                          Slip Op. 01 - 57

           UNITED STATES COURT OF INTERNATIONAL TRADE

- - - - - - - - - - - - - - - - - - x

THE HANOVER INSURANCE COMPANY,       :

                          Plaintiff, :

                     v.              :   Court No. 94-07-00438

                                     :
THE UNITED STATES,
                                    :
                         Defendant.
- - - - - - - - - - - - - - - - - - x


                          Opinion & Order

[On cross-motions, partial summary judgment
 for the plaintiff.]


                                            Decided:   May 16, 2001


     Sandler, Travis & Rosenberg, P.A. (Arthur K. Purcell);
Neville, Peterson & Williams (John M. Peterson) for the plaintiff.

     Stuart E. Schiffer, Acting Assistant Attorney General; Joseph
I. Liebman, Attorney in Charge, International Trade Field Office,
Commercial Litigation Branch, Civil Division, U.S. Department of
Justice (Bruce N. Stratvert); and Office of the Assistant Chief
Counsel, International Trade Litigation, U.S. Customs Service (Beth
C. Brotman), of counsel, for the defendant.



          AQUILINO, Judge:   This action arises out of the manu-

facture in and exportation from Italy of equipment for a Grand

Coulee electrical power plant of the Columbia Basin Project in the

State of Washington. Its importation was pursuant to contract with

the Bureau of Reclamation, U.S. Department of the Interior, but the

pricing thereof fell within the ambit of determination(s) by other

federal-government department(s) of sales at less than fair value.
Court No. 94-07-00438                                       Page 2


See, e.g., Final Results of Antidumping Duty Administrative Review;
Large Power Transformers From Italy, 52 Fed.Reg. 46,806 (Dec. 10,

1987).   That determination by the International Trade Administra-

tion, U.S. Department of Commerce, set 71.40 percent as the margin

of the Italian manufacturer's dumping of such equipment at the time

of delivery to the United States.


                                 I

          According to the amended complaint filed by the above-

encaptioned plaintiff surety, the U.S. Customs Service computed

that margin to result in an antidumping duty of $292,638.12 on the

entry herein, which amount the surety ultimately paid1.       That

complaint alleges jurisdiction pursuant to 28 U.S.C. §§ 1581(a) and

1581(i)(4), pleading causes of action predicated in essence upon

averments (i) that the plaintiff never received notice of suspen-

sion of liquidation, as required by 19 U.S.C. §1504(c); (ii) that

it also never received notice of suspension on Customs Form 4333-A,

as required by 19 C.F.R. §159.12(c); (iii) that the price payable

by the United States through the Bureau of Reclamation included

import duty and was subject to mandatory adjustment under which the

government was obliged to absorb duties, including any for dumping;


     1
       Plaintiff's single consumption entry bond on Customs Form
7551 was in the name of The Legnano Electric Corporation, the
nominal importer of the merchandise manufactured by Industrie
Elettriche di Legnano, which firm a decree of the Italian Ministry
of Industry placed under "Extraordinary Administration" by a
government-appointed commissioner subsequent to the entry herein.
See Nuove Industrie Elettriche di Legnano S.p.A. v. United States,
14 CIT 334, 335, 739 F.Supp. 1567, 1569 (1990).
Court No. 94-07-00438                                              Page 3


(iv) that, under the terms of the government contract, the assess-

ment of additional duties triggered an increase in the contract

price of the merchandise, which, in turn, should have caused an

equivalent increase in its United States Price, resulting in a

determination that no antidumping duties were due; and (v) that the

United   States   have   been   unjustly    enriched   by   acquiring   the

equipment via the lowest public bid price and thereafter also

collecting antidumping duties thereon.


           In its answer to the amended complaint, the defendant

denies, among other allegations, that this Court of International

Trade has subject-matter jurisdiction over plaintiff's Counts III,

IV and V, pleading that those purported causes of action sound in

government contract, which is the statutory province of the United

States Court of Federal Claims.            As for the other two causes

posited by the plaintiff, the defendant denies that this court has

jurisdiction pursuant to 28 U.S.C. §1581(i) or that the plaintiff

has properly invoked jurisdiction under section 1581(a).


