Court Opinion

ID: 9447096
Source: CourtListenerOpinion
Date Created: 2023-08-03 22:25:23.325395+00
Date Added: 2024-06-11T17:30:53.813670
License: Public Domain

MOORE, Circuit Judge.
Petitioner, Continental Can Company, Inc,1 petitions for review of an order of the Federal Maritime Board (“the Board”) made in a proceeding instituted by the Board on its own motion against petitioner. The issues were: (1) whether petitioner, in shipping by ocean carrier from the United States to Venezuela glass containers, called “packer’s turn-*314biers,” manufactured by it, miselassified the containers as “Bottles or Jars, Empty, Glass” instead of classifying them as “Tumblers”; and (2) whether petitioner miselassified the containers “knowingly and willfully.”2
The Board Examiner as his “Ultimate Findings of Facts and Conclusions” found in substance that packer’s tumblers are primarily empty glass jars used as glass containers for packaging; that they were ordered as containers by customers of petitioner engaged in the business of manufacturing and packing food products; and that the containers “may and often have a re-use as drinking glasses by the purchaser of the packaged product.” He concluded that these packer’s tumblers fell within the classification “Bottles or Jars, Empty, Glass” rather than “Tumblers.” In addition he found that the applicable tariffs published by the United States Atlantic & Gulf-Venezuela and Netherlands Antilles Conference (“the Conference”) were ambiguous and that ambiguous tariffs as a matter of law must be resolved against the carrier or the Conference. The Examiner recommended that petitioner’s motion that the proceeding be discontinued be granted.
The Board (two members) made additional findings of fact, rejected the Examiner’s conclusions and held that “it is obvious that respondent’s [petitioner here] classification was not correct.” It also found that petitioner “knowingly and wilfully violated section 16 of the Act.” The third member of the Board dissented, holding that a packer’s tumbler is “first and foremost a glass container — a jar — manufactured for the primary purpose of packaging food stuffs” and that its use as a drinking glass is “both secondary and incidental to its primary use.” He therefore concluded that the classification used by petitioner was proper and that at least the tariffs were ambiguous, justifying the selection of the Bottles and Jars tariff.
The facts are not in dispute, the case having been heard upon a stipulation of facts to which numerous exhibits were annexed. During the periods of time in which the shipments in question were made two tariffs (VEN-6 and VEN-7) were in effect. The classifications which might have been relevant3 to a shipper of such merchandise were:
“Item 1000 * * *
Tumblers, viz:
Glass * * and
“Item 115 * * *
Bottles or Jars; Empty, Glass (not Cut Glass or Vacuum), with or without their equipment of Caps, Covers, Stoppers, or Tops (not Nipples) * * * ”
The glassware being shipped consisted of glass containers. These containers were listed on a special price list issued by petitioner entitled “Packers Tumblers.” Petitioner also published separate catalogues and price lists for its glassware and drinking glasses, i. e., tumblers.
When shipping the containers to Venezuela petitioner had to choose between the classification “Bottles or Jars; Empty, Glass” and “Tumblers.” There was no special tariff for “packers tumblers.” At the time this decision had to be made there was a publication entitled “Glossary of Packaging Terms” published by the Packaging Institute, Inc. Therein “Packer’s tumbler” was defined as: “A jar, pressed, without neck, used for the packing of certain products and suitable for re-use for drinking pur*315poses.” The then eurrent Webster’s New International Dictionary, Second Edition, 1944, defined “tumbler” as a “drinking glass without a foot or stem * * *.” Furthermore, in interstate shipments by rail packer’s tumblers of the same type here in question were being placed in the category of bottles and jars for tariff purposes. With the knowledge that the “packer’s tumblers” were to be used as food containers and that such use as might be made of the container by the ultimate purchaser as a drinking glass was entirely secondary, petitioner was wholly justified in considering the containers as glass jars. They were not sold by petitioner or purchased by petitioner’s customers as drinking glasses. Nor would any housewife, desirous of acquiring drinking glasses for her dining table, be likely to do so by purchasing a variety of food products in containers subsequently to be elevated in status from the kitchen to the dining room after the family had eaten its way through a dozen jars of jelly, cheese, marmalade and peanut butter. The primary purpose of a packer’s tumbler, i. e., to contain food, is certain. Thereafter its fate is more uncertain and precarious. The erstwhile container may find its way into the garbage can, a picnic basket, the kitchen or the carpenter shop as a container of nails or paint brushes. In any event packer’s tumblers in their secondary stage are highly expendable. In direct contrast are drinking glasses (“tumblers”) which are usually not subjected to such experiences except fortuitously. Their classification is and should be entirely different.
