NEW YORK CUSTOM-HOUSE CASES.

CHARLES KENWORTHY.

Where a British subject, who was domiciled in New York, and engaged in mercantile business there, was sued for fraudulent invoices of goods imported by him, which suit he adjusted with the government by payment of a portion of the sum demanded, held that he was bound by such adjustment from any revision of the suit before this commission.

A domiciled merchant of the United States or Great Britain, resident in the country of the other, has no right to the action of this commission in matters of current business embraced within the ordinary jurisdiction of the courts of the country where he resides. By treaty of July 3, 1815, such persons "are entitled to protection and security, but are to be subject always to the laws and statutes of the two countries respectively."

Evidence that fears were entertained lest other suits might be instituted, or seizures might be made unless a suit was adjusted, or a general prejudice to business might arise from controversy with the government, does not constitute such evidence of duress as to avoid a settlement.

In 1839 the claimant, who was a British subject, resided in the city of New York, and had been engaged there for some years in the importation and sale of goods.

From February 13 to July 19, 1839, certain goods were imported by him. They were duly examined, the, duties were paid on them, and they were removed for sale to Philadelphia. They were there seized as having been entered at a reduced rate of invoice and fraudulent valuation.

The goods consisted of 397 pieces, included in nine invoices, the total value of which was over £2,000. One hundred and two of these pieces were seized at Philadelphia. An adjustment was had of this suit by which 74 pieces were retained by government, and 28 pieces were restored to the claimant.

Claim is now made against the United States to recover back the value of the property seized, on the ground that the seizure was a fraudulent act of the collector of the city of New York, and that any adjustment made was obtained by duress and extortion.

HANNEN, agent and counsel for Great Britain.

THOMAS, agent and counsel for the United States.

The opinion of the board was delivered by

UPHAM, United States Commissioner:

This is one of a class of cases in all involving claims to the amount of between two and three hundred thousand dollars. They originate from seizures made in 1839 by Jesse Hoyt, collector of the port of New York, on complaint that, for some years previous, a series of importations on false invoices had been made at that port by merchants having partners or houses connected with them in Yorkshire, England, by which the revenue had been defrauded of large sums.

Many of the goods were sold at public auction in New York; other sales were made at Philadelphia and in Massachusetts. Some of the importers were arrested, and one or more fled the country. A portion of the cases were not sustained on trial, or were dismissed, as was alleged, owing to the difficulty of obtaining evidence from abroad; and others were prosecuted to judgment, or were settled by the parties.

A considerable amount was collected from these suits, and paid into the public treasury, and large sums were received by the collector and the prosecuting officers of the government for fees and charges. A portion of these charges were said to be illegal and exorbitant. Complaints were also made as to the mode in which the prosecutions were conducted, and a committee was appointed by the United States Senate, of which Mr. Poindexter was chairman, to investigate the subject.

A voluminous report was drawn up by the committee, and submitted to the Senate, in which a portion of the proceedings were severely commented upon, but no definite action was had on the report.

In all the cases of this class which have been presented for our decision the same general facts exist-that legal process was instituted, and the suits were either prosecuted to judgment, or were adjusted by agreement between the parties complained of and the government. Attempts were made to prove that these adjustments were obtained by duress. But the evidence does not sustain the charge.

It consists merely of vague statements of the injury arising from custom-house suits, and evidence of apprehensions that, unless adjustments were effected, other suits might be instituted or seizures made. Considerable stress was also laid on the fact that the prosecuting officers were largely interested in the proceeds of such suits,

but there was nothing to establish the charge that the suits were brought for fraudulent purposes, or that an honest importer should have feared their result.

In some of these cases large sums were paid to obtain an adjustment; and it seems to have been overlooked that, unless such adjustment is explained, it tends at least as much to show an acknowledgement of fraud or mistake on the part of the importer as it is evidence of duress on the part of the officers of government.

The suits should have been prosecuted to final judgment, if a valid defence existed. The parties were resident in the United States, and were availing themselves of the protection of the government in the transaction of their business; and they should not have adjusted claims then pending against them in courts of competent jurisdiction, and come here after a lapse of some fourteen years expecting their reconsideration.

It was not designed that this commission should take cognizance of such cases. The respective governments had already provided by treaty for the settlement of all transactions arising out of the ordinary business of commerce by persons domiciled in the government of the other.

The convention of July 3, 1815, to regulate commerce between the Territories of the United States and of Great Britain, provides, in article first, "that the inhabitants of the two countries, respectively, shall have liberty to remain and reside in any part of the territories of the other, where other foreigners are permitted to come; also to hire and occupy houses and warehouses, for the purposes of their commerce; and generally, that the merchants of each nation, respectively, shall enjoy the most complete protection and security for their commerce, but subject always to the laws and statutes of the two countries, respectively.”—(United States Statutes at Large, vol. 8, p. 228.)

It was manifestly contemplated in this provision that citizens or subjects of either government, resident in the country of the other, engaged in commerce, should be subject to the laws of the country where they reside, in all ordinary matters pertaining to such comThe adjudication of suits arising out of the collection of the revenue is certainly a matter of local jurisdiction by the courts of the country, and there can be no appeal from them to this tribunal.

merce.

Ex. Doc. 103-22

We have been able to see no ground, in any of this class of cases which have been presented to us, that entitle them to recovery under this commission.

The cases of PLATT & DUNCAN; executors of WILLIAM BOTTOMLEY; WILLIAM BROADBENT; executors of JOHN TAYLOR and SAMUEL BRADBURY; and GEORGE and SAMUEL SHAW, for whom Mr. HANNEN, assisted by Mr. BUTT, Queen's counsel, Mr. SPINKS, and others, appeared as counsel, were holden to come under the principles of this decision, and were disposed of accordingly.