Gaub v. Simpson

The only question to be resolved in this case is whether Elwood "Bill" J. Simpson (Simpson) discharged an Internal Revenue Service (IRS) lien against property he owned under circumstances that made him a volunteer and foreclosed him from legal subrogation. In a classic effort at obfuscation, Arnold A. Gaub (Gaub) presented the case as one involving the responsibility of a grantor under a warranty deed to defend the title to the property. It is clear the trial court focused upon the fact Simpson paid the amount of a tax lien against his property for taxes owed by Gaub. Through a straw man transfer, Simpson acquired the property from a grantee of Gaub to whom Gaub had conveyed the property prior to the attachment of the lien for federal taxes. When the IRS asserted the tax lien against his property, Simpson demanded Gaub obtain a release of the lien, paid the amount of the lien after Gaub failed to do so, and brought this action against Gaub to recover the amount paid. Gaub appeals from the judgment entered by the trial court in favor of Simpson, essentially contending that, for various reasons, he owed no duty to Simpson to defend the title to the property. We agree with the trial court that Simpson was not a volunteer when he paid the amount of the taxes to avoid foreclosure of a lien against his property, and he became entitled, as a matter of subrogation, to recover that amount from Gaub. The judgment of the trial court is affirmed.