City of Chicago v. Marcella M. Mance ( 2022 )

In the
United States Court of Appeals
For the Seventh Circuit
____________________
No. 21-1355
IN THE MATTER OF: MARCELLA M. MANCE,
Debtor,
CITY OF CHICAGO,
Appellant,
v.
MARCELLA M. MANCE,
Appellee.
____________________
Appeal from the United States District Court for the
Northern District of Illinois, Eastern Division.
No. 1:20-cv-01266 — Andrea R. Wood, Judge.
____________________
ARGUED OCTOBER 29, 2021 — DECIDED APRIL 21, 2022
____________________
Before SYKES, Chief Judge, and KANNE and HAMILTON,
Circuit Judges.
HAMILTON, Circuit Judge. This appeal presents a new
chapter in a long-term effort by the City of Chicago to collect
parking fines and other traffic fees from drivers who seek
bankruptcy protection. Some of the City’s tactics have worked
and others have not. See In re Fulton, 926 F.3d 916, 924 (7th
2 No. 21-1355
Cir. 2019) (City’s refusal to turn over vehicles to petitioners
during bankruptcy proceedings violated automatic stay),
vacated and remanded sub nom. City of Chicago v. Fulton, 141
S. Ct. 585 (2021); In re Steenes, 942 F.3d 834, 839 (7th Cir. 2019)
(vehicular tickets incurred during course of a Chapter 13
bankruptcy are administrative expenses that must be paid in
full).
The issue in this appeal is whether the City’s possessory
lien on a vehicle that it impounds due to unpaid tickets should
be deemed a “judicial lien” or a “statutory lien” under the
Bankruptcy Code. If the lien is judicial, all parties agree, it is
avoidable in bankruptcy under 11 U.S.C. § 522(f). If the lien is
instead deemed statutory, it is not avoidable under the same
provision.
We agree with the bankruptcy and district courts that the
City’s possessory lien on impounded vehicles is properly clas-
sified as judicial and therefore avoidable. Part I lays out the
stakes of this particular issue. Part II explains how judicial and
statutory liens are defined in the Bankruptcy Code. Part III
outlines the specific procedures the City must follow before it
can impose a lien on an impounded vehicle. Part IV explains
why a lien that flows from these procedures is judicial.
I. The Stakes
This case may appear to be a technical dispute with mod-
est stakes, but it’s a test case that is important to the City and
will affect many drivers. Outstanding debt for Chicago traffic
tickets surpassed $1.8 billion last year. 1 On average, the City
1 Melissa Sanchez, Chicago Mayor Lori Lightfoot Proposes Further Traffic
Ticket Reforms to Help Low-Income Motorists, ProPublica (Sept. 22, 2021, 5:10
No. 21-1355 3
issues around three million tickets a year, and by one recent
estimate, revenue from those tickets in 2016 exceeded a quar-
ter of a billion dollars and constituted seven percent of the
City’s operating budget. Melissa Sanchez & Sandhya
Kambhampati, Driven into Debt: How Chicago Ticket Debt Sends
Black Motorists into Bankruptcy, ProPublica Ill. (Feb. 27, 2018),
https://features.propublica.org/driven-into-debt/chicago-
ticket-debt-bankruptcy.
As the dockets in this court and the Northern District of
Illinois show, aggressive ticketing practices may help push
many drivers into bankruptcy. Id. (explaining that “[p]arking,
traffic and vehicle compliance tickets prompt so many bank-
ruptcies the court [in Chicago] [led] the nation in Chapter 13
filings” at the time); see also Table F-2—Bankruptcy Filings (De-
cember 31, 2019), U.S. Courts, https://www.uscourts.gov/sta-
tistics/table/f-2/bankruptcy-filings/2019/12/31 (last visited
Apr. 21, 2022) (Northern District of Illinois led nation in non-
business Chapter 13 filings with 15,851 cases in 2019). Even
with recent reforms to ticketing practices, bankruptcy filings
remain high by comparison to other districts. Table F-2—Bank-
ruptcy Filings (December 31, 2021), U.S. Courts,
https://www.uscourts.gov/statistics/table/f-2/bankruptcy-fil-
ings/2021/12/31 (last visited Apr. 21, 2022) (in 2021 the North-
ern District of Illinois had the second most non-business
Chapter 13 filings (5,198)).
