Legal Aid files suit to stop Scottsbluff couple from losing their home

January 20, 2019

Legal Aid of Nebraska has filed a lawsuit in an effort to keep a Scottsbluff couple from losing their home of two decades over $588 in back property taxes.

Attorney Mike Meister of the Scottsbluff office, who represents Kevin and Terry Fair, said: “People need to pay their taxes, but we believe the process allowing the county to take the property of one person and transfer it to someone else that stands to make a substantial profit, is unjust.”

He said the couple, both in their 60s, couldn’t afford the $588.21 in back property taxes after medical issues caused Terry Fair to lose her job, leaving she and her husband with a single income to make ends meet.

Continental Resources, a financial investor, paid $5,965.74 to buy the “right” to the back taxes and the house, leaving the Fairs without their home and the nearly $50,000 of equity that came with it.

Meister is working to keep the tax sale from going forward.

“The Fairs simply want to keep their home, work hard to catch up with their taxes, and keep what little wealth they have in their property,” he said. “That’s not too much to ask, and we believe it’s both wrong and unconstitutional to let the county and investor seize over $50,000 in equity and kick the Fairs out in the process.”

On behalf of the Fairs, attorneys with Legal Aid this month filed an answer-and-counter claim seeking to stop the transfer of the home to the private party, and challenging the constitutionality of the county tax sale process.

Under Nebraska law, counties can sell property tax liens to private parties when homeowners fall behind on real estate taxes.

Regardless of how much equity a property owner has built up — or how little the owner owes in back taxes — state law provides that the county can take and transfer the property and all of the equity in it to a private purchaser. By paying the tax lien and any subsequent taxes, these private parties can take ownership of the property after three years.

According to the lawsuit filed in Scotts Bluff County District Court, Continental Resources paid $588.21 in taxes on the Fairs’ home in March 2015. Three years later, the Fairs received their first notice of it and that the company was poised to take ownership of their house.

By then, with interest accruing at 14 percent per year, the unpaid tax amount was too great for them to make up, as Kevin had taken early retirement to stay home and take care of his ailing wife, Meister said.

“This suit illustrates what we see happening across the state, with low-income and elderly homeowners most impacted,” said Jennifer Gaughan, Legal Aid’s legal director, based in Omaha. “The Fairs are simply standing up to demand respect of their basic constitutional rights, a problem they share with so many other low-income homeowners across Nebraska.”

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