HBI, L.L.C. v. Barnette , 305 Neb. 457 ( 2020 )

Nebraska Supreme Court Online Library
www.nebraska.gov/apps-courts-epub/
05/29/2020 12:08 AM CDT
- 457 -
Nebraska Supreme Court Advance Sheets
305 Nebraska Reports
HBI, L.L.C. v. BARNETTE
Cite as 305 Neb. 457
HBI, L.L.C., appellee, v. Walter D.
Barnette, appellant.
___ N.W.2d ___
Filed April 10, 2020. No. S-19-147.
1. Constitutional Law: Statutes. The constitutionality of statutes and
statutory interpretation present questions of law.
2. Tax Sale: Time. Tax sale proceedings are governed by the law in effect
at the time the tax sale certificate was sold.
3. Tax Sale: Time: Liens. Under Neb. Rev. Stat. § 77-1801 (Reissue
2009), properties with delinquent real estate taxes on or before the
first Monday of March may be sold at a tax sale. The tax sale pur-
chaser acquires a lien on the property, which is represented by a tax
certificate.
4. Tax Sale. A property owner may redeem a property after a tax cer-
tificate has been issued with payment of the amount noted on the tax
certificate, other taxes subsequently paid, and interest.
5. Tax Sale: Time: Deeds: Foreclosure. If, after 3 years of the issuance of
a tax certificate, a property has not been redeemed, there are two meth-
ods by which the holder of the tax certificate may acquire a deed to the
property: the tax deed method and judicial foreclosure.
6. Tax Sale: Deeds: Notice. A tax deed acts to convey the property and
may be issued by the county treasurer after proper notice is provided.
7. Tax Sale: Foreclosure: Liens. Judicial foreclosure requires the holder
of a tax certificate to foreclose on the lien for taxes in the district court
of the county where the property is located.
8. Dismissal and Nonsuit. Under Neb. Rev. Stat. §§ 25-601 and 25-602
(Reissue 2016), a plaintiff has the right to dismiss an action without
prejudice any time before final submission of the case, so long as no
counterclaim or setoff has been filed by an opposing party.
9. Tax Sale: Deeds: Dismissal and Nonsuit. The language used to dis-
tinguish between the two methods of converting a tax certificate into a
deed in Neun v. Ewing, 290 Neb. 963, 863 N.W.2d 187 (2015), did not
- 458 -
Nebraska Supreme Court Advance Sheets
305 Nebraska Reports
HBI, L.L.C. v. BARNETTE
Cite as 305 Neb. 457
abrogate the tax certificate holder’s right to voluntary dismissal under
Neb. Rev. Stat. §§ 25-601 and 25-602 (Reissue 2012).
10. Tax Sale: Notice. If a titled owner cannot be found upon diligent
inquiry, Neb. Rev. Stat. § 77-1834 (Reissue 2009) permits the pur-
chaser or his or her assignee to publish the notice in some newspaper
published in the county and having a general circulation in the county
or, if no newspaper is printed in the county, then in a newspaper pub-
lished in Nebraska nearest to the county in which the real property
is situated.
11. Tax Sale: Notice: Proof: Words and Phrases. The word “found” in
Neb. Rev. Stat. § 77-1834 (Reissue 2009) means able to be served, and
the statute authorizes the holder of a tax certificate to provide notice
by publication if the record owner was unable to be served by certified
mail at the address where the property tax statement was mailed, upon
proof of compliance with Neb. Rev. Stat. § 77-1832 (Reissue 2009), if
the owner in fact lived at such address.
12. Tax Sale: Statutes. Even the misidentification of the purchaser on an
actual tax deed does not render it void. If a tax deed is in compliance
with the statutory requirements, the misidentification would, at most,
necessitate reformation of the tax deed.
13. Tax Sale: Deeds. There is no language in Neb. Rev. Stat. § 77-1831
(Reissue 2009) requiring that the party applying for the tax deed be
included.
14. Constitutional Law: Statutes: Presumptions: Proof. A statute is pre-
sumed to be constitutional, and all reasonable doubts are resolved in
favor of its constitutionality. The burden of establishing the unconstitu-
tionality of a statute is on the one attacking its validity.
15. Constitutional Law: Statutes: Proof. The unconstitutionality of a stat-
ute must be clearly established before it will be declared void.
16. Tax Sale: Notice. Neb. Rev. Stat. § 77-1832 (Reissue 2009) requires
service at the address where the property tax statement is mailed,
and thus, it is reasonably calculated to provide notice to the property
owner.
17. ____: ____. Notice by publication under Neb. Rev. Stat. § 77-1834
(Reissue 2009) is limited to circumstances where the record owner
resides at the address where the property tax statement is mailed, but he
or she is unable to be served there.
Appeal from the District Court for Sarpy County: Stefanie
A. Martinez, Judge. Affirmed.
Edward F. Noethe, of McGinn, Springer & Noethe, P.L.C.,
for appellant.
- 459 -
Nebraska Supreme Court Advance Sheets
305 Nebraska Reports
HBI, L.L.C. v. BARNETTE
Cite as 305 Neb. 457
Jeffrey J. Blumel and Gretchen L. McGill, of Dvorak Law
Group, L.L.C., for appellee.
Heavican, C.J., Miller-Lerman, Cassel, Stacy, Funke,
Papik, and Freudenberg, JJ.
Heavican, C.J.
I. INTRODUCTION
This is an appeal from an action to quiet title after issu-
ance of a tax deed. Appellant, Walter D. Barnette, argues that
a notice of application for a treasurer’s deed was defective
and that the statutory scheme relating to notice requirements
for obtaining a tax deed is unconstitutional on due process
grounds. We affirm.
II. BACKGROUND
On March 5, 2013, Pontian Land Holdings LLC (Pontian)
purchased a certificate of tax sale for real property after
Barnette failed to pay real estate taxes on the property. The
property was located at “Lot 2, Swaney’s Addition Replat I,
an Addition to the City of Bellevue, as surveyed, platted and
recorded, Sarpy County, Nebraska.” After waiting the statuto-
rily required 3 years, Pontian initially filed a judicial foreclo-
sure action on the property, but later dismissed the action and
filed an application for a treasurer’s tax deed.
As required by Neb. Rev. Stat. § 77-1831 (Reissue 2009),
Pontian sent notice of its intent to apply for a treasurer’s deed
for the property by certified mail, return receipt requested,
to the address where the property tax statement was mailed.
This address was Barnette’s residence, which was located
in Pottawattamie County, Iowa. The notice listed Pontian as
the purchaser of the real property, but erroneously stated that
Guardian Tax Partners Inc. (Guardian) would apply for the
treasurer’s tax deed. The notice also listed Guardian as the
sender of the certified mail. Although Barnette resided at the
address where the notice was sent, the notice was returned
as “unclaimed.” Handwriting on the certified mail receipt
- 460 -
Nebraska Supreme Court Advance Sheets
305 Nebraska Reports
HBI, L.L.C. v. BARNETTE
Cite as 305 Neb. 457
indicates the post office had made three attempts to deliver the
notice prior to returning it as unclaimed. Pontian subsequently
published notice in a Sarpy County newspaper for 3 consecu-
tive weeks.
On August 29, 2016, the Sarpy County treasurer issued a
treasurer’s tax deed in Pontian’s name. Pontian filed a com-
plaint, seeking to quiet title on the property. Barnette filed a
counterclaim to quiet title in his name. Pontian later trans-
ferred the property to HBI, L.L.C., and HBI was substituted
as plaintiff in the case. On October 31, 2017, Barnette filed a
motion for summary judgment that was later withdrawn. On
January 30, 2018, HBI filed a motion for summary judgment.
On February 14, Barnette filed a second motion for summary
judgment. Both motions were denied by the district court as
being premature.
On October 12, 2018, HBI filed a second motion for sum-
mary judgment. On October 22, Barnette filed a third motion
for summary judgment. Barnette later amended his counter-
claim with leave from the district court. The counterclaim
alleged Pontian’s notice was defective and challenged the
constitutionality of the notice requirements set forth in Neb.
Rev. Stat. §§ 77-1832 to 77-1835 (Reissue 2009) on due
process grounds. Specifically, Barnette argued that because
Pontian knew Barnette lived in Pottawattamie County, Iowa,
notice by publication in Sarpy County violated his right to
due process.
On January 15, 2019, the district court granted HBI’s
amended second motion for summary judgment and denied
Barnette’s third motion for summary judgment. The district
court quieted title in favor of HBI after finding that Barnette
was given sufficient notice in compliance with Nebraska law
and that the notice did not violate the due process requirements
of the U.S. Constitution or the Nebraska Constitution.
Barnette now appeals the district court’s order granting sum-
mary judgment in favor of HBI and denying Barnette’s third
motion for summary judgment.