When a vehicle owner’s parking-ticket debt accumulates,
the City has the legal right to impound the vehicle and can
eventually sell the vehicle to help pay off the debt. If the
PM), https://www.propublica.org/article/chicago-mayor-lori-lightfoot-
proposes-further-traffic-ticket-reforms-to-help-low-income-motorists.
4 No. 21-1355
impoundment lien can be discharged in bankruptcy, how-
ever, the owner may be able to recover her vehicle through
the bankruptcy court. Classifying an impoundment lien as ju-
dicial or statutory can make the difference between, on one
hand, allowing drivers to avoid a debt and denying the City
the sums owed, and on the other hand the owner perma-
nently losing the vehicle and putting more money in the
hands of the City.
The foundation for this particular issue was laid in 2016.
See Fulton, 926 F.3d at 920. The City Council passed a new or-
dinance that granted the City a lien on impounded vehicles
for ticket debts. Municipal Code of Chicago (“M.C.C.”) § 9-92-
080(f). Once a driver incurs the needed number of outstand-
ing tickets and final liability determinations, the City is au-
thorized to impound her vehicle and to attach a possessory
lien. The amount of the lien is based on how much the driver
owes in unpaid traffic tickets, plus additional fees. § 9-100-
120(d)(2).
Many drivers cannot afford to pay their outstanding tick-
ets and fees, let alone the liens imposed on their cars through
this process. As a result, some drivers declare bankruptcy and
seek to avoid them. Debtor-appellee Marcella Mance, for in-
stance, incurred several unpaid parking tickets and saw her
car impounded and subject to a possessory lien that totaled
$12,245, more than four times her car’s value. Facing this lia-
bility with a monthly income of $197 in food stamps, Mance
filed for bankruptcy under Chapter 7 and sought to avoid the
lien under 11 U.S.C § 522(f). When a vehicle owner files for
bankruptcy through Chapter 7, she can avoid a lien under
§ 522(f) if the lien qualifies as judicial and its value exceeds
the value of her exempt property (in this case, her car).
No. 21-1355 5
Conversely, if the lien is statutory, it is not avoidable under
the same provision. 2
The bankruptcy and district courts concluded that the lien
was judicial and avoidable. Both courts reasoned that the lien
was tied inextricably to the prior adjudications of Mance’s
parking and other infractions, so it did not arise solely by stat-
ute, as the Bankruptcy Code requires for a statutory lien. As
the district court explained in its opinion in this case: “There
is simply no way to disaggregate the final determinations of
liability from the lien resulting from immobilization. … With-
out the requisite number of judgments, the City would have
no right to immobilize the vehicles and no liens could arise.”
City of Chicago v. Howard, 625 B.R. 384, 390 (N.D. Ill. 2021). 3
II. Lien Definitions in the Bankruptcy Code
The classification of a lien under the Bankruptcy Code is a
question of law that we review de novo. In re Willett, 544 F.3d
787, 790 (7th Cir. 2008). The Code sorts liens into three mutu-
ally exclusive categories—statutory liens, judicial liens, and
security interests. In re Financial Oversight & Management Board
for Puerto Rico, 899 F.3d 1, 10 (1st Cir. 2018); In re Wigfall, 606
B.R. 784, 786–87 (Bankr. N.D. Ill. 2019); see also S. Rep. No. 95-
989, at 25 (1978), as reprinted in 1978 U.S.C.C.A.N. 5787, 5811
(“Those three categories are mutually exclusive and are [ex-
haustive] except for certain common law liens.”). Only the
first two are relevant here. The parties agree that Mance
2 These figures come from Mance’s Chapter 7 bankruptcy petition, i.e.,
Form 106. We accept Mance’s declarations for the purposes of this appeal.
3 Mance’s case was consolidated with that of another debtor (Cupree
Howard) in the district court and initially on appeal. We dismissed How-
ard’s appeal as moot before oral argument.
6 No. 21-1355
satisfies all the requirements for discharge under 11 U.S.C.
§ 522(f) if her lien is considered judicial, so the classification
is decisive.
