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Continental Resources v. Fair (2024)

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Continental Resources v. Fair (2024)

Citation: 317 Neb. 391 (2024); ___ N.W.3d ___; No. S-21-074 · Court: Supreme Court of Nebraska · Decided: August 23, 2024

The Nebraska Supreme Court’s decision on remand from the U.S. Supreme Court following tyler-v-hennepin-county. It is one of the first state-high-court opinions to apply Tyler and to hold that a private tax-certificate purchaser that obtains a tax deed can be a state actor liable in just compensation for the surplus equity it captured above the tax debt. Decided the same day as its companion case nieveen-v-tax-106-2024.

Facts

Kevin L. Fair failed to pay roughly $5,268 in delinquent property taxes on his Scotts Bluff County home. Under Nebraska's tax-certificate statutes, the county sold a tax certificate to Continental Resources, a private party. After the statutory period and Continental's compliance with notice requirements, Continental obtained a tax deed to the property "free of any encumbrances," extinguishing Fair's interest. Fair alleged the property was worth substantially more than his tax debt — leaving roughly $55,000 in equity captured with no mechanism to recover it.

In its earlier opinion (Continental Resources v. Fair, 311 Neb. 184, 971 N.W.2d 313 (2022)), the Nebraska Supreme Court rejected Fair’s takings claim. Fair petitioned for certiorari; while the petition was pending the U.S. Supreme Court decided Tyler. The Supreme Court then granted certiorari, vacated the Nebraska judgment, and remanded for reconsideration in light of Tyler (143 S. Ct. 2580 (2023)).

Holding

On remand the court held (per curiam) that the district court erred in granting summary judgment to Continental on Fair’s takings claim. Two pillars:

  1. Protected property interest in surplus equity. Following Tyler, Fair retained a constitutionally protected property interest “to the extent the value of [his] property exceeded his tax debt,” and the issuance of the tax deed effected a taking of that surplus without just compensation.
  2. The private purchaser is a state actor. Continental “can be fairly characterized as a state actor when it obtained a tax deed,” so the Takings Clause reaches its conduct. The court therefore reversed and remanded the takings claim, while affirming the district court’s judgment in all other respects.

Reasoning

  • Joint action with the State. Rather than rest on the public-function test, the majority found Continental a state actor under the joint-action theory of Lugar v. Edmondson Oil Co., 457 U.S. 922 (1982): Continental “exercised a privilege created by the State in order to seize property” and “required the assistance of governmental parties” — the county’s sale of the certificate and issuance of the deed — “in order to complete its action.”
  • Supporting authority. The court cited Tulsa Professional Collection Services v. Pope, 485 U.S. 478 (1988) (“when private parties make use of state procedures with the overt, significant assistance of state officials, state action may be found”), and the Fourth Circuit’s Plemons v. Gale, 396 F.3d 569 (4th Cir. 2005) (tax-lien purchaser is a state actor), and noted West Virginia’s high court reached the same result in Wells Fargo Bank, N.A. v. UP Ventures II, 223 W. Va. 407 (2009).
  • Character of the tax-collection system. The court found its state-action conclusion “reinforced by the overall character of Nebraska’s delinquent property tax collection system” and the interdependent relationship it creates between the county and certificate purchasers.
  • Separate writing. A concurrence/dissent disputed the state-action holding, arguing Continental merely used a state-created remedy and that the county, not the private purchaser, should bear liability for just compensation — a fault line that recurs across the Tyler progeny.

Practical impact

  • For former owners, the decision confirms that a Nebraska tax-deed taking of surplus equity is compensable post-Tyler and that the private investor who took the deed is a proper defendant — not only the county.
  • For investors / operators, it establishes direct just-compensation exposure for tax-certificate purchasers in Nebraska who obtain a deed on property worth materially more than the debt, and signals that surplus must be accounted for to avoid liability. See surplus-funds and surplus-waterfall.
  • The state-actor holding is the analytical hinge later echoed by New Jersey in 257-261-20th-avenue-realty-v-roberto-2025 (joint-action / public-function theory).

Good-law status

Still good law. Decided August 23, 2024; reverses summary judgment and remands — not overruled, distinguished, or limited as of last_verified 2026-06-02. The companion case nieveen-v-tax-106-2024 applies the same reasoning.

Applies in →

nebraska. Persuasive across jurisdictions with private tax-certificate / tax-deed systems on the state-actor question.

Legal information, not legal advice. This page summarizes a court decision for educational purposes and does not create an attorney-client relationship. Verify against the primary opinion and consult a licensed attorney in the relevant jurisdiction before acting. Last verified 2026-06-02.

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