1999 #10, Wyly, 3-31-99

In re: CAMERON W. WYLY, Chapter 7; Bankr. No. 94-10088

The matter before the Court is Debtor's Motion for Order Directing Clerk of Courts, Brown County Auditor and Other Officers of Record to Discharge Judgment/Lien Discharged in Bankruptcy filed March 5, 1999. This is a core proceeding under 28 U.S.C. § 157(b)(2). This letter decision and subsequent order shall constitute the Court's findings and conclusions. As set forth below, the Motion will be denied as to the poor relief lien of $4,500.00 held by Brown County.

First, Debtor did not seek the correct relief to have a lien removed. S.D.C.L. § 15-16-20, on which Debtor relies, applies only to the removal of judgments, not liens. [Debtor also cited 11 U.S.C. § 523 but the Court presumes that is a typo for § 524.] In contrast, a Chapter 7 debtor generally relies on 11 U.S.C. § 522(f) to have certain liens avoided. Compare Local Bankr. Rs. 4072-1 and 4073-1 and corresponding appendices.

Second, the types of liens that a debtor may have avoided under § 522(f) is limited. The lien to be avoided must be on exempt property and it must not be a statutory lien, 11 U.S.C. § 522(f)(1)(A), or it must be a nonpossessory, nonpurchase money security interest in certain exempt personalty. 11 U.S.C. § 522(f)(1)(B). Here, there is no showing Brown County's poor lien fits either category. Most important, it appears that the County's lien is a pre-petition, statutory lien that cannot be removed under § 522(f). Compare In re Taylor, Bankr. No. 89-40349, slip op. (Bankr. D.S.D. March 19, 1998); and In re Hookie, Bankr. No. 97-40015, slip op. (Bankr. D.S.D. April 16, 1998).

Counsel for Debtor may submit (by fax) a proposed order that removes only the judgment of AAA Auto Parts.