                                    A


           This joinder of issue has been followed by a motion for

(partial) summary judgment on the part of the plaintiff and a

cross-motion by the defendant for similar summary relief.               The

gravamen of the surety's motion is that the subject entry was li-

quidated by operation of law since Customs failed to provide notice
Court No. 94-07-00438                                        Page 4


of suspension of liquidation and that the Service's assessment of

the antidumping duties was erroneous in that it failed to follow

the Commerce Department's liquidation instructions. This motion is

accompanied by a required statement of material facts as to which

it is contended there is no genuine issue to be tried within the

meaning of then-applicable CIT Rule 56(i)2.    It states, in perti-

nent part:


           12. Section 1.1.6 of the "Specifications" identified
     in paragraph 11 above[3] provides that "the contract
     price" includes all applicable duties paid upon importa-
     tion.    Section 1.1.6 also provides that the contract
     price shall be increased by the amount of any duty
     increase assessed after the contract property is im-
     ported, resulting from any "statute, court decision,
     written ruling, or regulation", which requires the
     contractor (importer) to "pay or bear the burden" of such
     duty "or increase in the rate thereof" which would not
     otherwise have been payable on such transactions or
     property.

          13. Antidumping duties assessed on imported mer-
     chandise under 19 U.S.C. §1675[] constitute statutory
     "duties" and/or "increases" in the rate of duty, within
     the meaning of Section 1.1.6 of the "Specifications"
     identified . . . above. The Commerce Department's Final


     2
      This requirement of amended Rule 56 has been relettered (h),
effective May 1, 2000.
     3
       This statement (erroneously) has two preceding paragraphs
numbered 11, the first of which refers to a Solicitation DS-7371
that

     included a form issued by the Bureau of Reclamation,
     numbered 7-1481 (9-76) and entitled "Specifications,
     Division 1 - General Requirements".     Section 1.1.6 of
     these Specifications, entitled "Federal, State, and Local
     Taxes", discusses the affect of federal, state, and local
     taxes and duties on "the contract price".
Court No. 94-07-00438                                       Page 5



     Results in 52 Fed.Reg. 46,806, imposing antidumping duty
     margins on merchandise previously imported by Legnano,
     required Legnano, and the plaintiff as surety, to "pay or
     bear the burden" of the duty increase.

          14. The . . . Final Results . . . constitute[] a
     "written ruling" within the meaning of . . . Section
     1.1.6.

          15. Liquidation of the subject entry was suspended
     by statute in accordance with 19 U.S.C. §1675(a) (1982).

          16. On or about February 2, 1988, [] Customs . . .
     issued . . . Information Exchange ("C.I.E.") number N-
     169/70 (Supplement 13), setting forth the "Master List"
     and indicating the actual antidumping duty applicable to
     the entry in question was $292,638.12. . . .

          17. . . . Customs . . . liquidated the merchandise
     on June 10, 1988, together with interest on the antidump-
     ing duties . . . through the date of liquidation.

          18. Legnano never paid the antidumping duties in
     question, or any interest accruing thereon.

          19. The first demand made upon the . . . surety was
     November 4, 1988. Plaintiff filed a protest . . . on
     January 23, 1989 in order to challenge the demand . . ..

          20. In the Ruling dated March 22, 1994 . . ., the
     District Director of Customs (Seattle) granted plain-
     tiff's protest . . . with respect to the applicability of
     interest, pursuant to . . . Headquarters' decision on
     Application for Further Review dated March 8, 1994 (HQ
     224397), but denied plaintiff's protest with respect to
     the . . . antidumping duties. Customs determined in the
     1994 Ruling that Hanover's protest was timely filed.

          21. On or about April 7, 1994, plaintiff tendered
     and the . . . Service received payment in the amount due
     . . ..

          22. Defendant is the same entity which purchased
     the subject merchandise through its Department of
     Interior . . . at a price which the defendant determined
     to be dumped.

                             *   *   *
Court No. 94-07-00438                                       Page 6


          26. The "Master List" issued by the Treasury
     Department . . . directed . . . Customs . . . to notify
     . . . Service Headquarters of any "information on file
     which might affect the appraised value under the anti-
     dumping provisions." C.I.E. number N-169/70 (Supplement
     13).   If such information was on file, Customs was
     instructed to "suspend liquidation of the affected
     entries until a decision is made concerning the applica-
     bility of the additional information."


