Bank of Illinois v. Covey (In re Shara Manning Properties, Inc.)

OPINION

THOMAS L. PERKINS, Chief Judge.

This adversary proceeding involves a priority dispute between two mortgagees and the IRS. The first to record was Bank of Illinois, n/k/a Heartland Bank and Trust Co. (“BOI”). The IRS recorded second. Third to record was Eastern Tazewell Development Co. (“ETDC”). The mortgages of both BOI and ETDC are challenged, each by the other.

*902FACTUAL AND PROCEDURAL BACKGROUND

The Debtor, Shara Manning Properties, Inc. (“SMPI”), owned and operated by Shara Manning, was a developer of residential real estate. It developed Wyndhill Estates, consisting of 26 acres of…