De Lima v. Bidwell/Opinion of the Court

by Henry Billings Brown

United States Supreme Court

182 U.S. 1

De Lima  v.  Bidwell

 Argued: January 8, 9, 10, 11, 1901. --- Decided: May 27, 1901

This case raises the single question whether territory acquired by the United States by cession from a foreign power remains a 'foreign country' within the meaning of the tariff laws.

1. Did the question of jurisdiction raised by the demurrer involve only the jurisdiction of the circuit court as a Federal court, we should be obliged to say that the defendant was not in a position to make this claim, since the case was removed to the Federal court upon his own petition. It is no infringement upon the ancient maxim of the law that consent cannot confer jurisdiction, to hold that, where a party has procured the removal of a cause from a state court upon the ground that he is lawfully entitled to a trial in a Federal court, he is estopped to deny that such removal was lawful if the Federal court could take jurisdiction of the case, or that the Federal court did not have the same right to pass upon the questions at issue that the state court would have had if the cause had remained there. Defendant neither gains nor loses by the removal, and the case proceeds as if no such removal had taken place. Cowley v. Northern P. R. Co. 159 U.S. 569, 583, 40 L. ed. 263, 267, 16 Sup. Ct. Rep. 127; Mansfield, C. & L. M. R. Co. v. Swan, 111 U.S. 379, 28 L. ed. 462, 4 Sup. Ct. Rep. 510; Mexican Nat. R. Co. v. Davidson, 157 U.S. 201, 39 L. ed. 672, 15 Sup. Ct. Rep. 563.

This, however, is more a matter of words than of substance, as the defendant unquestionably has the right to show that the state court had no jurisdiction, or that the complaint did not set forth facts sufficient to constitute a cause of action. This we understand to be the substance of the defense in this connection.

By Rev. Stat. § 2931, it was enacted that the decision of the collector 'as to the rate and amount of duties' to be paid upon imported merchandise should be final and conclusive, unless the owner or agent entered a protest and within thirty days appealed therefrom to the Secretary of the Treasury; and, further, that the decision of the Secretary should be final and conclusive, unless suit were brought within ninety days after the decision of the Secretary. By Rev. Stat. § 3011, any person having made payment under such protest was given the right to bring an action at law and recover back any excess of duties so paid.

The law stood in this condition until June 10, 1890, when an act known as the customs administrative act was passed (26 Stat. at L. 131, chap. 407) by which the above sections (Rev. Stat. §§ 2931, 3011) were repealed and new regulations established, by which an appeal was given from the decision of the collector 'as to the rate and amount of duties chargeable upon imported merchandise,' if such duties were paid under protest, to a board of general appraisers whose decision should be final and conclusive (§ 14) 'as to the construction of the law and the facts respecting the classification of such merchandise and the rate of duty imposed thereon under such classification,' unless within thirty days one of the parties applied to the circuit court of the United States for a review of the questions of law and fact involved in such decision. § 15. It was further provided that the decision of such court should be final, unless the court were of opinion that the question involved was of such importance as to require a review by this court, which was given power to affirm, modify, or reverse the decision of the circuit court.

The effect of the customs administrative act was considered by this court in Re Fassett, 142 U.S. 479, 35 L. ed. 1087, 12 Sup. Ct. Rep. 295, in which we held that the decision of the collector that a yacht was an imported article might be reviewed upon a libel for possession filed by the owner, notwithstanding the customs administrative act. It was held that the review of the decision of the board of general appraisers, provided for by § 15 of that act, was limited to decisions of the board 'as to the construction of the law and the facts respecting the classification' of imported merchandise 'and the rate of duty imposed thereon under such classification,' and that it did not bring up for review the question whether an article be imported merchandise or not, nor, under § 15, is the ascertainment of that fact such a decision as is provided for. Said Mr. Justice Blatchford: 'Nor can the court of review pass upon any question which the collector had not original authority to determine. The collector had no authority to make any determination regarding any article which is not imported merchandise; and if the vessel in question here is not imported merchandise, the court of review would have no jurisdiction to determine any matter regarding that question, and could not determine the very fact which is in issue under the libel in the district court on which the rights of the libellant depend.'

'Under the customs administrative act the libellant, in order to have the benefit of proceedings thereunder, must concede that the vessel is imported merchandise, which is the very question put in contention under the libel, and must make entry of her as imported merchandise, with an invoice and a consular certificate to that effect.' It was held that the libel was properly filed.

The question involved in this case is not whether the sugars were importable articles under the tariff laws, but whether, coming as they did from a port alleged to be domestic, they were imported from a foreign country; in other words, whether they were imported at all as that word is defined in Woodruff v. Parham, 8 Wall. 123, 132, 19 L. ed. 382, 384. We think the decision in the Fassett Case is conclusive to the effect that, if the question be whether the sugars were imported or not, such question could not be raised before the board of general appraisers; and that whether they were imported merchandise for the reasons given in the Fassett Case that a vessel is not an importable article, or because the merchandise was not brought from a foreign country, is immaterial. In either case the article is not imported.

Conceding, then, that § 3011 has been repealed, and that no remedy exists under the customs administrative act, does it follow that no action whatever will lie? If there be an admitted wrong, the courts will look far to supply an adequate remedy. If an action lay at common law, the repeal of §§ 2931 and 3011, regulating proceedings in customs cases (that is, turning upon the classification of merchandise), to make way for another proceeding before the board of general appraisers in the same class of cases, did not destroy any right of action that might have existed as to other than customs cases; and the fact that by § 25 no collector shall be liable 'for or on account of any rulings or decisions as to the classification of said merchandise or the duties charged thereon, or the collection of any dues, charges, or duties on or on account of said merchandise,' or any other matter which the importer might have brought before the board of general appraisers, does not restrict the right which the owner of the merchandise might have against the collector in cases not falling within the customs administrative act. If the position of the government be correct, the plaintiff would be remediless; and if a collector should seize and hold for duties goods brought from New Orleans, or any other concededly domestic port, to New York, there would be no method of testing his right to make such seizure. It is hardly possible that the owner could be placed in this position. But we are not without authority upon this point.