          27. Under the terms of the Contract, the assessment
     of additional duties, as evidenced by the assessment
     instructions in the Master List, triggered an increase in
     the contract price for the imported merchandise. This,
     in turn, should have caused an equivalent increase in the
     "United States Price" for the merchandise, resulting in
     a determination that no antidumping duties were due.


          28. . . . Customs had an obligation to follow the
     Master List instructions, and having been fully aware of
     the price adjustment clause of the Contract, the District
     Director of Customs (Seattle) should have notified . . .
     Headquarters and adjusted the United States Price of the
     goods to offset the amount of antidumping duties (and
     other duties) found to be due.


          29. Customs failed to appraise and liquidate the
     merchandise in accordance with the price adjustment
     clause in the Contract, and in accordance with the
     instructions from the Treasury Department (via the
     Commerce Department) contained in the "Master List".


          In its response to this statement, the defendant admits

paragraphs 15, 16, 21 and 26.   It admits paragraphs 17, 19, 20 and

28 in part.   Its denials of portions of those four paragraphs and

of the other paragraphs (11 (first), 12, 13, 14, 18, 22-24, 27 and

29, supra) in toto also aver that such contradiction does not

signify the existence of issues of material facts which would

preclude summary judgment, albeit in favor of the defendant.
Court No. 94-07-00438                                             Page 7


Defendant's own Statement of Additional Material Facts as to Which

There Is No Genuine Issue to be Tried is as follows:


          1. Plaintiff's searches for notices of suspension
     in connection with the subject entry were performed for
     the first time by (a) Michael M. Tracey in 1988, (b) Mary
     Beth Duquette (Myers) in 1994, and (c) Ronald Ritland on
     or about the date of his affidavit, July 28, 1998.

          2. Customs computer records indicate that notices
     of suspension were issued to plaintiff, as well as the
     importer of record, in November 1981, November 1982, and
     November 1983, at their respective proper addresses.

          3. At the time of entry, the importer of record
     submitted a bond to Customs in the amount of $358,000 to
     cover potential antidumping duty liability on the subject
     merchandise, pursuant to the antidumping finding in
     Treasury Decision 72-161.


          The plaintiff denies paragraphs 2 and 3, while admitting

in part and denying in part the first paragraph of this statement.


                                 II

          The   defendant   characterizes   as   "new"4   the   claim   in

plaintiff's summary-judgment motion that the assessment of the

antidumping duties by Customs was erroneous in that the Service

failed to follow the Commerce Department's liquidation instruc-

tions, and it proceeds to argue that this claim is not

     "related to the same administrative decision listed in
     section 514 of the Tariff Act of 1930 that was contested
     in the protest." See 28 U.S.C. § 2638. The legislative
     history of section 2638 reveals that any newly raised
     ground must fall within the same category as the decision
     contested in the protest. . . .


     4
       Defendant's Memorandum in Support of its Motion for Summary
Judgment, p. 25.
Court No. 94-07-00438                                                  Page 8


          Plainly, Hanover's new claim fails to meet the
     requirements of section 2638. Indeed, this new claim, in
     essence, challenges the underlying dumping determination;
     thus, this Court lacks jurisdiction over such claim.


Defendant's Memorandum, pp. 25-26 (other citations omitted).


          Of   course,   if   this   claim    were    indeed   aimed   at   the

underlying dumping determination, the court would readily concur

that it lacks jurisdiction to hear and decide such subject pursuant

to 28 U.S.C. §1581(a).    But this court is unable to conclude that

the claim actually does invoke section 1581(c) or a basis of

subject-matter   jurisdiction     other      than    that   pleaded    by   the

plaintiff, namely, 1581(a).


          That section requires that issues brought thereunder to

this Court of International Trade must have been properly protested

per 19 U.S.C. §1514 (1994), subsection (a) of which Title 19

section enumerates the grounds for protesting "decisions of the

Customs Service, including the legality of all orders and findings

entering into the same, as to", among others,

     . . . (5) the liquidation or reliquidation of an entry,
     or reconciliation as to the issues contained therein, or
     any modification thereof; . . ..


See, e.g., American Hi-Fi Int'l, Inc. v. United States, 19 CIT 1340

(1995), citing Mitsubishi Elec. America, Inc. v. United States, 44

F.3d 973 (Fed.Cir. 1994).     And plaintiff's protest appears to have

been pursuant to this subsection (a)(5) from the beginning, e.g.:
Court No. 94-07-00438                                             Page 9


     2.     We hereby protest the liquidation or reliquidation
            of the above entry with increased duties represent-
            ing antidumping duties. The surety herein did not
            issue a bond for the payment of antidumping duties
            covering this entry.

