Seattle Association of Credit Men, a Corporation v. United States

Seattle Association of Credit Men brought this action against the United States to quiet title to certain funds. The district court dismissed the action for want of jurisdiction. Plaintiff appeals, raising the jurisdictional issue as the only question for our consideration;

The facts to be-considered in determining that question may be briefly stated. In 1952, Western Appliance Co., Inc., became unable to pay its bills in the ordinary course of business. The company, therefore, on July 1, 1952, gave appellant, as trustee for Western’s unsecured creditors, a promissory note in the sum of $22,000. The note was secured by a chattel mortgage and by an assignment of Western’s accounts receivable.

: On June 2, 1953, Western, then insolvent, gave appellant a bill of sale to the assets covered by the mortgage. Appellant sold these assets and planned to distribute the proceeds among Western’s creditors. On June 15, 1953, however, before this distribution could be made, the District Director of Internal Revenue levied on these funds. The purpose of the levy was to collect withholding and employment taxes in the sum of $1,632.-29, due and owing by Western.

Three days later, the district…