U.S. v. Ray Thomas Gravel Co., 4163

• Decision Date: 21 November 1963
• Docket Number: No. 4163,4163
• Citation: 373 S.W.2d 333
• Parties: 64-1 USTC P 9410 UNITED STATES of America, Appellant, v. RAY THOMAS GRAVEL COMPANY, Inc., et al., Appellees.
• Court: Texas Court of Appeals

Page 333

373 S.W.2d 333

64-1 USTC P 9410

UNITED STATES of America, Appellant, v. RAY THOMAS GRAVEL COMPANY, Inc., et al., Appellees.

No. 4163.

Court of Civil Appeals of Texas, Waco.

Nov. 21, 1963.

Rehearing Denied Dec. 12, 1963.

Barefoot Sanders, U. S. Atty., Charles D. Cabaniss, Asst. U. S. Atty., Louis F. Oberdorfer, Meyer Rothwacks, Joseph Kovner, Earl J. Silbert, Washington, D. C., for appellant.

John A. Kerr, Joseph P. Burt, Fay Prescott, Sheldon Anisman, Ft. Worth, for appellees.

WILSON, Justice.

The questions presented are whether the federal tax lien fixed pursuant to 26 U.S.C.A. Sec. 6321 is inferior, as the trial court concluded, to three other competing claims.

We adopt appellant's statement of the facts:

On May 31, 1960, Seabreez Pools, Inc., by contract agreed to construct a swimming pool for Glen V. Paden. Paden agreed to pay Seabreez $5,000 upon the completion of the swimming pool and in addition to pay for all labor, taxes and insurance, material, swimming pool equipment, equipment rental, and any other costs owing in the construction of the pool. Seabreez began construction of the pool on or about May 31, 1960.

Prior to September 9, 1960, the United States of America assessed and filed liens for federal taxes against Seabreez in the amount of $3,905.70. On that date Seabreez in writing assigned to W. C. Turner $2,335.34 of the amount it was to be paid under its contract with Paden. This amount was subsequently reduced to $2,142.13. The assignment was accepted in writing by Paden, but was never recorded.

On November 4, 1960, Ray Thomas Gravel Company, Inc., filed an action for debt in the District Court of Tarrant County against Jay W. Ratliff and Seabreez. On January 5, 1961 that court adjudged that Ratliff and Seabreez were indebted to Ray Thomas Gravel Company, Inc., in the amount of $1,345.01. On November 4, 1960, Ray Thomas Gravel Company, Inc. also filed garnishment proceedings in the District Court of Tarrant County against Paden as garnishee, alleging that he was indebted to Ratliff and Seabreez. The writ of garnishment was served on Paden on November 9, 1960, and he answered, on November 23, 1960, that he was not so indebted. Since Paden, the garnishee, was a resident of Johnson County, the Tarrant County court transferred the garnishment proceeding to the District Court of Johnson County. The latter court concluded that at the time the garnishment proceeding was instituted Paden was indebted to Seabreez under their contract in the sum of $2,286.07 for equipment rental and materials furnished.

After the garnishment proceeding was transferred to the District Court of Johnson County, Paden, on August 17, 1962, filed his bill of interpleader in which he joined Ray Thomas Gravel Company, Inc., Seabreez Pools, Inc., Jay W. Ratliff, W. C. Turner and W. E. Turner, and the United States of America. Prior to this date, the United States had assessed and filed additional tax liens against Seabreez, bringing the total of tax liens to $7,809.42, plus interest.

The district court concluded that Paden, indebted to Seabreez under the contract in the amount of $7,286.07, properly filed his bill of interpleader. For the services of his attorney in this proceeding and the garnishment proceeding, the District Court awarded Paden $1,000. It also determined that Seabreez was indebted to the Turners in the amount of $2,142.13, to Ray Thomas Gravel Company, Inc., in the amount of $1,135.01, and to the United States of America in the amount of $7,809.42, plus $1,307.77 interest computed through March 28, 1963. It further ruled that the attorney's fees, the assignment by Seabreez to the Turners, and the garnishment lien of Ray Thomas Gravel Company, Inc., all had priority over the tax liens of the United States.

We recognize appellant's contention that the standing of the competing claims in relation to the federal tax lien is largely a federal question. United States v. Acri, 348 U.S. 211, 213, 75 S.Ct. 239, 99 L.Ed. 264. We adopt also the principles announced in United States v. Pioneer American Ins. Co., 374 U.S. 84, 83 S.Ct. 1651, including those that priority is governed by the 'first in time, first in right' rule; that under the persent facts the federal tax lien arises when it is assessed; and that whether liens created by state law are inchoate or choate, so as to become attached for priority purposes, is tested by whether they are perfected, i. e., they become choate when the identity of the lienor, the property subject to the lien, and the amount are established.