     3.     We protest liquidation or reliquidation with dump-
            ing duties reflected on the demand on surety in
            excess of the amount reflected in the assessment
            instructions for this entry in C.I.E. N-169/70. . .
            and interest calculated from an incorrect princi-
            pal . . . in violation of 19 U.S.C. §1673e(c)(3).

Defendant's Memorandum, Exhibit 6, third page.


            The part of the Customs Courts Act of 1980 which the

defendant cites, 28 U.S.C. §2638, provides that, in any civil

action

     in which the denial, in whole or in part, of a protest is
     a precondition to . . . commencement . . ., the court, by
     rule, may consider any new ground in support of the civil
     action if such new ground --

          (1) applies to the same merchandise that was the
     subject of the protest; and

          (2) is related to the same administrative decision
     listed in section 514 of the Tariff Act of 1930 that was
     contested in the protest.


To the extent plaintiff's contention that Customs failed to follow

Commerce's   instructions   is   genuinely   "new",   according   to   the

foregoing provision it need only apply to the same merchandise and

be related to the same Service decision, which clearly is the case

at bar.      That the reasons for contesting liquidation may be

different is not controlling, only that they lie within 19 U.S.C.

§1514(a).    See, e.g., C.L. Hutchins & Co. v. United States, 67

Cust.Ct. 60, C.D. 4252, 331 F.Supp. 318 (1971) (jurisdiction over
Court No. 94-07-00438                                                     Page 10


new   claim    upheld    as   within   the   same    category   of   protestable

decision).         Also, the question of jurisdiction under section

1581(a) turns on which agency makes the decision.                    See, e.g.,

American Hi-Fi Int'l, Inc. v. United States, supra.


              The defendant has no support for its position that the

"essence"     of    plaintiff's   "new"      claim   is   a   challenge   to   the

underlying dumping determination.            The plaintiff does not contest

that determination, rather that Customs liquidated the subject

entry without reporting the escalation clauses in the contract as

"any information on file which might affect the appraised values"

of the goods, as required by Commerce's liquidation instructions

themselves.        As has been pointed out, 19 U.S.C. §1514(a)

      contemplates that both legality and correctness of a
      liquidation be determined, at least initially, via the
      protest procedure. The wording . . . makes it clear that
      any challenge to the propriety of a liquidation . . .
      must be through this statute.


LG Elec. U.S.A., Inc. v. United States, 21 CIT 1421, 1426, 991

F.Supp. 668, 674 (1997) (emphasis in original), quoting United

States v. A.N. Deringer, 66 CCPA 50, 55, 593 F.2d 1015, 1020

(1979).   Indeed, "[j]urisdiction for actions challenging Customs'

failure to follow Commerce's actual liquidation instructions . . .

is found under 28 U.S.C. §1581(a)."            American Hi-Fi Int'l, Inc. v.

United States, 20 CIT 910, 916, 936 F.Supp. 1032, 1037 (1996); ABC

Int'l Traders, Inc. v. United States, 19 CIT 787, 791 (1995) (claim
Court No. 94-07-00438                                       Page 11


that Customs failed to follow Commerce's liquidation instructions

"may be brought before the court under 28 U.S.C. §1581(a) . . .

after denial of protests by Customs").


                               III


          The defendant takes the position that, under the Tariff

Act of 1930, as amended, notice to an importer of suspension of

liquidation of an entry was sufficient to forego liquidation at the

rate and amount of duty posited by it at the time of entry.     That

is, notice to a surety of such suspension was not necessary.


          The amended section of that act provided at the time of

entry herein:

     (a) Liquidation

          Except as provided in subsection (b) of this
     section, an entry of merchandise not liquidated within
     one year from:

          (1) the date of entry of such merchandise . . .


     shall be deemed liquidated at the rate of duty, value,
     quantity, and amount of duties asserted at the time of
     entry by the importer, his consignee, or agent. . . .

     (b) Extension

          The Secretary may extend the period in which to
     liquidate an entry by giving notice of such extension to
     the importer, his consignee, or agent in such form and
     manner as the Secretary shall prescribe in regulations,
     if . . .