The case of Elliott v. Swartwout, 10 Pet. 137, 9 L. ed. 373, was an action of assumpsit against the collector of the port of New York to recover certain duties upon goods alleged to have been improperly classified. It was held that as the payment was purely voluntary, by a mutual mistake of law, no action would lie to recover them back, although it would have been different if they had been paid under protest. Said Mr. Justice Thompson: 'Here, then, is the true distinction: when the money is paid voluntarily and by mistake to an agent, and he has paid it over to his principal, he cannot be made personally responsible; but if, before paying it over, he is apprised of the mistake, and required not to pay it over, he is personally liable.' If the payment of the money be accompanied by a notice to the collector that the duties charged are too high, and that the person paying intends to sue to recover back the amount erroneously paid, it was held that such action must lie 'unless the broad proposition can be maintained, that no action will lie against a collector to recover back an excess of duties paid him, but that recourse must be had to the government for redress.' The case recognized the fact that, with respect to money paid under a mistake of law, the collector stood in the position of an ordinary agent, and could be made personally liable in case the money were paid under protest.

This decision was made in 1836. Apparently in consequence of it an act was passed in 1839 requiring moneys collected for duties to be deposited to the credit of the Treasurer of the United States; and it was made the duty of the Secretary of the Treasury to draw his warrant upon the Treasurer in case he found more money had been paid to the collector than the law required. It was held by a majority of this court in Cary v. Curtis, 3 How. 236, 11 L. ed. 576, that this act precluded an action of assumpsit for money had and received against the collector for duties received by him, and that the act of 1839 furnished the sole remedy. It was said of that case in Arnson v. Murphy, 109 U.S. 238, 240, 27 L. ed. 920, 921, 3 Sup. Ct. Rep. 184, 186: 'Congress, being in session at the time that decision was announced, passed the explanatory act of February 26, 1845, which, by legislative construction of the act of 1839, restored to the claimant his right of action against the collector, but required the protest to be made in writing at the time of payment of the duties alleged to have been illegally exacted, and took from the Secretary of the Treasury the authority to refund conferred by the act of 1839 (5 Stat. at L. 349, 727, chap. 22). This act of 1845 was in force, as was decided in Barney v. Watson, 92 U.S. 449, 23 L. ed. 730; until repealed by implication by the act of June 30, 1864' (13 Stat. at L. 214, chap. 171, § 14), carried into the Revised Statutes as §§ 2931 and 3011. In the same case of Arnson v. Murphy, 109 U.S. 238, 27 L. ed. 920, 3 Sup. Ct. Rep. 184, it was decided that the common-law right of action against the collector to recover back duties illegally collected was taken away by statute, and a remedy given, based upon these sections, which was exclusive. The decision in Elliott v. Swartwout was recognized, but so far as respected customs cases (i. e., classification cases) was held to be superseded by the statutes. So in Schoenfeld v. Hendricks, 152 U.S. 691, 38 L. ed. 601, 14 Sup. Ct. Rep. 754, it was held that an action could not be maintained against the collector, either at common law or under the statutes, to recover duties alleged to have been exacted, in 1892, upon an importation of merchandise, the remedy given through the board of general appraisers being exclusive.

The criticism to be made upon the applicability of these cases is that they dealt only with imported merchandise and with the duties collected thereon, and have no reference whatever to exactions made by a collector, under color of the revenue laws, upon goods which have never been imported at all. With respect to these the collector stands as if, under color of his office, he had seized a ship or its equipment, or any other article not comprehended within the scope of the tariff laws. Had the sugars involved in this case been admittedly imported, that is, brought into New York from a confessedly foreign country, and the question had arisen whether they were dutiable, or belonged to the free list, the case would have fallen within the customs administrative act, since it would have turned upon a question of classification.

The fact that the collector may have deposited the money in the Treasury is no bar to a judgment against him, since Rev. Stat. § 989, provides that, in case of a recovery of any money exacted by him and paid into the treasury, if the court certifies that there was probable cause for the act done, no execution shall issue against him, but the amount of the judgment shall be paid out of the proper appropriation from the Treasury.

We are not impressed by the argument that, if the plaintiffs insisted that these sugars were not imported merchandise, they should have stood upon their rights, refused to enter the goods, and brought an action of replevin to recover their possession. It is true that, to prevent the seizure of the sugars, plaintiffs did enter them as imported merchandise; but any admission derivable from that fact is explained by their protest against the exaction of duties upon them as such. They waived nothing by taking this course. The collector lost nothing, since he was apprised of the course they would probably take. It is true that in the Fassett Case, 142 U.S. 479, 35 L. ed. 1087, 12 Sup. Ct. Rep. 295, the proceeding was by libel for possession of the vessel, which is analogous to an action of replevin at common law; but it would appear that Rev. Stat. § 934 would stand in the way of such a remedy here, since by that section 'all property taken or detained by any officer or other person under authority of any revenue law of the United States shall be irrepleviable, and shall be deemed to be in the custody of the law, and subject only to the orders and decrees of the courts of the United States having jurisdiction thereof.' If the words 'under authority of any revenue law' are to be construed as if they read 'under color of any revenue law,' it would seem that these sugars could not be made the subject of a replevin; but even conceding that replevin would lie, we consider it merely a choice of remedies, and that the plaintiffs were at liberty to waive the tort and proceed in assumpsit.

We are all of opinion that this action was properly brought.

2. Whether these cargoes of sugar were subject to duty depends solely upon the question whether Porto Rico was a 'foreign country' at the time the sugars were shipped, since the tariff act of July 24, 1897 (30 Stat. at L. 151, chap. 11), commonly known as the Dingley act, declares that 'there shall be levied, collected, and paid upon all articles imported from foreign countries' certain duties therein specified. A foreign country was defined by Mr. Chief Justice Marshall and Mr. Justice Story to be one exclusively within the sovereignty of a foreign nation, and without the sovereignty of the United States. The Eliza, 2 Gall. 4, Fed. Cas. No. 4,346; Taber v. United States, 1 Story, 1, Fed. Cas. No. 13,722; The Adventure, 1 Brock, 235, 241, Fed. Cas. No. 93.