A. The Statutory Text
We begin our analysis with the statutory text. The Bank-
ruptcy Code defines judicial and statutory liens in 11 U.S.C.
§ 101. Here is each definition in full:
(36) The term “judicial lien” means lien ob-
tained by judgment, levy, sequestration, or
other legal or equitable process or proceeding.
…
(53) The term “statutory lien” means lien arising
solely by force of a statute on specified circum-
stances or conditions, or lien of distress for rent,
whether or not statutory, but does not include
security interest or judicial lien, whether or not
such interest or lien is provided by or is depend-
ent on a statute and whether or not such interest
or lien is made fully effective by statute.
§ 101(36), (53).
Both definitions focus on the events (or the lack thereof)
that precede creation of the lien. The two definitions use dis-
tinct language to describe how the two different types of liens
arise. We see this in the use of “arising solely” for statutory
liens versus “obtained by” for judicial liens. “Solely” seems
clear enough and signals that prior legal proceedings leading
to a lien would exclude the lien from the category of statutory
liens. The definition of a judicial lien—“obtained by judg-
ment, levy, sequestration, or other legal or equitable process
No. 21-1355 7
or proceeding,” § 101(36)—has an “element of causation in-
herent in the phrase ‘obtained by.’” See Field v. Mans, 516 U.S.
59, 66 (1995) (interpreting § 523(a)(2), which prohibits dis-
charge of certain debts “obtained by … false pretenses, a false
representation, or actual fraud”). The statutory definition of a
judicial lien indicates that the term applies when the lien is
caused by or results from the broad categories of process
identified in the latter part of the definition. These textual dif-
ferences are noted in the history of the Bankruptcy Reform
Act of 1978. The House and Senate reports on the Act ex-
plained: “A statutory lien is only one that arises automatically,
and is not based on an agreement to give a lien or on judicial
action.” H.R. Rep. No. 95-595, at 314 (1977), as reprinted in
1978 U.S.C.C.A.N. 5963, 6271; S. Rep. No. 95-989, at 27, as re-
printed in 1978 U.S.C.C.A.N. at 5811; see also 5 Collier on
Bankruptcy ¶ 545.01 (16th ed. 2021).
Under these definitions, classification of a lien depends on
the events, if any, that must occur before the lien attaches. In
re Schick, 418 F.3d 321, 324 (3d Cir. 2005) (“The relevant in-
quiry is to determine the nature of the [] lien, i.e., whether it
arises solely by force of statute, or whether it results from
some type of judicial process or proceeding.”); see also 2 Col-
lier on Bankruptcy ¶ 101.53 (“[A] judicial lien arises only by
virtue of judicial proceedings in the absence of which there
would not be such a lien. The statutory lien by definition
arises without any judicial proceeding.” (footnote omitted)).
B. Illustrations
Common examples of statutory and judicial liens are gen-
erally consistent with this focus on the prior events needed for
the lien to arise and attach to property. Take mechanics’ liens
first, often cited as an example of a statutory lien. See, e.g.,
8 No. 21-1355
Schick, 418 F.3d at 324; In re Cunningham, 478 B.R. 346, 350
(Bankr. N.D. Ind. 2012) (“Case law throughout the country
has routinely determined that a mechanic’s lien, or similar
liens arising by means of a state’s statutory enactment, are at
their base statutory liens.”); see also id. at 351 (collecting
cases); H.R. Rep. No. 95-595, at 314, as reprinted in 1978
U.S.C.C.A.N. at 6271 (listing mechanics’ liens in the examples
of statutory liens, as well as materialmen’s liens, warehouse-
men’s liens, and tax liens). In simple terms, a statute provides
a mechanic a lien on improved property as soon as payment
for the mechanic’s work on the property is due and goes un-
paid. The mechanic need not go to a judge to secure a lien;
rather, the lien arises solely by statute once the condition—a
lack of payment—occurs. A mechanic’s lien may be perfected
by filing the lien with a county clerk or similar official, but that
filing is not considered a “legal or equitable process or pro-
ceeding” within the definition of a judicial lien. 11 U.S.C.
