Oral Argument: Pung v. Isabella County | Foreclosure Over $2k Tax Bill Triggers a Constitutional Clash

Overview

The Pung family lost their $194,400 home over a $2,242 tax bill — a tax bill they never owed. Isabella County auctioned the home for $76,000 and returned only $73,766. The family lost over $118,000 in home equity.

Question: Can local governments pay a person their home’s auction price or their home’s fair market value when the government auctions the home at a foreclosure sale?

Background: The Pung family lost $194,400 home over $2,242 tax bill they never owed. Isabella County auctioned the home, fetching $76,000. Pung family received only $73,766 back.

Pung Argues: Counties must give fair market value as compensation when government takes property, not whatever an auction produces. Losing $118,000 over $2,242 creates grossly disproportionate punishment violating Eighth Amendment Excessive Fines Clause.

Isabella County Argues: Just compensation means what someone pays at a free and fair auction. No penalty exists, the Pungs lost only difference between auction price and debt.

Stakes: If Pung wins: Property owners get market value from forced home sales regardless of what a person pays at an auction. If Isabella County wins: property owners risk losing home equity over small, disputed, but unpaid property taxes.

Oral Advocates:

• For Petitioner (Pung): Philip L. Ellison of Outside Legal Counsel PLC.
• United States as Amicus Curiae: Frederick Liu, Assistant to the Solicitor General, U.S. Department of Justice.
• For Respondent (Isabella County, Michigan): Matthew Nelson of Warner Norcross and Judd.

Timestamps:

[00:00:00] Oral Argument Preview

[00:01:11] Oral Argument Begins

[00:01:20] Pung Opening Statement

[00:02:58] Pung Free for All Questions

[00:26:21] Pung Round Robin Questions

[00:51:09] United States Opening Statement

[00:52:18] United States Free for All Questions

[00:59:56] United States Round Robin Questions

[01:19:40] Isabella County Opening Statement

[01:21:46] Isabella County Free for All Questions

[01:39:59] Isabella County Round Robin Questions

[01:43:00] Pung Rebuttal