Court Opinion

ID: 9423114
Source: CourtListenerOpinion
Date Created: 2023-08-02 23:06:04.10087+00
Date Added: 2024-06-11T17:22:42.385989
License: Public Domain

Mr. Justice Black,
dissenting.
Section 6323 of the 1954 Internal Revenue Code provides that an unfiled tax lien is not “valid as against any mortgagee, pledgee, purchaser, or judgment cred*279itor . . . The Court here holds that a bankruptcy trustee must be treated as if he were a “judgment creditor” thereby reducing government tax claims to the level of unsecured creditors. I am unable to agree. A bankruptcy trustee cannot be treated as a judgment creditor except by giving that term an entirely artificial, fictional meaning. The Court justifies this extraordinary twist of meaning by reference to § 70c of the Bankruptcy Act, 11 U. S. C. § 110 (c) (1964 ed.). That section, so far as here pertinent, provides:
“c. . . . The trustee, as to all property, whether or not coming into possession or control of the court, upon which a creditor of the bankrupt could have obtained a lien by legal or equitable proceedings at the date of bankruptcy, shall be deemed vested as of such date with all the rights, remedies, and powers of a creditor then holding a lien thereon by such proceedings, whether or not such a creditor actually exists.”
This language gives no intimation of a purpose to destroy a valid tax lien such as the Government had here when bankruptcy occurred. The section’s terms simply show a purpose to make sure that all the property the bankrupt had before bankruptcy will be vested in the trustee. It stretches this language entirely too much to say it was intended to change the law so drastically that the mere appointment of a trustee could render invalid a government tax lien which was perfectly valid the moment before bankruptcy. Nor can this section fairly be read as an attempt by Congress to nullify valid government tax liens by placing the claims of all unsecured creditors of the bankrupt on the same level as valid tax liens. In writing § 70c Congress was amending the bankruptcy law, not the government tax hen law that dates back nearly 100 years. I still think, as we said in United States v. Gilbert Associates, 345 *280U. S. 361, 364, that in enacting the predecessor of § 6323 Congress used the words “judgment creditor” in “the usual, conventional sense of a judgment of a court of record . . .'The Second, Third, and Ninth Circuits have so construed this section. I think they were right. The Court today gives frail and inadequate support, I think, for its judicial destruction of the Government's congressionally created lien.
I would reverse this judgment.