Tax Lien – Foreclosure

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7^th Circuit Court of Appeals

Case Name: United States of America v. Z Investment Properties, LLC, et al.

Case No.: 18-1915

Officials: BAUER, BRENNAN, and SCUDDER, Circuit Judges.

Focus: Tax Lien – Foreclosure

Carroll V. Raines (“Raines”) and his wife, Lizzie Mae Raines, purchased their home in 1975 as joint tenants and not tenants in common. When Raines’ wife died, he became the sole owner of 18952 W. Oak Avenue, Mundelein, Lake County, Illinois (the “Property”). Raines was the sole owner of the Property at the time of his death in July 2009. Raines died intestate with six heirs. On August 9, 2010, the United States recorded a notice of federal tax lien (the “Notice”) against Raines with the Lake County Recorder of Deeds for taxes and penalties in the amount of $115,022.42. The Notice incorrectly identified “Carrol V. Raines” as the debtor, omitting the second “l” from his first name, and failed to include a legal description or permanent index number for the Property, but did correctly identify it by its address—18952 W. Oak Avenue, Mundelein, Lake County, Illinois.

In November 2010, Raines’ heirs conveyed their interest in the Property to Chicago Title Land Trust Company (“Chicago Title”). Following its acquisition of the Property, Chicago Title made improvements and capital investments in the Property. On June 12, 2017, the Government instituted proceedings seeking to foreclose the tax lien against the Property. The complaint named Chicago Title, several other financial institutions, and municipal entities. By November 2017, the parties agreed to waive any discovery and filed cross‐motions for summary judgment, asking the court to rule on the enforceability of the federal tax liens and whether the affidavit of William Bond (“Bond”) was admissible.

On April 2, 2018, the district court granted the Government’s motion and denied Z Investment Properties, LLC (“Z Investments”) and Chicago Title’s (collectively, the “Appellants”) motion. The district court found that: the Appellants had adequate notice of the tax lien because it conformed to the applicable provisions of the Internal Revenue Code; and the Government could enforce the tax lien which encumbered the Property. The district court also found Bond’s affidavit was partially inadmissible and struck paragraphs 5‐7, 10‐12, 14, 20, and 21. Final Judgment was entered on April 9, 2018. For the reasons stated below, we agree and affirm.

Affirmed

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Derek A Hawkins is trademark corporate counsel for Harley-Davidson. Hawkins oversees the prosecution and maintenance of the Harley-Davidson’s international trademark portfolio in emerging markets.