MEMORANDUM OF DECISION

The sole issue presented in this case is one of law, that is, whether the Employment Development Department of the State of California (hereinafter “E.D.D.”) had acquired, prior to the commencement of Chapter 11 proceedings by Tropicana Graphics, Inc. (hereinafter “Tropicana”) a statutory lien which could not be avoided by Tropicana pursuant to 11 U.S.C. § 545 , and hence was unassailable as a preference pursuant to 11 U.S.C. § 547 (c)(6). For the reasons which follow, the court answers this question in the negative.

FACTS

On May 11, 1979 E.D.D. filed a Notice of State Tax Lien against Tropicana with the California Secretary of State for unpaid taxes in the amount of $5,691.41, pursuant to Section 1703 of the California Unemployment Insurance Code. On January 2, 1980 E.D.D. filed a second Notice of State Tax Lien against Tropicana for unpaid taxes in the amount of $1,030.36; and on July 7, 1980 E.D.D. filed against Tropicana a third Notice of State Tax Lien for unpaid taxes in the amount of $5,187.57.

On August 21, 1980, pursuant to Section 1755 of the California Unemployment Insurance Code, E.D.D. served a Notice of Levy on funds of Tropicana which were on deposit with Wells Fargo Bank (hereinafter “the bank”). Said Notice of Levy listed a sum of $7,680.71 as the amount due and delinquent and pursuant to Section 1757 of the California Unemployment Insurance Code, required the bank to surrender or remit such amount to E.D.D. On October 15, 1980 the bank remitted the sum of $7,030.61 to E.D.D.

Meanwhile, on September 2, 1980 Tropicana had filed a voluntary petition for relief pursuant to Chapter 11 of the Bankruptcy Code; and on October 7, 1980 Tropicana commenced this action seeking to recover as a preferential transfer the $7,030.61 which was turned over to E.D.D. by the bank.

The facts recited above are undisputed, the case having been tried on a written stipulation of facts which establish all of the factual elements of a voidable preference.

LEGAL ANALYSIS

Section 545 of the Bankruptcy Code, 11 U.S.C. § 545 , provides in part as follows:

Under the above-quoted statutory provision, as well as under its predecessor, Section 67(c)(1)(B) of the Bankruptcy Act of 1898, as amended, the trustee may avoid the fixing of a statutory lien on the property of the debtor to the extent that such lien is not enforceable against a bona fide purchaser on the date of filing the bankruptcy petition, whether or not such purchaser exists. In Re Cummins, 656 F.2d 1262 (9th Cir.1981); In Re Perry, 487 F.2d 84 (9th Cir.1973), cert. denied, 415 U.S. 978 , 94 S.Ct. 1565 , 39 L.Ed.2d 874 ; In Re Allgeier and Dyer, Inc., 18 B.R. 82, 86-87 (Bkrtcy.W.D.Ky.1982); 4 Collier on Bankruptcy, 15th Ed., ¶ 545.04[2]. And the determination of whether a state statutory lien is enforceable against a bona fide purchaser is governed by the law of the state which created the lien. In Re Allgeier and Dyer, Inc., supra, at page 86; In Re Leach, 15 B.R. 1005, 1009 (Bkrtcy.D.Conn.1981).

In the view of this court, neither the notices of state tax liens nor the notice of levy filed by E.D.D. created a lien against personal property of Tropicana enforceable against a bona fide purchaser. Under California law any priority or status that taxing authorities enjoy is governed solely by statute. In Re Cummins, supra, at page 1264. This court has been unable to find any statute of the State of California which renders E.D.D.’s lien enforceable against a bona fide purchaser.

At relevant times here involved Section 1703(a) of the California Unemployment Insurance Code provided in part as follows:

Section 1703(c) of the California Unemployment Insurance Code provided that with “respect to personal property, whether tangible or intangible, at any time after creation of the lien pursuant to subdivision (a) the director may file a notice of state tax lien with the Secretary of State... ”. However, this section further provided in part as follows:

The above-quoted provisions would seem to make it clear that the lien created by Section 1703(a) is not enforceable as to personal property against a bona fide purchaser. Nor is there anything in Section 1755 of the California Unemployment Insurance Code, which provides for notices of levy, that indicates that service of a notice of levy renders the lien created by Section 1703(a) enforceable against a bona fide purchaser.

E.D.D. contends that upon its service of the Notice of Levy upon the bank, Tropicana’s account in the bank became property of E.D.D. to the extent of the amount of unpaid taxes, relying upon Phelps v. United States, 421 U.S. 330 , 95 S.Ct. 1728 , 44 L.Ed.2d 201 (1975) and its progeny. However, in Phelps the court was interpreting federal law, particularly the Internal Revenue Code; whereas as heretofore noted, California law governs the determination of whether E.D.D.’s statutory lien in this case is enforceable against a bona fide purchaser. A statutory lien under the Internal Revenue Code may be enforceable against a bona fide purchaser under circumstances that state tax liens would not. See In Re Williams, 16 B.R. 95 (Bkrtcy.E.D.Calif.1981); and compare In Re Cummins, supra.

E.D.D. also relies upon In Re Perry, supra, where the court said ( 487 F.2d at page 85 ):

Apparently, E.D.D. is proceeding on the premise that the Notice of Levy that it filed was equivalent to the levy of a writ of execution. The inaccuracy of this premise is made clear by Section 1785 of the California Unemployment Insurance Code which provided as follows:

Thus, the warrant procedure under Section 1785, rather than the notice of levy procedure under Section 1755, was the statutory equivalent of the levy of a writ of execution. Perhaps, as in In Re Perry, supra, E.D.D. “could have perfected its lien by going further and issuing and levying a warrant for the collection of the tax” ( 487 F.2d at page 85 ); however, E.D.D. did not do so.

This Memorandum of Decision contains findings of fact and conclusions of law as required by Bankruptcy Rule 752. Counsel for the plaintiff is directed to prepare, serve, and lodge an appropriate judgment.

.- The right of a trustee to avoid statutory liens pursuant to 11 U.S.C. § 545 may be exercised by a debtor-in-possession under Chapter 11. 11 U.S.C. § 103 (a); In Re Garden Inn Steak House, Inc., 22 B.R. 830, 832 (Bkrtcy.N.D.Ohio 1982). . During 1980 many provisions of the California Unemployment Insurance Code were amended effective July 1, 1981; however, the provisions quoted in this Memorandum of Decision were those in effect at the relevant times involved.