Silberman

The United States appeals an order establishing the relative priority of claims to the proceeds of the sale of real property owned by *1536 decedent Howard Silberman. The United States contends that, pursuant to the federal insolvency statute ( 31 U.S.C. § 3713 ) its unnoticed tax liens take priority over the prior recorded judgment liens of respondents Household Finance Corporation and Household Retail Services, Inc.

Facts

The executor filed a report of sale and a petition for an order confirming the sale of the property free and clear of liens and for distribution of the sale proceeds. In support of the petition, the executor filed a declaration asserting that the estate’s liabilities for administrative expenses and claims against the decedent exceeded it assets by $215,497, and an amended petition which stated that the estate was unable to pay certain liabilities as they became due. The court appointed a special master to determine whether the estate was insolvent. The special master concluded that the estate had been insolvent since February 25, 1992.

The claimants competing for the sale proceeds were the United States, the California Franchise Tax Board, judgment…