1. Attorney's fees.

Upon original joinder in the bill of interpleader, appellant was dismissed on its plea of sovereigan immunity. It thereafter filed a motion for leave to voluntarily intervene in the same interpleader action, which leave was granted. It then intervented, asserting claim to the fund in the registry.

Rule 43, Texas Rules of Civil Procedure is derived from and is identical in substance to Rule 22(1) Federal Rules of Civil Procedure. The general rule is summarized, 48 A.L.R.2d 192: In the absence of any statutory provisions governing the matter, notably in the federal courts and in Texas, 'a disinterested stakeholder who has reasonable doubts as to the party entitled to the funds or property in his possession, and who in good faith interpleads the claimants, is entitled to an allowance for attorneys' fees.' Nearly 100 federal decisions are cited in support of the text. This has consistently been the rule in Texas. Nixon v. Malone, 100 Tex. 250, 98 S.W. 380, 99 S.W. 403; Greer v. Franklin Life Ins. Co., 148 Tex. 166, 221 S.W.2d 857.

Appellant relies on the holding in United States v. Pioneer American Ins. Co., above, that attorneys' fees provided for in a mortgage were subordinate to the federal lien for taxes. There the secured note stipulated only that the maker would pay 'reasonable' attorneys' fees in an unliquidated amount, and it was held this portion of the lien was inchoate. In considering the attorney's fee we are not here dealing with a lien or with a contractual debt or right. In United States v. Liverpool & London & Globe Ins. Co., 348 U.S. 215, 75 S.Ct. 247, 99 L.Ed. 268, the United States was named and served as a party to a state court garnishment proceeding by a bill of interpleader. Upon removal to federal court, the United States was dismissed as a party to the interpleader action. It did not then seek to re-enter the suit, but filed a separate complaint for foreclosure of its tax lien. The garnishee's attorney fee allowed, which was the subject of the holding, was incurred in the garnishment proceedings to which the United States was not property a party. That holding is applicable here in so far as the attorney's fee was awarded in connection with the garnishment. It is not applicable to such fee as was awarded for services in the interpleader proceedings.

Appellant was not required to utilize the services and machinery of the state court; it could have protected its rights independently of the interpleader. Indeed, it successfully objected to involuntary subjection to the jurisdiction of that court and its action on the bill, and thereafter voluntarily invoked that same jurisdiction by obtaining leave to intervenue. By so seeking and accepting the remedy made available by the law of this state, it became amenable and subject to the law governing that remedy as fully as if it had initiated the action. It will not be permitted to deprive the stakeholder of rights to which he would be otherwise entitled, any more than would any other claimant to the fund. Immediately before appellant entered the proceedings as intervenor, the court was authorized to award an attorney's fee to the stakeholder from the fund. An intervenor takes the case as he finds it. Corzelius v. Crosby Producing & Royalty Co., Tex.Civ.App., 52 S.W.2d 270, 272; Lynn County School Board v. Garlynn, etc. Dist., Tex.Civ.App., 118 S.W.2d 1070, writ ref.

As to this phase of the matter, we are not concerned with priority in time, or the time at which the amount was fixed. The assessment of the fee is in much the same category as the assessment of the stakeholder's costs of court. Although making no complaint as to court costs, appellant insists in argument that it is entitled to recovery, as a preference, of the entire fund, even as against court costs. In our opinion the trial court properly ordered the fee taxed against and paid from the fund. Wilke v. Finn, Tex.Com.App., 39 S.W.2d 836, 839; Parker Square State Bank v. Triangle Supply Co., Tex.Civ.App., 364 S.W.2d 418, 424, writ ref. n. r. e. The attorney's fee awarded to the stakeholder for services in connection with the interpleader is to be accorded priority to the appellant's tax lien claim, and the latter was properly subordinated to it. However, the attorney's fee fixed by the trial court is for services both in the garnishment and in the interpleader proceedings, unsegregated as to the amount attributable to each. This portion of the judgment is severed, reversed and remanded for a new trial. Upon another trial the attorney's fees awarded should be fixed separately for services in each proceeding, and order of payment of the fee for services in the garnishment made inferior to appellant's lien claim.

2. Garnishment lien; Ray Thomas Gravel Co., Inc.

Ray Thomas Gravel Co. urges the notice of tax lien was not filed in the proper county. This appellee became a judgment creditor of the taxpayer in the amount of $1345.01 on January 5, 1961. 26 U.S.C.A. Sec. 6323 makes the lien for taxes created by assessment invalid as against a judgment creditor until notice is filed in the office...