- 461 -
Nebraska Supreme Court Advance Sheets
305 Nebraska Reports
HBI, L.L.C. v. BARNETTE
Cite as 305 Neb. 457
III. ASSIGNMENTS OF ERROR
Barnette assigns that the district court erred in (1) not
finding that Pontian’s original election of foreclosure barred
the tax deed process, (2) finding the notice provided com-
plied with Nebraska statutes, (3) not finding the Nebraska
tax sale statutory scheme violated the U.S. Constitution and
the Nebraska Constitution, (4) finding Barnette’s due proc­
ess rights under the U.S. Constitution and the Nebraska
Constitution were not violated, and (5) not quieting title to
Barnette.
IV. STANDARD OF REVIEW
[1] The constitutionality of statutes and statutory interpreta-
tion present questions of law. 1
V. ANALYSIS
1. Original Election of
Judicial Foreclosure
In his first assignment of error, Barnette argues Pontian’s
claim for a tax deed was barred by its original election to pro-
ceed to judicial foreclosure.
[2-7] The Legislature’s recent amendments to tax sale stat-
utes notwithstanding, the proceedings at issue in this case are
governed by the law in effect on December 31, 2009. 2 Under
Neb. Rev. Stat. § 77-1801 (Reissue 2009), properties with
delinquent real estate taxes on or before the first Monday
of March may be sold at a tax sale. The tax sale purchaser
acquires a lien on the property, which is represented by a tax
certificate. 3 A property owner may redeem a property after a
tax certificate has been issued with payment of the amount
noted on the tax certificate, other taxes subsequently paid, and
1
Pfizer v. Lancaster Cty. Bd. of Equal., 260 Neb. 265, 616 N.W.2d 326
(2000).
2
See Neb. Rev. Stat. § 77-1837.01(2) (Cum. Supp. 2016).
3
See Neb. Rev. Stat. § 77-1818 (Reissue 2009).
- 462 -
Nebraska Supreme Court Advance Sheets
305 Nebraska Reports
HBI, L.L.C. v. BARNETTE
Cite as 305 Neb. 457
interest. 4 If, after 3 years, the property has not been redeemed,
there are two methods by which the holder of a tax certificate
may acquire a deed to the property: the tax deed method and
judicial foreclosure. 5 A tax deed acts to convey the property
and may be issued by the county treasurer after proper notice
is provided. 6 Judicial foreclosure requires the holder of a tax
certificate to foreclose on the lien for taxes in the district court
of the county where the property is located. 7
Barnette relies on language in Neun v. Ewing 8 to support
his argument that Pontian’s application for a tax deed was
barred by its initial filing of a foreclosure action. In Neun,
property owners attempted to redeem their property after a
foreclosure action had been filed using the procedure set forth
in § 77-1824, authorizing redemption from a tax sale prior to
the issuance of a tax deed. This court held that once judicial
foreclosure has begun, only the separate redemption procedure
established by Neb. Rev. Stat. § 77-1917 (Reissue 2009) is
available. 9 Recognizing that the two procedures for converting
a tax sale certificate into a deed are not interchangeable, the
court concluded that
once the holder has elected to proceed under chapter 77,
article 19, the provisions of such article govern the rights
of the parties in relation to the tax sale certificate. In
other words, after the election to proceed by judicial fore-
closure has been made, both the holder and the property
owner are bound by that election. 10
4
See Neb. Rev. Stat. § 77-1824 (Reissue 2009). See, also, SID No. 424 v.
Tristar Mgmt., 288 Neb. 425, 850 N.W.2d 745 (2014).
5
See SID No. 424, supra note 4.
6
See § 77-1831 and Neb. Rev. Stat. § 77-1837 (Reissue 2009).
7
See Neb. Rev. Stat. § 77-1902 (Reissue 2009).
8
Neun v. Ewing, 290 Neb. 963, 863 N.W.2d 187 (2015).
9
See id.
10
Id. at 970, 863 N.W.2d at 194.
- 463 -
Nebraska Supreme Court Advance Sheets
305 Nebraska Reports
HBI, L.L.C. v. BARNETTE
Cite as 305 Neb. 457
In arriving at its holding, the court articulated: “‘Although
the overall objective of both procedures is the recovery of
unpaid taxes on real property, these [procedures] “are two sepa-
rate and distinct methods for the handling of delinquent real
estate taxes”’ which are ‘neither comparable nor fungible.’” 11
[8] Barnette argues that this language precluded Pontian
from applying for a tax deed because it initially filed a fore-
closure action. Neun is distinguishable. The issue in Neun was
the manner of redemption permitted once the holder of a tax
sale certificate had elected to proceed with judicial forfeiture.
Moreover, Barnette’s interpretation of Neun is inconsistent with
a plaintiff’s statutory right to voluntary dismissal. Under Neb.
Rev. Stat. §§ 25-601 and 25-602 (Reissue 2016), a plaintiff has
the right to dismiss an action without prejudice any time before
final submission of the case, so long as no counterclaim or set-
off has been filed by an opposing party.
[9] Here, Pontian’s foreclosure action was dismissed prior
to a summons being issued, and no complaint was served on
Barnette in that action. Thus, Pontian had a statutory right to
voluntarily dismiss its initial filing without prejudice. We hold
that Pontian’s election to initially file and dismiss the judicial
foreclosure action did not preclude his application for a tax
deed. In addition, we clarify that the language used to distin-
guish between the two methods of converting a tax certificate
into a deed in Neun did not abrogate the tax certificate holder’s
right to voluntary dismissal under §§ 25-601 and 25-602. In
this case, Pontian had a right to voluntary dismissal under
§§ 25-601 and 25-602 because no counterclaim or setoff had
been filed. 12
11
Id.
12
See id. See, also, Adair Asset Mgmt. v. Terry’s Legacy, 293 Neb. 32, 875
N.W.2d 421 (2016) (stating that existence of different procedures available
to holder to convert tax sale certificate into deed does not affect meaning
of tax sale certificate).
- 464 -
Nebraska Supreme Court Advance Sheets
305 Nebraska Reports
HBI, L.L.C. v. BARNETTE
Cite as 305 Neb. 457
2. Notice Under § 77-1831
(a) Publication in Sarpy County
In his second assignment of error, Barnette first argues that
publication in Sarpy County was insufficient notice because
Pontian knew Barnette lived in Pottawattamie County, Iowa.
A tax sale purchaser is not entitled to a tax deed unless he or
she provides sufficient notice to the property owner at least 3
months prior to the application for the tax deed. 13 A tax deed is
presumptive evidence that notice has been served or published
as statutorily required. 14
[10] Although the Legislature has since amended § 77-1832,
the version of the statute governing the proceedings at issue
here provided, in relevant part, that “[s]ervice of the notice
provided by section 77-1831 shall be made by certified mail,
return receipt requested, upon the person in whose name the
title to the real property appears of record to the address where
the property tax statement was mailed . . . .” If the titled owner
could not be found upon diligent inquiry, § 77-1834 permitted
the purchaser or his or her assignee to publish the notice “in
some newspaper published in the county and having a general
circulation in the county or, if no newspaper is printed in the
county, then in a newspaper published in this state nearest to
the county in which the real property is situated.”
In Wisner v. Vandelay Investments, 15 this court addressed
whether the applicable language in §§ 77-1832 and 77-1834
permitted the holder of a tax certificate to serve a property
owner by publication after being unable to serve her by certi-
fied mail when the holder had actual knowledge of the prop-
erty owner’s location. In that case, the holder had sent notice
by certified mail, return receipt requested, but the notice
was returned as “‘unclaimed.’” 16 This court held that the
13
See § 77-1831.
14
See Neb. Rev. Stat. § 77-1842 (Reissue 2009).
15
Wisner v. Vandelay Investments, 300 Neb. 825, 916 N.W.2d 698 (2018).
16
Id. at 853, 916 N.W.2d at 721.
- 465 -
Nebraska Supreme Court Advance Sheets
305 Nebraska Reports
HBI, L.L.C. v. BARNETTE
Cite as 305 Neb. 457
holder had completely complied with the notice requirements
of § 77-1832 by proceeding to service by publication after the
owner was unable to be served by certified mail at the address
where the property tax statement was mailed. 17
[11] We further held that the word “found” in § 77-1834
meant “‘able to be served’” and that the statute authorized the
holder of a tax certificate to provide notice by publication if
the record owner was unable to be served by certified mail at
the address where the property tax statement was mailed, upon
proof of compliance with § 77-1832, if the owner in fact lived
at such address. 18 The court warned that a contrary holding
would permit a property owner that was already deficient in
paying real estate taxes to force a judicial foreclosure proceed-
ing by avoiding the notice. 19
Here, Pontian sent notice of its application for a tax deed by
certified mail, return receipt requested, to the address where
the property tax statement was mailed—Barnette’s residence
in Pottawattamie County, Iowa. Barnette had continuously
resided at this address for 4 years and had received notices of
taxes due on the property at this address. However, Pontian’s
notice was returned as “unclaimed.” Pontian then published
the notice in Sarpy County as required by § 77-1834. The
tax deed was issued after Pontian had complied with both
§§ 77-1832 and 77-1834. Section 77-1834 only authorized
service by publication in the county where the property was
located. 20 Because Pontian was not required to publish notice
in any other county except Sarpy County, Pontian’s actual
knowledge of Barnette’s location is irrelevant for purposes of
this assignment of error. 21 We hold that Barnette has not met
his burden of rebutting the statutory presumption that Pontian’s
17
See id.
