frdrn1a in the value of the rupee, it 1lf more to suppose that they would have made the clause read something lIke this, y c·hange in duties, or in the value ()f the cltrrency oj Irtdia, (or· the rupee,) to be for or against the purchaser," than suppose the stTuctionnow claimed for the in' qUCstioIl ·tQ have been contemplated. The change in value 'of the rupee· is quite as and independent a contingency to be r9psidered and provided for as the "change in duties," and the language suggested would be far more apt and appropriate to express the additional idea. The inora natural construction of the language used is to limit it to a change in the rate of duties by congressional legislation, or by authority of congressional legislation, and not to extend it to changes in amount of duties rarely affected, and in,cidentally and accidentally resulting from legislation and official action intended to effect other objects having no reference to duties or revenues. This is the conclusion to which my mind has come from a consideratioIl of the language itself, viewed in the light of. the general and legislative history of the country, without considering the testimony of witnesses relating to the general understanding of merchants as to the purpose and signification of the clause in question. .. If,however, testimony is competent to show what the purpose an.d signification of the .clause is as generally understood in the mercantile community where the contract is made, then the .testimony clearly shows that it is understood to be to changes in the rate of duty by authority of congressional legislation, as I have already held. The plaintiffs' counsel insist that if this testimony is admissible, it can have no significance for the reason that the provision now found
,.An
to
UNITED STATES
'D.
AUDITORS OJ' TOWN OJ' BROOKLYN.
4:73
in section 8564, Rev. St., was not adopted till long after the war, and long after the custom having its origin in the war and its attendant legislation of introducing the clause in question had been established; and at that time the question whether a change in foreign coin would work a change in the duty could not have arisen. Concede this to be so, then, if such a question could not have arisen for that reason, it follows that the parties making those contract9 "'i tha.t time could not specifically have contemplated embracing such a change in the amount of duties in the term "change of duties;" as used in these contracts, and it is not probable that the sense has since been extended. In my judgment, in any view I can take of the matter, such a change the parin the amount of duties to be paid was not contemplated ties when the contract was made, and is not embraced in ·the words "change in duties." There must be a finding and judgment ror defendants, and it is 80 ordel'ed.
UNITED STATES e:r: reI. THE INs. Co. 'D. THE BoARD AUDITORS, etc., OJ' THE ToWN OJ' BROOKLYN. (Circuit Court, N. D. lUinoil. August 3, 1881.) 1. i. VAIN
OJ'
ToWN
AcTS. The law never requires one to do an idle or vain act.
SAME-ToWN DEBTS-DEMAND-MANDAlIWS.
Judgments had been recovered against a town from time to time through a numLcr of years without any action being taken by the town authorities to provide for their payment. Upon an application for a mandamus against them to compel them to take the necessary action under the law, held, that the writ might issue without a formal demand upon them for their payment, or to proceed as the law required, as it. was apparent that to make such demalld would be a mere idle act.
Mr. Bailey, for relator. EdBail If Hawley, for defendants. DRUMMOND, C. J. This is an application by the relator, after due notice, for a peremptory mandamus against the defendants to take the necessary steps under the law to assess a tax for the payment of various judgments which have been rendered in this court against the town of Brooklyn, Lee county,-one on the thirteenth of. March, 1876, for $5,511; one on the twenty-fourth of June, 1879, for $22,644.30; one on the thirty-first of March, 1880, for the sum of $5,120.50; and one on the twenty-fourth of December, 1880, for $5,615.68,-a11 with costs.