The status of Porto Rico was this: The island had been for some months under military occupation by the United States as a conquered country, when, by the 2d article of the treaty of peace between the United States and Spain, signed December 10, 1898, and ratified April 11, 1899, Spain ceded to the United States the island of Porto Rico, which has ever since remained in our possession, and has been governed and administered by us. If the case depended solely upon these facts, and the question were broadly presented whether a country which had been ceded to us, the cession accepted, possession delivered and the island occupied and administered without interference by Spain or any other power, was a foreign country or domestic territory, it would seem that there could be as little hesitation in answering this question as there would be in determining the ownership of a house deeded in fee simple to a purchaser who had accepted the deed, gone into possession, paid taxes, and made improvements without let or hindrance from his vendor. But it is carnestly insisted by the government that it never could have been the intention of Congress to admit Porto Rico into a customs union with the United States, and that, while the island may be to a certain extent domestic territory, it still remains a 'foreign country' under the tariff laws, until Congress has embraced it within the general revenue system.

We shall consider this subject more at length hereafter, but for the present call attention to certain cases in this court and certain regulations of the executive departments which are supposed to favor this contention.

In United States v. Rice, 4 Wheat. 246, 4 L. ed. 562, which was an action of debt brought by the United States upon a bond for duties upon goods imported into Castine, in the district (now state) of Maine, during its temporary occupation by the British troops in the war of 1812, it was held the action would not lie, though Castine was subsequently evacuated by the enemy and restored to the United States. The court said that, by the military occupation of Castine, the enemy acquired a possession which enabled him to exercise the fullest rights of sovereignty; that the sovereignty of the United States was suspended, and our laws could be no longer rightfully enforced there, or be obligatory upon the inhabitants; that by the surrender the inhabitants passed under a temporary allegiance to the British government, and were only bound by the laws of that government, and that Castine was during this period to be deemed a foreign port; that goods brought there were subject to duties which the British government chose to impose, and were in no correct sense imported into the United States; and that the subsequent evacuation by the enemy did not change the character of the transaction, since the goods were not liable to American duties when imported. In that case the character of the port, as foreign or domestic was held to depend upon the question of actual occupation, and the right of the defendant determinable by the facts then existing, and, further, that the subsequent reoccupation of the port by the United States was ineffectual to change the right of the defendant or to vest a new right in the United States.

A case, somewhat to the converse of this, was that of Fleming v. Page, 9 How. 603, 13 L. ed. 276, which was an action against the collector at Philadelphia, to recover back duties upon merchandise imported from Tampico, in Mexico, during a temporary military occupation of that place by the United States. It was held that, although Tampico was within the military occupation of the United States, it had not ceased to be a foreign country, in the sense in which these words are used in the acts of Congress. In delivering the opinion of the court Mr. Chief Justice Taney observed: 'The United States, it is true, may extend its boundaries by conquest or treaty, and may demand the cession of territory as the condition of pease, in order to indemnify its citizens for the injuries they have suffered, or to reimburse the government for the expenses of the war. But this can be done only by the treaty-making power or the legislative authority, and is not a part of the power conferred upon the President by the declaration of war. . . . While it was occupied by our troops, they were in an enemy's country, and not in their own; the inhabitants were still foreigners and enemies, and owed to the United States nothing more than the submission and obedience, sometimes called temporary allegiance, which is due from a conquered enemy when he surrenders to a force which he is unable to resist.'

This was clearly a sufficient reason for disposing of the case adversely to the importer, but the learned Chief Justice proceeded to put the case upon another ground, that 'there was no act of Congress establishing a custom house at Tampico, nor authorizing the appointment of a collector; and consequently there was no officer of the United States authorized by law to grant the clearance and authenticate the coasting manifest of the cargo in the manner directed by law, where the voyage is from one port of the United States to another;' that the only collector was one appointed by the military commander, and that a coasting manifest granted by him could not be recognized in the United States as the document required by law when the vessel is engaged in the coasting trade, nor exempt the cargo from the payment of dutices. He states that this construction of the tariff laws had been uniformly given by the administrative department of the government, and cited the case of Florida, after it had been ceded to the United States and the military forces had taken possession of Pensacola: 'That is, that, although Florida had by cession actually become a part of the United States, and was in our possession, yet, under our revenue laws, its ports must be regarded as foreign until they were established as domestic by act of Congress. And it appears that this decision was sanctioned at the time by the Attorney General of the United States, the law officer of the government. And, although not so directly applicable to the case before us, yet the decisions of the Treasury Department in relation to Amelia island and certain ports in Louisiana, after that province had been ceded to the United States, were both made upon the same grounds. And in the later case, after a customhouse had been established by law [2 Stat. at L. 418, chap. 14], at New Orleans, the collector at that place was instructed to regard as foreign ports Baton Rouge and other settlements still in the possession of Spain, whether on the Mississippi, Iberville, or the seacoast. The department, in no instance that we are aware of, since the establishment of the government, has ever recognized a place in a newly acquired country as a domestic port from which the coasting trade might be carried on, unless it had been previously made so by act of Congress.'

While we see no reason to doubt the conclusion of the court, that the port of Tampico was still a foreign port, it is not perceived why the fact that there was no act of Congress establishing a customhouse there, or authorizing the appointment of a collector, should have prevented the collector appointed by the military commander from granting the usual documents required to be issued to a vessel engaged in the coasting trade. A collector, though appointed by a military commander, may be presumed to have the ordinary power of a collector under an act of Congress, with authority to grant clearances to ports within the United States, though, of course, he would have no power to make a domestic port of what was in reality a foreign port.

