A federal appeals panel has determined that a bankruptcy filing shouldn’t offer protection from traffic fines, the Cook County Record reported. The U.S. Seventh Circuit Court of Appeals issued an opinion in a consolidated appeal from the city of Chicago, which has been trying to get money from car owners who said bankruptcy proceedings precluded them from paying speeding, red light and parking tickets. According to the opinion, Chicago’s municipal code makes vehicle owners responsible for traffic tickets. The city said seven debtors failed to pay 72 fines totaling nearly $12,000 because their chapter 13 estates can ignore the tickets because there is no provision for the payment of fines incurred after filing for bankruptcy, and that their cars can’t be towed or booted. Chief Bankruptcy Judge Pamela Hollis denied the city’s motion to vacate the orders, keeping the vehicles in the chapter 13 estates. Seventh Circuit Judge Frank Easterbrook noted Judge Hollis said she hadn’t read the city’s motions. “The only reason she gave is that the court as an institution routinely keeps all assets in all chapter 13 estates,” Easterbrook wrote. “She did not say why she and her colleagues do this — and, as far as the parties are aware, or we could ascertain, the court has never explained why it made this decision.” In the alternative, the city asked Hollis to treat the fines as administrative expenses needed to preserve each estate’s holdings. She denied that motion as well, and U.S. District Judge Elaine Bucklo affirmed that ruling. “Immunity from traffic laws for the duration of a chapter 13 plan does not seem to us an outcome plausibly attributed to the Bankruptcy Code,” Judge Easterbrook wrote. “Nothing in the text of the Code so much as hints at such an objective, and one point of returning property to the debtors’ ownership … is to ensure that debtors pay the ordinary and necessary expenses of maintaining that property.”