18
See id.
19
See Wisner, supra note 15.
20
See id.
21
See id.
- 466 -
Nebraska Supreme Court Advance Sheets
305 Nebraska Reports
HBI, L.L.C. v. BARNETTE
Cite as 305 Neb. 457
notice was sufficient and that his second assignment of error is
accordingly without merit.
(b) Misidentification of Guardian
In his second assignment of error, Barnette further argues
that the notice was defective because it showed Guardian,
rather than Pontian, as the party who would apply for the deed.
HBI maintains that the error in listing Guardian was immaterial
and did not negate the sufficiency of the notice.
Section 77-1831 provides:
No purchaser at any sale for taxes or his or her assign-
ees shall be entitled to a deed from the treasurer for
the real property so purchased unless such purchaser or
assignee, at least three months before applying for the
deed, serves or causes to be served a notice stating when
such purchaser purchased the real property, the descrip-
tion thereof, in whose name assessed, for what year taxed
or specially assessed, and that after the expiration of three
months from the date of service of such notice the deed
will be applied for.
[12] Pontian’s notice included the information required and
correctly listed Pontian as the party who had purchased the
property. Further, this court has held that even the misidentifi-
cation of the purchaser on the actual tax deed does not render
it void. In Ottaco Acceptance, Inc. v. Larkin, 22 the purchaser
of a tax certificate had later assigned the tax certificate to
another entity. The assignee requested, and was issued, a tax
deed for the property, but the tax deed incorrectly identified the
assignee as the original purchaser of the property. 23 This court
held that the tax deed was in compliance with the statutory
requirements and that the misidentification would, at most,
necessitate reformation of the tax deed. 24
22
Ottaco Acceptance, Inc. v. Larkin, 273 Neb. 765, 733 N.W.2d 539 (2007).
23
See id.
24
See id.
- 467 -
Nebraska Supreme Court Advance Sheets
305 Nebraska Reports
HBI, L.L.C. v. BARNETTE
Cite as 305 Neb. 457
[13] We hold that the inclusion of Guardian as the party that
would apply for the tax deed does not render the notice defec-
tive, as there is no language in § 77-1831 requiring that the
party applying for the tax deed be included. This court will not
read into a statute a meaning that is not there. 25
As previously stated, Barnette’s second assignment of error
is without merit.
3. Constitutionality of Nebraska’s
Tax Sale Notice Requirements and
Barnette’s Due Process Rights
In his third and fourth assignments of error, Barnette argues
Nebraska’s statutory scheme for tax sales is unconstitutional on
due process grounds. Specifically, Barnette asserts that his due
process rights were violated when Pontian published its notice
in Sarpy County pursuant to § 77-1834, knowing Barnette
resides in Pottawattamie County, Iowa. The district court found
that Pontian had complied with the statutory notice require-
ments before applying for the tax deed and that the procedures
used did not violate Barnette’s due process rights.
(a) Presumption of Constitutionality
[14,15] A statute is presumed to be constitutional, and all
reasonable doubts are resolved in favor of its constitution-
ality. 26 The burden of establishing the unconstitutionality of a
statute is on the one attacking its validity. 27 The unconstitution-
ality of a statute must be clearly established before it will be
declared void. 28
(b) Notice Requirement
Before the government may deprive a person of their
property, the government must provide “notice reasonably
25
See Wisner, supra note 15; State v. Gill, 297 Neb. 852, 901 N.W.2d 679
(2017); State v. Mortensen, 287 Neb. 158, 841 N.W.2d 393 (2014).
26
State ex rel. Bruning v. Gale, 284 Neb. 257, 817 N.W.2d 768 (2012).
27
Id.
28
Id.
 - 468 -
Nebraska Supreme Court Advance Sheets
305 Nebraska Reports
HBI, L.L.C. v. BARNETTE
Cite as 305 Neb. 457
calculated, under all the circumstances, to apprise interested
parties of the pendency of the action and afford them an oppor-
tunity to present their objections.” 29 In Mullane v. Central
Hanover Tr. Co., 30 the U.S. Supreme Court held that when a
recipient’s address is known, the determination of whether the
method of notice is “reasonably calculated” is analyzed at the
time the notice is sent. 31
(c) Jones v. Flowers
In his brief, Barnette cites Jones v. Flowers 32 in support of
his argument that Nebraska’s tax deed notice requirements are
unconstitutional. In that case, the U.S. Supreme Court held
that the government’s attempt at providing notice of a tax sale
was insufficient to satisfy due process when the notice was
returned as unclaimed and that the government failed to take
additional reasonable steps to provide notice to the property
owner before the property was sold. 33
In Jones, the property owner had moved from his home in
Little Rock, Arkansas, into an apartment in Little Rock after
he and his wife were separated. The mortgage company had
been paying the property taxes until the mortgage was paid off,
and then the taxes became delinquent. Three years later, the
Commissioner of State Lands (Commissioner) sent the owner,
by certified mail, notice of the tax delinquency and information
about his right to redeem the property. The certified letter was
sent to the address of the property where the owner’s wife still
lived and was returned as “‘“unclaimed.”’” 34
29
Mullane v. Central Hanover Tr. Co., 339 U.S. 306, 314, 70 S. Ct. 652, 94
L. Ed. 865 (1950).
30
Mullane, supra note 29.
31
Id., 339 U.S. at 318 (“[w]here the names and post office addresses of those
affected by a proceeding are at hand, the reasons disappear for resort to
means less likely than the mails to apprise them of its pendency”).
32
Jones v. Flowers, 547 U.S. 220, 126 S. Ct. 1708, 164 L. Ed. 2d 415
(2006).
33
Id.
34
Id., 547 U.S. at 224.
- 469 -
Nebraska Supreme Court Advance Sheets
305 Nebraska Reports
HBI, L.L.C. v. BARNETTE
Cite as 305 Neb. 457
Two years later, the Commissioner published a notice of
public sale in the newspaper. The publication occurred a few
weeks prior to the public sale. The Commissioner mailed a sec-
ond certified letter after receiving a purchase offer for the home,
warning the house would be sold if the delinquent taxes were
not paid. Again, the letter was returned as “‘unclaimed.’” 35 The
owner was eventually notified of the sale when the purchaser
had an unlawful detainer notice delivered to the property, and
the notice was served on the owner’s daughter.
The owner in Jones filed a lawsuit against the Commissioner
and the purchaser, alleging that the Commissioner’s failure to
provide notice of the tax sale and the right to redeem consti-
tuted a taking of his property without due process. The trial
court granted summary judgment in favor of the Commissioner
and the purchaser, and the Arkansas Supreme Court affirmed,
holding that the Commissioner’s attempt to provide notice by
certified mail satisfied due process. The U.S. Supreme Court
reversed, holding 5 to 3 that under the circumstances pre-
sented, “[t]he Commissoner’s effort to provide notice to [the
owner] of an impending tax sale of his house was insufficient
to satisfy due process . . . .” 36
The Court in Jones recognized that Arkansas’ statutory
scheme for providing notice of a tax sale likely satisfied the
requirements for due process because sending certified mail
to an address that the owner was required by law to keep
updated is reasonably calculated to reach the property owner.
However, in examining the “‘practicalities and peculiarities of
the case,’” 37 the Court compared the Commissioner’s knowl-
edge of ineffective service to sending notice with actual
knowledge that the notice was unlikely to reach the recipi-
ent because he was imprisoned or incompetent. Because the
letter concerned the “important and irreversible” prospect
35
Id.
36
Id., 547 U.S. at 239.
37
Id., 547 U.S. at 230 (quoting Mullane, supra note 29).
