I note a series of recent posts on the NACBA list serve about used car dealers who are using "starter lockouts" against Chapter 13 debtors to prevent the debtors from driving their cars. As I understand the technology, a starter lockout is a device installed in the electrical system of a car that can be activated by satellite.
In a non-bankruptcy situation, the starter lockout is a way for a used car dealer to disable a vehicle if the buyer misses a payment or bounces a check. In the cases discussed on this list serve, it appears that the lockout was activated prior to the bankruptcy filing and the car dealers are refusing to cancel the starter lockout despite the bankruptcy filing.
The consensus on the list serve is that a used car dealer who refuses to cancel a starter lockout is in violation of the automatic stay. The practical effect of the dealer's action is equivalent to a dealer who refuses to return a repossessed vehicle after a filing.
If you are a debtor or a debtor's lawyer who is dealing with a starter lockout, then you most likely have a cause of action for damages for the car dealer's violation of the automatic stay.
In the Nothern District of Georgia, where I practice I have always had success forcing a used car dealer to return a vehicle seized prior to the bankruptcy filing, although I usually do have to make a case that the debtor will be able to make the case work.
[tags] starter lockout, automatic stay, automatic stay violation, adversary proceeding [/tags]