          (2) liquidation is suspended as required by statute
     or court order; . . ..
Court No. 94-07-00438                                       Page 12

     (c) Notice of suspension

          If the liquidation of any entry is suspended, the
     Secretary shall, by regulation, require that notice of
     such suspension be provided to the importer or consignee
     concerned and to any authorized agent and surety of such
     importer or consignee.


19 U.S.C. §1504.   The regulations promulgated in conjunction with

this statute were as follows:

     § 159.11   Entries liquidated by operation of law.

          (a) Time limit generally.    Except as provided in
     §159.12, an entry not liquidated within 1 year from the
     date of entry of the merchandise . . . shall be deemed
     liquidated by operation of law at the rate of duty,
     value, quantity, and amount of duties asserted by the
     importer at the time of filing an entry summary for
     consumption in proper form . . ..

     § 159.12   Extension of time for liquidation.

          (a) Reasons -- (1) Extension. The district direct-
     or may extend the 1-year statutory period for liquidation
     for an additional period not to exceed 1 year if:

          (i) Information needed by Customs. Information
     needed by Customs for the proper appraisement or classi-
     fication of the merchandise is not available, or

           (ii) Importer's request. The importer requests an
     extension in writing before the statutory period expires
     and shows good cause why the extension should be granted.
     . . .

          (2) Suspension. The 1-year liquidation period may
     be suspended as required by statute or court order.


          (b) Notice of extension. If the district director
     extends the time for liquidation, as provided in para-
     graph (a)(1) of this section, he promptly shall notify
     the importer or the consignee and his agent and surety on
     Customs Form 4333-A, appropriately modified, that the
     time has been extended and the reasons for doing so.
Court No. 94-07-00438                                        Page 13


          (c) Notice of suspension. If the liquidation of an
     entry is suspended as required by statute or court order,
     as provided in paragraph (a)(2) of this section, the
     district director promptly shall notify the importer or
     the consignee and his agent and surety on Customs Form
     4333-A, appropriately modified, of the suspension.

19 C.F.R. §§ 159.11, 159.12 (1980).


          The duty of the court is to give effect to the intent of

Congress, and in doing so the first reference is to the literal

meaning of the words adopted.     E.g., Flora v. United States, 357

U.S. 63, 65 (1958).     See also Kelly v. Robinson, 479 U.S. 36, 43

(1986); Madison Galleries, Ltd. v. United States, 870 F.2d 627, 629

(Fed.Cir. 1989) (the "starting point in every case involving

construction of a statute is the language itself").   Moreover, the

inquiry

     must cease if the statutory language is unambiguous    and
     "the statutory scheme is coherent and consistent." .   . .
     The plainness or ambiguity of statutory language        is
     determined by reference to the language itself,        the
     specific context in which that language is used, and   the
     broader context of the statute as a whole.

Robinson v. Shell Oil Co., 519 U.S. 337, 340-41 (1997), quoting

United States v. Ron Pair Enterprises, Inc., 489 U.S. 235, 240

(1989), and citing Connecticut Nat'l Bank v. Germain, 503 U.S. 249,

253-54 (1992), Estate of Cowart v. Niklos Drilling Co., 505 U.S.

469, 477 (1992), and McCarthy v. Bronson, 500 U.S. 136, 139 (1991).

Interpretation must "not be guided by a single sentence or member

of a sentence" but by the "provisions of the whole law, and . . .

its object and policy."    Philbrook v. Glodgett, 421 U.S. 707, 713

(1975) (citations omitted).
Court No. 94-07-00438                                             Page 14


            The defendant contends that the plain meaning of section

1504, supra, supports its position that notice to a surety is not

required for an extension of liquidation due to suspension by

statute or court order.       Under the statute, liquidation is deemed

to occur one year from the date of entry, "[e]xcept as provided in

subsection (b)".    19 U.S.C. §1504(a).       Since that subsection does

not provide for sureties, even though suspension is one basis for

extension, the argument is that no notice was required in this

case.   See Defendant's Memorandum, pp. 7-10.