§ 101(36); see Schick, 418 F.3d at 326, citing In re Fennelly, 212
B.R. 61, 65 (D.N.J. 1997) (“The mere ministerial act of record-
ing the lien does not create the requisite legal process or pro-
ceeding required to be a judicial lien.”). The critical point is
that a mechanic’s lien attaches to the property automatically
when the debtor fails to make a payment for the services due.
Accord, Wigfall, 606 B.R. at 787. No judicial or similar process
is needed. 4
4 Perfection is necessary for the statutory lien’s continued effective-
ness and protection against other creditors. It also has implications under
11 U.S.C. § 545, which allows a bankruptcy trustee to avoid certain statu-
tory liens. But the fact that a lien must be perfected does not transform it
into a judicial lien. See 2 Collier on Bankruptcy ¶ 101.53 (“[M]erely be-
cause [statutory liens] require some form of judicial filing for their perfec-
tion against other creditors or continued effectiveness, they are not
No. 21-1355 9
Contrast this example of a statutory lien with the textbook
judicial lien: a court-ordered money judgment. There are sev-
eral ways a dispute could make its way into a court and result
in a money judgment. But before the lien can arise at all, a
court must enter judgment for the winning creditor. That
party then records it as a lien on the losing party’s property.
Because the lien is “obtained by” a court proceeding, it is con-
sidered judicial. 2 Collier on Bankruptcy ¶ 101.36; see also
Schick, 418 F.3d at 328 (“[F]or a lien to be judicial, there must
be some judicial or administrative process or proceeding that
ultimately results in the obtaining of the lien.”).
As we will see next, Chicago’s impoundment lien in this
case lies somewhere in between these easy illustrations. We
find decisive the substantial quasi-judicial proceedings
needed for the City to obtain an impoundment lien. The City’s
possessory lien thus did not arise “solely” by statute.
III. The City’s Lien Program
To classify the City’s impoundment lien, we examine how
it arises or is obtained, beginning with unpaid tickets and con-
tinuing through the process of impoundment and attachment
of the lien.
First, the owner must accrue the required number of traffic
violations and final determinations. A car may be impounded
only after an owner has three or more “final determinations
of liability,” or two final determinations that have been out-
standing for more than a year, “for parking, standing,
transformed into judicial liens. While the filing of the lien may determine
whether it is perfected to the extent that it may not be avoided by the trus-
tee under section 545, it does not transmute a statutory lien into a different
kind of lien.” (footnotes omitted)).
10 No. 21-1355
compliance, automated traffic law enforcement system, or au-
tomated speed enforcement system violation[s].” M.C.C. § 9-
100-120(b).
The underlying traffic violation undergoes an administra-
tive process before it turns into a final determination of liabil-
ity. First, a police officer or other official observes and records
a traffic or parking violation. The official then gives the oper-
ator of the vehicle a notice of the violation (e.g., by hand or by
placing it on the vehicle). § 9-100-030(b)(i)–(ii). If, however,
the operator drives away before the official can serve the no-
tice, the City mails the owner of the vehicle a notice of the
traffic violation. § 9-100-030(b)(iii). Alternatively, an auto-
mated speed or traffic system records a violation and the City
sends a notice to the registered owner. § 9-100-045.
The owner can contest the charged violation in an in-
person proceeding or by writing. §§ 9-100-050, -055, -070, -
080. If the owner loses or fails to contest the violation, a
determination of liability is entered. § 9-100-090. The owner
can then file an appeal under the Illinois Administrative
Review Law. Id.; see also Van Harken v. City of Chicago, 713
N.E.2d 754, 759 (Ill. App. 1999). If she loses on appeal or fails
to contest the liability determination, the City obtains a “final
determination.” § 9-100-100. In Fulton, we concluded that
these final determinations of liability amounted to “money
judgments.” See 926 F.3d at 930–31, vacated on other grounds,
141 S. Ct. 585.
At that point, the owner must pay the fine for the violation.
§ 9-100-100(b). “The fines for violations of the City’s Traffic
Code range from $25 (e.g., parallel parking violation) to $500
(e.g., parking on a public street without displaying a wheel tax
license emblem).” Fulton, 926 F.3d at 920, citing § 9-100-
No. 21-1355 11
020(b)–(c). These fines can grow quickly. “Failure to pay the
fine within twenty-five days automatically doubles the pen-
alty” in most cases. Id., citing § 9-100-050(e).
