Brumer v. United States

• Decision Date: 28 September 1948
• Citation: 34 N.W.2d 325,252 Wis. 425
• Parties: BRUMER v. UNITED STATES.
• Court: Wisconsin Supreme Court

252 Wis. 425

34 N.W.2d 325

BRUMER

v.UNITED STATES.

Supreme Court of Wisconsin.

Sept. 28, 1948.

On rehearing.

Motion for rehearing denied. [By Editorial Staff.]

For former opinion see 31 N.W.2d 599,252 Wis. 425.

Stanley Rector, Chief Counsel, and W. H. Putnam, Asst. Chief Counsel, both of Madison, for appellant.

Theron La Mar Caudle, Asst. Atty. Gen., and Sewall Key, George A. Stinson and Homer R. Miller, Sp. Assts. to Atty. Gen., and Timothy T. Cronin, U. S. Atty., and Howard W. Hilgendorf, Asst. U. S. Atty., both of Milwaukee, for respondent.

ROSENBERRY, Chief Justice.

In this case the appellant moved for rehearing upon the following propositions:

I. The appellant being a judgment creditor, it is entitled to the protection afforded that class of creditors by section 3672 of the Internal Revenue Code, 26 U.S.C.A. § 3672.

II. If the appellant is not a judgment creditor, then section 3672 does not apply, but the court is respectfully requested to indicate what defect in the Wisconsin Statute, Section 108.22(2), precludes a resulting judgment creditor status and the application of Section 3672.

We shall consider the second question first. In the opinion filed in this case it was assumed that the appellant was a judgment creditor pursuant to the provisions of Section 108.22(2). It was held that the claim of a judgment creditor must have the requisite degree of specificity, and cited the case of United States v. Texas, 314 U.S. 480, 62 S.Ct. 350, 352, 86 L.Ed. 356 to sustain that proposition.

It is true that United States v. Texas, supra, did not deal with a judgment creditor, but it did deal with a lien created by the Statutes of the State of Texas, which provided that all gasoline taxes ‘shall be a preferred lien, first and prior to any and all other existing liens, upon all of the property of any distributor, devoted to or used in his business as a distributor * * *’, nor does it deal with the provisions of subsec. (a) of sec. 3672, which provides:

‘Invalidity of Lien Without Notice.

‘Such lien shall not be valid as against any mortgagee, pledgee, purchaser, or judgment creditor until notice thereof has been filed by the collector’,

but it does deal with liens and cites cases which deal with judgment creditors.

In Thelusson v. Smith, 2 Wheat., 396, 4 L.Ed. 271, the claimant was a judgment creditor. The court held, as stated in the syllabus: ‘A judgment gives to the judgment creditor a lien on the debtor's lands, and a preference over all subsequent judgment creditors, but the law defeats the preference in favor of the United States in the cases specified in the act of 1799, ch. 22, sec. 65.’

This is now sec. 3466. It was said in United States v. Texas, supra, 314 U.S. at page 485, 62 S.Ct. at page 352, 86 L.Ed. 356, citing Thelusson v. Smith, supra: ‘That a general judgment lien upon the lands of an insolvent debtor does not take precedence over claims of the United States unless execution of the judgment has proceeded far enough to take the land out of the possession of the debtor.’

In Brent v. Bank of Washington, 10 Pet. 596, 9 L.Ed. 547, it was held that sec. 65, now sec. 3466, 31 U.S.C.A. § 191, operates to give the United States a priority as against a judgment creditor.

Appellant refuses to recognize that the conflict in this case is not between the United States as a lien claimant and the appellant as the holder of a judgment lien, but relates solely to the question whether in an insolvency proceeding other...