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August 23, 1982

RITA M. DURHAM, Plaintiff,
UNITED STATES OF AMERICA, by the COMMISSIONER OF INTERNAL REVENUE, and NATIONAL STATE BANK, Executor of the Estate of John Richard Durham, Defendants

The opinion of the court was delivered by: DEBEVOISE

 Plaintiff, Rita M. Durham, instituted this action against the United States under 28 U.S.C. § 2410, seeking a judgment declaring that her claim to the assets of her deceased husband's estate is superior to the claim of the United States to those assets. The claim of the United States arises out of plaintiff's husband's unpaid taxes. In an amended complaint plaintiff joined The National State Bank, executor of her husband's estate. The United States moved for summary judgment. The Bank, in effect, seeks only an order directing the manner in which the assets should be distributed.

 The Facts

 The facts are undisputed. On July 29, 1975 plaintiff was divorced from her husband, John Durham, pursuant to a decree entered in New Jersey Superior Court. The Superior Court awarded child custody and alimony to plaintiff but reserved decision on the question of equitable distribution of the marital estate. John Durham died testate on April 28, 1976, devising his residuary estate to an inter vivos trust executed between the decedent and The National State Bank. The Bank was also appointed executor of John Durham's estate.

 On August 24, 1977 the Superior Court rendered its equitable distribution decision. The Court ordered that the estate pay plaintiff $75,000.00 as her share of the marital estate and directed the executor of the estate to liquidate so much of its assets as were necessary to pay that amount.

 Subsequently plaintiff and the Bank each received a "Notice of Deficiency" from the Internal Revenue Service (IRS) dated April 14, 1978. According to the notice, John Durham owed income tax and penalties totalling $25,816.00 (plus interest) for the 1974 and 1975 tax years. After receipt of this notice, plaintiff states, "petitions were filed with the United States Tax Court" (Complaint, para. 6), which in December, 1979 assessed deficiencies (and other amounts due) against the estate totalling $19,816.00 (plus interest). The Tax Court absolved plaintiff of liability for those deficiencies (Complaint, para. 7). The United States admits only that the Tax Court issued a decision absolving plaintiff from liability for any amounts due from the estate on the ground that she was an "innocent spouse" (United States' Answer, para. 6).

 On August 20, 1979 plaintiff obtained a writ of execution based upon the Superior Court's August 19, 1977 order of equitable distribution. On October 11, 1979 plaintiff caused the writ and a notice of levy dated October 5, 1979 to be served (by the Union County Sheriff) upon the Bank. Plaintiff thereby levied upon "all monies [held by the Bank] as Executor of the Estate of John Richard Durham, due or to become due to the Estate . . . ." The levy did not specify the amount of funds subject to the levy, but it did indicate that as of October 5, 1979 the estate owed to plaintiff "$88,190.88, including judgment, interest and Sheriff's fees". In a November 1, 1979 letter to plaintiff's attorney, however, the Union County Sheriff stated that although the levy had been served on the Bank on October 5, 1979, a bank officer informed him that the estate's account was subject to "a prior lien by the I.R.S. in the amount of $29,000.00".

 On November 11, 1979 the IRS made an assessment of $11,400.05 against the estate of John Durham, for deficiencies determined to be due on the decedent's 1975 federal income taxes. On December 31, 1979 the IRS made a second assessment against the estate for $13,107.05 determined to be due on decedent's 1974 federal income taxes.

 Conclusions of Law

 Although the United States asserts an interest in the Durham estate assets based on the decedent's federal tax deficiencies, the United States does not claim its purported priority through the provisions of the Federal Tax Lien Act of 1966, 26 U.S.C. § 6323(a) ("FTLA"). In fact, the United States concedes

that Rita Durham's lien is entitled to priority over the liens of the U.S. pursuant to the provisions of Section 6323(a) of the Internal Revenue Code [ 26 U.S.C. § 6323(a)] by virtue of the fact that the U.S.'s unrecorded liens are not valid against a judgment lien creditor.
[United States' Brief, at 2-3.]

 Rather, the United States asserts that "by virtue of Title 31 U.S.C. Section 191, the United States is entitled to priority to the assets of the Durham estate and [is] entitled to be paid before any other debts of the estate, ...

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