UNITED STATES v. SECURITY TRUST & SAVINGS BANK, EXECUTOR, ET AL.
Nos. 10, 11, 12 and 13
Supreme Court of the United States
Argued October 16, 1950. Decided November 13, 1950.
340 U.S. 47
Thomas M. Hamilton submitted on the record for respondents.
MR. JUSTICE MINTON delivered the opinion of the Court.
The question presented here is whether a tax lien of the United States is prior in right to an attachment lien where the federal tax lien was recorded subsequent to the date of the attachment lien but prior to the date the attaching creditor obtained judgment.
On October 17, 1946, Wilton M. Morrison sued George and Genell Styliano on an unsecured note. Pursuant to
Subsequently, four suits were brought in the Superior Court of San Diego County involving the four parcels of land upon which Morrison had procured the attachment. Morrison and the United States were made parties defendant in each of these suits. The first suit was brought to quiet title to one of the parcels of real estate. The Stylianos had sold this parcel to the plaintiffs of the suit, who paid the balance of the purchase price into court. The other three suits were to foreclose separate mortgages on the other three parcels. The Superior Court ordered the balance of the purchase price and any surplus
The District Court of Appeal for the Fourth Appellate District affirmed. 93 Cal. App. 2d 608, 209 P. 2d 657. The Supreme Court of California declined to hear the case, and we granted certiorari. 339 U. S. 947.4 The four cases were consolidated below for purposes of appeal, and Morrison‘s claims of priority were treated as a single issue. They are treated here in the same manner.
The effect of a lien in relation to a provision of federal law for the collection of debts owing the United States is always a federal question. Hence, although a state court‘s classification of a lien as specific and perfected is
Nor can the doctrine of relation back—which by process of judicial reasoning merges the attachment lien in the judgment and relates the judgment lien back to the date of attachment—operate to destroy the realities of the situation. When the tax liens of the United States were recorded, Morrison did not have a judgment lien. He had a mere “caveat of a more perfect lien to come.” New York v. Maclay, 288 U. S. 290, 294.
The liens asserted by the United States stem from 53 Stat. 448, 449,
In cases involving a kindred matter, i. e., the federal priority under
Reversed.
MR. JUSTICE JACKSON, concurring.
I am persuaded that we are required to hold the tax lien of the Government superior to the California attachment. While we should accept the law of California as
United States v. Snyder, 149 U. S. 210 (1893), was decided at a time when the forerunner of the present statute, § 3186 of the Revised Statutes as amended by § 3 of the Act of March 1, 1879, provided:
“If any person liable to pay any tax neglects or refuses to pay the same after demand, the amount shall be a lien in favor of the United States from the time when the assessment-list was received by the collector, except when otherwise provided, until paid, with the interest, penalties, and costs that may accrue in addition thereto, upon all property and rights to property belonging to such person.” 20 Stat. 327, 331.
The Snyder case held, in interpreting the above statute along with Art. I, § 8 of the Constitution, that the lien created by that statute was a valid binding lien even against a bona fide purchaser for value without knowledge or notice of the existence of such a lien.
Thereafter the statute was amended and a proviso added which said: “. . . That such lien shall not be valid as against any mortgagee, purchaser, or judgment creditor until notice of such lien shall be filed by the collector . . .” in the appropriate place for filing. 37 Stat. 1016. The House Report accompanying the proposed amendment, H. R. Rep. No. 1018, 62d Cong., 2d Sess. 2 (1912), said in part, after citing the above case:
“. . . the lien is so comprehensive that it covers all the property and rights to property of the delinquent situated anywhere in the United States, and any person taking title to real estate is subjected to the
impossible task of ascertaining whether any person, who has at any time owned the real estate in question, has been delinquent in the payment of the taxes referred to while the owner of the real estate in question. The business carried on under the internal-revenue law may be at a great distance from the property affected by this secret lien, but this will not relieve the property from the lien.”
In 1938, United States v. Rosenfield, 26 F. Supp. 433 (D. C. E. D. Mich., S. D.), held that a bona fide purchaser for value of shares of stock from a seller against whom notice of lien for federal income taxes had been duly filed prior to the sale, took subject to the lien even though the purchaser did not have notice or knowledge of such lien. As a direct result of this decision, the statute was again amended, this time to include pledgees and the exception in case of securities as now found in
“. . . While it is true that the filing of the notice of the tax lien may constitute notice in the case of real property, it is inequitable for the statute to provide that it constitutes notice as regards securities. . . . An attempt to enforce such liens on recorded notice would in many cases impair the negotiability of securities and seriously interfere with business transactions. . . .”
My conclusion from this history is that the statute excludes from the provisions of this secret lien those types of interests which it specifically included in the statute and no others.