It is not intended to intimate that the cases of United States v. Rice and Fleming v. Page are not harmonious. In fact, they are perfectly consistent with each other. In the first case it was merely held that duties could not be collected upon goods brought into a domestic port during a temporary occupation by the enemy, though the enemy subsequently evacuated it; in the latter case, that the temporary military occupation by the United States of a foreign port did not make it a domestic port, and that goods imported into the United States from that port were still subject to duty. It would have been obviously unjust in the Rice Case to impose a duty upon goods which might already have paid a duty to the British commander. It would have been equally unjust in the Fleming Case to exempt the goods from duty by reason of our temporary occupation of the port without a formal cession of such port to the United States.

The next case is that of Cross v. Harrison, 16 How. 164, 14 L. ed. 889. This was an action of assumpsit to recover back moneys paid to Harrison while acting as collector at the port of San Francisco, for tonnage and duties upon merchandise imported from foreign countries into California between February 2, 1848,-the date of the treaty of peace between the United States and Mexico, and November 13, 1849, when the collector appointed by the President (according to an act of Congress passed March 3, 1849) entered upon his duties. Plaintiffs insisted that, until such collector had been appointed, California was and continued to be after the date of the treaty a foreign territory, and hence that no duties were payable as upon an importation into the United States. The plaintiffs proceeded upon the theory, stated in the dictum in Fleming v. Page, that duties had never been held to accrue to the United States in her newly acquired territories until provision was made by act of Congress for their collection, and that the revenue laws had always been held to speak only as to the United States and its territories existing at the time when the several acts were passed. The collector had been appointed by the military governor of California, and duties were assessed, after the treaty, according to the United States tariff act of 1846. In holding that these duties were properly assessed, Mr. Justice Wayne cited with apparent approval a despatch written by Mr. Buchanan, then Secretary of State, and a circular letter issued by the Secretary of the Treasury, Mr. Robert J. Walker, holding that from the necessities of the case the military government established in California did not cease to exist with the treaty of peace, but continued as a government de facto until Congress should provide a territorial government. 'The great law of necessity,' says Mr. Buchanan, 'justifies this conclusion. The consent of the people is irresistibly inferred from the fact that no civilized community could possibly desire to abrogate an existing government, when the alternative presented would be to place themselves in a state of anarchy, beyond the protection of all laws, and reduce them to the unhappy necessity of submitting to the dominion of the strongest.' These letters will be alluded to hereafter in treating of the action of the executive departments.

The court further held in this case that, 'after the ratification of the treaty, California became a part of the United States, or a ceded, conquered, territory;' that, 'as there is nothing differently stipulated in the treaty with respect to commerce, it became instantly bound and privileged by the laws which Congress had passed to raise a revenue from duties on imports and tonnage;' that (p. 193, L. ed. 901) 'the territory had been ceded as a conquest, and was to be preserved and governed as such until the sovereignty to which it had passed had legislated for it. That sovereignty was the United States, under the Constitution, by which power had been given to Congress to dispose of and make all needful rules and regulations respecting the territory or other property belonging to the United States. . . . That the civil government of California, organized as it was from a right of conquest, did not cease or become defunct in consequence of the signature of the treaty, or from its ratification, . . . and that, until Congress legislated for it, the duty upon foreign goods imported into San Francisco were legally demanded and lawfully received by Mr. Harrison.' To the objection that no collection districts had been established in California, and in apparent dissent from the views of the Chief Justice in Fleming v. Page, he added (p. 196, L. ed. 902): 'It was urged that our revenue laws covered only so much of the territory of the United States as had been divided into collection districts, and that out of them no authority had been given to prevent the landing of foreign goods or to charge duties upon them, though such landing had been made within the territorial limits of the United States. To this it may be successfully replied that collection districts and ports of entry are no more than designated localities within and at which Congress had extended a liberty of commerce in the United States, and that so much of its territory as was not within any collection district must be considered as having been withheld from that liberty. It is very well understood to be a part of the laws of nations that each nation may designate, upon its own terms, the ports and places within its territory for foreign commerce, and that any attempt to introduce foreign goods elsewhere, within its jurisdiction, is a violation of its sovereignty: It is not necessary that such should be declared in terms, or by any decree or enactment, the expressed allowances being the limit of the liberty given to foreigners to trade with such nation.'

The court also cited the cases of Louisiana and Florida, and seemed to take an entirely different view of the facts connected with the admission of those territories from what had been taken in Fleming v. Page. The opinion, which is quite a long one, establishes the three following propositions: (1) That under the war power the military governor of California was authorized to prescribe a scale of duties upon importations from foreign counties to San Francisco, and to collect the same through a collector appointed by himself, until the ratification of the treaty of peace. (2) That after such ratification duties were legally exacted under the tariff laws of the United States, which took effect immediately. (3) That the civil government established in California continued, from the necessities of the case, until Congress provided a territorial government.

It will be seen that the three propositions involve a recognition of the fact that California became domestic territory immediately upon the ratification of the treaty, or, to speak more accurately, as soon as this was officially known in California. The doctrine that a port ceded to and occupied by us does not lose its foreign character until Congress has acted and a collector is appointed was distinctly repudiated with the apparent acquiescence of Chief Justice Taney, who wrote the opinion in Fleming v. Page, and still remained the Chief Justice of the Court. The opinion does not involve directly the question at issue in this case: whether goods carried from a port in a ceded territory directly to New York are subject to duties, since the duties in Cross v. Harrison were exacted upon foreign goods imported into San Francisco as an American port; but it is impossible to escape the logical inference from that case that goods carried from San Francisco to New York after the ratification of the treaty would not be considered as imported from a foreign country.

The practice and rulings of the executive departments with respect to the status of newly acquired territories, prior to such status being settled by acts of Congress, is, with a single exception, strictly in line with the decision of this court in Cross v. Harrison, 16 How. 164, 14 L. ed. 889. The only possessions in connection with which the question has arisen are Louisiana, Florida, Texas, California, and Alaska. We take these up in their order.

