## Facts

- A private creditor obtained and recorded a Pennsylvania judgment against Francis J. Romani in 1985, creating a lien on his real property.
- The United States later filed notices of federal tax liens totaling roughly $490,000 against the same property.
- Romani died in 1992; his estate was insolvent and consisted solely of real estate valued at $53,001, encumbered by both the judgment lien and the federal tax liens.
- The estate administrator sought court approval to convey the property to the judgment creditor in satisfaction of the judgment.
- The United States objected, arguing that the federal priority statute, 31 U.S.C. § 3713(a), required federal tax claims to be paid first in an insolvent estate.
- Pennsylvania courts approved the conveyance, concluding that the Federal Tax Lien Act of 1966, including 26 U.S.C. § 6323(a), limited the reach of § 3713(a) for tax debts.
- The Supreme Court granted certiorari.

## Issues

1. Whether 31 U.S.C. § 3713(a) requires a federal tax claim to take priority over a judgment creditor’s prior perfected lien on a decedent’s real property.
2. Whether the Federal Tax Lien Act of 1966, particularly 26 U.S.C. § 6323(a), prevents the federal priority statute from displacing the protections afforded to judgment lien creditors.

## Decision

- The Court unanimously affirmed the state court judgment.
- Section 3713(a) does not require that a federal tax claim be preferred over a judgment creditor’s perfected lien on real property.
- Because the judgment lien was perfected under state law and preceded the federal tax lien notices, § 6323(a) rendered the federal tax liens invalid against that judgment lien.
- The Court declined to decide, outside the tax context, the full scope of § 3713(a) as to antecedent perfected liens.
- Justice Scalia concurred in part and in the judgment.

## Legal Principles

- When Congress creates a detailed, tax-specific priority framework in the Federal Tax Lien Act, that scheme governs priority disputes involving federal tax liens.
- Under 26 U.S.C. § 6323(a), a federal tax lien is not valid against a judgment lien creditor until the Government files proper notice.
- The federal priority statute, 31 U.S.C. § 3713(a), does not override the Federal Tax Lien Act’s specific protections for judgment lien creditors in the tax-lien context.
- A perfected (choate) judgment lien that requires no further steps to attach and be enforceable is treated as a secured interest for purposes of applying § 6323(a).

## Conclusion

The Court held that the federal priority statute does not permit the United States to defeat a prior perfected judgment lien with an insolvent estate’s unpaid federal tax claim where the Federal Tax Lien Act protects judgment lien creditors from unnotified federal tax liens.


United States v. Estate of Romani, 523 U.S. 517 (1998)