Volume 57 — Washington Reports, Second Series

[1] INTERNAL REVENUE — LIENS — WHAT LAW GOVERNS — PROPERTY TO WHICH LIEN CAN ATTACH. Whether a taxpayer has "property or rights to property" to which a federal tax lien may attach pursuant to IRC 1954 § 6321, is a matter to be ascertained under state law. [2] SAME — PROPERTY SUBJECT TO LIEN — RETAINED PERCENTAGE FUND. A contractor had no rights subject to seizure under a federal tax lien in a retained percentage fund which, pursuant to RCW 60.28.010-.020, was withheld by a school district from payments made to the contractor under a contract with the school district, except to the extent that the claim of the contractor against the school district exceeded the aggregate of the claims against the fund of subcontractors and the State Tax Commission. [3] SAME — PRIORITY. In an action to determine the priority of payments from such a fund, there was nothing to which the federal tax liens could attach, where there was no excess over a sum sufficient to discharge the claims of the subcontractors and the State Tax Commission. [4] APPEAL AND ERROR — BRIEFS — POINTS AND ARGUMENTS. The Supreme Court will not consider an assignment of error where there is no argument in the brief in support thereof.<page_number>Page 81</page_number> [5] ESTOPPEL — GROUNDS — ADMISSIONS — WAIVER. In such an action, a bonding company, which was the obligor on a performance bond executed by the contractor, was estopped from questioning the form of a claim by a subcontractor, where, although the claim did not comply with the provisions of RCW <cross_reference>39.08.030</cross_reference>, relating to the giving of notice, the bonding company acknowledged to the subcontractor that his claim had been received but that it preferred to postpone any discussion as to its merits until a later date; since having once recognized the claim, as such, the bonding company waived its right to insist that the statute be substantially complied with as to the form of the claim. [6] INTERNAL REVENUE — LIENS — PRIORITY. In such an action, federal tax liens attached to an amount retained by the school district in excess of the amount required to be retained by RCW 60.28.010-.020 and had priority over claims of the contractor's surety for payments made for labor and material upon the contractor's default, where the federal taxes were assessed prior to the date of the first payment made by the surety; since under IRC 1954 § 6322 the federal liens were perfected as of the date of the assessment of the tax, while the surety did not become subrogated to the rights and properties of the taxpayer until the date of the first payment of a claim defaulted by the contractor. [7] SUBROGATION — SURETIES — UPON PAYMENT OF CLAIMS — EXTENT SUBROGATED. In such an action, there was no merit in a contention by the contractor's surety that it was subrogated to the rights of the owner of the property in addition to the rights of the contractor, where there had been no abandonment of the contract requiring the bonding company to finish the work, but the contract had been substantially completed and the only default was with respect to payment of certain laborers and materialmen, since the bonding company was subrogated only to the rights of the claimants upon paying their claims. [8] INTERNAL REVENUE — LIENS — PRIORITY — LABOR AND MATERIAL LIENS. Whether the liens of laborers and materialmen or federal tax liens take precedence is a matter to be determined under federal law. [9] SAME — GENERAL LIENS — PRIORITY OVER INTERNAL REVENUE LIENS. In order for a general lien to achieve priority over a federal internal revenue lien, it must have become perfected by being reduced to judgment prior to the date the assessment rolls are received by the collector. [10] SAME. In such an action, the claim of the United States was given priority where the liens of the laborers and materialmen were not reduced to judgment until after the effective date of the federal tax liens. [11] APPEAL AND ERROR — RECORD — SHORT RECORD — STATEMENT OF POINTS. A party appealing on a short record can base error only on points included in his statement of points. [1] See Ann. 105 A.L.R. 1247, 174 A.L.R. 1378; Am. Jur., Internal Revenue, §§ 218, 219.<page_number>Page 82</page_number>