Secret Santa: The State Escheat Lists

[a reprint of an article from 12-31-08, with updated links, because still relevant every year]

When you buy a gift card that is never used; when you walk away from the balance of an old bank account; or where someone dies owning securities but there is no heir to inherit the shares; where you move and forget about a deposit left with utility companies; where insurance money is due to unknown beneficiaries; where the lease on a safe deposit box lapses and no one shows up to pick up what is inside; what becomes of these property rights?  In feudal England, where our laws derive from, all unclaimed property returned to the King.  Like the end of a game of Monopoly, all the money went back into the box, to be redistributed in a new game.  The concept is called "escheat" and it survives in the laws of the fifty states.  As Blackstone said (I've always wanted to quote Blackstone - it sounds so authoritative), "The word itself is originally French or Norman, in which language it signifies chance or accident, and with us denotes an obstruction of the course of descent … in which case the land naturally results back … to the … lord of the fee." 

We have no lords of the fee these days, but still have the problem of what to do with lost or unclaimed property, and we have adopted the same solution:  the state has the right to all unclaimed property.  In the words of the Pennsylvania law, "All abandoned and unclaimed property and property without a rightful or lawful owner as hereafter set forth is subject to the custody and control of the Commonwealth …"  Of course in Pennsylvania they cannot claim property in Alaska or even New Jersey, and so the law further limits their reach to property that is physically located in Pennsylvania, and for intangible property, if the last known address of the owner is within the Commonwealth.  When is property considered abandoned and unclaimed?  The Pennsylvania law in its wisdom goes on for eighteen pages, but the bottom line is that for most property in an account, if there has been no activity for five years, then the property is presumed abandoned.  So how does the Commonwealth find out about what is unclaimed?  The holder of the property must file a report each year.  The Commonwealth then compiles a list, containing the names, items of property and last known addresses, if any, of the owners listed in the reports, and makes the information publicly accessible.  Before the Internet, that public notice was an ad in a newspaper in each county showing all of the unclaimed property for addresses in that county.  Now, those ads still run, but Pennsylvania has set up a website, at http://www.patreasury.org/unclaimedProperty.html , that is open 24 hours a day, seven days a week, with a search engine to easily search for any items by last name or company name of the owner.  New Jersey has a similar site at:  http://www.unclaimedproperty.nj.gov/l .  Delaware too:  http://php.delawareonline.com/state/unclaimed.php .  If you want to search for some other state, use the search term "unclaimed property" along with the state name. 

If you find a listing for property that may be yours, or someone you know, each site has a procedure for filing a claim, and a process for proving who you are and that you are entitled to the return of your property.  If the property is something other than money, then the state may have sold it, but will give you the cash value of the property realized in the sale.  There are companies who will file your claim for you for a fee, but as noted on the Pennsylvania site, "Our staff will assist you in recovering your property free of charge." 

So how big a problem is this for the Commonwealth?  In their own words, "The Treasury Department is seeking the owners of over $1 billion in unclaimed property.  In 2007, we returned nearly $88.8 million to over 63,000 owners."  That is a lot of unclaimed property.  I hope some of it is yours, or someone's that you know, and that in 2011 you thread your way through the process and help to return some of this amount to its rightful owners.  Pass the word!

©2010  Douglas P. Humes

Finders Keepers

In Concord, Pennsylvania last month, according to the Delaware County Daily Times, "State police said a 74-year-old man lost a large sum of money in a purple Crown Royal whiskey bag Monday morning."  There followed a spirited comment section in which some people claimed "finders keepers" as the law of the land, while others berated them for suggesting that the playground rule is actually the law.  This is one of those old sayings that I have always meant to track down to see if it actually represents what the law is.  What I found is that it is relatively true, at least in Pennsylvania, if you are dealing with "lost" or abandoned property. 

Where to begin on this subject?  In law school, one section of our class spent the first month talking about a case of two hunters finding a dead fox in the woods.  Who owns it?  The one who shot it or the one who found it first?  The discussion goes to the basic meaning of what "property" is.  In the days of the cave man, if you had possession of the item, then very likely it was your property, as long as you could defend yourself against those who would show up in your face and disagree.  Eventually came rules to try to resolve those situations without beating each other over the heads with clubs:  the law.  In English common law, a distinction was made between property lying above ground and beneath the ground.  If property was lost above the ground - lost by the true owner or abandoned - then the finder was entitled to keep the item.  The representative case given in my law school textbook was a 1722 incident where a boy found jewels while cleaning out a chimney.  A nearby jeweler claimed them as his.  The court ruled that the boy had a right to them against anyone but the rightful owner.  If the rightful owner can prove that the lost property is his, then the property is no longer "lost".  The finder is not even entitled to a reward.  But if what was found was a trunk full of jewels buried beneath the surface of the earth, then the property was called "treasure trove".  And who owned it?  The finder, the owner of the land, or the King?  In different parts of the world, and at different times in history, all of these answers have been true.  In England over the last 500 years or so, the answer is the King.  This practice has to some degree transferred over to the United States in our laws concerning escheat.  Property in certain categories, that has been left for too long in an old bank account, or securities that have gone unclaimed, are considered abandoned and the holder is required to send the property off to the state.  If you are the true owner, you can always reclaim it, but otherwise, the King still gets to keep it. 

In Pennsylvania today, the state of the law is that "the finder of lost property has a valid claim to the same against all the world, except the true owner," and that "the finder of money has title to it against all the world except the true owner."   Other cases suggest that "the place in which a lost article is found does not constitute any exception to the general rule of law that the finder is entitled to it as against all persons except the owner.  The right of the finder depends on his honesty and entire fairness of conduct.  The circumstances attending the finding must manifest good faith on his part.  There must be no reason to suspect that the owner was known to him or might have been ascertained by proper diligence."  Property is not "lost" when you reach into an unlocked car and "find" it.  Property is not lost when you know who the owner is, or know where to find him.  If you are following an armored car, like poor Joey Coyle in 1981, and a million dollars falls out, the property is not lost.  The law requires the finder to have a minimum of integrity and interest in the true owner.  And of course, what would the law be without exceptions?  If the finder is a policeman in the course of performing his duties, then he is an agent of the state, and must turn it over to the state.  If the true owner does not turn up, then this property is one of those categories of property that escheats to the state. 

So, where does that leave us?  If you are walking in Concord Township and find a purple Crown Royal whiskey bag containing a lot of money, can you keep it?  If you are a policeman on duty, then no.  If you have read the Delaware County Times article or this one, then no, you are on notice and you can find the rightful owner with relative ease.  But if a year from now someone is walking in the area and bends down and picks up a weathered purple bag containing a large sum of money, that seems to have been lost in the field, then most likely yes, he can keep it.  Finders keepers is still the law of Pennsylvania.

©2009  Douglas P. Humes