DOJ Says Surety Must Pay Bill Sent 8 Years After Entries Liquidated

CBP can still collect unpaid antidumping duties on a customs bond despite waiting nearly eight years after the relevant entries liquidated before demanding payment, the Justice Department said in a brief filed April 23. Aegis Security Insurance Co., which acted as surety on 10 entries of fresh garlic from China that was deemed liquidated 2006, says the statute of limitations had expired on the bond by the time CBP billed Aegis for the full continuous bond amount, $50,000, in 2014. “Because a customs bond is a contract, the [Federal Circuit] has held that a cause of action to enforce its obligations accrues when the terms of the bond are breached,” DOJ said. “In this case, the terms of the bond at issue were not breached by Aegis until CBP made a demand for payment against Aegis and Aegis failed to pay the duties within the time required by law.”

“The deemed liquidations did not signify a breach of the terms of the subject bond by Aegis,” DOJ said. “Indeed, the terms of the bond do not contemplate liquidation or a deemed liquidation as the event when Aegis must pay the outstanding duties owed on the bond and therefore cannot operate as the event when Aegis breached the bond,” DOJ said. Both Aegis and DOJ have filed cross-motions for summary judgment.