This Article considers two related sets of questions that have recently taken center stage in the municipal bankruptcies of Detroit and other cities. First, what is the relationship between liens and lien substitutes, such as priorities and exceptions from bankruptcy’s automatic stay? As similar as liens and priorities are, the bankruptcy laws have long drawn a sharp distinction between state-created liens, which are honored in bankruptcy; and state-created priorities, which are not. The second question is the question in the Article’s title: what is a lien? Whether a purported lien actually is a lien is not always clear, especially if the lien is created by statute rather than by the parties themselves. The Article attempts to make sense of existing law, advocates a functional approach to liens and priorities, and questions whether courts should honor a statutory lien that lacks the key attributes of a lien.
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