Louisiana: By treaty between France and Spain, October 1, 1800 (8 Stat. at L. 202), His Catholic Majesty promised to cede to the French Republic the colony or province of Louisiana; and by treaty between the United States and the French Republic of April 30, 1803, France ceded to the United States, 'forever and in full sovereignty, the said territory with all its rights and appurtenances,' with a provision (art. 3) 'that the inhabitants of the ceded territory shall be incorporated in the Union of the United States, and admitted as soon as possible, according to the principles of the Federal Constitution.' This treaty was ratified October 21, 1803. Possession of the territory was not delivered by Spain to France until November 30, 1803, and by France to the United States, December 20, 1803. In the meantime, and on October 31, 1803, Congress authorized the President to take possession of the territory, and to administer it until Congress had further acted upon the subject. 2 Stat. at L. 245, chap. 1. On February 24, 1804, Congress passed another act (2 Stat. at L. 251, chap. 13), taking Louisiana within the customs union, and repealing certain special laws laying duties upon goods imported from that territory into the United States. This act was to take effect March 25, 1804. We are, then, concerned only with the interval between December 20, 1803, when possession was delivered to the United States, and March 25, 1804, when the act of February 24 took effect.

In a letter to President Jefferson of July 9, 1803, Mr. Gallatin, then Secretary of the Treasury, expressed the opinion that all the duties on exports, now payable at New Orleans by Spanish laws, should cease, and all articles the growth of Louisiana, which, when imported into the United States, now pay duty, should continue to pay the same, or at least such rates as would on the whole not affect the revenue. Writings of Gallatin, vol. 1, page 127.

The instructions of the Treasury Department with respect to this interval are contained in a letter by Mr. Gallatin to Governor Claiborne, who was about to start for his post as governor of the new province, under date of October 3, 1803, in which he says: 'It is understood that the existing duties on imports and exports, which by the Spanish law are now levied within the province, will continue until Congress shall have otherwise provided.' On November 14, 1803, Mr. Gallatin issued an order directed to Mr. Trist, who had been designated as collector of the port of New Orleans, as follows: 'You will also be pleased to observe, first, that the taxes and the duties to be collected under your direction are precisely the same which by the existing laws and regulations Louisiana were demandable under the Spanish government at the time of taking possession. . . . 10. That until otherwise provided for, the same duties are to be collected on the importation of goods in the Mississippi district, from New Orleans, and vice versa, as heretofore.'

On February 28, 1804, Mr. Gallatin issued a circular letter notifying the collectors of the passage of the act of February 24, and that the same would go into effect March 25, and 'that by the 3d section of said act so much of any law or laws imposing duties on the importations into the United States of goods, wares, and merchandise from New Orleans, which is the only port of entry in said territories, has been repealed.'

These instructions undoubtedly show that Mr. Gallatin treated New Orleans as a foreign port until Congress, by the act of February 24, 1804, admitted it within the customs union, and, so far, is an authority in favor of the position taken by the collector in this case. But it should be borne in mind in this connection, that his instructions to collect duties levied by the Spanish law upon foreign importations into New Orleans are manifestly inconsistent with the position subsequently taken by this court in Cross v. Harrison, 16 How. 164, 14 L. ed. 889, wherein it is said (p. 189, L. ed. 899) of the action of Mr. Harrison in California: 'That war tariff, however, was abandoned as soon as the military governor had received from Washington information of the exchange and ratification of the treaty with Mexico, and duties were afterwards levied in conformity with such as Congress had imposed upon foreign merchandise imported into the other ports of the United States, Upper California having been ceded by the treaty to the United States.' After saying that this action had been recognized by the President, Mr. Justice Wayne adds: 'We think it was a rightful and correct recognition under all the circumstances, and when we say rightful we mean that it was constitutional, although Congress had not passed an act to extend the collection of tonnage and import duties to the ports of California.' Indeed, it is quite evident from this case that the court took an entirely different view of the relations of California to the Union from that which had been taken by Mr. Gallatin as to Louisiana in his instructions to the collector of New Orleans.

Florida: Florida was ceded by Spain to the United States by treaty signed February 22, 1819, but not ratified until October 29, 1820. 8 Stat. at L. 252. By act of March 3, 1821 (3 Stat. at L. 637, chap. 39), Congress authorized the President to take possession of the Floridas and extend thereto the revenue laws of the United States. Possession of East Florida was not delivered until July 10, 1821; nor of West Florida until July 17. It is true that certain ports of Florida were in the military occupation of the United States prior to the actual delivery of possession by Spain, but the cession did not take effect until there had been a voluntary and complete delivery under the treaty. As the act extending the revenue laws to the Floridas was passed before the surrender of the province to the United States, there was no interval of time upon which the Treasury Department could act, the provinces, immediately upon the surrender, becoming subject to the act of March 3, 1821.

An opinion of Mr. Wirt, then Attorney General, of August 20, 1821, in the case of The Olive Branch, 1 Ops. Atty. Gen. 483, is instructive in this connection as illustrating the views of the administration. After stating that possession of East Florida was not delivered until July 17 (a mistake for July 10), he held that the cargo of The Olive Branch, which had cleared from the port of St. Augustine, July 14, was imported into Philadelphia from a foreign port or place, and consequently subject to duty, because possession had not been delivered, citing the case of The Fama, 5 C. Rob. 106, and adding: 'On the other hand, I apprehend that goods carried into a port of Florida before the delivery, remaining in port on shipboard until after the delivery, and then brought into the United States in the same vessel, or by transshipment into others, having been never entered in the Spanish customhouses, nor landed, nor the duties thereon paid or secured, but having continued all the while water-borne, would be subject to our revenue laws. . . . Our laws impose duties only on goods imported into the United States from some foreign port or place. If, there fore, in the case put, the importation be, in contemplation of law, an importation from the Floridas, the case is not within our laws, because at the time of the importation the Floridas were not foreign ports or places.' The learned Attorney General evidently took the view that the Floridas ceased to be a foreign country upon a delivery of possession under the treaty. In a subsequent letter of January 24, 1823 (5 Ops. Atty. Gen. 748), Mr. Wirt admits that he had been misled by the newspapers in the belief that East Florida had been surrendered prior to July 14, on which day The Olive Branch left St. Augustine, and recommended that the case be sent to the President, as it seemed to involve a dispute with Great Britain.

