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Nature of Suit Code: 290
Nature of Suit: Other Real Property Actions
Cause of Action: 

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OFFICE OF THE CLERK 

United States Court of Appeals for the Tenth Circuit 

C-404 United States Courthouse 

1929 Stout Street 

Denver Colorado 80294 

December 6, 1991 

TO: ALL RECIPIENTS OF THE CAPTIONED OPINION 

RE: 90-7095 Pate v. USA 

Filed November 20, 1991 

By Judge Logan 

Please be advised that the name of WHITEFIELD, as one 

of the plaintiffs-appellants in the captioned case, has been 

corrected to read WHITFIELD. 

Very truly yours, 

ROBERT L. HOECKER, Clerk 

By, /4£ /L/4___ Barbara Schermerhorn 

Deputy Clerk 

Appellate Case: 90-7095 Document: 010110097004 Date Filed: 11/20/1991 Page: 1 
PUBLISH 

UNITED STATES COURT OF APPEALS 

TENTH CIRCUIT 

HELEN PATE; WILLIAM WHITEFIELD PATE; 

JULIA RUTH PATE; KIRKSEY MCCORD PATE, 

Plaintiffs-Appellants, 

,~ov 2 o 1991 

ROBERT L. HOECKER 

Clerk 

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No. 90-7095 

UNITED STATES OF AMERICA, DEPARTMENT 

OF THE TREASURY INTERNAL REVENUE 

SERVICE, 

Defendant-Appellee. 

Appeal from the United States District Court 

for the Eastern District of Oklahoma 

(D.C. No. 89-392-C) 

Submitted on the Briefs: 

G. Michael Blessington, Oklahoma City, Oklahoma, for plaintiffsappellants. 

Shirley D. Peterson, Assistant Attorney General, Gary R. Allen, 

William S. Estabrook and Jordan L. Glickstein, Attorneys, Tax 

Division, Department of Justice, Washington, D.C., for defendantappellee. 

Before LOGAN, MOORE and BALDOCK, Circuit Judges. 

LOGAN, Circuit Judge. 

Appellate Case: 90-7095 Document: 010110097004 Date Filed: 11/20/1991 Page: 2 
Plaintiffs, the wife and children of Whit Pate, appeal from 

an adverse judgment entered by the district court on cross-motions 

for summary judgment in this quiet title action. The gravamen of 

the action concerns the validity of certain tax liens asserted 

against plaintiffs' property, which derive exclusively from the 

admitted tax liability of Whit Pate. 1 

The stipulated facts underlying the district court's 

decision, which are set forth in some detail in its Findings of 

Fact and Conclusions of Law filed November 26, 1990 (Findings and 

Conclusions), need only be briefly summarized for purposes of our 

analysis. Whit Pate purchased a family residence in 1975, which 

was titled, and mortgaged, solely in the name of his wife, 

plaintiff Helen Pate. In the succeeding years, Whit Pate, who 

earned the couple's only income, provided his wife the funds 

necessary to maintain and remodel their home and to pay off the 

original mortgage. 2 In 1984, Helen Pate deeded the property 

jointly to the couple's children, retaining a life estate for 

herself. At present, the government has several liens noticed 

against the property arising from Whit Pate's conceded tax 

liabilities for the years 1983 through 1987. 

The district court granted summary judgment for the 

government, holding that plaintiffs' property was subject to the 

1 After examining the briefs and appellate record, this panel has 

determined unanimously that oral argument would not materially 

assist the determination of this appeal. See Fed. R. App. P. 

34(a); 10th Cir. R. 34.1.9. The case is therefore ordered submitted without oral argument. 

2 Additional mortgag~ken out over the years by Helen Pate to 

secure loans for her h~~b;fid, were also satisfied with funds from 

Whit Pate. 