- 470 -
Nebraska Supreme Court Advance Sheets
305 Nebraska Reports
HBI, L.L.C. v. BARNETTE
Cite as 305 Neb. 457
of losing one’s home, the Court held that additional steps
were required. 38
(d) Constitutionality of §§ 77-1832
and 77-1834
In the present case, Barnette has failed to meet his burden
of establishing Nebraska’s statutory notice requirements are
unconstitutional. Section 77-1832 authorizes notice by certi-
fied mail, return receipt requested, to the address where the
property tax statement is mailed. If the record owner is unable
to be served by certified mail, § 77-1834 authorizes notice by
publication upon proof of compliance with § 77-1832 if the
record owner lives at the address where the property tax state-
ment was mailed. 39
[16,17] Because § 77-1832 requires service at the address
where the property tax statement is mailed, it is reasonably
calculated to provide notice to the property owner. 40 Further,
notice by publication under § 77-1834 is limited to circum-
stances, such as those presented here, where the record owner
resides at the address where the property tax statement is
mailed, but he or she is unable to be served there. 41 For these
reasons, we hold that the applicable notice requirements are
constitutionally sufficient.
(e) Barnette’s Right to Due Process
Barnette has also failed to establish that issuance of the tax
deed was in violation of his due process rights. In Dusenbery
v. United States, 42 the U.S. Supreme Court recognized that the
use of the postal service to send certified mail is “a method
our cases have recognized as adequate for known addresses.” 43
38
Id., 547 U.S. at 230.
39
See Wisner, supra note 15.
40
See Jones, supra note 32.
41
See id.
42
Dusenbery v. United States, 534 U.S. 161, 122 S. Ct. 694, 151 L. Ed. 2d
597 (2002).
43
Id., 534 U.S. at 169 (emphasis supplied).
- 471 -
Nebraska Supreme Court Advance Sheets
305 Nebraska Reports
HBI, L.L.C. v. BARNETTE
Cite as 305 Neb. 457
The Court confirmed that in determining whether due process
requirements are satisfied, it is the method of notice that is
analyzed and not the result. 44 In Jones, the Court articulated
that “the failure of notice in a specific case does not establish
the inadequacy of the attempted notice.” 45 And, when assessing
the adequacy of notice, “unique information about an intended
recipient” must be considered. 46
The test in Jones for the constitutional sufficiency of notice
is case specific and analyzes whether the action was some-
thing that someone “‘desirous of actually informing’” the
homeowner would do. 47 Because additional reasonable steps
were available to the State, given the circumstances, the
Commissioner’s effort to provide notice to the owner was
insufficient to satisfy due process. What is “reasonable in
response to new information depends upon what the new infor-
mation reveals.” 48
The dissent, and the authority it cites, interprets Jones as
establishing a new rule requiring the government to make addi-
tional attempts at providing notice each time notice is returned
as unclaimed. However, the Jones Court explicitly stated:
“[W]e disclaim any ‘new rule’ that is ‘contrary to Dusenbery
and a significant departure from Mullane.’” 49
(i) Sufficient Notice Under
Dusenbery and Mullane
The test in Dusenbery for the constitutional sufficiency of
notice is whether the chosen method is “‘reasonably calcu-
lated’ to apprise a party of the pendency of the action.” 50 As
discussed above, both Dusenbery and Mullane recognized that
44
See Dusenbery, supra note 42.
45
Jones, supra note 32, 547 U.S. at 231.
46
Id., 547 U.S. at 230.
47
Id.
48
Id., 547 U.S. at 234.
49
Id., 547 U.S. at 238.
50
Dusenbery, supra note 42, 534 U.S. at 170.
- 472 -
Nebraska Supreme Court Advance Sheets
305 Nebraska Reports
HBI, L.L.C. v. BARNETTE
Cite as 305 Neb. 457
when a recipient’s address is known, sending notice by certi-
fied mail satisfies due process. 51
Under the circumstances presented here, Pontian’s attempt
to provide Barnette with notice of its intent to apply for a tax
deed failed; however, under both Dusenbery and Mullane, the
attempted notice was adequate. Pontian had actual knowledge
of Barnette’s address in Iowa and sent notice to that address.
This knowledge is one of the “‘practicalities and peculiarities
of the case’” 52 and must be taken into account when assessing
the adequacy of notice. Because Pontian had actual knowledge
of Barnette’s address, the method of service was reasonably
calculated to apprise Barnette of Pontian’s intent to apply for
a tax deed. Accordingly, we hold that the notice was constitu-
tionally sufficient.
The dissent contends that the focus of Jones was on the fact
that the certified mail went unclaimed. We disagree. In Jones,
the Court was clearly focused on two “‘practicalities and pecu-
liarities of the case’” 53 that may vary the notice required: 54 the
government’s knowledge and the fact that the property interest
at stake was the owner’s home.
(ii) “New Wrinkle” in Jones
The “new wrinkle” presented in Jones was whether the
government’s knowledge that notice has failed vitiates the
reasonableness of the method used under the circumstances
presented. This is demonstrated by the Court’s extensive reli-
ance on two of its prior holdings: Robinson v. Hanrahan 55 and
Covey v. Town of Somers. 56
51
See, Dusenbery, supra note 42; Mullane, supra note 29.
52
See Jones, supra note 32, 547 U.S. at 230.
53
Id.
54
Id., 547 U.S. at 227 (“question presented is whether such knowledge on
the government’s part is a ‘circumstance and condition’ that varies the
‘notice required’”).
55
Robinson v. Hanrahan, 409 U.S. 38, 93 S. Ct. 30, 34 L. Ed. 2d 47 (1972).
56
Covey v. Town of Somers, 351 U.S. 141, 76 S. Ct. 724, 100 L. Ed. 1021
(1956).
- 473 -
Nebraska Supreme Court Advance Sheets
305 Nebraska Reports
HBI, L.L.C. v. BARNETTE
Cite as 305 Neb. 457
Robinson involved a forfeiture proceeding where the State
had complied with the statutory requirements for providing
notice, but knew the owner was incarcerated at the time.
The Court held that the State’s manner of service was not
reasonably calculated to apprise the owner of the proceeding
because the State knew the individual was not at the address to
which the notice was mailed and knew that the individual was
unable to get to that address at the time the notice was sent. 57
Similarly, in Covey, the Court held that notice of foreclosure
by mailing, posting, and publication did not satisfy due proc­
ess requirements because government officials knew that the
property owner was incompetent and that she did not have the
protection of a guardian.
Jones did not create a formulaic test for deciding when
additional attempts at notice are required. The Court deter-
mined the return of the owner’s letter as unclaimed constituted
“new information” revealed to the government. 58 That infor-
mation must then be taken into account as one of the “‘prac-
ticalities and peculiarities of the case’” when determining
whether the attempt at notice was adequate. 59 If the attempt
was not adequate, there is an obligation to take additional
steps that are reasonable under the circumstances, “if practi-
cable to do so.” 60
The new information presented in Jones was that the owner
had either (1) moved from the address or (2) failed to retrieve
the certified letter from the post office. Based on this conclu-
sion, the Court provided examples of reasonable steps that
could have been implemented after the letter’s return. In doing
so, the Court advised: “What steps are reasonable in response
to new information depends upon what the new informa-
tion reveals.” 61
57
Robinson, supra note 55.
58
Jones, supra note 32, 547 U.S. at 234.
59
See id., 547 U.S. at 230.
60
See id., 547 U.S. at 234.
61
Id.
- 474 -
Nebraska Supreme Court Advance Sheets
305 Nebraska Reports
HBI, L.L.C. v. BARNETTE
Cite as 305 Neb. 457
(iii) Balancing Interests
“‘[D]ue process is flexible and calls for such procedural
protections as the particular situation demands.’” 62 In Mathews
v. Eldridge, 63 the U.S. Supreme Court instructed that in deter-
mining whether the procedures used in providing notice are
constitutionally sufficient, the governmental and private
interests are analyzed using three distinct factors. These fac-
tors include:
First, the private interest that will be affected by the offi-
cial action; second, the risk of an erroneous deprivation of
such interest through the procedures used, and the prob-
able value, if any, of additional or substitute procedural
safeguards; and finally, the Government’s interest, includ-
ing the function involved and the fiscal and administra-
tive burdens that the additional or substitute procedural
requirement would entail. 64
In Jones, the Court reaffirmed that the reasonableness of
notice requires “[b]alancing a State’s interest in efficiently
managing its administrative system and an individual’s interest
in adequate notice . . . .” 65 When concluding that notice to the
owner was inadequate, the Court gave special importance to
the fact that the property owner was “in danger of losing his
house.” 66 The Court stated:
In this case, the State is exerting extraordinary power
against a property owner—taking and selling a house he
owns. It is not too much to insist that the State do a bit
more to attempt to let him know about it when the notice
letter addressed to him is returned unclaimed.” 67
62
Mathews v. Eldridge, 424 U.S. 319, 334, 96 S. Ct. 893, 47 L. Ed. 2d 18
(1976) (quoting Morrissey v. Brewer, 408 U.S. 471, 92 S. Ct. 2593, 33 L.
Ed. 2d 484 (1972)).
63
Mathews, supra note 62.
64
Id., 424 U.S. at 335.
