Protecting Property Interests From Aggressive Government Tax Taking (Tyler v. Hennepin County—Oral Arguments at U.S. Supreme Court)

Some would call it “theft” (photo by Marilyn Swanson)

By: Donald L Swanson

Oral arguments are held at the U.S. Supreme Court on April 26, 2023, in Tyler v. Hennepin County, Minnesota, Case No. 22-166.  A transcript of such arguments is linked here.

The essence of the case is this.  Hennepin County, Minnesota:

  • confiscates the home of 93-year-old Geraldine Tyler to pay a $15,000 property tax bill;
  • sells Geraldine’s home for $40,000;
  • keeps all the sale proceeds, including the $25,000 windfall that exceeds Geraldine’s tax bill; and
  • fights in court to retain the right to cheat other people in similar fashion—all the way to the U.S. Supreme Court.

As one judge described such facts in proceedings below, some would call it “theft.”

From a review of questions and comments from the justices during oral arguments, it appears that the justices are inclined toward protecting Geraldine Tyler’s property interests.

What follows are a smattering of questions and comments from the various justices.

Questions/Comments from Justices

JUSTICE THOMAS: . . . at bottom, [Geraldine is] saying the county took her property, made a profit on it with the surplus equity, and it belongs to her.  . . .  can you think of . . . any instance in which a creditor can foreclose on property or seize property and keep the excess profit or the excess amount over the debt that’s actually owed? [at 65]

JUSTICE GORSUCH: Well, so she has to allege that there are mortgages . . . is that what you’re suggesting? . . . you’re asking us to bring into the record that there are mortgages, okay, and take cognizance of that, even though we don’t have that . . . in the pleading. . . .  if we’re going to take . . . judicial notice of that, we’d also take judicial notice of the fact that people often . . . ­are personally liable for those mortgages and that the money that went to the state here could have been used to discharge her personal debt.  And then where are we? It seems to me like we’re at summary judgment. [at 73-74]

CHIEF JUSTICE ROBERTS: . . . ­at bottom, is your theory that the state can define property as it wishes? . . . what is the limiting principle? . . . isn’t that what [the County is] doing here? It’s saying whatever you think you have, after three years of not paying your taxes, we have it.  Your property interest is, you know, confined to that extent. . . . our property interests are defined and confined by a lot of things, but I just want to know, if there is something that the state can’t touch, what is it and where does it come from? [at 78]

JUSTICE JACKSON: . . . the government has traditionally been able to take property . . . in a tax situation . . . , liquidate it . . . and extract from it the amount to which you as the government are entitled. But you seem to be suggesting that you can take it and extinguish all of the property interests that [Geraldine] has. [at 82-83]

JUSTICE KAGAN: Are there any limits to that?  . . . I mean, $5,000 tax debt, $5 million house, take the house, don’t give back the rest? . . . But Nelson had a very easy way for the property owner to get all the surplus value. . . . in Nelson, when the state sold the house, you had to file some paperwork and then you got all the money back. Here, when the state sells the house, there’s nothing you can file to get your money back. The state says we’ll keep it. . . . Are there any limits on that? Take a $5,000 tax debt and a $5 million house, and the state says, thanks, we’ll keep it. [at 83-84]

JUSTICE GORSUCH: Assume . . . that there is no mechanism for an opportunity to get the surplus value in this statute, and the government takes a million dollar property . . . for a modest amount owed to the government, a $5 amount. Taking, no taking? . . . So . . . a $5 property tax, a million dollar property, good to go? [at 85-86]­

CHIEF JUSTICE ROBERTS: . . . the Constitution says without just compensation. I don’t think the framers were ignorant of the notion of eminent domain, but they still wanted to protect private property if you don’t pay for it.

JUSTICE JACKSON: . . . ­why are you suggesting that there would be, like, a real big practical problem if we ruled in the way that your friend on the other side wants us to? My understanding is that Minnesota’s statute and the states at the founding that were doing this were in the minority. So most states allow for some sort of a surplus or have some sort of mechanism to give the money back to homeowners. So what is the big practical problem that we would face? [at 91]

JUSTICE KAGAN: If you had a $10,000 income tax bill due and the government came in and took your $100,000 bank account and didn’t give you the $90,000 back, taking? . . . So what’s the difference? . . . 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, . . .  why should land be treated so much more favorably . . . the state can just keep the whole when the state could never do that with cash? [at 91-94]

JUSTICE KAVANAUGH: Why would we read the Constitution to disfavor real property, though? That seems very counterintuitive. [at 96]

CHIEF JUSTICE ROBERTS: Counsel, I think you’re right that there’s a difference between the value that our history places upon money and property, but I think it’s the exact opposite of what you’re saying. I think our cases bear this out, where they talk about property, you know, land, being essential to the preservation of liberty and it’s a bulwark against the dominance of the state.  Money, on the other hand, you know, inflation, it’s worthless, but land is still there. And to say that there’s a greater degree of protection for money as opposed to property, I think, has it exactly backwards. [at 97-98]


Here’s hoping the U.S. Supreme Court justices protect Geraldine Tyler’s interests in her formerly-owned real property.

The questions/comments from justices cited above seem to suggest that they will do so—hopefully, that’s not mere wishful thinking on my part.

It will be interesting to see what the justices do in this case.

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