Follet

This is an appeal from an order of the District Court confirming an order of the referee in bankruptcy fixing priority of claims against the bankrupt Hercules Gasoline Company.

The sole question presented by the record is whether the c-laim of the State of California for gasoline taxes is superior to judgment liens against the bankrupt filed by the appellants. The referee adjudged the secured claim of the State was entitled to priority.

The facts are not in dispute. By virtue of the Motor Vehicle Fuel Tax Act (Cal.Stats. 1923, c. 267, p. 571, as amended), the bankrupt became indebted to the State in 1930 and the first quarter of 1931 in an amount slightly over $200,000. By virtue of the same statute, this obligation became a Hen upon all property of the bankrupt, attaching as of the date of delivery or distribution of the taxed fuel.

The appellants hold Hens against the bankrupt’s real property by virtue of judgments obtained in personal injury actions, which judgments were filed in the counties where bankrupt’s property is situated. These Hens attached subsequent to the Hen of the State.

On May 19, 1932, the State filed a claim to which the trustee objected on the ground that…