            On its face, however, the statute is not unambiguous, and

the court thus cannot rely exclusively on subsection (b)'s enacted

language.     In   such   a   circumstance,   "congressional   intent    is

particularly relevant."       United States v. Hohri, 482 U.S. 64, 71

(1987).   While section 1504(b), supra, does not specify notice to

sureties, subsection (c) explicitly requires notice to them of

suspension. In short, subsections (a), (b) and (c), read together,

are not perfectly "coherent and consistent", and the intent of

Congress cannot be gleaned solely from their erstwhile words.


            The history of section 1504 does reflect reasonably-clear

legislative intent. The primary justification for requiring notice

to sureties under subsection (c) was to minimize risk of loss.          See

H.R. Rep. No. 95-621, p. 25 (1977); S. Rep. No. 95-778, p. 32

(1978).   The latter report (of the Senate Finance Committee) noted

that prior to the enactment of the section there was no law re-
Court No. 94-07-00438                                               Page 15


quiring liquidation to be completed within a specific time period.

See S. Rep. No. 95-778, p. 31.    It stated that subsection (c) would

require notice of any suspension of liquidation to be given to the

importer or consignee concerned and to any authorized agent and

surety of such importer or consignee.         See id. at 32.   The report

explained that the law was designed to

      increase certainty in the customs process for importers,
      surety companies, and other third parties with a poten-
      tial liability relating to a customs transaction. Under
      the present law, an importer may learn years after goods
      have been imported and sold that additional duties are
      due, or may have deposited more money for estimated
      duties than are actually due but be unable to recover the
      excess for years as he awaits liquidation.         Surety
      companies, which are jointly liable with importers for
      additional duties, would be better able to control their
      liabilities. Sureties would also be better protected
      against losses resulting from the dissolution of their
      principals in instances where there has been undue delay
      in liquidating entries.


Id.   Similarly, the House Ways and Means Committee Report explains

that subsection (c)

      provides notice of any suspension of liquidation to the
      importer or consignee concerned and to any authorized
      agent and surety of such importer or consignee.      The
      addition of this subsection gives notice to the sure[t]y
      companies and other third parties that there is a po-
      tential for loss.

           Thus, the sureties can take appropriate measures
      upon receiving this notice to make sure that at least as
      to continuing activities, the risk of loss will be
      minimized.

H.R. Rep. No. 95-621, p. 25.      Indeed, for the Customs Service to

extend   the   liquidation   period   based   on   a   suspension   without

notifying the surety would seemingly diminish this legislative

purpose.
Court No. 94-07-00438                                           Page 16


           In addition to the legislative history, some case law

supports   an   interpretation   requiring   notice   to   sureties    of

suspension of liquidation.       In Old Republic Ins. Co. v. United

States, 10 CIT 589, 596, 645 F.Supp. 943, 950 (1986), for example,

the court held that notice to the surety was not required for a

valid extension when notice was given to the importer.                That

opinion noted different treatment of sureties with regard to

suspension, to wit:


          Suspension of liquidation is one ground upon which
     an extension may be granted.     . . . Pursuant to the
     statutory scheme, it appears that if liquidation has been
     suspended and the time for liquidation will be extended
     as a result, then the Secretary must tell the importer or
     consignee and their authorized agent and surety of the
     suspension, but need only notify the importer, the
     consignee, or agent of the extension. Thus, if the ex-
     tension does not involve a suspension there would be no
     requirement of notice to the surety under the statute.


10 CIT at 595 and 645 F.Supp. at 949, n. 14 (citation omitted).


           Finally in 1993, Congress amended the statute to require

notice to sureties of all extensions of liquidation. The report of

the House Ways and Means Committee commented on the version of

section 1504 at issue herein in explaining the reasons for the

legislative confirmation:


          With regard to notification of sureties, the bill
     corrects an omission in existing law and codifies
     existing administrative practice. Presently, Customs is
     only required to provide notice of an extension of liqui-
     dation of an entry to sureties when the liquidation is
     suspended by statute or court order. The statute does
     not require notice to be sent to the surety when liquida-
     tion is extended because Customs requires more informa-
Court No. 94-07-00438                                                    Page 17


      tion or when the importer requests an extension. The
      bill will now require notification of sureties in all
      three instances.

H.R. Rep. No. 103-361, pt. 1, p. 139 (1994) (emphasis added).

Obviously, this confirmed the view within Congress that the statute

as   it   existed   required    notice     to   sureties     of   suspension   of

liquidation.


