Fagan v. Timmons

• Decision Date: 08 August 1950
• Docket Number: 16395.
• Citation: 60 S.E.2d 863,217 S.C. 432
• Parties: FAGAN v. TIMMONS.
• Court: South Carolina Supreme Court

60 S.E.2d 863

217 S.C. 432

FAGAN v. TIMMONS.

No. 16395.

Supreme Court of South Carolina.

August 8, 1950

F. Ehrlich Thomson, Columbia, for appellant.

John S. Nicholson, Nelson, Mullins & Grier, all of Columbia, for respondent.

STUKES, Justice.

This is a proceeding under Title 12, Chapter 44, Code of 1942, sec. 746 et seq., supplementary to an unsatisfied execution upon judgment for $750 damages recovered for wilful tort. Fagan v. Timmons, 215 S.C. 116, 54 S.E.2d 536 certiorari denied, Timmons v. Fagan, 338 U.S. 904 70 S.Ct. 306, rehearing refused, 70 S.Ct. 1018.

After return of execution nulla bona by the sheriff plaintiff filed his petition alleging that fact, defendant's refusal to pay despite her ownership of, quoting, 'various and sundry properties in and about the city of Columbia,' etc. To rule to show cause defendant made return admitting the unpaid judgment and resisted the appointment of a receiver of her property, which is authorized in supplementary proceedings by Code, sec. 751, upon the grounds that the United States had filed in 1946 income tax liens against her property in the respective amounts of $42,042.71 and $2,469.24, which she was contesting in the federal tax court; and that her real estate is subject to mortgages aggregating $105,000.00. Defendant's opposition to the appointment of a receiver on circuit and here, is twofold, first that the United States is a necessary party and its absence deprives the court of jurisdiction; and second, such action is unjust and inequitable under the circumstances.

Arguments were heard upon the petition for receiver and the verified return. Order dated Feb. 25, 1950 was thereafter entered. With respect to the tax liens of the United States the court found that perforce Title 26 U.S.C.A. § 3670, the federal government has liens against 'all property and rights to property, whether real or personal, belonging' to the taxpayer, which is a superior lien, on which account the court declined to appoint a general receiver with power to sell, etc. However, a receiver was appointed to take possession of the defendant's property, collect the rents, issues and profits and hold the same subject to the liens of the federal government and subject to the further orders of the court, except that expenses of upkeep and maintenance of the property should be paid. A prominent Columbia realtor was named receiver and it was required that he give bond in the amount of $10,000 for the faithful performance of his duties. Other provisions of the order need not be noticed because they are irrelevant here.

The defendant appealed upon exceptions which raise the questions which have been argued and of which mention has already been made. Referring to the first, appellant relies mainly upon our decision of Crews v. Beattie, 197 S.C. 32, 14 S.E.2d 351, for her position that the receivership is improper because of the lien interest of the United States which is not a party and which has not consented to be sued in this action. But that case is beside the point. In it a taxpayer was attempting to divert funds to the State treasury which were payable to the United States under a specific pledge made pursuant to statute. Here the effort is not to take funds or property from the federal...