65
Jones, supra note 32, 547 U.S. at 240.
66
Id., 547 U.S. at 238.
67
Id., 547 U.S. at 239 (emphasis supplied).
- 475 -
Nebraska Supreme Court Advance Sheets
305 Nebraska Reports
HBI, L.L.C. v. BARNETTE
Cite as 305 Neb. 457
And, “when a letter is returned by the post office, the sender
will ordinarily attempt to resend it, if it is practicable to do
so. . . . This is especially true when . . . the subject matter of
the letter concerns such an important and irreversible pros-
pect as the loss of a house.” 68 The Court emphasized: “We do
not think that a person who actually desired to inform a real
property owner of an impending tax sale of a house he owns
would do nothing when a certified letter sent to the owner is
returned unclaimed.” 69
While the property at issue is one factor to be considered,
we do not, as the dissent suggests, limit Jones to cases involv-
ing houses. The fact that Jones involved an occupied house
was information that must be considered when determining
whether the notice was adequate. “[A]ssessing the adequacy of
a particular form of notice requires balancing the ‘interest of
the State’ against ‘the individual interest sought to be protected
by the Fourteenth Amendment.’” 70
In Jones, the Court was balancing the government’s interest
against the owner’s interest in an occupied home, and evidence
was presented to show that Arkansas’ statutes already required
a homeowner to be served by personal service if certified mail
is returned. Here, Barnette is attacking the constitutionality of
the tax deed issued to Pontian. There is a presumption of con-
stitutionality, and Barnette has the burden of establishing that
his due process rights were violated. 71
68
Id., 547 U.S. at 230 (emphasis supplied).
69
Id., 547 U.S. at 229 (emphasis supplied). See, also, id., 547 U.S. at 229
(“we evaluate the adequacy of notice prior to the State extinguishing a
property owner’s interest in a home”) (emphasis supplied); id., 547 U.S. at
238 (“at the end of the day, that someone who actually wanted to alert [the
owner] that he was in danger of losing his house would do more when the
attempted notice letter was returned unclaimed, and there was more that
reasonably could be done”) (emphasis supplied).
70
Id., 547 U.S. at 229 (quoting Mullane, supra note 29).
71
See Stenger v. Department of Motor Vehicles, 274 Neb. 819, 743 N.W.2d
758 (2008).
- 476 -
Nebraska Supreme Court Advance Sheets
305 Nebraska Reports
HBI, L.L.C. v. BARNETTE
Cite as 305 Neb. 457
Because the particular situation dictates what procedural
due process protections are required, 72 it is Barnette’s bur-
den to demonstrate that he is entitled to the same procedural
safeguards as those required in Jones. Yet, the record is void
of any evidence regarding the burden on the government, and
Barnette has presented no evidence demonstrating his property
was anything more than a vacant lot.
(iv) Reasonable Steps
Based on the specific facts presented in Jones, the Court sug-
gested sending a letter by regular mail so that a signature was
not required, posting notice on the front door of the property,
or addressing mail to “occupant” would be reasonable. These
additional steps were deemed reasonable because Arkansas’
statutes already required a homeowner to be served by personal
service if certified mail is returned. And, the property at issue
was an occupied home.
Balancing the State’s interest in efficiency against the own-
er’s property interest in his home, the Court in Jones rejected
as unreasonable the suggestion that the government should
conduct a search for the owner’s new address in the local
phonebook and government records. The Court determined
the government was not required to go that far because such a
requirement would impose too great a burden. The Court also
noted that “‘[i]t is not [the Court’s] responsibility to prescribe
the form of service that the [government] should adopt.’” 73
(v) Desirous of Actually Informing
In Jones, the Court explained that “‘when notice is a per-
son’s due . . . [t]he means employed must be such as one
desirous of actually informing the absentee might reasonably
adopt to accomplish it.’” 74 Thus, if the return of the notice
72
See Mathews, supra note 62.
73
Jones, supra note 32, 547 U.S. at 238 (quoting Greene v. Lindsey, 456
U.S. 444, 102 S. Ct. 1874, 72 L. Ed. 2d 249 (1982)).
74
Id. (quoting Mullane, supra note 29).
- 477 -
Nebraska Supreme Court Advance Sheets
305 Nebraska Reports
HBI, L.L.C. v. BARNETTE
Cite as 305 Neb. 457
as unclaimed is new knowledge indicating the chosen method
of service is not “desirous of actually informing,” additional
reasonable steps are required—but only if such steps are
practicable. 75
In the present case, Pontian’s knowledge that the certified
letter had been returned as unclaimed did not indicate that
its method of service was not desirous of actually informing
Barnette. Pontian sent notice to Barnette by certified mail,
return receipt requested, to the address where the property
tax statement was mailed, as required by § 77-1832. Prior to
returning the notice as unclaimed, the post office had made
three attempts to deliver the notice. After it was returned as
unclaimed, Pontian proceeded to notice by publication in a
Sarpy County newspaper, as permitted by § 77-1834.
(vi) Practicalities and
Peculiarities of Case
Jones does not preclude the conclusion we reach today. This
case involves substantially different facts and circumstances
from those presented in Jones. Other states have rejected the
argument that additional steps are required after notice sent to
a property owner’s last known and actual address was returned
as unclaimed or where property owners have failed to present
evidence that they were either not home or not available to
claim the notice.
The North Carolina Court of Appeals rejected a property
owner’s argument that Jones required additional steps after a
notice was returned as unclaimed and held that the notice sent
to the property owner’s last known and actual address complied
with due process requirements. 76 The Supreme Court of New
York, Appellate Division, recognized that when mailings had
been sent to the property owners’ current and correct addresses
but returned as unclaimed, the lack of evidence indicating
75
Id.
76
St. Regis of Onslow County v. Johnson, 191 N.C. App. 516, 663 S.E.2d
908 (2008).
- 478 -
Nebraska Supreme Court Advance Sheets
305 Nebraska Reports
HBI, L.L.C. v. BARNETTE
Cite as 305 Neb. 457
property owners were not home or legitimately unavailable
to sign for the letter was “‘unique information about [the]
intended recipient[s]’” to be taken into account when determin-
ing whether notice was reasonable. 77
Addressing the sufficiency of notice in a breach of contract
action, the Pennsylvania Court of Common Pleas has also held
that “[w]hen a letter is returned as ‘refused’ or ‘unclaimed,’ the
notice is sufficient if it is apparent that the address was valid
and could be located by the postal office.” 78 In Mikhaylov v.
U.S., 79 the U.S. District Court for the Eastern District of New
York similarly recognized that in the context of asset forfei-
ture, “[a] written notice sent, via certified mail, to any known
addresses, combined with published notices, ordinarily satisfies
the Mullane standard.” The court stated:
The only arguable exceptions are: where the gov-
ernment knows or should know that the written notice
will not reach the intended recipient (e.g., the written
notice is returned as undeliverable), and it can obtain the
recipient’s correct address internally (e.g., the recipient
is already in the government’s custody). . . . Or, where
the government knows or should know that the intended
recipient will not understand the written notice (e.g., the
recipient lacks the mental capacity). 80
Here, Barnette’s actual address was known and the notice
was correctly sent to that address. In contrast to Jones, 81
the property at issue in this case was not Barnette’s home.
Barnette’s home is in Council Bluffs, Iowa, where he has
77
Temple Bnai Shalom of Great Neck v. Village of Great Neck Estates, 32
A.D.3d 391, 393, 820 N.Y.S.2d 104, 106 (2006) (quoting Jones, supra
note 32).
78
Masergy Communications, Inc. v. Atris, Inc., No. 06-24948, 2007 WL
5479856 (Pa. Com. Pl. Oct. 4, 2007).
79
Mikhaylov v. U.S., 29 F. Supp. 3d 260, 267 (E.D.N.Y. 2014).
80
Id. at 267-68.
81
Jones, supra note 32.
- 479 -
Nebraska Supreme Court Advance Sheets
305 Nebraska Reports
HBI, L.L.C. v. BARNETTE
Cite as 305 Neb. 457
continuously resided throughout the entire tax sale process and
admits to having received tax notices for the property at issue
there. Because Pontian’s notice was sent to Barnette’s actual
address, the only new information revealed by the return of the
letter was that either (1) Barnette had not been home during the
attempts at delivery, and then failed to retrieve the letter from
the post office, or (2) Barnette had been avoiding service.
The dissent cites two cases in support of its position.
However, there is a distinct difference between the factual cir-
cumstances in those cases and the one before us today. In each
case, the property owner had denied having actual notice of the
pending proceedings. Moreover, in Schlereth v. Hardy, 82 the
court found that the property owner “was not offered a certi-
fied letter by the postal worker that she refused to accept—she
simply failed to retrieve a letter, the substance of which was
unknown to her.”
