not made in pursuance of these levies. Realty, itself, emphasizes that Just Born, Inc., did not make payment to the Government within ten days after the first levy, and that the Government took no action to enforce the levy, although repeatedly requested by Realty to do so. Reference has already been made to Ruppin's letter of September 24, 1954 to Whelan, in which Ruppin stated, 'As attorney for American Caramel Company * * * I have authorized Just Born, Inc. to pay over to you for the United States the sum of $ 26,000.00 levied on by the government * * *.' It seems clear that both the Government and Caramel treated the payment as a voluntary one.
Considering the payment as voluntary, we conclude that the Government and Caramel had the right to allocate it as they did. The general rule is set forth at 70 C.J.S. Payment § 76, page 280:
'As a general rule, the exercise of the right of appropriation of payments belongs exclusively to the debtor and creditor and no third person may control or compel an appropriation different from that agreed on or made by them * * *. Thus person secondarily liable on one or more of the debts may not control the application of a payment by the debtor or the creditor, and neither the debtor nor the creditor is required to apply payments in a manner most beneficial to such persons, and the court, in making application of a payment where the debtor and creditor have failed to do so, is not required to apply it so as to exonerate such persons.'
If the payment is to be regarded, in law, as an involuntary one, we think Realty's position is in no wise improved. The application of an involuntary payment rests in the discretion of the court. 70 C.J.S. Payment § 51, page 257. 'As a general rule, where neither the debtor nor the creditor directs the application of a payment, the law will apply it to the unsecured debt or to the debt which is least secured or is most precarious': Id., § 73, page 278. This is the rule in Pennsylvania. In re Woods Trust, 1944, 350 Pa. 290, 294, 38 A.2d 28; Hoover v. Summerville, 1917, 67 Pa.Super. 544; Nevin v. Caldwell, 1933, 110 Pa.Super. 19, 23, 167 A. 413; Northampton National Bank of Easton v. Holland, 1937, 126 Pa.Super. 597, 603, 190 A. 483; Page v. Wilson, 1942, 150 Pa.Super. 427, 433, 28 A.2d 706. Since the later tax accounts were the least secured, the law will apply the payment to those accounts.
Conclusions of law.
1. The Court has jurisdiction of the parties and of the subject matter.
2. Plaintiff is entitled to judgment against the defendant, American Caramel Company, in the sum of $ 11,339.99, together with interest thereon.
3. The funds received by the plaintiff from Just Born, Inc., were lawfully applied to the later tax accounts due the plaintiff from Caramel.
4. The earlier tax accounts due the plaintiff from Caramel have continued to be and now are liens against the real estate transferred from Caramel to Realty.
5. Plaintiff is entitled to be paid from the $ 15,000 deposited with the Registry of this Court the sum of $ 11,339.99, together with any lawful interest and penalties thereon, in addition to costs. Upon such payment, Realty shall be entitled to satisfaction of the aforesaid liens upon its real estate.
Counsel will submit an appropriate form of judgment.
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