Petitioner Tyler, a 94 year-old woman, owed $15,000 in local property taxes and related penalties in connection with an abandoned condominium. In accordance with state tax-lien statutes, Hennepin County, Minnesota seized the property, sold it for $40,000, and retained the $25,000 surplus. The Eighth Circuit rejected Tyler’s contention that the County’s refusal to return the surplus was a taking of private property without just compensation in violation of the Constitution’s Fifth and Fourteenth Amendments. The Supreme Court has granted certiorari to resolve a split of authority on whether a governmental entity must pay just compensation when it seizes and sells property to collect a debt and keeps the surplus.
1. Whether taking and selling a home to satisfy a debt to the government, and keeping the
surplus value as a windfall, violates the Takings Clause.
2. Whether the forfeiture of property worth far more than needed to satisfy a debt plus,
interest, penalties, and costs, is a fine within the meaning of the Eighth Amendment.
ALF’s Amicus Brief:
ALF long has advocated for protection of private property from unconstitutional governmental intrusion. Its amicus brief supports Petitioner Tyler’s contention that the Minnesota statute authorizing the County to keep the profits from selling seized property to satisfy a tax debt (analogous to statutory schemes in 13 additional States) violates the Fifth Amendment’s Takings Clause (also known as the Just Compensation Clause), which is applicable to States through the Fourteenth Amendment.
The amicus brief was co-authored authored by ALF Advisory Council member Nancie Marzulla, who is a nationally recognized expert on Takings and related property law issues, and ALF Executive Vice President & General Counsel Larry Ebner.
ALF’s brief argues, consistent with Supreme Court precedent, that a State may not circumvent the Just Compensation Clause by attempting to “redefine” private property as public property:
“Regardless of how characterized, the Minnesota tax forfeiture scheme violates the Just Compensation Clause and, unchecked, threatens the very concept of private property, as it signals to States that they may appropriate with impunity private property through the simple process of legislating away the private property right.”
The brief also explains that the Eighth Circuit’s opinion mischaracterizes Supreme Court precedent on seizure and sale of private property to satisfy debts owed to the government by confusing a right to redeem seized property with the inability to obtain the surplus proceeds from sale of the property.
