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July 25, 1994

ADELVISION, L.P., formerly known as ADELPHIA CABLEVISION ASSOCIATES OF RADNOR, L.P., Plaintiff-Stakeholder,

The opinion of the court was delivered by: FRANKLIN S. VAN ANTWERPEN


 This interpleader action concerns a priority dispute between a federal tax lien and an investor's security interest in a limited partnership. The parties have stipulated to the facts and present this case for resolution on cross-motions for summary judgment. The court is asked to determine the relative rights of the defendants to $ 794,382.00 in proceeds from the liquidation of (5) limited partnership units of plaintiff Adelvision, L.P. ("Adelvision"). Adelvision and the Pennsylvania Department of Labor and Industry have been dismissed as parties to this action, and David R. Cook ("Cook"), Horace E. Groff ("Groff") and the United States of America now claim an interest in the five liquidated Adelvision units. The court relies upon the Stipulated Statement of Facts in rendering this decision, but for purposes of clarity and context, sets forth the following summary of facts, which includes certain explanatory remarks concerning the procedural posture of the case.


 Defendant Groff, a businessman who resides and does business in Lancaster County, Pennsylvania, was involved with several food companies, the most significant of which were G.P.C., Inc. and Wilson Nut Company. Stipulation, PP 7-8. In August 1986, Groff caused G.P.C., Inc. and the Wilson Nut Company to enter into loan arrangements with Hamilton Bank of Lancaster, Pennsylvania, whereby Hamilton Bank extended term loans and lines of credit to the two companies in the amount of $ 3,210,000.00. Stipulation, PP 9-10; Stip. Exhibit "A".

 In February 1987, these loan agreements were first amended and an additional line of credit of $ 700,000.00 was extended to G.P.C. At that time, Groff and his wife, Susan, also entered into a guarantee agreement for repayment of the Hamilton debt. Stipulation, P 11; Stip. Exhibit "B". The Hamilton loans were secured by all the tangible and intangible property of G.P.C., mortgages on Groff's personal residence and other real property owned by Groff, pledges of promissory notes, and stock in other companies, as well as the assignment of a non-competition agreement. Stipulation, P 15.

 In the early 1980s, Groff also purchased five (5) partnership units of Adelphia Cablevision Associates of Radnor, L.P., now known as Adelvision ("Adelvision Units"). The partnership units gave Groff a right to share in the ownership and profits of the partnership as a limited partner. Groff retained ownership of the five Adelvision Units through December 1, 1992. However, these Units were not pledged to Hamilton Bank as security for the notes described above. Stipulation, P 16.

 Despite the influx of borrowed funds from Hamilton Bank, Groff's companies continued to experience financial difficulties. As a result, Groff and Hamilton Bank amended the aforementioned loan agreements a total of six (6) times, thereby reducing the lines of credit and extending the time for payment of the loan obligations. Stipulation, P 13; Stip. Exhibit "C". As of November 12, 1991, the balance owed by Groff on five (5) separate notes totaled $ 2,670,885.00. Stipulation, P 14. At that time, the loans were in default and Hamilton considered the collateral securing the bank loans as possibly insufficient to cover the repayment of the loans. Stipulation, PP 24 and 26. In fact, the asset value of the loans had been reduced on Hamilton Bank's balance sheet by at least $ 1,000,000.00. Stipulation, P 24.

 In late 1990 and into 1991, Mr. David R. Cook, acting through his agent and representative, Francis P. Dougherty ("Dougherty"), entered into negotiations with Hamilton Bank about the possible purchase of Groff's loan obligations to the Bank. At that time, Dougherty, also on behalf of Cook, initiated discussions with Groff about the possibility of investing in Groff's companies. Stipulation, P 17. The parties also discussed whether Groff could provide additional security with respect to Groff's Hamilton Bank loans if Cook agreed to purchase those loans from the bank. Stipulation, P 18.

 By Agreement signed by the parties dated November 12, 1991, an accord was reached between Groff and Cook over the purchase of the Hamilton Bank loans. In the Agreement, Groff stated that he would grant a security interest in the five (5) Adelvision Units to Cook so long as Cook purchased the loans from Hamilton Bank for $ 1,050,000.00. Stipulation, P 19; Stip. Exhibit "D". Groff performed his obligation by executing a Security Agreement conveying the security interest in the five (5) Adelvision Units to Cook. Stipulation, P 20; Stip. Exhibit "E".

 On November 13, 1991, in performance of his obligation to Groff, Cook entered into a General Conveyance, Assignment and Bill of Sale with Hamilton Bank, pursuant to which Hamilton assigned the loans to Cook who in turn wired $ 1,050,000.00 to Hamilton Bank that day. Stipulation, P 21; Stip. Exhibit "F". Finally, Financing Statements, specifically describing the collateral offered to Cook in the Security Agreement between the parties, were signed by Groff and filed in the Office of the Prothonotary of Lancaster County and the Department of Secretary of State of the Commonwealth of Pennsylvania on November 18, 1991 and December 9, 1991, respectively. Stipulation, P 22; Stip. Exhibit "G".