Again, it is Barnette’s burden to establish issuance of the
tax deed was unconstitutional. 83 However, he has not offered
any evidence to show that the notice was not reasonably cal-
culated to apprise him of Pontian’s intent to apply for a tax
deed. During oral argument, Barnette’s counsel admitted there
was no evidence in the record regarding why Barnette had
not accepted the letter. Barnette has not alleged that he was
unaware of the attempts at service or that he was unavailable
to claim the letter. Barnette has also not alleged a lack of actual
knowledge of Pontian’s intent to apply for a tax deed. This dif-
fers from the property owner in Jones who had demonstrated
that he had only learned of the pendency of the proceedings
after his home had already been sold. 84
Sending notice to Barnette at his actual residence demon-
strates Pontian was desirous of actually informing Barnette of
its intention to apply for a tax deed. Accordingly, we hold that
82
Schlereth v. Hardy, 280 S.W.3d 47, 52 n.4 (Mo. 2009).
83
See Stenger, supra note 71.
84
See Jones, supra note 32.
- 480 -
Nebraska Supreme Court Advance Sheets
305 Nebraska Reports
HBI, L.L.C. v. BARNETTE
Cite as 305 Neb. 457
the notice was constitutionally sufficient under the standard
articulated in Jones.
The dissent correctly asserts that sending Barnette notice
by regular mail would have imposed little burden on Pontian.
However, regardless of the level of burden imposed, Pontian
was not obligated to do so. The Court of Appeals of New York
rejected a similar argument when holding that the government
was not required to take additional steps under Jones after
tax bills and a notice of foreclosure proceeding were sent by
regular mail, but returned as undeliverable because the own-
ers had not shown that there were any steps that would have
yielded the owners’ new address. 85 Here, the burden lies on
Barnette, and he has presented no evidence to show that there
were additional reasonable steps and that these additional steps
would be practicable.
Even assuming the dissent’s interpretation of Jones is cor-
rect, and the return of notice as unclaimed independently
triggers an obligation to take additional reasonable steps
when notice is sent to the property owner’s actual residence,
these steps are still not constitutionally required unless it
is “practicable to do so.” 86 The Oxford English Dictionary
defines “practicable” as “[a]ble to be done or put into prac-
tice successfully; feasible; able to be used; useful, practical,
effective.” 87
The U.S. Court of Appeals for the Seventh Circuit has
recognized: “The Constitution does not require that an effort
to give notice succeed. . . . If it did, then people could evade
knowledge, and avoid responsibility for their conduct, by burn-
ing notices on receipt—or just leaving them unopened . . . .” 88
85
Mac Naughton v. Warren County, 20 N.Y.3d 252, 982 N.E.2d 1237, 959
N.Y.S.2d 104 (2012).
86
See Jones, supra note 32, 547 U.S. at 234.
87
“Practicable,” Oxford English Dictionary Online, http://www.oed.com/
view/Entry/149217 (last visited Apr. 4, 2020).
88
Ho v. Donovan, 569 F.3d 677, 680 (7th Cir. 2009) (citing Dusenbery,
supra note 42).
- 481 -
Nebraska Supreme Court Advance Sheets
305 Nebraska Reports
HBI, L.L.C. v. BARNETTE
Cite as 305 Neb. 457
In this case, regular mail (or mail addressed to “occupant”)
would not likely have been useful or effective, especially
given the fact Barnette has not alleged that he was unaware
of the delivery attempts or that he was unavailable to claim
the letter.
To the extent the dissent discusses Neb. Rev. Stat. § 25-520.01
(Reissue 2016) and its requirement that along with publication,
parties must mail a copy of the published notice to all parties
having a direct legal interest in the action when the party’s
name and address are known, the Legislature has not included
the same requirement when publishing under § 77-1834. While
the inclusion of such a requirement may be appropriate, its
absence does not affect the constitutionality of the notice pro-
vided in the case before us.
Under the totality of circumstances presented, Pontian’s
attempt at notice was “‘desirous of actually informing’”
Barnette of its intent to apply for a tax deed. 89 Pontian com-
plied with §§ 77-1832 and 77-1834 and was not required to
publish notice anywhere other than Sarpy County. Accordingly,
we hold that the notice was constitutionally sufficient.
There is no merit to Barnette’s third and fourth assignments
of error.
4. Action to Quiet Title
In his fifth assignment of error, Barnette reasserts his claims
of defective notice and service and argues the statutory time
period for obtaining a deed to the property has expired. As set
forth above, Pontian’s notice of its intent to apply for a tax
deed was not defective. This argument is meritless.
VI. CONCLUSION
Pontian complied with the statutory notice requirements for
obtaining a tax deed. Because the requirements are reason-
ably calculated to apprise a property owner of a tax certificate
holder’s intent to apply for a tax deed, they are constitutionally
89
See Jones, supra note 32, 547 U.S. at 230.
- 482 -
Nebraska Supreme Court Advance Sheets
305 Nebraska Reports
HBI, L.L.C. v. BARNETTE
Cite as 305 Neb. 457
sufficient. Barnette has failed to meet his burden of establish-
ing the tax deed is invalid. The judgment of the district court
is affirmed.
Affirmed.
Cassel, J., concurring.
I agree with the court that HBI correctly followed Neb. Rev.
Stat. § 77-1831 (Reissue 2009) regarding notice that must be
given upon tax deed issuance. And I agree that under the cir-
cumstances here, there was no due process violation.
But I write separately to suggest that the Legislature may
wish to follow the example of Neb. Rev. Stat. § 25-520.01
(Reissue 2016), which was adopted in response to Mullane v.
Central Hanover Tr. Co. 1 The Legislature may find it prudent
to amend Neb. Rev. Stat. § 77-1835 (Supp. 2019) to provide
that where notice by publication is given, the party giving such
notice shall send by U.S. mail a copy of the first such pub-
lished notice to the record owner of the property.
1
Mullane v. Central Hanover Tr. Co., 339 U.S. 306, 70 S. Ct. 652, 94 L. Ed.
865 (1950).
Papik, J., dissenting.
“Before a State may take property and sell it for unpaid
taxes, the Due Process Clause of the Fourteenth Amendment
requires the government to provide the owner ‘notice and
opportunity for hearing appropriate to the nature of the case.’”
Jones v. Flowers, 547 U.S. 220, 223, 126 S. Ct. 1708, 164
L. Ed. 2d 415 (2006), quoting Mullane v. Central Hanover
Tr. Co., 339 U.S. 306, 70 S. Ct. 652, 94 L. Ed. 865 (1950).
I believe that under the U.S. Supreme Court’s opinion in
Jones, Pontian provided constitutionally inadequate notice of
its intent to apply for a treasurer’s deed for Barnette’s property.
While the majority finds this case distinguishable from Jones,
I do not.
In this dissent, I will first explain how I read Jones and how
I understand it to apply here. I will then address the majority’s
position that my reading of Jones is incorrect.
- 483 -
Nebraska Supreme Court Advance Sheets
305 Nebraska Reports
HBI, L.L.C. v. BARNETTE
Cite as 305 Neb. 457
Jones v. Flowers and Unclaimed
Certified Mail.
As the majority explains, Jones involved a fact pattern simi-
lar to the one before us. After the longtime owner of a house
separated from his wife and moved out, taxes on the house
were not paid. A government official later sent notice of the
delinquency and information about how to redeem the property
by certified mail to the address where the owner no longer
lived. It was returned unclaimed. Two years later, the govern-
ment official published a notice of public sale of the house in
a local newspaper. When a purchase offer was received for
the home, the government official sent another certified letter,
warning that the house would be sold if the delinquent taxes
were not paid. Once again, the certified mail was returned
unclaimed. The owner did not learn of the sale until the pur-
chaser had an unlawful detainer notice sent to the property,
which was served on the owner’s daughter.
The owner’s lawsuit alleging that his house was being taken
without due process eventually reached the U.S. Supreme
Court. In an opinion authored by Chief Justice Roberts, the
Court first acknowledged that due process does not require
actual notice before the government may take property and that
in prior cases, it had deemed notice constitutionally adequate
if it was reasonably calculated to reach the intended recipi-
ent when sent. The Court also noted its precedent, including
Dusenbery v. United States, 534 U.S. 161, 122 S. Ct. 694, 151
L. Ed. 2d 597 (2002), and Mullane, supra, generally permitting
service by mail.
The Court explained, however, that Jones presented a
“new wrinkle”: whether due process requires additional steps
“when the government becomes aware prior to the taking that
its attempt at notice has failed.” 547 U.S. at 227. The Court
concluded that reasonable followup measures are required
in such circumstances, reasoning that no one who “actually
desired to inform a real property owner of an impending tax
sale of a house he owns would do nothing when a certified
- 484 -
Nebraska Supreme Court Advance Sheets
305 Nebraska Reports
HBI, L.L.C. v. BARNETTE
Cite as 305 Neb. 457
letter sent to the owner is returned unclaimed.” Jones v.
