WHAT!?!?!? I wonder if Chicago has heard of the "takings clause". Althought the takings clause doesn't apply to the state directory it does de facto apply to the state by other means. It applies to the states through the Due Process Clause of the Fourteenth Amendment, First English, 482 U.S. at 310 n.4; see also 2 Ronald D. Rotunda & John E. Nowak, Treatise on Constitutional Law: Substance and Procedure 523 (3d ed. 1999).
The purpose of seizing and selling the vehicle must be to satisfy the fines, not to punish the debtor or to enrich the contractor. Hence, the car should be sold at city auction with a mininum bid price and the debtor's note holder notified of the auction. Absent, these safeguards, I fail to see how this sale has been properly effected. A lawyer should not have much of problem getting this sale overturned at the appellate level. (I'll assume all traffic court judges in Chicago are hacks.)
Furthermore, it is outrageous that city would not accept $700 towards satisfying the $1000 debt. The fines are pulled essentially from thin air and any towing costs would have been more than offset by the $700.
The sad thing is even if this woman files bankruptcy, the debt on the vehicle will be discharged but her parking fines will not. Hey government, thanks for nothing!