US Supreme Court hears arguments in woman’s lawsuit against Hennepin County
A Hennepin County woman’s property rights lawsuit came before the U.S. Supreme Court on Wednesday.
Geraldine Tyler, 94, lost her one-bedroom condo in Minneapolis over unpaid taxes, plus interest and penalties totaling around $15,000. Hennepin County sold the apartment for $40,000 and kept every penny.
Tyler is being represented by the national nonprofit Pacific Legal Foundation (PLF), which calls the ordeal a case of “home equity theft.”
Minnesota is among roughly a dozen states and the District of Columbia that allow local jurisdictions to keep the excess money, according to PLF, which says Tyler’s case is one of nearly 9,000 between 2014 and 2021.
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There hasn’t been any explanation about why Tyler stopped paying her property taxes when she moved from the condo to an apartment building for older people in 2010. She moved for “health and safety” reasons, PLF said.
During the hearing Wednesday, justices seemed in broad agreement with arguments by Tyler’s lawyer that Hennepin County violated the Constitution’s prohibition on the taking of private property without “just compensation.”
The county’s lawyer said Tyler made clear she wanted nothing to do with the condo in the five years she owed back taxes.
David Schultz, a political science and legal studies professor at Hamline University, talked to 5 EYEWITNESS NEWS about the case back in January after the Supreme Court agreed to hear it.
“First, what I see is the state has the authority to be able to go after people who don’t pay their taxes,” Schultz said. “Two, there’s got to be some kind of sense of compassion. Compassion in the sense of looking at the age of the person looking at the financial circumstances — and to me, how do you bring the two together?”
He also said the decision in the case could have a wide impact.
“This has implications for not just property taxes, but also in terms of income taxes, and a whole bunch of other issues in terms of the ability of states to generate revenue,” Schultz said.
Tyler also is raising a claim that Minnesota’s law violates the Eighth Amendment’s prohibition on excessive fines. But if the court rules in her favor based on the Fifth Amendment, it wouldn’t have to decide the other issue.
“When the government takes property to satisfy a debt and takes more than what is owed, it has a constitutional duty to return or pay for the excess,” Christina Martin, senior attorney with PLF, said to Justices.
Justices asked several questions during the 100 minutes of arguments — one from Justice Samuel Alito asked if the concerns would be the same if this were not a house that was sold, but a different type of property, Martin responding in part: “if they’re collecting personal property taxes, they’re not allowed to take more than what’s owed. And so I think if you have a personal property situation, the same principle would carry over.”
Hennepin County sent a statement that reads in part under state tax laws, “when someone abandons their property by not paying property taxes for many years, title to the property transfers to the state.”
“Counties must follow a complicated administrative process under state law to return those properties to the tax rolls,” Hennepin County added. “When properties are sold, net proceeds offset the loss to school districts, cities, and the county of uncollected property taxes. Forfeiture is not a source of profit — factoring in all costs, Hennepin County’s program does not manage to break even.”
The county also outlined it works “very hard to help anyone who wants to avoid forfeiture,” including with senior citizens who can be part of its Senior Citizens’ Property Tax Deferral program — something it says caps seniors’ property tax payments.
The county and State of Minnesota were represented by attorney Neal Katyal.
“We’re only defending what Minnesota does here, which is say when the title is fully transferred to the government, at that point, her property rights are extinguished,” Katyal said to Justices.
Following Wednesday’s arguments, political science professor with Hamline University, David Schultz tells 5 EYEWITNESS NEWS the Justices, “seemed very skeptical about what Hennepin County and the State of Minnesota is doing.”
Adding Tyler’s case has a chance to win and will have a further impact than just Minnesota.
“This could have a huge impact for many states, and many homeowners across the country. [Including] for those who are struggling [with] paying taxes [and] maintaining their homes,” Schultz added.
The Supreme Court’s decision is expected by late June.
The Associated Press contributed to this story.