Texas: On March 1, 1845, Congress adopted a joint resolution consenting to the annexation of Texas upon certain conditions (5 Stat. at L. 797), but it was not until December 29, 1845, that it was formally admitted as a state. 9 State. at L. 108. In this interval, and on July 29, 1845, the Secretary of the Treasury issued a circular letter directing the collectors to collect duties upon all imports from Texas into the United States until Congress had further acted. Of course, there could be no question that Texas remained a foreign state until December 29, when she was formally admitted. The circular, therefore, is of no pertinence to the question here involved.

California: California was ceded by Mexico to the United States by treaty signed February 2, 1848, ratifications of which were exchanged May 30, 1848, and proclamation made July 4. 9 Stat. at L. 922. On March 3, 1849, an act was passed (9 Stat. at L. 400, chap. 112,) including San Francisco within one of the collection districts, and on November 13 the collector appointed by the President entered upon his duties. California had been in our military possession since August, 1847. There was, therefore, an interval of one year and nine months between the date of the treaty, February 3, 1848, and November 13, 1849, when the collector entered upon his duties.

On October 7, 1848, Mr. Buchanan, then Secretary of State, addressed a letter to Mr. Voorhees, already referred to, in which he states that, although the military government ceased to exist with the conclusion of the treaty of peace, it would continue with the presumed consent of the people until Congress should provide for them a territorial government, and then adds: 'This government de facto will, of course, exercise no power inconsistent with the provisions of the Constitution of the United States, which is the supreme law of the land. For this reason no import duties can be levied in California on articles the growth, produce, or manufacture of the United States, as no such duties can be imposed in any other part of our Union on the productions of California. Nor can new duties be charged in California upon such foreign productions as have already paid duties in any of our ports of entry, for the obvious reason that California is within the territory of the United States. I shall not enlarge upon this subject, however, as the Secretary of the Treasury will perform that duty.' Ex. Docs. 2d Sess. 30th Cong. vol. 1, p. 47.

Mr. Walker, then Secretary of the Treasury, did perform that duty in a circular letter of the same date to the collectors, in which he instructed the collectors as follows: 'First, All articles of the growth, produce, or manufacture of California, shipped therefrom at any time since the 30th day of May last' (the date when the ratifications were exchanged), 'are entitled to admission free of duty into all the ports of the United States and, second, all articles of the growth, produce, or manufacture of the United States are entitled to admission free of duty into California, as are also all foreign goods which are exempt from duty by the laws of Congress, or on which goods the duties prescribed by those laws have been paid to any collector of the United States previous to their introduction into California.' Ibid. p. 45. He adds that foreign goods imported into California, not paying duties there, will be subject to duty if shipped thence to any port or place in the United States. In a letter from Mr. Marcy, Secretary of War, to Colonel Mason, the military commander, of October 9, 1848, he uses the same language.

These letters are cited with approval by this court in Cross v. Harrison, 16 How. 184, 14 L. ed. 897; and although the question there related only to duties on godds imported from foreign countries, the tenor of the opinion, as already stated, is a virtual indorsement of the position taken by the executive departments. It is evident that the administration took an entirely different view of the law from what had been taken by Mr. Gallatin in his instructions regarding Louisiana, and established a practice which has never since been departed from, of treating territory ceded to the United States and occupied by its troops as being domestic, and not foreign, territory.

This correspondence with reference to California took place in 1848. The decision in Fleming v. Page, 9 How. 603, 13 L. ed. 276, was pronounced in 1850; yet as appears from the list of documents submitted by Mr. Johnson upon the argument of that case (p. 611, L. ed. 279) the attention of the court was not called to these instructions, though other letters and circulars were introduced bearing date of 1846 and 1847, as well as the treaty of peace of February 2, 1848. Had the correspondence above cited been laid before the court it is incredible that the Chief Justice should have said 'that the department in no instance that we are aware of, since the establishment of the government, has ever recognized a place in a newly acquired country as a domestic port, from which the coasting trade might be carried on, unless it had been previously made so by act of Congress.'

Alaska: This territory was ceded to us by Russia by treaty ratified June 20, 1867 (15 Stat. at L. 539), and possession was delivered to us at the same time. No act of Congress extending the revenue laws to Alaska and erecting a collection district was passed until July 27, 1868, 15 Stat. at L. 240, chap. 273. A period of thirteen months then elapsed before Alaska, was formally recognized by Congress as within the customs union, yet during that period goods from Alaska were, under a decision of the Secretary of the Treasury, admitted free of duty. By letter of Mr. McCullough, then Secretary of the Treasury, to the collector of the port of New York, dated April 6, 1868, he acknowledges receipt of a request from the Russian minister for the free entry of certain oil shipped from Sitka to San Francisco and reshipped to New York. He states: 'The request for the free entry of said oil was made on the ground that the oil was shipped from Sitka after the ratification of the treaty, by which the territory of Alaska became the property of the United States. The treaty in question was ratified on the 20th of June, 1867, and the collector at San Francisco has reported that the manifest of the vessel shows the oil to have been shipped from Alaska on the 6th day of July, 1867, and that the shipment consisted of fifty-two packages. Under these circumstances you are hereby authorized to admit the said fifty-two packages of oil free of duty.'

This position was indorsed by the Secretary of State, Mr. Seward, in a letter dated January 30, 1869, in which he said: 'I understand the decision of the Supreme Court in the case of Cross v. Harrison, 16 How. 164, 14 L. ed. 889, to declare its opinion that, upon the addition to the United States of new territory by conquest and cession, the acts regulating foreign commerce attach to and take effect within such territory ipso facto, and without any fresh act of legislation expressly giving such extension to the pre-existing laws. I can see no reason for a discrimination in this effect between acts regulating foreign commerce and the laws regulating intercourse with the Indian tribes.'

