City Of Chicago Not Releasing Impounded Vehicles Simply By Filing Chapter 13

If you owe the city of Chicago and the city impounds your vehicle, you have one less option to recover your vehicle based upon the decision In Re: Bianca L. Avila, Case Number 17B 870. In that case, the city of Chicago impounded a vehicle for past due parking tickets. Avilla filed a chapter 13 bankruptcy in an effort to recover her vehicle and to reorganize her outstanding debt. This was a common practice in the past. The City of Chicago had no object to this payment arrangement in the past years. In fact, it was accepted as the norm by its counsel. However, the practice was no longer accepted and Avila sued to try and recover her vehicle.

The Honorable, Judge Cassling, sitting on the bench in the Northern District of Illinois, agreed with the city of Chicago in determining that the city did not violate the automatic stay in bankruptcy when it refused to return the vehicle to its owner. Since the city had a possessory lien on the vehicle, its continuing exercise of possession was not a violation for the bankruptcy code. This decision now gives drivers one less option and a very important option at that, for recovering a vehicle once it is impounded by the city. Let the driver with outstanding parking ticket beware.

In a recent telephone conversation with the City of Chicago attorney, David Holtkamp, he advised attorneys from David M. Siegel & Associates that they would not be releasing cars at this time in light of Judge Cassling's decision.