United States v. City of New Britain, 347 U.S. 81 (1954)
United States v. City of New Britain
No. 92
Argued December 1, 1953
Decided February 1, 1954
347 U.S. 81
CERTIORARI TO THE SUPREME COURT OF ERRORS OF CONNECTICUT
Syllabus
dg:syll*
Syllabus
Foreclosure sales under two mortgages on real estate of a delinquent taxpayer in Connecticut produced less than enough to satisfy all claims, which included a federal lien created by § 3670 of the Internal Revenue Code for unpaid withholding and unemployment taxes and insurance contribution and a City’s liens for delinquent real estate taxes and war rent. Connecticut laws provide that real estate tax liens "shall take precedence of all transfers and incumbrances" in any manner affecting the property subject to the lien, and that water-rent liens take "precedence over all other liens or incumbrances except taxes" on the property subject to the liens. The record did not establish that the taxpayer was insolvent.
Held: since § 3670 of the Internal Revenue Code does not in terms confer priority upon the lien created thereby, and no other federal statute does so in the circumstances of this case, the priority of each statutory lien here involved must depend on the time it attached to the property in question and became choate. Pp. 82-88.
(a) The City gains no priority by the fact that its liens are specific, while the federal liens are general. P. 84.
(b) United States v. Security Trust & Savings Bank, 340 U.S. 47, and United States v. Gilbert Associates, 345 U.S. 361, distinguished. Pp. 86-87.
(c) That § 3672 of the Internal Revenue Code makes the federal lien invalid as to the prior recorded mortgages and the judgment in this case, and that the mortgagee could have paid the delinquent real estate taxes and water rent with the amount so paid becoming part of the mortgage debt covered by the mortgage lien, does not require a different result. Pp. 87-88.
139 Conn. 363, 94 A.2d 10, judgment vacated and cause remanded.
A Connecticut state court directed that, in the distribution of the proceeds of certain mortgage foreclosure sales of real estate, certain municipal tax and water rent liens should take priority over certain federal tax liens. The Supreme Court of Errors affirmed. 139 Conn. 363, 94 A. 2d 10. This Court granted certiorari. 346 U.S. 809. Judgment vacated and cause remanded, p. 88.