May it be a unanimous ruling….
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NRO:
Take the case of Geraldine Tyler, age 94. Tyler owned a condominium in Hennepin County, Minn. Owing to health and safety concerns, she moved to a senior-living apartment when she was 80. After missing property-tax payments on the condo, she ended up owing $2,300 in taxes and $12,700 in fees and penalties for those unpaid taxes. Hennepin County initiated a tax foreclosure and sold the condo for $40,000. But instead of taking only the $15,000 that Tyler owed and letting her keep the rest of her equity, the county pocketed the remaining $25,000, too.
Tyler sued the county, arguing that taking the remainder of her home equity was unconstitutional. This week, the Supreme Court will hear oral argument in Tyler v. Hennepin County.
This case will affect many more people than just Geraldine Tyler. The practice of taking the surplus equity on top of what is owed in taxes and fees, colloquially referred to as home-equity theft, occurs in more than a dozen states and disproportionately harms the poor and the elderly. It is also unconstitutional and contrary to historical legal practice. The Supreme Court should put an end to it nationwide.
The American legal system, and the English system from which it is derived, traditionally protected property owners from excessive tax forfeitures. The Magna Carta, which became the cornerstone of the English common-law system and influenced the American Founding, prohibited tax collectors from taking more property than was required to satisfy a debt.
In line with this foundational principle, the U.S. Constitution’s Fifth Amendment requires that just compensation be paid when private property is taken for public use. That rule should decide this case in Tyler’s favor. When a delinquent taxpayer’s home is taken to satisfy an unpaid tax bill, the homeowner is entitled to keep the remainder of the home equity — which is the homeowner’s property. Home-equity theft takes a homeowner’s private property with no just compensation (indeed, without any compensation).
But Hennepin County argues that, under Minnesota law, Tyler’s remaining equity is not hers at all and that it did not seize any property in the first place. This dangerous argument would give states carte blanche to define away property interests and violate the Fifth Amendment with impunity. States should not be allowed to so easily circumvent a core constitutional protection.
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@Jolly said in May it be a unanimous ruling….:
And the MSM hasn't reported it...
Wonder why?
Where have you looked when you way “MSM”?
I saw it this morning on NPR: https://www.npr.org/2023/04/26/1170667154/grandma-didnt-pay-taxes-now-her-house-is-focus-of-property-rights-test-case
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@jon-nyc , @Mik , I agree that it would be wrong if the local government kept the profit. But the local government is claiming that there is no profit, that the woman had negative equity after all liabilities were taken into consideration.
Still, on principle, I agree that government should not get to keep the surplus when there really is a surplus.
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@George-K said in May it be a unanimous ruling….:
she ended up owing $2,300 in taxes and $12,700 in fees and penalties for those unpaid taxes. Hennepin County initiated a tax foreclosure and sold the condo for $40,000. But instead of taking only the $15,000 that Tyler owed and letting her keep the rest of her equity, the county pocketed the remaining $25,000, too.
I'd need to see how they figured that. 5/8 of the sale appears to be profit over the original debt. I'd also like to see how they come up with penalties and fees more than 5 times the delinquent taxes.
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@George-K said in May it be a unanimous ruling….:
she ended up owing $2,300 in taxes and $12,700 in fees and penalties for those unpaid taxes. Hennepin County initiated a tax foreclosure and sold the condo for $40,000. But instead of taking only the $15,000 that Tyler owed and letting her keep the rest of her equity, the county pocketed the remaining $25,000, too.
I'd need to see how they figured that. 5/8 of the sale appears to be profit over the original debt. I'd also like to see how they come up with penalties and fees more than 5 times the delinquent taxes.
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Ilya Somin on the cross-ideological agreement on this case.
Cato and ACLU actually filed a joint brief.
https://reason.com/volokh/2023/04/26/unusual-cross-ideological-agreement-in-tyler-v-hennepin-county/
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https://www.washingtonpost.com/politics/2023/04/26/property-tax-equity-stealing-supreme-court/
Supreme Court justices on Wednesday seemed inclined to side with a 94-year-old woman who said a Minnesota county unfairly pocketed the surplus when it seized and sold her condominium after she failed to pay property taxes.
Hennepin County, which contains Minneapolis, foreclosed on Geraldine Tyler’s one-bedroom condo after she moved into an apartment building for the elderly and stopped paying property taxes for five years.
She owed about $15,000 in taxes and penalties. The county sold her condo for $40,000 and kept the surplus, as the law allows in Minnesota, the District of Columbia and about a dozen other states.
The Supreme Court is considering Tyler’s claim that keeping the excess money violates the Constitution’s prohibition on the taking of private property without fair compensation by the government, as well as protection against excessive fines. The Pacific Legal Foundation, a property-rights group representing Tyler, calls what Hennepin County did “equity-stealing.”
Wednesday’s lengthy oral argument touched on the Magna Carta and the 13th-century Statute of Gloucester and featured more than a dozen references to a colonial-era American judge named St. George Tucker. In the end, however, both conservative and liberal justices seemed less moved by an appeal to history and more worried that there was no limit to the county’s argument that it is entitled to the whole proceeds of a sale when it seizes property because of unpaid taxes.
Chief Justice Roberts declines to testify on Supreme Court ethics
“At bottom, she’s saying the county took her property, made a profit on it with the surplus equity, and it belongs to her,” Justice Clarence Thomas said. He asked Washington lawyer Neal K. Katyal, representing Hennepin County, whether he could think of “any instance in which a creditor can . . . seize property and keep the excess profit or the excess amount over the debt that’s actually owed?”
Justice Elena Kagan similarly pushed Katyal. “Are there any limits?” she asked. “I mean, $5,000 tax debt, $5 million house. Take the house, don’t give back the rest?”
She added: “If the mind rebels at the notion that the government can seize your $100,000 bank account and not give you back the $90,000 that you don’t owe, if the mind rebels at that, you know, why should . . . what was going on in 1200 or what was going on in 1776 change anything?”
Katyal said that the Supreme Court had previously blessed a similar law in New York and that Minnesota made it even easier than that law for Tyler and others to avoid forfeiture. He said Tyler ignored five years of warnings about not paying property taxes and other offers of how to restructure payment of what she owed.