As showing the construction put upon this question by the legislative department, we need only to add that § 2 of the Foraker act makes a distinction between foreign countries and Porto Rico, by enacting that the same duties shall be paid upon 'all articles imported into Porto Rico from ports other than those of the United States, which are required by law to be collected upon articles imported into the United States from foreign countries.'

From this r esum e of the decisions of this court, the instructions of the executive departments, and the above act of Congress, it is evident that, from 1803, the date of Mr. Gallatin's letter, to the present the there is not a shred of authority, except the dictum in Fleming v. Page (practically overruled in Cross v. Harrison), for holding that a district ceded to and in the possession of the United States remains for any purpose a foreign country. Both these conditions must exist to produce a change of nationality for revenue purposes. Possession is not alone sufficient as was held in Fleming v. Page; nor is a treaty ceding such territory sufficient without a surrender of possession. Keene v. M'Donough, 8 Pet. 308, 8 L. ed. 955; Pollard v. Kibbe, 14 Pet. 353, 406, 10 L. ed. 490, 516; Hallett v. Doe ex dem. Hunt, 7 Ala. 899; The Fama, 5 C. Rob. 106. The practice of the executive departments, thus continued for more than half a century, is entitled to great weight, and should not be disregarded nor overturned except for cogent reasons, and unless it be clear that such construction be erroneous. United States v. Johnston, 124 U.S. 236, 31 L. ed. 389, 8 Sup. Ct. Rep. 446, and other cases cited.

But were this presented as an original question we should be impelled irresistibly to the same conclusion.

By article 2, § 2, of the Constitution, the President is given power, 'by and with the advice and consent of the Senate, to make treaties, provided two thirds of the senators present concur;' and by article 6, 'this Constitution and the laws of the United States which shall be made in pursuance thereof, and all treaties made or which shall be made under the authority of the United States, shall be the supreme law of the land.' It will be observed that no distinction is made as to the question of supremacy between laws and treaties, except that both are controlled by the Constitution. A law requires the assent of both houses of Congress, and, except in certain specified cases, the signature of the President. A treaty is negotiated and made by the President, with the concurrence of two thirds of the senators present, but each of them is the supreme law of the land.

As was said by Chief Justice Marshall in United States v. The Peggy, 1 Cranch, 103, 110, 2 L. ed. 49, 51: 'Where a treaty is the law of the land, and as such affects the rights of parties litigating in court, that treaty as much binds those rights, and is as much to be regarded by the court, as an act of Congress.' And in Foster v. Neilson, 2 Pet. 253, 314, 7 L. ed. 415, 435, he repeated this in substance: 'Our Constitution declares a treaty to be the law of the land. It is, consequently, to be regarded in courts of justice as equivalent to an act of the legislature, whenever it operates of itself without the aid of any legislative provision.' So in Whitney v. Robertson, 124 U.S. 190, 31 L. ed. 386, 8 Sup. Ct. Rep. 456: 'By the Constitution a treaty is placed on the same footing, and made of like obligation, with an act of legislation. Both are declared by that instrument to be the supreme law of the land, and no superior efficacy is given to either over the other. When the two relate to the same subject the courts will always endeavor to construe them so as to give effect to both, if that can be done without violating the language of either; but if the two are inconsistent, the one last in date will control the other, provided always that the stipulation of the treaty on the subject is self-executing.' To the same effect are the Cherokee Tobacco, 11 Wall. 616, sub nom. 207 Half Pound Papers Smoking Tobacco v. United States, 20 L. ed. 227, and the Head Money Cases, 112 U.S. 580, sub nom. Edye v. Robertson, 28 L. ed. 798, 5 Sup. Ct. Rep. 247.

One of the ordinary incidents of a treaty is the cession of territory. It is not too much to say it is the rule, rather than the exception, that a treaty of peace, following upon a war, provides for a cession of territory to the victorious party. It was said by Chief Justice Marshall in American Ins. Co. v. 356 Bales of Cotton, 1 Pet. 511, 542, 7 L. ed. 242, 255; 'The Constitution confers absolutely upon the government of the Union the powers of making war and of making treaties; consequently that government possesses the power of acquiring territory, either by conquest or by treaty.' The territory thus acquired is acquired as absolutely as if the annexation were made, as in the case of Texas and Hawaii, by an act of Congress.

It follows from this that by the ratification of the treaty of Paris the island became territory of the United States, although not an organized territory in the technical sense of the word.

It is true Mr. Chief Justice Taney held in Scott v. Sanford, 19 How. 393, 15 L. ed. 691, that the territorial clause of the Constitution was confined, and intended to be confined, to the territory which at that time belonged to or was claimed by the United States, and was within their boundaries as settled by the treaty with Great Britain, and was not intended to apply to territory subsequently acquired. He seemed to differ in this construction from Chief Justice Marshall in American Ins. Co. v. 356 Bales of Cotton, 1 Pet. 511, 542, 7 L. ed. 242, 255, who in speaking of Florida before it became a state, remarked that it continued to be a territory of the United States, governed by the territorial clause of the Constitution.

But whatever be the source of this power, its uninterrupted exercise by Congress for a century, and the repeated declarations of this court, have settled the law that the right to acquire territory involves the right to govern and dispose of it. That was stated by Chief Justice Taney in the Dred Scott Case. In the more recent case of National Bank v. Yankton County, 101 U.S. 129, 25 L. ed. 1046, it was said by Mr. Chief Justice Waite that Congress 'has full and complete legislative authority over the people of the territories and all the departments of the territorial governments. It may do for the territories what the people, under the Constitution of the United States, may do for the states.' Indeed, it is scarcely too much to say that there has not been a session of Congress since the territory of Louisiana was purchased, that that body has not enacted legislation based upon the assumed authority to govern and control the territories. It is an authority which arises, not necessarily from the territorial clause of the Constitution, but from the necessities of the case, and from the inability of the states to act upon the subject. Under this power Congress may deal with territory acquired by treaty; may administer its government as it does that of the District of Columbia; it may organize a local territorial government; it may admit it as a state upon an equality with other states; it may sell its public lands to individual citizens, or may donate them as homesteads to actual settlers. In short, when once acquired by treaty, it belongs to the United States, and is subject to the disposition of Congress.