2 

Appellate Case: 90-7095 Document: 010110097004 Date Filed: 11/20/1991 Page: 3 
liens arising from Whit Pate's tax liabilities, on the basis of 

the following two-stage analysis: 

First, as to the 1975 acquisition in the name of Helen Pate, 

the district court concluded that Whit Pate retained an 

encumberable beneficial interest in the property through the legal 

mechanism of a purchase money resulting trust on the basis of the 

following reasoning: 

"It is undisputed that the money to purchase the 

house and lot in 1975 came from Whit Pate, who has 

continually resided on and enjoyed the benefits of the 

property. The primary factual issue to be established 

in declaring a resulting trust is the payment of the 

consideration for the property, title to which has been 

taken in another. Such is the situation here." 

Findings and Conclusions at 9 (citations omitted). 

Second, the district court held that the 1984 conveyance to 

the children constituted a fraudulent transfer of Whit Pate's 

beneficial interest under Okla. Stat. tit. 24, § 116, and, 

therefore, raised no impediment to attachment of the tax liens 

because 

"[a]t the time of the [1984] transfer, Whit Pate had 

already been assessed four federal tax liens. He thus 

reasonably believed he would incur debts beyond his 

ability to pay as they became due. See §116(A)(2)(b). 

The court thus finds that the transfer was made with 

actual intent to hinder, delay or defraud a creditor. 

See § 116 ( B) ( 2 ) , 1 O • 11 

Findings and Conclusions at 10. 

We review the district court's summary judgment rulings de 

novo, applying the same legal standard used by the district court 

under Fed. R. Civ. P. 56(c). Abercrombie v. City of Catoosa, 896 

F.2d 1228, 1230 (10th Cir. 1990). "Summary judgment should be 

granted only if 'there is no genuine issue as to any material fact 

3 

Appellate Case: 90-7095 Document: 010110097004 Date Filed: 11/20/1991 Page: 4 
, , and . . . the moving party is entitled to judgment as a matter of 

law.'" Id. (quoting Rule 56(c)). In the instant case, we must 

determine whether the district court properly applied the 

applicable law to the undisputed facts. 

We begin our analysis, as the district court did, with the 

recognition that a tax lien can attach only to a property interest 

owned by the delinquent taxpayer and that the existence and extent 

of such an interest is governed by state law. See,~, United 

States v. Rodgers, 461 U.S. 677, 683, 690-91 (1983); Bigheart 

Pipeline Corp. v. United States, 835 F.2d 766, 767-68 (10th Cir. 

1987) . With this in mind, our threshold inquiry concerns the 

proper treatment of the 1975 acquisition under Oklahoma law, 

because if Whit Pate obtained no interest in the property at that 

time the character of Helen Pate's subsequent conveyance3 to the 

couple's children is irrelevant to the viability of the tax liens 

asserted exclusively through Whit Pate. 

The district court found that a resulting trust arose in 

favor of Whit Pate primarily because he bought the property for 

his wife. The district court expressly relied on Copenhaver v. 

Copenhaver, 317 P.2d 756, 760 (Okla. 1957), for the general 

presumption in favor of a resulting trust when title to real 

property is taken in one person's name but the purchase price is 

paid by another. See Oklahoma City v. Vahlberg, 173 P.2d 736 

(Okla. 1946). However, there is a well-established exception to 

this general rule which is triggered by the very circumstances in 

3 The nature and effect of Whit Pate's limited participation in 

this conveyance is discussed infra. 

4 

Appellate Case: 90-7095 Document: 010110097004 Date Filed: 11/20/1991 Page: 5 
the instant case. When a husband purchases property for his wife, 

not only is the resulting trust presumption inapplicable, but the 

wife is entitled to the opposing presumption that the property is 

hers alone by way of a gift or advancement. See Chastain v. 

Posey, 665 P.2d 1179, 1182-83 (Okla. 1983); Fletcher v. Fletcher, 

244 P.2d 827, 830 (Okla. 1952); King v. Courtney, 122 P.2d 1014, 

1015 (Okla. 1941). Accordingly, the district court's disposition 

cannot be supported on its stated rationale. 