            In sum, this court, in the light of the legislative

history (including the subsequent congressional confirmation), as

well as of the administrative approach and judicial interpretation,

concludes that Customs had to have notified the plaintiff of the

suspension    in    extending   the   period     of   time   within   which    to

liquidate Legnano's entry.


                                      IV

            The defendant asserts that the Service "gave notice of

the suspension to the surety".             Defendant's Memorandum, p. 7.

Hanover disagrees.      Each side now moves for summary judgment upon

its respective stance.      As a rule, such judgment

      shall   be   rendered  forthwith   if   the   pleadings,
      depositions, answers to interrogatories, and admissions
      on file, together with the affidavits, if any, show that
      there is no genuine issue as to any material fact and
      that the moving party is entitled to a judgment as a
      matter of law.

CIT Rule 56(c) (2000).      Summary judgment will not lie, however, if

the evidence is such that a reasonable trier of fact could return

a verdict for the nonmoving party.          See, e.g., Anderson v. Liberty

Lobby, Inc., 477 U.S. 242, 248 (1986).             Moreover, when there are
Court No. 94-07-00438                                           Page 18


cross-motions for summary judgment, a court must decide each motion

by interpreting the evidence submitted by the moving party in a

light most favorable to the opposing party.      See, e.g., Matsushita

Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986).


          In cases turning on the alleged giving of notice and lack

of receipt thereof, there is a presumption that

     letters or other communications, properly addressed,
     stamped, and deposited in the mail, are received by the
     addressee in due course. . . . That presumption is re-
     buttable by proof of non-receipt. . . .

          Where a notice is required to be given by Customs
     officials, the burden of going forward with the evidence
     initially falls upon the plaintiff because the notice is
     deemed to have been given by virtue of the presumption of
     regularity which attaches to official acts. However, the
     burden of proof then is on the Government because it is
     the Government's statutory responsibility to provide the
     notice. The proofs offered by a plaintiff at this point
     are directed toward negating the presumed delivery by way
     of evidence of non-receipt, non-issuance, or non-delivery
     of the notice. When the plaintiff has met this initial
     requirement, the burden of going forward shifts to the
     Government to establish that notice was given. . . .


Intra-Mar Shipping Corp. v. United States, 66 Cust.Ct. 3, 5-6, C.D.

4160 (1971) (citations omitted).       See also Int'l Cargo & Sur. Ins.

Co. v. United States, 15 CIT 541, 544, 779 F.Supp. 174, 177 (1991);

F.W. Myers & Co., Inc. v. United States, 6 CIT 215, 215-16, 574

F.Supp. 1064, 1065 (1983).

                                   A

          It has been held that an affidavit from a plaintiff

importer's record-keeper, stating that an extension notice had not

been received, was sufficient to rebut the presumption that notice
Court No. 94-07-00438                                                     Page 19


was in fact given.           See, e.g., Enron Oil & Transp. Co. v. United

States, 15 CIT 511 (1991), vacated and remanded on other grounds,

988 F.2d 130 (Fed.Cir. 1993); Int'l Cargo & Sur. Ins. Co. v. United

States, 15 CIT at 544, 779 F.Supp. at 177 ("The presumption is not

conclusive, and may be rebutted by a declaration or other evidence

indicating that notice was not received").


            Here, the plaintiff has submitted affidavits from the

Hanover employees and broker responsible for handling suspension

notices received from Customs.             The sum and substance of each

affiant is that he or she has no recollection of ever receiving or

reviewing    a    Notice     of   Suspension    of   Liquidation    for   Legnano

Electric    Corporation        entry   81-534208-9    and   that    The   Hanover

Insurance Company never received such a notice.                  See Plaintiff's

Summary Judgment Exhibit F (Affidavit of Michael M. Tracy, para.

10); Exhibit G (Affidavit of Jeannette Heroux, para. 6); Exhibit H

(Affidavit       of   Mary   Beth   Duquette,    para.    10);   and   Exhibit   I

(Affidavit of Ronald E. Ritland, para. 6).               In the absence of such

receipt, according to these affidavits, no suspension file was

established or subsequently located, whereupon the plaintiff claims

that "the reasonable inference which may be drawn from the absence

of a specific file is that . . . notice was not received."

Plaintiff's Response Brief, p. 16.


            The court finds that these submissions, at a minimum,

rebut the presumption that notice was in fact given.                      Cf. G.

