A legal fight over homeownership and tax liens in Nebraska reached a major turning point when the state's highest court revived a compensation claim from a couple who lost their mortgage-free home over a relatively small tax debt.
uncertain
who → reach → debt
Kevin Fair and his wife, Terry, owned a home in Scotts Bluff County with no mortgage or other liens.
asserted
Fair → own → mortgage
The property was valued by the county at $59,759.
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property → value → 59,759
After the couple failed to pay $588.21 in property taxes, the county sold the tax debt to Continental Resources.
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county → fail → Resources
The dispute eventually reached the US Supreme Court before returning to the Nebraska Supreme Court.
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dispute → reach → Court
In 2024, the Nebraska court ruled that Fair had a valid claim that he was deprived of property without just compensation.
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he → rule → compensation
Debt swells and deed changes hands
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deed → swell → hands
The case began in 2015, when the Scotts Bluff County treasurer sold a tax certificate for the unpaid $588.21 to Continental Resources on March 11.
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treasurer → begin → March
Nebraska law allowed the county to sell the tax certificate to a private buyer.
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county → allow → buyer
Continental then paid later property taxes on the home.
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Continental → pay → home
The county stopped sending the Fairs further tax bills after Continental began making those payments.
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Continental → stop → payments
Three years later, on April 13, 2018, Continental sent the couple a “Notice of Expiration of Right of Redemption.
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Continental → send → Redemption
The notice gave them three months to recover the property by paying $5,268, which represented the unpaid taxes, interest, fees, and other costs.
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which → give → taxes
The Fairs did not pay the amount within the three-month period.
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Fairs → pay → period
In July 2018, Continental applied for a tax deed, and the county treasurer issued the deed to the company.
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treasurer → apply → company
At that time, the county assessed the property at $59,759.
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county → assess → 59,759
The deed transferred the property to Continental free of the Fairs' ownership interest.
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deed → transfer → interest
District court and initial appeals
Continental then filed a quiet title case in state court to establish its ownership.
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Continental → file → ownership
Kevin Fair responded with a counterclaim and a third-party complaint against Scotts Bluff County and the county treasurer.
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Fair → respond → County
The Nebraska Attorney General also took part because Fair was challenging the constitutionality of state laws.
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Fair → take → laws
Fair argued that taking a property worth $59,759 to satisfy a tax debt of $5,268 amounted to an unconstitutional taking without just compensation under both the US and Nebraska Constitutions.
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taking → argue → Constitutions
He also raised claims under the Due Process Clauses, the Excessive Fines Clause of the US Constitution, and other provisions of the Nebraska Constitution.
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He → raise → Constitution
The District Court for Scotts Bluff County granted summary judgment for Continental and rejected Fair's constitutional claims.
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Court → grant → claims
Fair appealed.
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Fair → appeal → ?
In 2022, the Nebraska Supreme Court initially upheld the lower court's decision, ruling that Nebraska's tax certificate system was not unconstitutional in the ways Fair had argued.
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Fair → uphold → ways
Fair then asked the US Supreme Court to review the case.
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Fair → ask → case
While that request was pending, the US Supreme Court decided Tyler v. Hennepin County in 2023.
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Court → pende → 2023
In Tyler, the Court held that a homeowner could have a constitutional takings claim when a government takes property to pay a tax debt and keeps the property's value above the amount owed.
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government → hold → amount
The US Supreme Court later granted review in Fair's case, vacated the Nebraska Supreme Court's earlier ruling, and sent the case back to Nebraska for reconsideration in light of Tyler v. Hennepin County.
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Court → grant → County
The case remained docketed as S-21-074.
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case → docket → S-21
State supreme court revives claim
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court → revive → claim
After reviewing the case again, the Nebraska Supreme Court reversed the lower court's summary judgment on Fair's takings claim.
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Court → review → claim
The decision was issued on August 23, 2024, in Continental Resources v. Fair, 317 Neb. 391.
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decision → issue → Fair
According to the Nebraska Supreme Court's opinion, Fair had a protected property interest in the value of his home above the amount of his tax debt.
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Fair → accord → debt
The court said that if the property was worth more than the debt, taking that extra value without paying Fair could amount to a taking without just compensation.
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taking → say → compensation
The court also concluded that Continental could potentially be responsible for paying that compensation.
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Continental → conclude → compensation
The justices found that Continental's decision to seek the tax deed was sufficiently connected to the state tax system to count as state action for purposes of Fair's takings claim.
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decision → find → claim
The court therefore sent that claim back for further proceedings.
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court → send → proceedings
The court did not revive Fair's other constitutional claims.
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court → revive → claims
It upheld summary judgment for Continental and the county on those claims, including the Excessive Fines claim.
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It → uphold → claim
…and 6 more, not listed.
The Aporia
