Nieveen v. Tax 106

311 Neb. 574

974 N.W.2d 15

Sandra K. NIEVEEN, appellant,

v.TAX 106, a Nebraska general partnership, et al., appellees.

No. S-21-364.

Supreme Court of Nebraska.

Filed May 13, 2022

Mark T. Bestul, Jennifer Gaughan, and Caitlin Cedfeldt, of Legal Aid of Nebraska, for appellant.

Christian R. Blunk, of Harris & Associates, P.C., L.L.O., for appellees TAX 106 and Vintage Management, LLC.

Patrick F. Condon, Lancaster County Attorney, and Eric Synowicki for appellees Lancaster County and Rachel Garver.

Douglas J. Peterson, Attorney General, and James A. Campbell, Solicitor General, for appellee Attorney General.

Heavican, C.J., Miller-Lerman, Cassel, Funke, Papik, and Freudenberg, JJ., and O'Gorman, District Judge.

Papik, J.

After Sandra K. Nieveen failed to pay her real property taxes, the Lancaster County treasurer sold a tax certificate for the property to a private party. Over 3 years later, when Nieveen had still not paid the relevant property taxes, the tax certificate holder applied for and obtained a tax deed to the property. Nieveen later filed a lawsuit in which she argued that she should be declared the owner of the property for various reasons. The district court denied Nieveen relief, finding that she did not qualify for an extended redemption period under Neb. Rev. Stat. § 77-1827 (Reissue 2018) and that the tax certificate sale process did not violate her constitutional rights under the U.S. and Nebraska Constitutions. Nieveen now appeals, but we find no error on the part of the district court and, thus, affirm.

BACKGROUND

Tax Certificate Sale and Deed Transfer.

Nebraska utilizes tax certificate sales as one method of recouping delinquent property taxes. See, Neb. Rev. Stat. § 77-1801 et seq. (Reissue 2018); Continental Resources v. Fair, 311 Neb. 184, 971 N.W.2d 313 (2022) (discussing statutes governing tax certificate sale process). Nieveen did not pay her 2013 property taxes. As a result, the Lancaster County treasurer, pursuant to Nebraska's tax certificate sale statutes, sold a tax certificate for Nieveen's property to TAX 106 on March 2, 2015.

Three years after purchasing the tax certificate, TAX 106 began to take the procedural steps required by statute to request a tax deed from the Lancaster County treasurer for Nieveen's property. See § 77-1837. On March 2, 2018, TAX 106 sent a notice by certified mail to Nieveen of its intention to apply for a tax deed to the property in 3 months’ time if she did not redeem the property by paying the taxes, interest, and fees. See § 77-1831.

TAX 106 assigned its interest in the tax certificate to Vintage Management, LLC (Vintage). In June 2018, after Nieveen failed to redeem the property within the time period set forth in TAX 106's notice, Vintage applied for and received a tax deed to Nieveen's property from the Lancaster County treasurer.

Nieveen's Quiet Title Action.

Nearly a year after the issuance of the tax deed to Vintage, Nieveen filed this lawsuit in which she sought to quiet title to the property in her name. The defendants included Lancaster County and the Lancaster County treasurer (collectively Lancaster County), as well as Vintage. Nieveen alleged that TAX 106 obtained the tax certificate by paying $2,390.48 for delinquent property taxes in 2013 and 2014 and that it paid an additional $1,405.90 in property taxes for 2015. Nieveen also alleged that at the time Lancaster County issued the tax deed, her property was assessed at $61,900, and that there was no deed of trust securing a mortgage on the property.

Nieveen alleged that the issuance of the tax deed had violated her rights under the U.S. and Nebraska Constitutions. Relevant to this appeal, Nieveen alleged that the issuance of the tax deed had violated her rights under the Due Process Clauses of the U.S. and Nebraska Constitutions, the Takings Clauses of the U.S. and Nebraska Constitutions, and the Excessive Fines Clauses of the U.S. and Nebraska Constitutions. She also alleged that she had a statutory right to a 5-year redemption period under § 77-1827 because she had a mental disorder at the time of the tax certificate sale.

Lancaster County and Vintage filed motions to dismiss in which they contended that Nieveen's complaint failed to state a claim upon which relief could be granted. The district court granted the motions to dismiss as to Nieveen's constitutional claims.

