SEEBERGER
v.
HARDY; SPALDING V. YOUNG
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In disputes over the tariff valuation of imported opera glasses, the Supreme Court held that the value of component materials should be determined as they exist in their final condition when assembled into the completed article, rather than in their raw or intermediate states when first purchased by the manufacturer. The Court rejected the government's position that materials should be valued as they enter the manufacturer's hands because doing so would create arbitrary results depending on when each manufacturer purchased components and would subject valuations to raw material price fluctuations. The Court affirmed that Congress's 1890 tariff act provision requiring valuation "in its condition as found in the article" was merely declaratory of the correct legal rule.
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Mr. Justice Brown,
after .stating the case, delivered the opinion of the court.
These cases turn upon the question whether, -in estimating the value of the component materials of which d certain manufactured article is made, the value of the materials shall be taken in the raw and unmanufactured condition in which the manufacturer receives them, and before their respective values have been enhanced by work expended upon them, or in the condition that nothing remains to be done upon them by the manufacturer except putting them together to make the completed glass.
It appeared thé. manufacturer bought the metal in the shape of ingots, the shell in the natural form of mother-of-pearl, and the glasses' in the rough state in which they leave the cast. In neither case did the defendant introduce, any testimony. Nothing, therefore, appears in the record as to the value of the materials when purchased appropriate to each opera glass. It is evident that the question involved is one of considerable importance, as in some articles, the •raw material is the main cost, and in others, the labor. We think the theory of the importer was the correct one, and that the value of the materials should be taken at the time they are put together to form the completed glass. There are grave difficulties in making the estimation at any, other time. Whether, for instance, the shell shall be taken in its rough and uncleansed state as it comes from the animal, or after it has been cleaned ?md polished. Shall the glass be taken in its polished or unpolished state? Shall the. value of the metal be taken immediately after it is smelted or in a more advanced state of manufacture ? The position' óf the government seems to be that the value of the component materials should be taken as they go into the hands of the manufacturer. But one manufacturer may buy them in their rough state, another in their polished state, and another in their final state, ready to be put together in the form of a glass. The value of the raw material, as is shown in this case with respect to the shell and copper, may be subject to violent fluctuations. One manufacturer may have bought them at a high price,, another at a low price, both being held'a considerable time in stock. What price shall govern ? Thus, in appraising the value of a piece of furniture made of wood and silk plush, it would be obviously inequitable’ to take the value qf’ the lumber as it comes from the tree, and the silk from the worm or the spinner. The true rule would seem to be to take each of them as they go into the furniture.
While it may be true that to a certain extent the government may be at the mercy of the importers’ witnesses in estimating the value of the labor’ put upon the raw material as it goes into the completed article, this difficulty cannot be allowed to defeat the plain object of the enactment. Such difficulties were doubtless foreseen, as they did not appear to be of such, magnitude as to prevent Congress, in the act of 1890, -from providing particularly that “ the value of each component material shall be determined by .the ascertained value of such material in its condition as found in the article,” and thus putting, the question at rest. "We regard this as merely declaratory of the-law.
There is another point raised in this case, namely, that the opera glasses should be regarded as falling within the description of paragraph 216, as a manufacture composed wholly or in part of .metal, and, therefore, dutiable at 45 per cent ad valorem. As this question is not raised by the record, and no instruction was asked of the court based upon this interpretation, we do not find it necessary to express an opinion upon the subject.
The judgment of the court below in each case, is therefore,
Affirmed.
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Seeberger v. Schlesinger, 152 U.S. 581 (U.S. 1894)…ing and properly polished, costs more than the glass lenses and metal tubes and framework, when finished ready to be combined with said material to make a complete opera glass.” We held this method of computation to be correct in Seeberger v. Hardy, 150 U. S. 420, but .the question.-of the proper classification of the opera glasses was not considered in that case. We think the court was in error in holding that the articles in question were shells, whole or parts of, manufactured, as this clause was obvious…