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Tax Law Enforcement

Tax Law Enforcement


Types of Courts. The English legal system had several different sets of courts, each with its own rules of procedure and each dealing with a particular range of subjects. Most civil suits and criminal prosecutions were conducted in common-law courts, with trial by jury. These were familiar to many people in the colonies, as they sat in most places; other more-specialized courts with no juries were less well known. Admiralty courts handled controversies relating to maritime commerce, seamens wages, and violations of the trade and navigation laws. Until the late 1760s there was only one admiralty court for the American colonies, and it sat in Halifax, Nova Scotia. It had little impact outside the area of international trade or shipboard controversies. However, this court became a focal point in the developing conflict between the colonies and Britain.

Sugar Act. The Sugar Act of 1764 was designed to reorganize the colonial empire. The act set new customs procedures for intercolonial shipping, requiring shipping documents and other papers to be issued by customs officers. These documents had long been required in international trade, but for colonial merchants trading with the other colonies, the burdensome new paperwork served as an annoying imposition and, worse, threatened severe penalties for violations of these new laws. The Sugar Act extended the Halifax admiralty courts jurisdiction to any offense charged under the navigation, trade, customs, or revenue laws. This court would also have jurisdiction over all cases arising under the Stamp Act. Halifax was not a convenient location for a court to hear these cases. The Townshend Acts of 1767 added courts in three more cities: Boston, Philadelphia, and Charleston.

Penalties and Rewards. Penalties for violating customs regulations were severe, often including forfeiture of the vessel and the cargo. In admiralty court it was up to the owner of the ship or the property to prove his innocence rather than up to the prosecution to prove his guilt. Once a ship or its cargo (even if unloaded) were seized, the property belonged to the Crown unless the claimant could prove that he had not violated the law. The Sugar Act required the defendant to pay court costs, even if he was found innocent. Along with stiff penalties the Sugar Act offered significant rewards. The person who reported a violation would receive one-third of a seized ships value; the governor of the colony where the seizure was made received one-third; and the remaining one-third went to the imperial treasury. The informers reward, coupled with the difficulty an owner faced in trying to reclaim seized property, amounted to a license for extortion. The 1768 prosecution of John Hancock shows the effect these new duties and trade rules, and the abuses they made possible, had on the colonists.

Liberty. Hancock was a prosperous Boston ship owner and merchant. However, his outspoken public stands against Parliamentary tax policies and the various trade and revenue enactments incurred the wrath of the Massachusetts royal governor. In June 1768 customs officials, responding to a tip that Hancock was violating the Sugar Act, searched his ship, Liberty. Charging Hancock with violating the customs laws, authorities seized the ship and sold its cargo, dividing the proceeds among themselves. A criminal prosecution against Hancock in admiralty court followed. He was arrested and required to post an excessive bail. Witnesses against Hancock gave written depositions and were not required to testify in court. One individual was even given a government job while the case was still pending. After the defense had rested its case, new prosecution witnesses testified in the judges chambers. The case dragged on for five months and was extensively reported in the newspapers. Apparently officials in London were finally embarrassed by the abuse of the judicial process, and the criminal case was abruptly dismissed in March 1769. The impact of the case was that it demonstrated to the colonists the types of abuses that resulted when the customs policy was enforced

by self-interested officials and that maritime laws could be used to stifle political dissent.


Laurence M. Friedman, A History of American Law (New York: Simon & Schuster, 1985);

Lawrence Henry Gipson, The Coming of the Revolution, 1763-1775 (New York: Harper, 1954).

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