Weissenberger, Federal Evidence, §803.37, p. 499 (3d ed. 1998):
Court No. 94-07-00438                                            Page 20


      . . . In a regularly conducted business activity where
      a person with personal knowledge systematically prepares
      and maintains records at a time proximate to the occur-
      rence of the event or transaction recorded, comprehen-
      siveness and accuracy may be assumed. Consequently, lack
      of a record concerning the event is persuasive evidence
      of its nonoccurrence or nonexistence.


                                  B

            Defendant's primary evidence is a computer printout from

the   Customs   extension/suspension   history   file,   accompanied   by

written attempts under oath by two Service employees to explain

standard operating procedures for printing, mailing, and recording

notices of suspension of the kind at issue herein.        One declarant

is of the

      opinion that if the history file has a record of an
      extension or suspension notice for an entry, then the
      notice was printed and mailed to the address shown on the
      record . . ..

Defendant's Memorandum, Exhibit 2 (Declaration of Roger Odom, para.

15). Similarly, the second declaration (by Arthur Versich) states:


      . . . [W]here, as here, a record of a notice is extracted
      from the history file, we know that the notice was
      formatted for printing and copied to the printer spool.
      These end-of-week programs and printing operations must
      be performed, and there is no doubt in my mind that where
      Customs has a record of a notice, the notice was printed
      at or about the time indicated by the run date.

Id., Exhibit 3, para. 23.


            The court finds these submissions by the defendant, at a

minimum, undermine plaintiff's motion for summary judgment on the
Court No. 94-07-00438                                               Page 21


issue of notice.      Cf. A.N. Deringer, Inc. v. United States, 20 CIT

978 (1996)(judgment entered for Customs after trial involving

similar notice printout and explanatory testimony).



                                    C

           Viewing this evidence submitted in defendant's motion in

a light most favorable to it, however, does not lead this court to

conclude that a reasonable trier of fact could not return a verdict

for the plaintiff.     On the other hand, the court is also not led by

plaintiff's motion to conclude that it could not find for the

defendant, given all the papers presented to date. In other words,

the dispositive question of notice, or lack thereof, herein is a

material matter which must be addressed at trial and subjected to

cross-examination, which has been said to be the surest test of

truth and a better security than the oath.


                                    V


           In furtherance of the foregoing discussion, defendant's

cross-motion for summary judgment must be denied, while plaintiff's

motion for (partial) summary judgment can be, and it hereby is,

granted, save the issue of the provision by Customs to, and of its

receipt   by,   The   Hanover   Insurance   Company   of   notice   of   the

suspension of liquidation of The Legnano Electric Corporation's

entry 81-534208-9, and also except for the issue of whether the

Service failed to follow the Commerce Department's liquidation
Court No. 94-07-00438                                        Page 22


instructions5, which matters must be resolved by trial.

           The parties are hereby directed to confer and prepare and

present a proposed pretrial order on or before June 29, 2001, by

which time a date for the trial will be set.

           So ordered.

Decided:   New York, New York
           May 16, 2001

                                ________________________________

                                               Judge




     5
       The plaintiff articulates its stance on this question as
follows:

          Once Commerce's review was completed, and . . . had
     issued the Master List setting forth its final de-
     termination, . . . Customs . . . was required to perform
     the ministerial task of carrying out the instructions in
     the Master List . . . [, which] did not merely instruct
     Customs to liquidate the entries and collect antidumping
     duties, but also required Customs officers to first make
     inquiry in their files concerning whether they had any
     information on hand which would have affected the
     appraisement of the transformers under the antidumping
     duty laws.     Customs officials at Seattle had such
     information; however, they failed to forward this
     information to Customs Headquarters and suspend liqui-
     dation, as directed, but instead proceeded directly to
     liquidation of the entry at bar. Had Customs correctly
     carried out the Master List instructions, the price
     escalation clauses of the contract -- directly relevant
     to the appraisement of the goods for antidumping purposes
     -- would presumably have been taken into account,
     eliminating the antidumping duty liability.      Customs'
     failure to carry out the Master List instructions,
     therefore, resulted in an improper liquidation and an
     incorrect and excessive assessment of antidumping duties.


Plaintiff's Memorandum, pp. 50-51 (emphasis in original).   Compare
Defendant's Memorandum, pp. 1-2, n. 1 and p. 23, n. 11.
