County of Clark, State of Nevada v. United States

The parties assert opposing claims to a fund in the amount of $52,000.00 now in the hands of the District Court for the District of Nevada and created by the District Court in connection with bankruptcy proceedings. Each claim is based upon tax obligations of the bankrupt estate. The United States claim is founded upon a perfected tax lien for sums due prior to adjudication in bankruptcy. The County claim is based upon taxes accruing during the pendency of the bankruptcy proceedings. The County contends that these sums constitute costs of administration and preservation of the es tate and should have precedence over the secured claim of the United States. From decision of the District Court awarding the fund in its entirety to the United States the County has taken this appeal.

On July 16, 1959, in its order for the sale of assets of the bankrupt, Properties Moulin Rouge, Inc., a corporation, the District Court provided that the sale should be subject to certain listed encumbrances, the first of which was for federal, state, county and city taxes, “but in a total amount not in excess of the total sum of $52,000.00 * * It directed the referee to “determine and fix the nature,…