Tyler v. Hennepin County
598 U.S. 631
SCOTUS2023Background
- Geraldine Tyler owned a Minneapolis condominium that accrued about $15,000 in unpaid real-estate taxes (plus interest/penalties); Hennepin County seized and sold the unit for $40,000 and retained the $25,000 surplus under Minnesota law.
- Minnesota's tax-forfeiture scheme vests absolute title in the State after three years of delinquency and directs that sale proceeds in excess of taxes and costs remain with the county, with no procedure for the former owner to recover the surplus.
- Tyler (age 94) sued, alleging the County’s retention of the surplus violated the Fifth Amendment Takings Clause and the Eighth Amendment Excessive Fines Clause.
- The District Court dismissed for failure to state a claim; the Eighth Circuit affirmed, reasoning that where state law recognizes no surplus interest, there is no taking, and it also rejected the excessive-fines claim.
- The Supreme Court granted certiorari and reversed the Eighth Circuit, holding Tyler plausibly alleged a Fifth Amendment taking; the Court did not decide the Eighth Amendment claim.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Standing to sue | Tyler: County’s retention of $25,000 is a pocketbook injury attributable to County and redressable by court | County: Possible other encumbrances (mortgage/lien) might eliminate any net loss, so no injury | Court: Tyler plausibly pleaded financial harm; at motion-to-dismiss stage she has standing |
| Whether surplus after tax sale is "property" under Takings Clause | Tyler: Remaining sale proceeds are private property and cannot be appropriated without just compensation | County: Minnesota law extinguishes owner’s interest in surplus, so no Takings Clause protection | Court: State law is important but not dispositive; history and precedents show owners are entitled to surplus, so retention plausibly effects a taking |
| Effect of historical/state forfeiture statutes & Nelson v. City of New York | Tyler: Historical practice and many states require return of surplus; Minnesota’s unique rule cannot avoid Takings protection | County: State statute extinguishes the interest—Nelson permits procedural limits on surplus recovery | Court: Nelson distinguished (it involved an available recovery procedure); Minnesota provides no opportunity to reclaim surplus—historical consensus supports protection |
| Abandonment by nonpayment of taxes | County: Failure to pay taxes amounts to constructive abandonment, so no compensable property interest | Tyler: Abandonment requires surrender/relinquishment; Minnesota’s scheme focuses only on nonpayment, not use or intent to abandon | Court: Nonpayment alone doesn’t establish abandonment; Minnesota’s forfeiture does not equate to abandonment, so County cannot evade Takings Clause by framing it as abandonment |
Key Cases Cited
- Phillips v. Washington Legal Foundation, 524 U.S. 156 (state law is important but cannot be the sole source of property for Takings analysis)
- Tahoe-Sierra Preservation Council, Inc. v. Tahoe Regional Planning Agency, 535 U.S. 302 (government directly appropriating private property is a classic taking)
- United States v. Taylor, 104 U.S. 216 (taxpayer entitled to surplus proceeds of tax sale)
- United States v. Lawton, 110 U.S. 146 (government keeping property rather than selling does not permit withholding surplus without compensation)
- Nelson v. City of New York, 352 U.S. 103 (distinguished: no taking where owner had procedural opportunity to claim surplus)
- Lujan v. Defenders of Wildlife, 504 U.S. 555 (standing requires injury in fact attributable to defendant and redressable)
- Texaco, Inc. v. Short, 454 U.S. 516 (States may condition retention of property rights on reasonable conditions; abandonment principles)
- Armstrong v. United States, 364 U.S. 40 (Takings Clause prevents forcing some individuals alone to bear public burdens)
- Ruckelshaus v. Monsanto Co., 467 U.S. 986 (framework for identifying property interests beyond state law)