After the dismissal of Nieveen's constitutional claims, her sole remaining claim was that title should be quieted in her name because she was entitled to an extended redemption period under § 77-1827. The district court granted summary judgment to Lancaster County on this claim, because Lancaster County did not claim an interest in the property at issue. The district court overruled Vintage's motion for summary judgment on that claim, finding that there remained genuine questions of material fact to be determined at trial.

Trial Evidence.

At trial, Nieveen offered evidence in support of her claim that she had a "mental disorder" for purposes of § 77-1827 at the time of the tax certificate sale. Nieveen testified that she had been diagnosed with "major depressive disorder, recurrent, severe," and generalized anxiety disorder.

Nieveen testified that she had dealt with depression and anxiety for 30 years, but that her condition had improved in 2018 after she started taking a new medication. She asserted that she would have been suffering from symptoms of depression and anxiety in 2015 because it "was no different than any other year" prior to beginning her new course of medication in 2018.

Nieveen testified that she experienced "good days" and "bad days" with respect to her depression and anxiety. Before she found an effective medication, she had more bad days than good days. On a bad day, Nieveen testified that she would stay at her house and sleep or watch television. During bad days, she would not pay bills or pick up her mail. She testified that her mail would "build up" to such an extent that postal workers would "bundle it up and throw it on [her] back porch or ... take it back to the post office" and warn her that if she did not start "picking up" her mail, they would no longer deliver to her house. Nieveen claimed to still have some mail from 2015 that she had not yet gone through.

Nieveen testified that there was no reason aside from her mental health that would have prevented her from responding to the sale of the tax certificate for her property in March 2015. She also testified, however, that sometimes she failed to pay bills because she did not have the money to pay and that when she did not have the money, she would ignore the bills. When asked by her counsel why she failed to pay certain bills, Nieveen initially responded that she "[j]ust didn't want to deal with the situation." When her counsel followed up to ask if she failed to pay because of symptoms of her depression and anxiety, Nieveen responded that it was "because [of] depression, anxiety, I didn't want to deal with life in general. So, looking at my bills was depressing, and making me anxious. I just didn't want to deal with it, and I didn't deal with it."

Nieveen acknowledged that several years prior to trial, she had received a notice from the city that she needed to make certain repairs to her house and remove a couch from its front porch. She admitted that she promptly responded to those notices and, with the help of her brother-in-law, did what the city required. She also acknowledged that in 2008, she received a notice that she had failed to pay her property taxes, but that her daughter paid the taxes and, as a result, the situation did not escalate as it did with respect to the tax certificate sale at issue in this case.

Nieveen admitted that she understood she had to pay her bills and that there were consequences if she failed to do so. She also admitted that between 2010 and 2016, neither a guardian, conservator, nor a power of attorney managed her affairs.

Nieveen's daughter also testified at trial. Her daughter testified that she had no reason to doubt Nieveen's diagnoses and that she had observed Nieveen to be "[v]ery withdrawn" and to sleep a lot. Nieveen's daughter corroborated Nieveen's testimony that she failed to pay taxes and other bills when due. When asked why Nieveen did not pay her bills, Nieveen's daughter responded, "I'd say [it is a] combination of money and just like — I don't — denial of just life, in general of the way life works ...."

Nieveen also offered and the district court received deposition testimony of Sabrina Hellbusch. Hellbusch is a licensed advanced practice registered nurse in Nebraska and is board certified in mental health. Nieveen has been a patient of Hellbusch since November 2018. Hellbusch confirmed that she had diagnosed Nieveen with "major depressive disorder, recurrent, severe," and generalized anxiety disorder. Hellbusch testified that Nieveen's mental disorder was "severe enough that it could cause a person to neglect an important activity and could cause a person to miss important deadlines." She also testified that, in her opinion, Nieveen's symptoms were sufficiently severe that they explained why her responsibilities have not always been met. Hellbusch admitted that she was only able to give opinions concerning Nieveen's condition from 2018 forward and thus could not give an opinion concerning Nieveen's condition in 2015.

In addition to evidence concerning Nieveen's mental health, Nieveen offered evidence regarding an attempt to redeem the property in May 2019. Nieveen and her daughter testified that her daughter supplied Nieveen with a blank check and that Nieveen went to the Lancaster County treasurer's office to tender payment for the unpaid taxes. They testified that the treasurer's office refused to accept the payment.

Vintage did not present any live testimony at trial. It did offer and the district court received an affidavit of Dr. Bruce Gutnik. Dr. Gutnik has practiced medicine in psychiatry and...