Bay Area Estate And Tax Planning Law Firm

Unclaimed property in California: The adventure continues

On Behalf of | Mar 16, 2015 | Uncategorized |

There are only a few ways the government can take private property. Eminent domain, for example, allows the government — usually the city or the state, but, really, any government body — to take privately owned land for public use. The government still has to pay for the land, but as long as it pays a fair price and meets the “public use” requirement, it’s valid. The meaning of public use, of course, is tested time and again in the courts, but if there is a public use, the taking is legal.

The government can also take your property if you forget about it or never realized it was yours in the first place. California will eventually get life insurance proceeds if the beneficiary cannot be located or fails to come forward. California will eventually get the contents of a bank account that sits dormant for a certain time, and California will eventually get the contents of our friend’s safe deposit box — including the Babar book — if the box is abandoned.

The formal term for this is escheat (from the French, eschoir, to fall incidentally, according to Blacks Law Dictionary 10th Ed.). Most people skip the formality and go for something easier to spell and to pronounce: This is the law of unclaimed property.

The process is fairly simple. If there is no contact with the owner or no activity on a bank account, safe deposit box, securities or similar types of property for a period of time defined by statute, the entity that has possession of the property (the “holder”) must report the information to the state and then hand over the contents of the account, the safe deposit box, and so on, to the state Controller’s Office.

What happens from there? We’ll get to that in our next post.

Source: California State Controller’s Office, Unclaimed Property Program FAQs, accessed March 6, 2015