In reaching their decisions, neither courts nor administrative bodies should ignore the realities of life and disregard common knowledge even though such knowledge may not have achieved a place within the purview of judicial notice. Many food items today are sold in containers which may ultimately be used for other purposes. This potential additional use is, as petitioner concedes 4 “a help in marketing the packaged product.” This possibility, however, does not change the container character ox the article shipped to the food packager. The packager is not buying tumblers nor reselling tumblers. Furthermore, packer’s tumblers must be specially manufactured so as to have a “finish” (the edge of the glass) to which the metal or other enclosing cap may be attached.
A few cardinal principles of tariff law suffice as a guide to the proper decision.
The “controlling use” determines the classification (Sonn v. Magone, 1895, 159 U.S. 417, 16 S.Ct. 67, 40 L.Ed. 203; Magone v. Heller, 1893, 150 U.S. 70, 14 S.Ct. 18, 37 L.Ed. 1001; Worthington v. Robbins, 1891, 139 U.S. 337, 11 S.Ct. 581, 35 L.Ed. 181; Maillard v. Lawrence, 1853, 16 How. 251, 14 L.Ed. 925; Sonken-Galamba Corporation v. Union Pac. R. Co., 10 Cir., 1944, 145 F.2d 808). A homely illustration of possible double use of articles was given by the Supreme Court over a hundred years ago in deciding that for duty purposes “shawls” were essentially “wearing apparel” despite the fact that they might be used for other purposes and that even a “stocking” retained its own character although temporarily demeaned into a lowly nightcap by its owner (16 How. 251, 261).
Ambiguity should be resolved against the carrier where “the tariff, having been written by the carrier, is vulnerable against the carrier if the tariff’s meaning is ambiguous" (Rubber Development Corp. v. Booth S.S. Co., et al., 2 U.S.M.C. 746, 748 (1945)).
Respondents have failed to adduce proof that the controlling use of the containers in question was, or was intended to be, a drinking glass or tumbler.
Assuming that a selection had to be made as to tariff classification between the two items, the question of choice at least is sufficiently close to present ambiguity.
*316Finally, there is no justification for holding that one classification is so clearly right and the other wrong that willful and knowing intent to misclassify is the only fair conclusion. Thus far a Trial Examiner who devotes himself to dealing with tariff problems has held petitioner’s classification to be correct. A Board member in a well-reasoned dissent has agreed. Two Board members believe otherwise. This court itself is not in agreement. This situation alone should clearly establish ambiguity. If choice has to be made between one Trial Examiner and one Board member as against two Board members, possibly guidance is to be received from the Supreme Court’s comment concerning the weight to be given to a Trial Examiner’s findings, namely, “that evidence supporting a conclusion may be less substantial when an impartial, experienced examiner who has observed the witnesses and lived with the case has drawn conclusions different from the Board’s than when he has reached the same conclusion” (Universal Camera Corp. v. National Labor Relations Board, 1951, 340 U.S. 474, 496, 71 S.Ct. 456, 469, 95 L.Ed. 456). Furthermore, ambiguity having been raised, the parties may well resolve these issues amongst themselves. At least they should have the opportunity. On the record as a whole, it cannot be said that the Board’s findings were supported by substantial evidence.
The order of the Board is set aside with directions to enter a new order to the effect that the proceeding against petitioner in Docket No. 823 be discontinued.

. In 1956 petitioner acquired the property of Hazel-Atlas Glass Company which was thereupon dissolved. Since September 1956 the business of Hazel-Atlas has been carried on as the Hazel-Atlas Glass Division of petitioner.

. Section. 16 of the Shipping Act, 1916, as amended, 46 U.S.C.A. § 815 reads as follows : “It shall be unlawful for any shipper, consignor, consignee, forwarder, broker, or other person, or any officer, agent, or employee thereof, knowingly and willfully, directly or indirectly, by means of false billing, false classification, false weighing, false report of weight, or by any other unjust or unfair device or means to obtain or attempt to obtain transportation by water for property at less than the rates or charges which would otherwise be applicable.”

. A third classification, “Item 1000 * * Glassware, N. O. S. * * * ” is conceded to be inapplicable.

. Petitioner’s brief, p. 8.