Indeed, absent some other basis for ascribing a cognizable 

property interest to Whit Pate, plaintiffs are entitled to summary 

judgment quieting their title to the property free and clear of 

the subject tax liens. The presumption against a resulting trust 

arising out of the 1975 acquisition controls unless rebutted by 

clear and convincing evidence, see Fletcher, 244 P.2d at 830; 

King, 122 P.2d at 1015; see generally Cacy v. Cacy, 619 P.2d 200, 

202 (Okla. 1980) (evidence of resulting trust "must be clear, 

unequivocal, and decisive beyond a reasonable doubt"), and such 

evidence is lacking in the stipulated record here. None of the 

factual circumstances regarding Whit Pate's continued rent-free 

residence in the family home and payment of upkeep and remodeling 

expenses are inconsistent with his wife's ownership of the 

property. Nor does the fact that Helen Pate mortgaged the home to 

secure loans her husband advised were necessary, and that he 

repaid, in any way undercut her ownership status. Moreover, Whit 

Pate's participation in the 1984 warranty deed to the children was 

appropriately limited to his legally required acquiescence in the 

conveyance of his wife's title to the family homestead. See 

5 

Appellate Case: 90-7095 Document: 010110097004 Date Filed: 11/20/1991 Page: 6 
Grenard v. McMahan, 441 P.2d 950, 951 (Okla. 1968) (citing both 

state constitutional and statutory provisions requiring spousal 

consent to transactions involving homestead exemption). Finally, 

we note that the 1975 acquisition of the property was not tainted 

by any existing and accruing tax liabilities, which did not arise 

until years later. 

The government appears to advance an alternative rationale to 

the district court's resulting trust analysis, as follows: 

(1) Oklahoma law provides for a "homestead exemption," i.e., a 

reciprocal prudential restriction on the transfer or encumbrance 

of the family residence which vests automatically for the 

protection of both husband and wife independently of any 

considerations of title or ownership; 4 (2) Whit Pate resided with 

his wife on the property since its purchase and therefore was 

vested with this homestead interest for the period in question; 5 

(3) this court and others have held that tax liens may attach to a 

delinquent taxpayer's interest in the family residence despite the 

protections awarded the nondelinquent spouse by homestead 

exemptions of the sort recognized in Oklahoma; 6 and (4) "[t]hus, 

Whit Pate clearly had an interest in the homestead property at 

issue to which the IRS liens that were filed against him could 

attach." Brief for the Appellee at 20-23. There is a fatal flaw 

4 See,~, In re Estate of Wallace, 648 P.2d 828, 831-32 (Okla. 

1982); Keel v. Jones, 413 P.2d 549, 551 (Okla. 1966). 

5 See,~, Keel, 413 P.2d at 550-51; Mercer v. McKee!, 108 P.2d 

138, 141 (Okla. 1940). 

6 See Tillery v. Parks, 630 F.2d 775, 777-78 (10th Cir. 1980); 

see also, ~, United States v. Rodgers, 461 U.S. at 700-02; 

United States v. Heasley. 283 F.2d 422, 427 (8th Cir. 1960). 

6 

Appellate Case: 90-7095 Document: 010110097004 Date Filed: 11/20/1991 Page: 7 
in this argument, however, arising from a fundamental 

misconception regarding the nature of the homestead exemption. 

Depending on the controlling state law definition or 

characterization, a homestead exemption may create a bona fide 

property interest or merely afford a personal right to preclude 

the alienation or encumbrance of such interests. See generally 

United States v. Morgan, 554 F. Supp. 582, 587-88 (D. Colo. 1982) 

(contrasting Kansas homestead exemption, which the state's courts 

have expressly construed to confer an estate in land, with 

Colorado exemption, which has been construed as only a personal 

exemption creating no interest in land). In Oklahoma "'[t]he 

homestead right is not an estate in land, but a mere privilege of 

exemption from execution of such estate as the holder has.'" 

Evans v. Evans, 301 P.2d 232, 234 (Okla. 1956) (quoting Mercer v. 

McKeel, 108 P.2d at 141). Thus, it was held in Evans that a 

wife's homestead right, which had undeniably afforded her its 

protection while she resided in the family home, did not create 

any inheritable estate in that property, which had been titled 

solely in her husband's name, after she predeceased her husband. 

