The Supreme Court landmark decision in Tyler v. Hennepin County (No. 22-166, May 23, 2023), addressed an appeal by a non-HOA homeowner in Minnesota who was foreclosed on by the state. She brought “claims under the Takings Clause of the Fifth Amendment and the Excessive Fines Clause of the Eighth Amendment.” It has an immense impact on the constitutionality of HOA foreclosures. The Takings Clause is applicable to the action of states by means of the 14th Amendment.
(These claims of unconstitutional foreclosures and excess fines as a punished were argued in my 2013 pamphlet, HOA Common Sense: rejecting private government, No. 8, “Draconian punishment and intimidation.”)
In Tyler, the Court maintained that while states have imposed property taxes,
“Such taxes are not themselves a taking, but are a mandated “contribution from individuals . . . for the support of the government . . . for which they receive compensation in the protection which government affords.”
And it posed, “The question is whether that remaining value is property under the Takings Clause, protected from uncompensated appropriation by the State.” The Court answered, “Our precedents have also recognized the principle that a taxpayer is entitled to the surplus in excess of the debt owed.”
The Court’s reasoning extended the Takings Clause to other arenas beyond taxes,
“Finally, Minnesota law itself recognizes that in other contexts a property owner is entitled to the surplus in excess of her debt. Under state law, a private creditor may enforce a judgment against a debtor by selling her real property, but “[n)o more shall be sold than is sufficient to satisfy” the debt, and the creditor may receive only “so much [of the proceeds) as will satisfy” the debt. . . . Likewise, if a bank forecloses on a home because the homeowner fails to pay the mortgage, the homeowner is entitled to the surplus from the sale.”
The Supreme Cout concluded,
“Because we find that Tyler has plausibly alleged a taking under the Fifth Amendment, and she agrees that relief under “the Takings Clause would fully remedy [her] harm,” we need not decide whether she has also alleged an excessive fine under the Eighth Amendment.”
In a broad, extended view of this decision, one can say that any state law that does not allow excess funds from foreclosure to belong to the debtor, by public or by private foreclosures, would be deemed unconstitutional. And that goes for HOA foreclosures! No longer need we address the opposition that HOAs are private contracts and the Constitution and laws of the land do not apply. This momentous Supreme Court decision has knocked down the doors for homeowners in HIOAs.
HOA Constitutional Government 
If I had $200,000 equity in my home and the assessment HOA debt was $15,000 you bet I would use this Supreme Court ruling to protect my money!
I think you know that I keep pretty good track of things going on around the USA. Here is something from George pertaining to something I followed for a couple of years. Hennepin County is in Minnesota, and I have been familiar with this particular lawsuit for a number of years. George seems to think it may have some effect on what happens in a HOA — and I cannot help but hope he is right. By the way, have you heard anything about the owner on Indiana that was involved in the foreclosure?
Keith, a Snell & WIlmer article on priority of HOA foreclosure proceeds in Arizona. go here https://www.jdsupra.com/legalnews/hoa-foreclosure-excess-sale-proceeds-go-8501039/
Hello Keith how do you get the builder assigned HOA company to turn the HOA over to the homeowners.
Purchased my home November 2017 was told the HOA (Panhandle) would be turned over by 2019. The builder (Ryan home) turned the land over and the HOA. The HOA who also owns Panhandle homes added land and built storage units also owns by them. Our HOA is still with the HOA picked by the builder, 3 years after the competition of the development. They still refuse to turn the HOA over to the homeowners. They refuse to have a meeting or show records. They pay their family businesses for the little they do in the development and raise the fee yearly.