The Supreme Court on Thursday delivered a unanimous victory for property rights when it ruled that a Minnesota county violated the Constitution by seizing and selling an elderly woman’s home over a small tax debt and keeping the profit.Embed from Getty Images
Geraldine Tyler, who is now 94 years old, bought a condominium in Hennepin County in 1999 and lived there for more than a decade. She fell behind on her taxes after moving to a retirement community in 2010. The county added $13,000 in interest, penalties and fees to her original $2,300 tax bill. In 2015, it sold her home for $40,000 and pocketed the remaining $25,000 surplus.
Tyler spent years arguing that such a taking was unconstitutional under the Fifth Amendment, which requires that the government pay just compensation when property is taken for public use. But she lost in lower courts, which held that state law did not recognize any property interest in the excess proceeds from a tax foreclosure sale.
The Supreme Court reversed that decision and held that Tyler was entitled to challenge the county’s action as a violation of her federal constitutional rights. Chief Justice John Roberts wrote for the court that “the taxpayer must render unto Caesar what is Caesar’s but no more.”
Christina Martin, a senior attorney at the Pacific Legal Foundation who represented Tyler, hailed the ruling as a win for property rights. “The county could have collected the debt without violating the Constitution by following the traditional common law rule still followed in most states and still followed in Minnesota in nearly every other debt collection circumstance,” she said.
The ruling could have implications for millions of Americans who face the risk of losing their home equity to government or private investors under similar schemes. According to a report by the Pacific Legal Foundation last year, a dozen states regularly allow such practices and others have laws that could permit them in some circumstances.
“This case is about more than just Geraldine Tyler’s home. It’s about protecting millions of Americans from losing their hard-earned equity to government greed,” said Robert McNamara, a senior attorney at the Institute for Justice, which filed a brief supporting Tyler.
- SCOTUS Rules Against Home Equity Theft | Cato Institute | May 25, 2023
- Supreme Court Unanimously Rules Against Government Theft of Home Equity | The Heritage Foundation | May 26, 2023
- Supreme Court Strikes Down Minnesota Law That Allowed Government to Keep Home Equity After Tax Foreclosure | Institute for Justice | May 25, 2023