Territory thus acquired can remain a foreign country under the tariff laws only upon one or two theories: Either that the word 'foreign' applies to such countries as were foreign at the time the statute was enacted, notwithstanding any subsequent change in their condition, or that they remain foreign under the tariff laws until Congress has formally embraced them within the customs union of the states. The first theory is obviously untenable. While a statute is presumed to speak from the time of its enactment, it embraces all such persons or things as subsequently fall within its scope, and ceases to apply to such as thereafter fall without its scope. Thus, a statute forbidding the sale of liquors to minors applies, not only to minors in existence at the time the statute was enacted, but to all who are subsequently born, and ceases to apply to such as thereafter reach their majority. So, when the Constitution of the United States declares in art. 1, § 10, that the state shall not do certain things, this declaration operates, not only upon the thirteen original states, but upon all who subsequently become such; and when Congress places certain restrictions upon the powers of a territorial legislature, such restrictions cease to operate the moment such territory is admitted as a state. By parity of reasoning a country ceases to be foreign the instant it becomes domestic. So, too, if Congress saw fit to cede one of its newly acquired territories (even assuming that it had the right to do so) to a foreign power, there could be no doubt that from the day of such cession and the delivery of possession such territory would become a foreign country, and be reinstated as such under the tariff law. Certainly no act of Congress would be necessary in such case to declare that the laws of the United States had ceased to apply to it.

The theory that a country remains foreign with respect to the tariff laws until Congress has acted by embracing it within the customs union presupposes that a country may be domestic for one purpose and foreign for another. It may undoubtedly become necessary, for the adequate administration of a domestic territory, to pass a special act providing the proper machinery and officers, as the President would have no authority, except under the war power, to administer it himself; but no act is necessary to make it domestic territory if once it has been ceded to the United States. We express no opinion as to whether Congress is bound to appropriate the money to pay for it. This has been much discussed by writers upon constitutional law, but it is not necessary to consider it in this case, as Congress made prompt appropriation of the money stipulated in the treaty. This theory also presupposes that territory may be held indefinitely by the United States; that it may be treated in every particular, except for tariff purposes, as domestic territory; that laws may be enacted and enforced by officers of the United States sent there for that purpose; that insurrections may be suppressed, wars carried on, revenues collected, taxes imposed; in short, that everything may be done which a government can do within its own boundaries, and yet that the territory may still remain a foreign country. That this state of things may continue for years, for a century even, but that until Congress enacts otherwise, it still remains a foreign country. To hold that this can be done as matter of law we deem to be pure judicial legislation. We find no warrant for it in the Constitution or in the powers conferred upon this court. It is true the nonaction of Congress may occasion a temporary inconvenience; but it does not follow that courts of justice are authorized to remedy it by inverting the ordinary meaning of words.

If an act of Congress be necessary to convert a foreign country into domestic territory, the question at once suggests itself, What is the character of the legislation demanded for this purpose? Will an act appropriating money for its purchase be sufficient? Apparently not. Will an act appropriating the duties collected upon imports to and from such country for the benefit of its government be sufficient? Apparently not. Will acts making appropriations for its postal service, for the establishment of lighthouses, for the maintenance of quarantine stations, for erecting public buildings, have that effect? Will an act establishing a complete local government, but with the reservation of a right to collect duties upon commerce, be adequate for that purpose? None of these, nor all together, will be sufficient, if the contention of the government be sound, since acts embracing all these provisions have been passed in connection with Porto Rico, and it is insisted that it is still a foreign country within the meaning of the tariff laws. We are unable to acquiesce in this assumption that a territory may be at the same time both foreign and domestic.

A single further point remains to be considered: It is insisted that an act of Congress, passed March 24, 1900 (31 Stat. at L. 51), applying for the benefit of Porto Rico the amount of the customs revenue received on importations by the United States from Porto Rico since the evacuation of Porto Rico by the Spanish forces, October 18, 1898, to January 1, 1900, together with any further customs revenues collected on importations from Porto Rico since January 1, 1900, or that shall hereafter be collected under existing law, is a recognition by Congress of the right to collect such duties as upon importations from a foreign country, and a recognition of the fact that Porto Rico continued to be a foreign country until Congress embraced it within the customs union. It may be seriously questioned whether this is anything more than a recognition of the fact that there were moneys in the Treasury not subject to existing appropriation laws. Perhaps we may go further, and say that, so far as these duties were paid voluntarily and without protest, the legality of the payment was intended to be recognized; but it can clearly have no retroactive effect, as to moneys theretofore paid under protest, for which an action to recover back had already been brought. As the action in this case was brought March 13, 1900, eleven days before the act was passed, the right to recover the money sued for could not be taken away by a subsequent act of Congress. Plaintiffs sue in assumpsit for money which the collector has in his hands, justly and equitably belonging to them. To say that Congress could by a subsequent act deprive them of the right to prosecute this action would be beyond its power. In any event, it should not be interpreted so as to make it retroactive. Kennett's Petition, 24 N. H. 139; Alter's Appeal, 67 Pa. 341, 5 Am. Rep. 433; Norman v. Heist, 5 Watts & S. 171, 40 Am. Dec. 493; Donovan v. Pitcher, 53 Ala. 411, 25 Am. Rep. 634; Palairet's Appeal, 67 Pa. 479, 5 Am. Rep. 450; State use of Methodist Episcopal Church v. Warren, 28 Md. 338.

We are therefore of opinion that at the time these duties were levied Porto Rico was not a foreign country within the meaning of the tariff laws, but a territory of the United States, that the duties were illegally exacted, and that the plaintiffs are entitled to recover them back.

The judgment of the Circuit Court for the Southern District of New York is therefore reversed, and the case remanded to that court for further proceedings in consonance with this opinion.

Mr. Justice McKenna, with whom concurred Mr. Justice Shiras and Mr. Justice White, dissenting:

Notes