United States v. Scovil, 348 U.S. 218 (1955)
Uploaded by
Scribd Government DocsUnited States v. Scovil, 348 U.S. 218 (1955)
Uploaded by
Scribd Government Docs348 U.S.
218
75 S.Ct. 244
99 L.Ed. 271
UNITED STATES of America, Petitioner,
v.
R. P. SCOVIL et al.
No. 35.
Argued Nov. 16, 1954.
Decided Jan. 10, 1955.
Mr.
John R. Benney, Washington, D.C., for petitioner.
Mr. J. D. Todd, Jr., Greenville, S.C., for respondents.
Mr. Justice MINTON delivered the opinion of the Court.
This case involves the relative priority of a landlord's distress for rent under the
laws of South Carolina and a lien for unpaid taxes due the United States. The
landlord, herein referred to as respondent, on April 7, 1952, filed in the Court of
Common Pleas for Greenville County, South Carolina, an affidavit setting forth
that the Dan Tassey, Inc., was indebted to him for rent and requesting a distress
warrant which issued. The master's report shows only that the landlord for past
due rent 'proceeded on the 7th day of April, 1952 to distress upon the assets of
said corporation for said rent in arrears.' The record does not disclose what was
actually done in the distress proceedings. South Carolina Code Annotated,
1952, 41151, provides when the affidavit of a landlord is filed the
magistrate may issue his distress warrant naming the amount due with costs
and deliver the warrant to an officer for service. The officer shall forthwith
demand payment ( 41153), and if not paid, he shall distrain sufficient
property on the rented premises to pay the amount, giving a list of property
distrained together with a copy of the distress warrant to the tenant. The distress
must be reasonable as to amount of property distrained, on penalty of action for
damages ( 41158, 41159). The tenant has five days in which to put up
bond and free the property from the lien of distraint ( 41160).
The next day, April 8, 1952, a receiver was appointed for the corporate
taxpayer-tenant as an insolvent. All of the assets of the corporation passed to
the receiver, who sold them and realized therefrom the fund over which this
contest is waged.
For nonpayment of taxes due, the Collector of Internal Revenue received the
proper assessment lists in his office on March 19, 1951, May 24, 1951, August
29, 1951, December 3, 1951, February 23, 1952, and February 28, 1952, and
notice of these liens thereafter was filed in the proper office in Greenville
County, South Carolina, on April 10, 1952. Section 3671 of the Internal
Revenue Code, 26 U.S.C.A. 3671, provides that the lien for such unpaid
taxes attaches when the assessment lists are received by the Collector.
Therefore, long before the landlord obtained a distress warrant the
Government's liens for taxes had attached.
The Supreme Court of South Carolina held that, since the distress warrant was
perfected before the receiver was appointed, the landlord's distress lien was
superior to the United States' priority created by 3466, Revised Statutes, 31
U.S.C. 191, 31 U.S.C.A. 191. 224 S.C. 233, 78 S.E.2d 277. We granted
certiorari, 347 U.S. 974, 75 S.Ct. 785. However, we find it unnecessary to pass
upon the effect of that section. We hold that the Government must prevail
because of its liens under 3670, Internal Revenue Code, 26 U.S.C.A. 3670.
The landlord had a lien other than a mortgage, pledge, or judgment lien. As to
all other liens, such as the distress lien in the instant case, 3672 of the Internal
Revenue Code, 26 U.S.C.A. 3672, affords no protection. United States v.
Security Trust & Sav. Bank of San Diego, 340 U.S. 47, 51, 71 S.Ct. 111, 113,
95 L.Ed. 53 (concurring opinion). Cf. United States v. Gilbert Associates, Inc.,
345 U.S. 361, 362365, 73 S.Ct. 701, 702, 703, 704, 97 L.Ed. 1071.
Moreover, the distress lien was not perfected in the federal sense at the time the
Government's liens were filed. Such perfection is, of course, a matter of federal
law. United States v. Waddill, Holland & Flinn, Inc., 323 U.S. 353, 65 S.Ct.
304, 89 L.Ed. 294; People of State of Illinois ex rel. Gordon v. Campbell, 329
U.S. 362, 371, 67 S.Ct. 340, 91 L.Ed. 348. The five-day period specified by
41160 of the South Carolina Code had not elapsed. During this time the
tenant-taxpayer could have reacquired any interest the landlord may have had in
his property by posting bond as provided by the Code. Therefore, such a lien
was only a caveat of a more perfect lien to come, as we have so often held in
other cases. United States v. Security Trust Co., supra; United States v. Gilbert
Associates, Inc., supra; United States v. Waddill, Holland & Flinn, Inc., supra,
323 U.S. at pages 357359, 65 S.Ct. 304, 306, 307; People of State of New
York v. Maclay, 288 U.S. 290, 53 S.Ct. 323, 77 L.Ed. 754.
It was decided in the trial court and argued here that the landlord was a
purchaser within the meaning of 3672 of the Internal Revenue Code and,
therefore, that the Government lien was invalid as to him. A purchaser within
the meaning of 3672 usually means one who acquires title for a valuable
consideration in the manner of vendor and vendee. Obviously, the landlord was
not a purchaser.
The judgment is reversed.
Reversed.