If the fines go unpaid, the next enforcement step for the
City is impoundment. That step requires more legal process.
The City must issue notice of the impending vehicle immobi-
lization to the owner. § 9-100-120(b). The owner then has
twenty-one days to either pay the fines or petition for a hear-
ing and appear in person to prove that she is not liable for the
outstanding tickets. If the owner fails to file a timely petition
or if her petition is denied, a final determination of eligibility
is entered.
After such a determination of liability and eligibility for
impoundment, the City may physically immobilize the car
(with a “boot,” for example). § 9-100-120(c). If the owner does
not obtain release of the immobilizing device within twenty-
four hours or request additional compliance time, the City can
finally tow the car to an impoundment facility. Id. When the
vehicle is immobilized or impounded, the outstanding ticket
debt becomes a lien on the vehicle: “Any vehicle impounded
by the City or its designee shall be subject to a possessory lien
in favor of the City in the amount required to obtain release
of the vehicle.” § 9-92-080(f); § 9-100-120(j) (same for immobi-
lized vehicles). 5
5 The City impounded and sold nearly 50,000 cars from 2011 to 2019.
Elliott Ramos, Chicago Seized and Sold Nearly 50,000 Cars Over Tickets Since
2011, Sticking Owners with Debt, WBEZ Chi. (Jan. 7, 2019, 5:01 AM),
https://www.wbez.org/stories/chicago-seized-and-sold-nearly-50000-
cars-over-tickets-since-2011-sticking-owners-with-debt/1d73d0c1-0ed2-
4939-a5b2-1431c4cbf1dd.
12 No. 21-1355
Turning to the details of this case, at the time of appellee
Mance’s bankruptcy filing, the City’s lien on her vehicle to-
taled $12,245 on a car allegedly worth $3,000. The amount of
the lien is based on the amount of the outstanding tickets, the
fees accumulated from storage and towing costs, and even at-
torney fees incurred by the City in the immobilization pro-
cess, among other costs. § 9-100-120(d)(2). 6
IV. Classification of the City’s Lien
A. The Lien Is “Obtained by” Adjudicating the Traffic
Violations
The very last step of the lien attachment is automatic.
Under the terms of the city ordinance, the lien arises upon
impoundment, without further action by a judge or quasi-
judicial official. On that basis, the City contends the
impoundment lien is a statutory lien, asserting that it arises
“solely” by statute. Like our colleagues on the bankruptcy
and district courts, however, we see the issue differently.
Under the statutory definitions of the two types of liens, we
do not think we can ignore all the prior legal process that must
occur before the City’s possessory lien arises. The lien is
“obtained by … other legal or equitable process or
proceeding,” 11 U.S.C. § 101(36), in that the lien arises from
and is based upon the prior quasi-judicial adjudications and
money judgments that determine the lien’s validity and
amount. The lien is judicial and avoidable in bankruptcy.
6The City offers various repayment plan options for eligible drivers
that might eliminate some of those fees. See § 9-100-120(d)(1); see also
§§ 9-100-160 (installment payment plans), -170 (Clear Path Relief Pilot Pro-
gram). The parties have not indicated to the court that Mance is enrolled
in any of those programs.
No. 21-1355 13
The City asks us to treat this prior process as irrelevant.
The City relies on the language “shall be subject to a posses-
sory lien” in the ordinance. The City treats the needed num-
ber of tickets, final adjudications, and later impoundment as
mere “conditions” that trigger the lien. In the City’s view,
those conditions should have no bearing on the classification
of the lien because they do not govern how the lien “arises.”
The City’s narrow focus on only the very last step leading
to attachment of an impoundment lien is not consistent with
the statutory definition of a judicial lien. A judicial lien is not
a statutory lien, “whether or not such interest or lien is pro-
vided by or is dependent on a statute and whether or not such
interest or lien is made fully effective by statute.” 11 U.S.C.
