The City’s possessory lien on the chapter 7 debtor’s vehicle was judicial rather than statutory and could therefore be avoided under section 522(f). City of Chicago v. Mance, No. 21-1355 (7th Cir. April 21, 2022).
After the chapter 7 debtor incurred several unpaid traffic tickets, the City of Chicago impounded her car subject to a possessory lien of $12,245, comprising the amount of the outstanding tickets, storage and towing costs, and the City’s attorney fees. The lien in this case was more than four times the car’s value. The debtor’s monthly income was $197 in food stamps. The bankruptcy court held that the lien was avoidable, and the district court affirmed. City of Chicago v. Howard, 625 B.R. 384, 390 (N.D. Ill. 2021). [Read more…] about City’s Lien on Vehicle Is Judicial and May be Avoided