 At the time of these transactions, Cook believed that Groff's companies, if permitted to operate and not liquidated, might in the future become profitable enough to participate in the repayment of the loans. Stipulation, P 27. This belief, together with liquidation proceeds of additional security given by Groff, including the five Adelvision Units that are at issue here, accorded Cook reasonable prospects of recovering his investment in the loans and of making a profit as well. Id. For these reasons, Cook, with the advice and counsel of Dougherty, has not pressed for payment of the loans nor has instituted foreclosure proceedings against Groff to date. Id. The United States now comes before the court asserting several claims for taxes against Groff. Specifically, tax liens are claimed on the five Adelvision Units belonging to Groff, by virtue of unpaid federal taxes plus statutory additions, in the amounts and for the periods indicated below: TYPE OF TAX PERIOD ENDING DATE ASSESSED AMOUNT 100% Penalty 03/31/87 10/31/91 $194,404.03 n1 Income 1989 12/30/91 $93,899.78 Income 1990 12/30/91 $110,444.34 Income 1988 10/20/92 $103.28 Income 1991 12/28/92 $122,043.70

 Stipulation, P 28. In addition to the above assessments, a notice of federal tax liens was filed on January 27, 1994 by the United States in Lancaster County against Groff for additional tax liabilities as follows: TYPE OF TAX PERIOD ENDING AMOUNT Income 1985 $343,425.44 Income 1986 $262,847.39 Income 1987 $180,456.38 Income 1988 $152,536.52 Income 1989 $88,455.95

 See U.S. Exhibit "C".

 On December 16, 1992, plaintiff Adelvision sold all of its assets to a third party. Adelvision originally brought this action in the Court of Common Pleas for Lancaster County, in order to establish the priority of conflicting claims to the $ 794,382.00 from the sale of the five Adelvision Units. The proceeds are now in the custody of the court. The action was removed to this court on or about February 17, 1993, and all parties have filed an answer to the plaintiff's complaint. On October 25, 1993, the plaintiff was dismissed from this action with prejudice by Stipulated Order. Also, on or about December 15, 1993, defendant Department of Labor and Industry of the Commonwealth of Pennsylvania filed a voluntary Notice of Dismissal of its claims in this matter. *fn2" Therefore, the only parties that continue to claim an interest in the Adelvision fund are the United States, Mr. Groff and Mr. Cook. We will now review remaining defendants' claims on the contested Adelvision property.


 In considering a motion for summary judgment, we must examine the evidence in the light most favorable to the non-moving party and draw all reasonable inferences in favor of that party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255, 106 S. Ct. 2505, 91 L. Ed. 2d 202 (1986). The standard does not change when the issues are presented in the context of cross-motions for summary judgment. Appelmans v. City of Philadelphia, 826 F.2d 214 (3d Cir. 1987); see also, Arnold Pontiac-GMC, Inc. v. General Motors Corp., 700 F. Supp. 838, 840 (W.D. Pa. 1988).


 The central issue in this case is whether Cook's interest under the Groff Agreement and Security Agreement is superior to the Internal Revenue Service's ("IRS") tax liens. The IRS claims the contested five liquidated Adelvision Units pursuant to six (6) separate federal tax liens totaling $ 1,548,616.81 filed against Groff. Cook claims the fund by virtue of a perfected security interest in the five Adelvision Units granted to him pursuant to the Groff Agreement and Security Agreement dated November 12, 1991. Groff claims the fund as the owner of the five Adelvision Units. All that remains to be decided in this action is the priority dispute among the United States, Groff and Cook. *fn3"

 Pursuant to the Internal Revenue Code, 26 U.S.C. § 6321, the failure of any person to pay a tax liability after demand creates a lien upon that person's property. The lien arises "at the time the assessment is made," 26 U.S.C. § 6322, and extends to all property belonging to the taxpayer. See United States v. National Bank of Commerce, 472 U.S. 713, 719-20, 105 S. Ct. 2919, 2923-24, 86 L. Ed. 2d 565 (1985); see also 21 West Lancaster Corp. v. Main Line Restaurant, Inc., 790 F.2d 354, 356 (3d Cir. 1986). A lien arising under § 6321 is afforded priority over all other unperfected liens or claims asserted against the taxpayer's property. 26 U.S.C. § 6323(a). Under § 6323(a), however, an IRS lien is ineffective against certain parties, including a "purchaser, holder of a security interest, mechanic's lien or judgment lien creditor," until the notice of the lien has been properly filed by the government. Id. ; see United States v. Pioneer American Ins. Co., 374 U.S. 84, 88, 83 S. Ct. 1651, 1654, 10 L. Ed. 2d 770, 774 (1963).

 In this case, the tax liens at issue arose during a period from 1985 to 1991, or more specifically at the dates of assessment. However, only the lien notice with respect to the 100% penalty, recorded on October 21, 1991, was filed prior in time to the filing of Financing Statements that Cook claims perfected his security interest in the five Adelvision Units. *fn4" Therefore, whether the tax liens may be enforced against the proceeds of the five Adelvision Units turns on whether Cook's interest falls within one of the four exceptions enumerated in § 6323(a).

 It is clear from the outset that Cook is neither a mechanic's lienholder, since his interest does not relate to "construction or improvement of [] property," 26 U.S.C. § 6323(h)(2), nor a judgment lienholder, since he has not yet obtained a judgment against Groff. Thus, the court must determine ...

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