§ 101(53). This language makes clear that the fact that a lien
resulted from a process that is “purely a creature of statute”
is not sufficient to classify the lien as statutory. In re Weath-
erspoon, 101 B.R. 533, 535 (Bankr. N.D. Ill. 1989) (citation omit-
ted). Put differently, “[t]he fact that a statute describes the
characteristics and effects of a lien does not by itself make the
lien a statutory lien.” 2 Collier on Bankruptcy ¶ 101.53. That
description fits the City’s impoundment lien in this case. A
statute (the ordinance) authorizes the lien and describes its
characteristics and effects, but we must still consider whether
the lien arises “solely by force of a statute on specified circum-
stances or conditions.” § 101(53).
Under both definitions, the relevant inquiry is not whether
a statute authorizes or governs the lien but what is necessary
for the lien to arise. If the lien requires a “judgment, levy,
sequestration, or other legal or equitable process or
proceeding,” the lien is judicial. If the lien arises “solely” by
statute once specific conditions are met, the lien is statutory.
14 No. 21-1355
In the case of a Chicago impoundment lien, without the
judicial or quasi-judicial procedures needed for final
determinations for each traffic violation and without the
quasi-judicial impoundment procedures, the City could not
impose a lien on the indebted driver’s vehicle. While the lien
is authorized by and defined by statute, the City’s possessory
lien does not arise “solely” by statute.
To be sure, as Mance acknowledged at oral argument,
liens on some impounded vehicles should be treated as
statutory liens. If a driver has committed a violation under
M.C.C. § 9-92-030, such as blocking an alleyway, obstructing
traffic, parking in a “tow zone,” or the like, the vehicle can be
towed on the spot, without any prior judicial process. Id. The
City then sends the vehicle owner notice after the fact. § 9-92-
070. When a vehicle is towed for one of these violations, it is
also subject to a lien. § 9-92-080(f) (“Any vehicle impounded
by the City or its designee shall be subject to a possessory lien
in favor of the City in the amount required to obtain release
of the vehicle.”); see also § 2-14-132(l) (same). Such violations
lead to immediate impoundment liens that do not require
advance notice to drivers or any other quasi-judicial
procedures before they can be imposed. Instead, a car is
automatically impounded upon a violation and subject to a
lien. 7
7 In the case of a violation that results in an immediate tow, the city
must offer adequate post-deprivation procedures to conform with due
process. See Miller v. City of Chicago, 774 F.2d 188, 192–96 (7th Cir. 1985)
(City not required to provide notice to owners before towing stolen vehi-
cles to satisfy due process); Sutton v. City of Milwaukee, 672 F.2d 644, 645–
46, 648 (7th Cir. 1982) (pre-towing notice and opportunity to be heard not
required to tow illegally parked cars, but adequate post-deprivation pro-
cedures are needed to provide due process); see also Gable v. City of
No. 21-1355 15
That automatic process is quite different from what hap-
pened here. For Mance, several legal proceedings had to be
completed before impoundment. Vehicle owners who incur
liens like Mance’s therefore face judicial liens and can avoid
them under 11 U.S.C. § 522(f). Vehicle owners whose viola-
tions resulted in immediate impoundment, by contrast, face
statutory liens and cannot avoid them under the same provi-
sion.
Next, the City argues that if we agree with appellee
Mance, we will create a circuit split with the Third Circuit’s
decision in In re Schick, 418 F.3d 321 (3d Cir. 2005). We are not
convinced. There is a critical difference between the processes
leading to the liens in the two cases.
Schick concluded that a lien held by the New Jersey Motor
Vehicles Commission was a statutory lien. Under New Jersey
law, a vehicle owner who committed a traffic violation faces
potential surcharges in various situations, such as reaching a
certain number of violation points or having been convicted
of refusing to take a breathalyzer test, among other examples.
The amount of the surcharges was dictated by “statute and
administrative regulations.” 418 F.3d at 324. If a driver failed
to pay the surcharges, the Commission was entitled to a lien
on the driver’s property in the amount of the surcharges and
interest. The Third Circuit concluded that such a lien held by
the Commission was statutory and therefore not avoidable
under 11 U.S.C. § 522(f).
