WASHINGTON (CN) — The seizure of a home belonging to a 94-year-old woman drew concern bordering on alarm from the justices Wednesday as they parsed the seeming unlimited power that states can wield to settle up debts, no matter the cost.
“Are there any limits to that,” Justice Elena Kagan asked bluntly. “I mean, $5,000 tax debt, $5 million house, take the house, don’t give back the rest?"
Geraldine Tyler had spent over a decade in the one-bedroom condominium she bought in Hennepin County, Minnesota, before her health forced to move into a building for seniors in 2010. An octogenarian at time, Tyler stopped keeping up with property taxes on the condo.
When the county took the title to Tyler's property in 2015, she was five years delinquent on the taxes. Selling the condo brought Hennepin County $40,000, meanwhile Tyler's debts totaled only $15,000.
She claims the county violated her constitutional rights by taking more than what it was owed.
“The county could have collected the debt without violating the Constitution by following the traditional common law rule still followed in most states and still followed in Minnesota in nearly every other debt collection circumstance,” Tyler's attorney Christina Martin argued Wednesday at a hearing of the Supreme Court.
Chief Justice John Roberts said states have deeply rooted rights to create laws to reimburse debts incurred by residents.
“It’s a deeply rooted right that’s traditionally defined by state law,” the Bush appointee said.
Many of the justices, however, appeared to think these laws should be limited.
“It’s not that it’s entitled to, as a result of the debt, extinguish completely the property interests or rights of the individual,” Justice Ketanji Brown Jackson said.
Tyler brought a class action against Hennepin County in 2019, alleging the county violated the federal takings clause and imposed an excessive fine for her debts. Backed by the Pacific Legal Foundation, she now seeks high court relief after the Eighth Circuit affirmed dismissal.
Hennepin County argued states have a long tradition of enforcing laws like its own to settle debts.
“The law here falls within a long tradition that stretches back before the republic and was present at the founding,” Neal Katyal with Hogan Lovells said.
The high court’s conservative majority is normally receptive to arguments rooted in history, but Wednesday’s arguments appeared to be an exception to that rule.
“I just don’t understand what on earth any of that history has to do with this case,” Justice Neil Gorsuch said.
Gorsuch hounded Katyal’s arguments that traced Hennepin County’s laws back to the Statute of Gloucester in 1278. The Trump appointee quoted Tyler’s reply brief in the case that said she was “not a vassal owing fealty to her lord.”
Justice Amy Coney Barrett posed a hypothetical about parking tickets.
“What about the hypothetical of you owe $20 in parking tickets,” the Trump appointee asked. “Can the state just take your whole car?”
Katyal said there was no history to be looked to find the answer for that hypothetical, to which Barrett remarked, “Well, there weren’t cars then.”
The government participated in Wednesday’s arguments in favor of neither party. It argued states have the power to settle their debts but not take full property rights if they exceed those debts.
“When a taxpayer fails to pay her full tax debt, the government may seize and sell property to recoup the money it is owed,” said Erica Ross, assistant to the U.S. solicitor general. “But that power does not encompass the power to extinguish an owner’s full rights in property that is worth more than the tax debt.
Wednesday’s arguments mark the Supreme Court’s last oral argument sitting of the term.
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