United States v. Estate of Donnelly, 397 U.S. 286 (1970)

Author: Justice Douglas

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United States v. Estate of Donnelly, 397 U.S. 286 (1970)


Respondents are bona fide purchasers of real property located in Livingston County, Michigan. Their purchase was made in August, 1960, from one Donnelly, against whom the United States had acquired a tax lien in 1950. By § 3672 of the Internal Revenue Code of 1939 that lien is not valid against a purchaser until notice thereof is filed in the office "authorized" by state law. Where state law "authorized" no such office, notice of lien was to be filed in the office of the United States District Court for the judicial district in which the land is located. Ibid. Michigan law authorized notice of a federal tax lien containing "a description of the land" to be filed with the register of deeds in the county where the land was located.{1}

The United States refused to be bound by the requirement of Michigan law regarding a "description of the land," and filed notice of lien in the District Court.

Hence, a title search in the accustomed way revealed no notice of lien clouding Donnelly’s title. Hence, respondents purchased the land innocently, and in good faith. Thereafter, on March 20, 1961, the United States filed its notice of lien with the register of deeds of Livingston County, as required by Michigan law.{2}

On December 18, 1961, over a year after respondents’ purchase, this Court held, in United States v. Union Central Life Ins. Co., 368 U.S. 291, that "Michigan law authorizing filing only if a description of the property was given" ran counter to the intent of § 3672, and, consequently, no real property filing requirement could be considered "authorized" by Michigan law. Id. at 296. Therefore, the Court held, a notice of lien was properly filed in the District Court.

I dissent from a retroactive application of that holding so as to injure bona fide purchasers who had relied on the prior law to make their investments. The Michigan Act had, at the time of the purchase, been approved both by the District Court in United States v. Maniaci, 36 F.Supp. 293, and by the Court of Appeals for the Sixth Circuit in Youngblood v. United States, 141 F.2d 912.

It seems manifestly unjust to deprive respondents of their property for the benefit of a lawless tax collector who knowingly concealed his secret lien until after the purchase was made.{3}

It is true that later, in Union Central, we ruled that § 3672 did not require the Government to file pursuant to Michigan law. Yet this new ruling on federal preemption should not, in my view, be applied to undo everything done by those relying on the former construction, as upheld in Youngblood.

I would hold that the teaching of Chicot County Drainage District v. Baxter State Bank, 308 U.S. 371, 374, as to statutes ruled unconstitutional, should be applied to the present situation:

The actual existence of a statute, prior to such a determination, is an operative fact, and may have consequences which cannot justly be ignored. The past cannot always be erased by a new judicial declaration. The effect of the subsequent ruling as to invalidity may have to be considered in various aspects -- with respect to particular relations, individual and corporate, and particular conduct, private and official. Questions of rights claimed to have become vested, of status, of prior determinations deemed to have finality and acted upon accordingly, of public policy in the light of the nature both of the statute and of its previous application, demand examination.

The majority of the Court in the present case narrowly confines that statement to the particular facts involved in Chicot County. The principle there involved, however, rooted deeply in considerations of fairness, clearly applies to the present case. I would hold that bona fide purchasers, whose purchases antedate our Union Central decision and who relied on the law as it had been previously construed, are protected in their investments. I dissent from the Court’s holding to the contrary.

1. Michigan Public Acts, 1023, No. 104, as amended, Michigan Public Acts, 1925, No. 13.

2. Previously, on November 28, 1950, the United States had filed notice of its lien with the register of deeds of Wayne County.

3. The Michigan statute requiring notices of liens to contain a description of real property upon which a lien was claimed was repealed in April, 1956, by Act No. 107, Michigan Public Acts, 1956. The United States, however, did not thereafter promptly file its notice of lien in the state office as it was now authorized to do under Michigan law. Nor did it stand on its previous filing in the District Court. Instead, it waited until March 20, 1961, on which date it filed a notice of the lien with the register of deeds of Livingston County.


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Chicago: Douglas, "Douglas, J., Dissenting," United States v. Estate of Donnelly, 397 U.S. 286 (1970) in 397 U.S. 286 397 U.S. 298–397 U.S. 300. Original Sources, accessed June 4, 2023, http://www.originalsources.com/Document.aspx?DocID=LKLZJHLATNR9IS1.

MLA: Douglas. "Douglas, J., Dissenting." United States v. Estate of Donnelly, 397 U.S. 286 (1970), in 397 U.S. 286, pp. 397 U.S. 298–397 U.S. 300. Original Sources. 4 Jun. 2023. http://www.originalsources.com/Document.aspx?DocID=LKLZJHLATNR9IS1.

Harvard: Douglas, 'Douglas, J., Dissenting' in United States v. Estate of Donnelly, 397 U.S. 286 (1970). cited in 1970, 397 U.S. 286, pp.397 U.S. 298–397 U.S. 300. Original Sources, retrieved 4 June 2023, from http://www.originalsources.com/Document.aspx?DocID=LKLZJHLATNR9IS1.