When elderly grandmother Geraldine Tyler failed to pay her property tax debt on her Minneapolis condo, Hennepin County took absolute title to the property, extinguishing all of Ms. Tyler’s interest, including any leftover proceeds after the taxes were paid. While the County was entitled to recover the back taxes, how could it justify greedily taking Tyler’s property, well beyond what was owed?
Yes, in the County’s brief filed a few weeks ago at the Supreme Court, the County relies on a 13th-century English law to argue it could take even a million-dollar property to satisfy a $10 tax debt. The Statute of Gloucester (1278) allowed aristocratic lords to evict tenant-farmers and keep the crops the tenants raised on the lord’s land if the tenants failed to pay “quit-rent” on time and the tenants had insufficient personal property to satisfy the debt.
Remember the American Revolution?
As PLF explained in our reply brief, when the colonists declared their independence from the English crown, they explicitly rejected the feudal concept that people work the land solely for the benefit of their lords and masters. Thomas Jefferson wrote that American colonists “held their lands, as they did their personal property, in absolute dominion.” Ms. Tyler was not a vassal owing fealty to her lord, but a free woman who owned her property outright.
Beyond grasping at feudal straws, the County casts itself as a victim. Oh, the poor County! It needs so many tax dollars. Foreclosing on valuable properties and taking the windfall exceeding homeowners’ tax debts is a boon that lets the County spend more. How dare Ms. Tyler deprive the County of her life savings, tied up in her singlemost-valuable asset?
To be clear, Ms. Tyler is not challenging the tax debt or the County’s ability to foreclose on property when tax debts go unpaid. She is challenging the County’s taking of her property above and beyond the tax debt. An owner’s inability to pay property taxes does not eliminate the County’s constitutional responsibility to refrain from taking more than it is owed. The self-dealing statute that wipes out every lien but the County’s own tax debt reflects governmental overreach prohibited by the Takings Clause.
Finally, the County and its amici imply that Ms. Tyler abandoned a blighted property and nuisance that the County had to clean up and repair to protect the public. The state even likens her failure to pay taxes on her condo to an abandoned gas station that caused a million dollars’ worth of soil contamination.
The picture they’re trying to paint of Ms. Tyler is absurdly inaccurate.
While Minnesota does have blighted areas—the state’s amicus brief contains photographs of legitimately abandoned, derelict properties—Ms. Tyler’s condo is not among them. The County doesn’t provide a picture of her property, but Zillow does, estimating its current value at $73,000. That means the County used Ms. Tyler’s property (the leftover proceeds after the tax debt was paid) to direct public resources to cleaning up other properties—a prototypical public use for which just compensation must be paid.
Ms. Tyler really isn’t asking so much. The County gets its taxes (along with exorbitant interest, collection costs, and steep penalties) and Ms. Tyler gets the excess value of her condo. Minnesota’s treatment of debtors in every other context follows this template, and the majority of states—as well as the federal government—return excess value after paying off debts attached to real property, too. When the Supreme Court rules, we are confident it will hold the County to the constitutional command and end the cruel practice of home equity theft.