In the 1933 case United States v. Reilly, the Supreme Court of the United States addressed whether a federal tax lien had priority over a previously unrecorded mortgage. The defendant, Reilly, was a mortgagor who failed to record his mortgage before the government assessed taxes against him and placed liens on all his property. When he defaulted on both his mortgage and tax payments, there arose a dispute about which debt should be paid first from proceeds of selling off assets. The court ruled in favor of the U.S., stating that under federal law (Revised Statutes §3186), when no notice is filed for an existing encumbrance such as a mortgage at time of assessment or demand for payment by IRS, then any subsequent claimant cannot defeat Government's right to collect its due share irrespective of state laws governing recording mortgages.

In the dissenting opinion for United States v. Reilly, 1933, it was argued that the majority's decision to uphold a conviction based on evidence obtained through wiretapping violated the Fourth Amendment rights of the defendant. The dissenting justices believed that wiretapping constituted an unreasonable search and seizure because it involved intrusion into private communications without a warrant or probable cause. They contended that such practices were not only unconstitutional but also undermined public trust in law enforcement agencies by allowing them to operate outside legal boundaries. Furthermore, they expressed concern about potential abuses of power if unchecked surveillance tactics were permitted under law. In their view, upholding this conviction set a dangerous precedent for future cases involving privacy rights and governmental overreach.