Geraldine Tyler, a 94-year-old grandmother, lost her Minneapolis condo when she failed to pay the property taxes for several years. Tyler does not dispute that Hennepin County could foreclose on the $40,000 property and sell it to obtain the $15,000 in taxes and costs that she owed it. But she argued that the county violated the Constitution when it kept the $25,000 left over after the property was sold. After roughly 100 minutes of debate on Wednesday, a majority of the justices seemed inclined to agree with her.
Representing Tyler, lawyer Christina Martin argued that the county had violated the Constitution’s takings clause, which bars the government from taking private property for public use without adequately compensating the property owners. The county, Martin said, could have followed a more traditional path and taken Tyler’s condo, sold it to pay Tyler’s debts, and then refunded the remainder to Tyler. But instead, she emphasized, the county kept the profits too. And if the county’s actions don’t violate the takings clause, Martin continued, at the very least they violate the Eighth Amendment’s ban on excessive fines, because the county’s seizure of Tyler’s property to punish her for not paying her property taxes on time goes well beyond compensating the government for any loss.
The Biden administration filed a “friend of the court” brief in which it agreed with Tyler that the county’s actions violated the takings clause. The justices pressed both Martin and Assistant to the Solicitor General Erica Ross, representing the Department of Justice, on potentially significant differences in the reasoning on which Tyler and DOJ relied to reach that conclusion – specifically, what is the property interest at stake, and when does the takings claim arise?
Ross contended that the property interest is the title to the condo, which is “taken” when the county seizes the title for failure to pay taxes, rather than when the condo is later sold.
Martin characterized her position – which focused on Tyler’s equity in her condo as the property interest that is seized when the government sells the condo and keeps all of the proceeds – as simply another way of looking at the same question, but Justice Sonia Sotomayor resisted that argument, telling Martin that there are “huge” implications to the different arguments. “These are big questions,” Sotomayor said, asking Martin why the court should address the federal government’s argument at all.
Some justices saw a disconnect between Katyal’s theory and how the government deals with takings and forfeitures in other contexts. When Katyal agreed with Kagan that the government could not seize an entire bank account containing $100,000 to pay a $10,000 income tax debt, he explained that the main difference was “mostly historical,” although he allowed that the difference between real property – that is, land and buildings – and other items of property could also play a role.
That distinction left Kagan befuddled. “If the mind rebels,” she said, at the idea that the government can seize a $100,000 bank account to pay a $10,000 tax debt, why should the government be allowed to rely on 13th- or 18th-century history to do essentially the same thing with real estate?
Justice Brett Kavanaugh agreed. “Why,” he asked Katyal, “would we read the Constitution to disfavor real property? That seems counterintuitive.”