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Nebraska Supreme Court rules in favor of firm that acquired land of 94-year-old who didn’t pay taxes

August 26, 2018 GMT

LINCOLN — The transaction just sounds questionable.

An investment company pays the delinquent taxes on a farm owned by a 94-year-old Nebraska widow. By paying $50,000 in back taxes and interest, the company acquires a 480-acre property valued at $1.1 million.

In a cautionary tale for the elderly and their heirs, the Nebraska Supreme Court ruled Friday that the transaction followed the letter of the law and that the company gets to keep the farm.

One of the judges disagreed. Judge William Cassel of O’Neill said the company should not have been allowed to reap what he called “a windfall that borders on the obscene.”


Cassel cited a provision that extends the payment deadline for taxpayers with a mental disorder. The judge pointed to testimony from a family doctor that showed that Gladys Pearl Wisner was in cognitive decline from advanced age and a series of ministrokes.

Yet the court majority upheld the ruling of a district judge, who said the woman’s mental function was “within the normal range of a person for her age.” As a result, the majority concluded that the extended deadline for a mental disorder did not apply to the case.

“It defies reason and common sense to ignore the impact of extremely advanced age on mental ability,” Cassel wrote in his dissent. “And coupled with the testimony of her doctor ... I cannot agree that Gladys had the capacity to act for the protection of her own rights in the payment of real estate taxes.”

Randy James, a Lincoln attorney listed in court records as an owner of Vandelay Investments, acknowledged an email from a reporter Friday but offered no response.

The case involved a farm southeast of North Platte originally acquired by Wisner’s family. In 1949, she and her husband moved to the property, where they raised their four children. After the death of her husband in 2007, one of her sons helped her manage her financial affairs until the son’s death in 2009.

Wisner then moved into a retirement home in North Platte, and she assigned power of attorney to another son, who lived in Iowa. To help make sure that her bills were paid promptly, the son assigned the duties to a trust officer at a local bank.

The son testified that he thought that the bank was paying the property taxes out of his mother’s trust funds, but a bank officer testified that she never received any tax notices to pay.


Starting in 2009, Wisner began falling behind on her taxes despite the fact that she had ample funds to cover her expenses.

State law allows delinquent taxpayers to pay back taxes, plus interest, within three years. After the deadline, the county treasurer may sell what’s called a tax certificate to an outside buyer, who pays the taxes and can either collect the debt plus interest from the property owner or take steps to acquire the property.

In 2011, the Lincoln County treasurer sold a tax certificate on the Wisner property to a buyer in Colorado, who paid off the back taxes. In 2014, Vandelay Investments bought the certificate and began steps to acquire the farm.

The company sent a notice to Wisner by certified mail, but it was returned as “unclaimed.” The company then published notice in the Courier Times, a weekly newspaper in Sutherland, a village west of North Platte. Finally, the company sent a second letter via first-class mail to Wisner, which received no reply.

In September 2014, the county transferred the deed to Vandelay.

Wisner’s son learned about the transfer from a tenant who farmed the property, and he quickly offered to pay the taxes, plus interest, to Vandelay. But the company refused, and the matter went to court.

At a 2016 trial, Wisner’s son argued that his mother didn’t have the mental capacity to understand the notices she received. He argued that meant the deadline to pay the taxes should have been extended to five years.

Lincoln County District Judge Richard A. Birch heard testimony from Wisner’s doctor, who said she had been in mental decline by 2011, when the tax sale took place. But the judge was swayed by testimony from a medical expert hired by Vandelay, who said the woman’s medical records showed no evidence of impairment until 2014.

The judge determined that Wisner did not have a mental disorder and ruled in favor of Vandelay. But in 2017, the Nebraska Court of Appeals reversed the trial court and ordered that the property be returned to Wisner.

Vandelay appealed to the Supreme Court. Writing for the majority, Supreme Court Judge Jeffrey Funke reversed the appeals court and said the company complied with all of the requirements. On the issue of Wisner’s mental capacity, the majority deferred to the district judge’s decision.

“Despite the harsh result in this matter, the Legislature has established strict rules for the payment of real estate taxes and ramifications for the failure to pay those taxes,” Funke wrote. “Vandelay complied with those statutory requirements.”