The Internal Revenue Service (IRS) recorded a tax lien against an owner, attaching to property he owned. A creditor of the owner later recorded a judgment lien which also attached to the property. The owner defaulted on a first trust deed and the lender sold the property at a trustee’s foreclosure sale which resulted in excess sales proceeds. The judgment creditor made a demand on the trustee for the excess proceeds. The IRS later made their demand on the trustee for the proceeds. The trustee determined the IRS was first in priority to receive the excess proceeds on the trustee’s sale. The judgment creditor disagreed, claiming priority to the proceeds over the IRS since the judgment creditor made its demand on the trustee for the proceeds before the IRS did. The IRS claimed first entitlement to the proceeds since it recorded the tax lien before the creditor recorded his judgment lien. A U.S. court of appeals held the IRS, having recorded a tax lien before the creditor recorded his judgment lien, has the first right to excess proceeds from the trustee foreclosure sale since priority of recording (“the first in time is first in right”) controls the right to excess proceeds from a trustee’s foreclosure sale, not the priority of making a demand on the trustee. [Quality Loan Service Corp. v. 24702 Pallas Way, Mission Viejo, CA 92691 (9th Cir. 2011)_F_]