Flowers, 547 U.S. 220, 229, 126 S. Ct. 1708, 164 L. Ed. 2d
415 (2006).
The Court went on to conclude that there were reasonable,
additional steps the government official could have taken,
including resending the notice by regular mail or posting notice
on the front door. The Court explained that such steps would
increase the likelihood of a property owner receiving actual
notice. Finally, the Court concluded that following up by pub-
lication was constitutionally inadequate.
I agree with Barnette that under Jones, the notice here was
constitutionally inadequate. The notice sent by certified mail
was returned unclaimed. I read Jones to tell us rather plainly
that in that circumstance, the State must take additional, rea-
sonable steps to provide notice if it is practicable to do so. 547
U.S. at 225 (“[w]e hold that when mailed notice of a tax sale is
returned unclaimed, the State must take additional reasonable
steps to attempt to provide notice to the property owner before
selling his property, if it is practicable to do so”).
Because I believe this case is controlled by Jones, I would
go on to consider, as the Court did in Jones, whether Pontian
took additional, reasonable measures to notify Barnette after
the certified mail went unclaimed. It quickly becomes clear to
me it did not.
As noted above, Jones concluded there were other, rea-
sonable steps that could have been taken after the attempt to
provide notice by certified mail failed. The Court mentioned
resending the notice by regular mail or posting notice on the
front door. The Court explained that such steps would increase
the likelihood of the property owner receiving actual notice
whether the property owner had moved or had simply not
retrieved the certified mail.
I see no reason why those reasonable, additional steps
could not have been taken here. Pontian, for example, could
have followed the normal practice in Nebraska of sending the
published notice to those with an interest in a proceeding by
- 485 -
Nebraska Supreme Court Advance Sheets
305 Nebraska Reports
HBI, L.L.C. v. BARNETTE
Cite as 305 Neb. 457
regular mail at the same time the notice was published. In most
instances in which a party is allowed to provide notice by pub-
lication, Nebraska law requires that, along with publication, the
party mail a copy of the published notice to “each and every
party appearing to have a direct legal interest in such action or
proceeding whose name and post office address are known to
him.” Neb. Rev. Stat. § 25-520.01 (Reissue 2016). A mailing
of published notice does not appear to have been statutorily
required in this unique context, see Neb. Rev. Stat. § 25-520.02
(Reissue 2016), but sending the published notice by regular
mail would have required little more of Pontian and would
have eliminated any argument that it provided constitutionally
inadequate notice under Jones. As the majority acknowledges,
sending Barnette notice by regular mail after the certified mail
went unclaimed would have imposed little burden on Pontian.
Pontian, however, did nothing except publish notice after the
certified mail was returned unclaimed. In Jones, publication
was deemed to be inadequate. See Jones v. Flowers, 547 U.S.
220, 126 S. Ct. 1708, 164 L. Ed. 2d 415 (2006).
Because Pontian did not, after the certified mail was returned
unclaimed, take reasonable, additional steps to attempt to notify
Barnette when it was practicable to do so, I do not believe it
provided constitutionally adequate notice. The majority, how-
ever, finds the notice was adequate based on a different reading
of Jones. I explain why I disagree with that reading below.
Majority’s Understanding of Jones.
The majority concludes that the notice sent by certified mail
that was returned unclaimed was sufficient to satisfy due proc­
ess notwithstanding Jones. As I understand the majority opin-
ion, it concludes that Jones does not apply in this circumstance
because it is not clear that the piece of property being taken
and sold by the government includes a house, because the
certified mail that went unclaimed was addressed to the place
where Barnette lived, and because it finds that the additional
steps discussed in Jones likely would have failed.
- 486 -
Nebraska Supreme Court Advance Sheets
305 Nebraska Reports
HBI, L.L.C. v. BARNETTE
Cite as 305 Neb. 457
I do not read the application of Jones to turn on the facts
identified by the majority. Take first, the majority’s determina-
tion that Jones has no bearing here because Jones involved
the taking of a house and, as the majority puts it, nothing in
the record demonstrates the property being taken here “was
anything more than a vacant lot.” The majority identifies a
number of occasions in which the U.S. Supreme Court in Jones
referred to the fact that the property being sold was a house
and that such an action is an important and extraordinary act.
For multiple reasons, I understand these references to empha-
size the significance and irreversibility of the government’s
taking property from its owner and selling it, not to, in the
majority’s words, attribute “special importance” to the fact that
the property being sold was a house.
Not only is that, in my view, a more natural reading, in
many other places in Jones, the U.S. Supreme Court frames
its analysis in terms of the taking of property in general. The
Court stated that it granted certiorari “to determine whether,
when notice of a tax sale is mailed to the owner and returned
undelivered, the government must take additional reason-
able steps to provide notice before taking the owner’s prop-
erty.” Jones, 547 U.S. at 223 (emphasis supplied). It further
explained that it took the case “to resolve a conflict among the
Circuits and State Supreme Courts concerning whether the Due
Process Clause requires the government to take additional rea-
sonable steps to notify a property owner when notice of a tax
sale is returned undelivered.” Id., 547 U.S. at 225 (emphasis
supplied). And in stating its holding, the Court said, “We hold
that when mailed notice of a tax sale is returned unclaimed,
the State must take additional reasonable steps to attempt to
provide notice to the property owner before selling his prop-
erty, if it is practicable to do so.” Jones v. Flowers, 547 U.S.
220, 225, 126 S. Ct. 1708, 164 L. Ed. 2d 415 (2006) (empha-
sis supplied).
I would also note that I find the conclusions the majority
draws from a house being at issue in Jones difficult to square
- 487 -
Nebraska Supreme Court Advance Sheets
305 Nebraska Reports
HBI, L.L.C. v. BARNETTE
Cite as 305 Neb. 457
with the facts of Jones itself. As the majority emphasizes, the
property owner in Jones did not actually reside at the house
that was being taken and sold by the government. The interest
of the property owner in Jones was thus not that of someone
whose residence was being sold out from under him. And
while a nonresident owner undoubtedly has a significant inter-
est in a house he or she owns, I do not see how such an inter-
est would, for due process purposes, be more significant than a
property owner’s interest in, say, a building used for business
purposes, farmland, or any other piece of real property, even “a
vacant lot.”
Neither am I persuaded by the majority’s conclusion that
Jones does not apply when, as here, the unclaimed certified
mail was sent to the address at which the property owner lives.
I concede that, at least at first blush, this distinction identified
by the majority seems meaningful. A compelling argument can
certainly be made that a person like the homeowner in Jones
who never has the opportunity to accept certified mail is more
deserving of additional attempts at notice than Barnette who,
for reasons that are not clear, did not sign for certified mail
sent to the home where he resides. One might add to that argu-
ment that a finding that Barnette was provided with inadequate
notice could create an incentive for delinquent taxpayers to
evade certified mail. See Jones, 547 U.S. at 248 (Thomas, J.,
dissenting) (“[t]he meaning of the Constitution should not turn
on the antics of tax evaders and scofflaws”). But as compel-
ling as I might find the policy arguments for the majority’s
position, I do not believe that Jones can fairly be read to allow
for it.
In holding that knowledge that notice has been returned
unclaimed requires the State to consider additional action,
Jones does not focus on the reason that the certified mail went
unclaimed. Its focus is instead on the fact that the certified
mail went unclaimed. The Court concluded that because the
certified mail went unclaimed, the government official knew
the attempt to actually notify the homeowner had failed and
- 488 -
Nebraska Supreme Court Advance Sheets
305 Nebraska Reports
HBI, L.L.C. v. BARNETTE
Cite as 305 Neb. 457
therefore, if practicable, additional steps were required. See
id., 547 U.S. at 225 (“when mailed notice of a tax sale is
returned unclaimed, the State must take additional reasonable
steps to attempt to provide notice . . . if it is practicable to
do so”).
But not only does Jones not focus on the owner’s living
somewhere other than the address where the certified mail
was sent, it explicitly discusses the possibility that certified
mail might go unclaimed by a person residing at the address
where the certified mail is sent. 547 U.S. at 234 (“[t]he return
of the certified letter marked ‘unclaimed’ meant either that
[the owner] still lived at [the address where the certified mail
was sent], but was not home when the postman called and did
not retrieve the letter at the post office, or that [the owner] no
longer resided at that address”) (emphasis supplied). The opin-
ion does not, however, conclude that a person who does not
retrieve certified mail sent to his or her residence has received
constitutionally adequate notice. To the contrary, it discusses
how the required additional attempts at providing notice such
as resending the notice by regular mail or posting notice on
the front door would address both the possibility that the
homeowner no longer lived at the address but also that he “had
simply not retrieved the certified letter.” Jones v. Flowers, 547
U.S. 220, 235, 126 S. Ct. 1708, 164 L. Ed. 2d 415 (2006). For
better or for worse, Jones treats alike property owners who do
not claim certified mail because they have moved and prop-
erty owners who simply fail to retrieve certified mail—neither
receive notice when certified mail goes unclaimed and the
additional steps are aimed at providing notice to both types
of parties.
