Anheuser-Busch Brewing Association v. United States/Opinion of the Court
This is an action for $27,000 for drawbacks on corks imported from Spain and used by claimant in bottling its beer, and entered for the benefit of drawback upon exportation under § 25 of the act of Congress entitled 'An Act to Reduce the Revenue and Equalize Duties on Imports and for Other Purposes,' APPROVED OCTOBER 1, 1890. THE SECTION Reads as foLLows:

'That where imported materials on which duties have been paid are used in the manufacture of articles manufactured or produced in the United States, there shall be allowed on the exportation of such articles a drawback equal in amount to the duties paid on the materials used, less one per centum of such duties. Provided, that when the articles exported are made in part from domestic materials, the imported materials, or the parts of the articles made from such materials, shall so appear in the completed articles that the quantity or measure thereof may be ascertained. And provided further, that the drawback on any article allowed under existing law shall be continued at the rate herein provided. That the imported materials used in the manufacture or production of articles entitled to drawback of custom duties when exported shall, in all cases where drawback of duties paid on such materials is claimed, be identified, the quantity of such materials used and the amount of duties paid thereon shall be ascertained, the facts of the manufacture or production of such articles in the United States and their exportation therefrom shall be determined, and the drawback due thereon shall be paid to the manufacturer, producer, or exporter, to the agent of either, or to the person to whom such manufacturer, producer, exporter, or agent shall in writing order such drawback paid, under such regulations as the Secretary of the Treasury shall prescribe.' [26 Stat. at L. 617, chap. 1244.]

The corks in question were, after their importation, subject to a special treatment, which, it is contended, caused them to be articles manufactured in the United States of 'imported materials' within the meaning of § 25. The court of claims decided against the contention and dismissed the petition. 41 Ct. Cl. 389.

The treatment to which the corks were subjected is detailed in finding 3, inserted in the margin.

In opposition to the judgment of the court of claims counsel have submitted many definitions of 'manufacture,' both as a noun and a verb, which, however applicable to the cases in which they were used, would be, we think, extended too far if made to cover the treatment detailed in finding 3 or to the corks after the treatment. The words of the statute are indeed so familiar in use and of meaning that they are confused by attempts at definition. Their first sense as used is fabrication or composition,-a new article is produced of which the imported material constitutes an ingredient or part. When we go further than this in explanation we are involved in refinements and in impracticable niceties. Manufacture implies a change, but every change is not manufacture, and yet every change in an article is the result of treatment, labor, and manipulation. But something more is necessary, as set forth and illustrated in Hartranft v. Wiegmann, 121 U.S. 609, 30 L. ed. 1012, 7 Sup. Ct. Rep. 1240. There must be transformation; a new and different article must emerge, 'having a distinctive name, character, or use.' This cannot be said of the corks in question. A cork put through the claimant's process is still a cork. The process is the preparation of the encasement of the beer, and assimilates this case to Joseph Schlitz Brewing Co. v. United States, 181 U.S. 584, 45 L. ed. 1013, 21 Sup. Ct. Rep. 740. There it was contended that bottles and corks in which beer is bottled and exported were 'imported materials used in the manufacture' of such beer, within the meaning of § 25. And it was pointed out-found by the court of claims-that the process of manufacturing beer for exportation was different from the process of manufacturing beer for domestic use, and the materials selected with greater care, in order that the bottled product might preserve purity under the conditions of transportation and change of climate. The process was detailed at length. It was decided, however, that such special process and treatment did not make the bottles and corks component parts of the beer when exported, as it was insisted they were. It is true that it was not contended in that case, as it is in this, that the corks or the bottles were articles manufactured in the United States of imported materials by reason of the special treatment to which they had been subjected, making them better or necessary for their purpose. That such a contention was possible under the statute did not occur to the brewing company. It does not appear in the statement of the case that the corks were subjected to any treatment, and appellant denies the application of the case by saying that 'the corks were not put through any process of manufacture whatever.' And yet it must have been necessary then, as the court of claims has found it to be, that, 'without the careful selection and thorough treatment of corks, beer cannot with safety be exported from the United States to foreign countries.' Of course the views of a litigant of his rights under a statute are not an absolute test of the views of a litigant in another case, but the Schlitz Brewing Case was one which may be supposed to have brought to consideration every practicable and legal problem under the statute, and if a cork by special treatment ceases to be a cork and becomes an article manufactured of cork, he change and the legal effect of it would have thrust themselves upon the notice of somebody. But passing this, there is force in the contention of the United States that the exportations were not of corks or bottles, but of beer, and therefore not articles exported within the meaning of § 25, entitled to a drawback. This phase of the case-indeed all phases of it-is ably dealt with in the opinion of the court of claims, and it would be unnecessary repetition to go over the argument or to review the cases.

Judgment affirmed. 

Notes