Chicago, 296 F.3d 531, 539–40 (7th Cir. 2002) (due process rights not vio-
lated when City deprived plaintiffs of impounded vehicles because City
was not deliberately indifferent and adequate post-deprivation remedies
were available).
16 No. 21-1355
The statutory scheme analyzed in Schick was markedly
different from the impoundment process leading to Chicago’s
lien. The New Jersey statute pertained to only the surcharges,
not the underlying vehicle violations. This bifurcated struc-
ture contributed to the court’s view that “the underlying traf-
fic proceeding charging the driver with a motor vehicle of-
fense [was] too remote to constitute the required judicial pro-
cess or proceeding necessary to find a judicial lien.” 418 F.3d
at 326. The underlying proceeding therefore bore “no relation
to the creation of the lien in favor of the [Commission], which
instead [arose] as a result of the filing of the certificate of debt
and its docketing by the Clerk of the Superior Court.” Id. (em-
phasis added).
Here, by contrast, the statutory structure does not separate
the underlying vehicle violation and any fees imposed after
the final determinations of the tickets, let alone the impound-
ment process. These steps are all tied together. Unlike the sit-
uation in Schick, Chicago’s administrative structures for chal-
lenging tickets and pending impoundments are not too far re-
moved from the impoundment lien. They are essential pre-
requisites for a valid impoundment lien, and they determine
the amount of the lien.
In Schick the amount of the surcharge—and therefore the
amount of the lien—was “set forth either in the statute or ad-
ministrative regulation and [was] not determined by the under-
lying proceeding against the driver.” 418 F.3d at 326 (emphasis
added). The opposite is true here. The amount of the Chicago
impoundment lien is determined precisely in and by the un-
derlying proceedings. Indeed, to secure release, the driver
must pay immobilization and impoundment costs, as well as
“all amounts, including any fines, penalties, administrative
No. 21-1355 17
fees …, if any, and related collection costs and attorney’s fees
… remaining due on each final determination for liability is-
sued to the owner.” M.C.C. § 9-100-120(d)(2). The City says
correctly that the total amount of the lien is not limited to the
underlying traffic fees, but all of the additional charges per-
tain to and result directly from the quasi-judicial processes
leading up to the lien. In this respect, the situation here is sim-
ilar to money judgments, which routinely include interest,
court costs, and sometimes attorney fees and other associated
costs, yet are considered judicial despite these tacked-on fees
because the resulting liens do not arise “solely” by statute.
The same is true here. The additional fees do not eliminate the
link to the underlying traffic violations and adjudications.
They strengthen it.
B. Tax Liens
The City also argues that adopting Mance’s position will
call the classification of tax liens into question. Congress in-
cluded tax liens in its examples of statutory liens in the legis-
lative history of the Bankruptcy Code. H.R. Rep. No. 95-595,
at 314, as reprinted in 1978 U.S.C.C.A.N. at 6271 (“Tax liens
are also included in the definition of statutory lien.”). The City
contends, however, that federal tax liens result from judicial
and quasi-judicial processes (under 26 U.S.C. §§ 6212(a),
6213(a), 6214(a), and 7482) that are similar to the processes
leading to a Chicago impoundment lien. If these procedures
must be followed before imposing a federal tax lien, yet eve-
ryone acknowledges that a tax lien is statutory, the City asks,
how could our lien be judicial based on similar prior proce-
dures?
Tax liens are unquestionably statutory. E.g., Financial
Oversight & Management Board, 899 F.3d at 11; Schick, 418 F.3d
18 No. 21-1355
at 324; IRS v. Diperna, 195 B.R. 358, 360 (E.D.N.C. 1996); In re
O’Neil, 177 B.R. 809, 811 (Bankr. S.D.N.Y. 1995). Our decision
does not call this classification into question. We are merely
evaluating the text of statutory provisions also provided by
Congress to determine where the City’s lien best fits under
those definitions. Classifying the City’s lien as judicial flows
directly from the text. Congress is entitled to single out a par-
ticular category of liens and classify it accordingly. We do not
disturb that prerogative or conclusion with this opinion.
Because Chicago’s impoundment lien on Mance’s vehicle
did not arise solely by force of statute, the lien is a judicial lien
for purposes of Mance’s bankruptcy.
AFFIRMED.