For this reason, I cannot agree with the majority that
Pontian’s attempt at notice was “desirous of actually inform-
ing” Barnette of its intent to apply for a tax deed. The major-
ity focuses exclusively on whether Pontian’s attempt to notify
Barnette of an impending tax sale was “desirous of actually
informing” when the certified mail was sent. Under Jones,
- 489 -
Nebraska Supreme Court Advance Sheets
305 Nebraska Reports
HBI, L.L.C. v. BARNETTE
Cite as 305 Neb. 457
however, that is not the end of the inquiry, at least when
certified mail is returned unclaimed. Under Jones, once cer-
tified mail is returned unclaimed, it is not enough that the
notice by certified mail was “desirous of actually informing”
when sent.
I also do not believe the majority is correct to conclude
that even if Jones applies, Pontian was not required to take
additional steps after the certified mail went unclaimed. The
majority concludes Pontian was not required to do so because,
it says, any additional steps would not likely have succeeded
because there is nothing in the record that indicates why
the certified mail went unclaimed in the first place. I do not
believe that is relevant. When Jones concluded that additional
steps such as sending the notice by regular mail or posting the
notice on the front door were reasonable and available, it did
not do so by considering whether those steps would have pro-
vided notice to the property owner in the case before it. It con-
cluded that such steps were “practicable” because they would
“increase the chances of actual notice” whether the property
owner had moved or had simply not retrieved the certified mail
sent to his home. Id., 547 U.S. at 234, 235. I do not believe we
can second-guess that determination here.
Other Authority.
The majority also relies on a number of cases in support of
its more limited understanding of Jones. Just as I disagree with
the majority’s understanding of Jones, I am not persuaded by
its reliance on other cases.
In my view, many of the cases cited by the majority do not
even speak to the issues at hand. For example, the majority
notes that in St. Regis of Onslow County v. Johnson, 191 N.C.
App. 516, 663 S.E.2d 908 (2008), the North Carolina Court
of Appeals rejected a property owner’s argument that Jones
required additional steps after a notice was returned unclaimed.
That is true enough, but the court did not do so for any of the
reasons the majority relies on here. The court concluded that
- 490 -
Nebraska Supreme Court Advance Sheets
305 Nebraska Reports
HBI, L.L.C. v. BARNETTE
Cite as 305 Neb. 457
notice was sufficient because in that case the notices were
returned unclaimed after the property had been sold and thus
the obligation to take additional steps to effect notice was
never triggered.
The majority also cites language from a Pennsylvania
trial court decision to the effect that even if letters are
returned unclaimed, the notice is sufficient if sent to a valid
address. See Masergy Communications, Inc. v. Atris, Inc., No.
06-24948, 2007 WL 5479856 (Pa. Com. Pl. Oct. 4, 2007). In
support of that proposition, however, the court cited cases that
predated Jones. The court only mentioned Jones in a footnote,
also distinguishing it on grounds not relied on by the major-
ity here.
I also cannot agree that Mikhaylov v. U.S., 29 F. Supp.
3d 260 (E.D.N.Y. 2014), supports the majority’s position. At
issue in that case was whether the government provided notice
consistent with due process before seizing property in a drug
forfeiture case. The government sent notice of the forfeiture to
the property owner’s last known address by certified mail. The
property owner had moved away, but someone else signed for
it. The property owner argued that he was entitled to actual
notice, and the court disagreed. Because the notice was not
returned unclaimed, the court’s opinion, unsurprisingly, does
not discuss Jones.
Despite the absence of any mention of Jones in Mikhaylov,
the majority splices together two quotes from the opinion and
appears to suggest those quotes support its position. The first
quote is a recitation of a principle of blackletter law with
which neither I nor anyone else could quibble: “A written
notice sent, via certified mail, to any known addresses, com-
bined with published notices, ordinarily satisfies the Mullane
standard.” Mikhaylov, 29 F. Supp. 3d at 267 (emphasis sup-
plied). In the next sentence of the majority opinion, the major-
ity quotes from language appearing two paragraphs later in
Mikhaylov discussing “[t]he only arguable exceptions.” Id.
To the extent the majority intends to suggest that Mikhaylov
- 491 -
Nebraska Supreme Court Advance Sheets
305 Nebraska Reports
HBI, L.L.C. v. BARNETTE
Cite as 305 Neb. 457
was articulating “[t]he only arguable exceptions” to its earlier
statement that certified mail sent to a known address ordinar-
ily satisfies Mullane, it is mistaken. The two paragraphs in
between the portions quoted by the majority make clear that
the court was discussing “arguable exceptions” to the rule that
actual notice is not required to satisfy due process. Mikhaylov,
29 F. Supp. 3d at 267. Jones did not require actual notice, and
no one is suggesting that actual notice is required here.
The majority does cite two cases, Temple Bnai Shalom
of Great Neck v. Village of Great Neck Estates, 32 A.D.3d
391, 820 N.Y.S.2d 104 (2006), and Mac Naughton v. Warren
County, 20 N.Y.3d 252, 982 N.E.2d 1237, 959 N.Y.S.2d 104
(2012), that appear to align with the majority’s understanding
of Jones to some degree. But Temple Bnai Shalom of Great
Neck declined to apply Jones based, in part, upon the reason
certified mail went unclaimed and Mac Naughton declined to
do so based upon a determination that additional efforts would
not have resulted in notifying the owners in the case before it.
As I have already explained, I do not believe either approach is
consistent with Jones.
While on the subject of authority, I note that others have
read Jones as I do. In Schlereth v. Hardy, 280 S.W.3d 47 (Mo.
2009), the Missouri Supreme Court confronted a case like
ours. In that case, certified mail was sent to the delinquent
taxpayer’s residence; the taxpayer received notifications of
the attempt to deliver, but she failed to pick it up; and it was
returned unclaimed. The person seeking to buy the delinquent
taxpayer’s home did not provide additional forms of notice.
The Missouri Supreme Court unanimously held that, under
Jones, the notice did not comply with due process. It con-
cluded that after the certified mail was returned unclaimed, the
sender was required to take reasonable, additional measures as
articulated in Jones. With respect to the fact that the delinquent
taxpayer received notification of the certified mail and failed
to retrieve it, the court stated: “Jones did not concern itself
with why the addressee failed to claim the certified letter. In
- 492 -
Nebraska Supreme Court Advance Sheets
305 Nebraska Reports
HBI, L.L.C. v. BARNETTE
Cite as 305 Neb. 457
fact, the Supreme Court allowed for the possibility that the
addressee, like [the delinquent taxpayer] simply would ignore
the requests to pick up the certified letter.” Schlereth, 280
S.W.3d at 51.
Similarly, in VanHorn v. Florida, 677 F. Supp. 2d 1288
(M.D. Fla. 2009), a federal district court concluded that, under
Jones, the government was required to attempt additional rea-
sonable steps at service, if practicable, even though the certi-
fied mail that went unclaimed was sent to the address where
the property owner resided. The court pointed to the language
in Jones discussed above that the government was required
to “account not only for the possibility that (as in [Jones])
an unclaimed letter was delivered to an address at which the
property owner did not reside but also ‘that he had simply not
retrieved the certified letter.’” VanHorn, 677 F. Supp. 2d at
1297, quoting Jones v. Flowers, 547 U.S. 220, 126 S. Ct. 1708,
164 L. Ed. 2d 415 (2006).
Conclusion.
In closing, I respond to the majority’s assertion that I read
Jones to create a new rule when the Jones Court disavowed
doing so. In fact, Jones did not altogether disavow the creation
of a new rule; the Court said it was not creating a rule that
“is contrary to Dusenbery and a significant departure from
Mullane.” 547 U.S. at 238. The dissent in Jones felt that this
was not an accurate account of the opinion. 547 U.S. at 244
(Thomas, J., dissenting) (“[t]he majority’s new rule is contrary
to Dusenbery and a significant departure from Mullane”). And,
as a matter of description, perhaps that is debatable.
But regardless of how Jones characterized its holding, we
are bound to follow it. See, e.g., State v. Thieszen, 295 Neb.
293, 297, 887 N.W.2d 871, 875 (2016) (“[u]pon questions
involving the interpretation of the U.S. Constitution, the deci-
sion of the U.S. Supreme Court is the supreme law, by which
state courts are bound”). Respectfully, I do not believe the
majority opinion does. For that reason, I dissent.