Pung v. Isabella County
Key claim: The Supreme Court held that just compensation under the Fifth Amendment Takings Clause following a tax-sale foreclosure is measured by the actual auction sale price (plus return of surplus proceeds), not the property’s hypothetical fair market value, and that the Eighth Amendment Excessive Fines Clause imposes no greater obligation.
Abstract
U.S. Supreme Court opinion decided 2026-06-23, by Samuel Alito. (Slip Opinion) OCTOBER TERM, 2025 1
Syllabus
NOTE: Where it is feasible, a syllabus (headnote) will be released, as is
being done in connection with this case, at the time the opinion is issued.
The syllabus constitutes no part of the opinion of the Court but has been
prepared by the Reporter of Decisions for the convenience of the reader.
See United States v. Detroit Timber & Lumber Co., 200 U. S. 321, 337.
SUPREME COURT OF THE UNITED STATES
Syllabus
PUNG, PERSONAL REPRESENTATIVE OF THE ESTATE OF PUNG v. ISABELLA COUNTY, MICHIGAN
CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE SIXTH CIRCUIT
No. 25–95. Argued February 25, 2026—Decided June 23, 2026
The Pung family owed $2,241.93 in real-property taxes, so local tax au- thorities in Isabella County, Michigan, initiated foreclosure proceed- ings and sold the Pung home—which was assessed at $194,400 for tax purposes—for $76,008 at public auction. Michael Pung sued in Fed- eral court, and the District Court granted Pung partial summary judg- ment on his Fifth Amendment claim. The court held that Pung should receive only the surplus proceeds from the tax sale—i.e., the difference between the sale price and the tax debt—not the property’s fair market value. The District Court also rejected Pung’s claim under the Eighth Amendment Excessive Fines Clause. The Sixth Circuit affirmed. Held: 1. The proper baseline for measuring “just compensation” following a tax sale is the auction sale price, not the property’s hypothetical fair market value, at least when the sale is fairly conducted in light of the country’s history of tax sales. Pp. 4–11. (a) For hundreds of years, English and American law have allowed the seizure and sale of property as a tax-collection method, provided that the government return any surplus proceeds to the debtor. Fed- eral statutes from the early days of the Republic applied this rule, as did this Court’s precedents. United States v. Taylor, 104 U. S. 216; United States v. Lawton, 110 U. S. 146; Nelson v. City of New York, 352 U. S. 103; BFP v. Resolution Trust Corporation, 511 U. S. 531. Pp. 4– 6. (b) Neither history nor precedent supports Pung’s contrary 2 PUNG v. ISABELLA COUNTY
Syllabus
argument. Pung’s reliance on a recent concurrence by a Justice of the
Supreme Court of Michigan interpreting the State Constitution does
not shed much light on the Takings Clause’s meaning, see Rafaeli, LLC
v. Oakland County, 505 Mich. 429, 485–522, 952 N. W. 2d 434, 466–
487 (Viviano, J., concurring). Cases about the seizure of multiple
pieces of property do not help him because the County sold just one
parcel of Pung’s real property, and Pung does not argue that the parcel
could have been subdivided. Eminent-domain cases do not help him
either because, even in that context, this Court has “refused to desig-
nate market value as the sole measure of just compensation,” United
States v. 564.54 Acres of Monroe and Pike County Land, 441 U. S. 506,
512. Fair market value is not an appropriate measure of just compen-
sation in this context because owners can generally avoid tax sales.
Pung’s fair-market-value theory would impose unprecedented
burdens on jurisdictions that wish to collect unpaid taxes and might
well make tax sales impractical. Under Pung’s rule, a tax sale would
often net the government a loss, paid out to the delinquent taxpayer
himself, rendering tax sales infeasible as a debt-collection mechanism.
That Pung’s novel interpretation of the Takings Clause would elimi-
nate this longstanding practice is strong evidence that his interpreta-
tion is incorrect. Pp. 6–10.
(c) The Court will not resolve any of Pung’s newfound contentions
that the procedure the County followed in seizing and selling his prop-
erty was unfair. The Sixth Circuit may address on remand any such
arguments properly preserved in that court. Pp. 10–11.
2. The Court rejects Pung’s argument that the County violated the
Eighth Amendment Excessive Fines Clause by failing to compensate
him for his property’s fair market value. Forfeiture of property can be
a “fin[e]” for purposes of the Eighth Amendment if it serves “in part to
punish.” Austin v. United States, 509 U. S. 602, 610. Pung lacks prec-
edent or historical evidence suggesting that a tax sale which is fairly
conducted in light of our Nation’s history would violate the Eighth
Amendment. In addition, imposing Pung’s fair-market-value rule un-
der the Eighth Amendment would entail the same drastic conse-
quences as imposing the rule under the Fifth Amendment. Pp. 11–12.
Vacated and remanded.
ALITO, J., delivered the opinion of the Court, in which ROBERTS, C. J., and SOTOMAYOR, KAGAN, GORSUCH, KAVANAUGH, BARRETT, and JACKSON, JJ., joined, and in which THOMAS, J., joined except as to Part II–B. SOTOMAYOR, J., filed a concurring opinion, in which GORSUCH and JACKSON, JJ., joined. THOMAS, J., filed an opinion concurring in part and concurring in the judgment, in which GORSUCH, J., joined except as to n. 1. Cite as: 609 U. S. ____ (2026) 1
Opinion of the Court
NOTICE: This opinion is subject to formal revision before publication in the
United States Reports. Readers are requested to notify the Reporter of
Decisions, Supreme Court of the United States, Washington, D. C. 20543,
pio@supremecourt.gov, of any typographical or other formal errors.
SUPREME COURT OF THE UNITED STATES _________________
No. 25–95
_________________
MICHAEL PUNG, PERSONAL REPRESENTATIVE OF THE ESTATE OF TIMOTHY SCOTT PUNG, PETITIONER v. ISABELLA COUNTY, MICHIGAN ON WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE SIXTH CIRCUIT [June 23, 2026]
JUSTICE ALITO delivered the opinion of the Court. When taxpayers fall behind on their property-tax bills, federal, state, and local governments alike have long used foreclosure and sale as a collection method. In Tyler v. Hennepin County, 598 U. S. 631 (2023), we held that the Fifth Amendment Takings Clause requires the government to return any surplus proceeds from tax foreclosure sales, i.e., the difference between the sale price and the taxpayer’s debt. The question presented here is whether the govern- ment must pay more when the sale price falls below the property’s hypothetical fair market value. In other words, is the constitutional baseline for “just compensation” the ac- tual tax-sale price or the price that someone would pay for the property in a hypothetical open-market transaction? We conclude that the proper baseline under the Takings Clause is the price obtained in a tax sale, at least when the sale is fairly conducted in light of our country’s history of tax sales. We also hold that, following a tax sale, the Eighth Amendment Excessive Fines Clause does not require the government to return more than the surplus proceeds. 2 PUNG v. ISABELLA COUNTY
Opinion of the Court
Neither the Fifth nor the Eighth Amendment requires the government to compensate former owners based on the hy- pothetical fair market value of their property. I In 2010, a local tax assessor denied the Pung family a state-law tax exemption for principal residences. The Pungs took the dispute to the Michigan Tax Tribunal, where th
Why this matters
Pung clarifies the practical remedy available to property owners who lose homes or land through tax-sale foreclosure: they are entitled to any surplus above the tax debt, but not to the gap between the auction price and fair market value. This limits the financial recovery for former owners—often low-income, elderly, or disabled homeowners—affected by tax enforcement, while confirming that Tyler v. Hennepin County’s constitutional protection against government retention of surplus proceeds remains intact.