Fulton v. Nicholson

Le Grand, C. J., delivered the opinion of this court. We are of opinion that the taxes due the State are to be first paid out of the fund, because of the 6th and 7th sections of the act of 1S43, chapter 208; and we are also of opinion, that the taxes due to Baltimore county are also a lien, under the act of 1797, chapter 90, it being admitted that they were “duly levied.” We affirm the order so far as it allows these taxes out of the fund in this proceeding, but add thereto the declaration, that in our judgment the mortgagee will be entitled to a preference, according to his proper priority in the administration of the personal estate. We regard him as substituted to the rights of the State and county. Bank of United States vs. Peter and others, 13 Peters, 123. But for the 7th section of the act of 1843, we should say these taxes were payable first out of the personal estate. Judgments, although binding real estate, are given a preference over other claims against the personal assets, and we think the same principle applies to taxes. They have always been allowed as preferred claims against the personalty. But by the 7th section, it is made the duty of the trustee to pay the taxes out of the proceeds. When this is done, the party entitled to the fund may be substituted in place of the collector or other party, to whom the taxes may be paid. Order affirmed