See id.; see also In re Estate of Wallace, 648 P.2d at 831-32 

(comparing homestead exemption, which is a personal right intended 

only to protect the family from creditors, with the probate 

homestead, which gives surviving family members a lifetime 

possessory interest superior to property interests of coheirs). 

Under these Oklahoma cases, the right to assert a homestead 

exemption is not, in and of itself, a substantive property 

interest to which the government's tax liens could attach. The 

7 

Appellate Case: 90-7095 Document: 010110097004 Date Filed: 11/20/1991 Page: 8 
government has not cited a single case that reaches a contrary 

conclusion. The Oklahoma cases it cites are in accord with those 

discussed immediately above. The federal cases it relies upon 

hold only that a homestead right does not preclude attachment of a 

tax lien to an otherwise established interest in homestead 

property--they do not suggest that the homestead right itself 

(here, of the delinquent taxpayer) could serve as the propety 

interest required to anchor the government's lien. Indeed, to 

permit encumbrance of a family residence with the liabilities of a 

nonowning spouse solely on the basis of his homestead right would 

be to transform what was intended as a shield for the protection 

of the family into a sword enabling creditors to inflict the very 

sort of domestic harm the exemption was meant to palliate. See In 

re Estate of Wallace, 648 F.2d at 831-32 ("[t]he spirit and 

purpose of the constitutional homestead exemption is to protect 

the entire family in its occupancy from improvidence and the 

urgent demands of creditors"). Absent some clear direction to 

this effect from the Oklahoma courts we will not construe the 

homestead exemption in such a self-defeating fashion. See 

generally First Nat'l Bank of Sentinel v. Anderson, 240 P.2d 1066, 

1068 (Okla. 1952) (Oklahoma Supreme Court repeatedly has held that 

constitutional and statutory provisions relating to homestead 

exemption are to be liberally construed in interests of family 

home). 

The government also cites federal cases recognizing its 

general authority to enforce tax liabilities against the property 

of third parties who serve merely as the delinquent taxpayer's 

8 

Appellate Case: 90-7095 Document: 010110097004 Date Filed: 11/20/1991 Page: 9 
nominees, alter egos, fraudulent transferees, and the like. It is 

not clear whether this broad, heterogeneous body of caselaw, 

discussed in the opening section of the government's argument, is 

intended to introduce and frame the more specific issues regarding 

Whit Pate's alleged property interests under the particular 

theories we have already reviewed or to provide a separate basis 

for attributing ownership of the property to him. Should the 

latter be the case, the factual circumstances already deemed 

inadequate to substantiate a resulting trust in favor of Whit Pate 

are also insufficient to satisfy the government's burden of 

establishing his ownership of the property under the various 

theories represented in the authorities cited. See generally 

Security Counselors, Inc. v. United States, 860 F.2d 867, 869 (8th 

Cir. 1988) (government bears burden of establishing taxpayer's 

interest in escrow funds held by third party); Arth v. United 

States, 735 F.2d 1190, 1191 (9th Cir. 1984) (government bears 

burden of establishing taxpayer's interest in bank account 

assigned to third party); Valley Finance, Inc. v. United States, 

629 F.2d 162, 171 n.19 (D.C. Cir. 1980) (government bears burden 

of establishing taxpayer's interest in property held by alleged 

alter ego), cert. denied, 451 U.S. 1018 (1981). 

For the reasons discussed above, we hold that Whit Pate never 

had an interest in plaintiffs' property sufficient to enable 

attachment of the government's liens. Therefore, the 1984 

transaction between Helen Pate and the other plaintiffs is of no 

consequence to the rights of the parties, and plaintiffs are 

entitled to summary judgment in their favor. 

9 

Appellate Case: 90-7095 Document: 010110097004 Date Filed: 11/20/1991 Page: 10 
The judgment of the United States District Court for the 

Eastern District of Oklahoma is REVERSED, and the cause is 

REMANDED with directions to enter judgment for plaintiffs. 

10 

Appellate Case: 90-7095 Document: 010110097004 Date Filed: 11/20/1991 Page: 11