64 CBJ 289. Abandoned and Escheated Property: How long is long enough?.

• Author: By BARBARA C. PAYNE (fn*)

Connecticut Bar Journal

Volume 64.

64 CBJ 289.

Abandoned and Escheated Property: How long is long enough?

Abandoned and Escheated Property: How long is long enough?By BARBARA C. PAYNE (fn*)Escheat is a reversion of property to the state [for] want of an individual competent to inherit the property. (fn1) It is within the power of the state to prescribe conditions and grounds of escheat. Escheat extends to all rights of property including a remainder.(fn2)

In some jurisdictions, property, the title to which fails for want of a proper claimant, or for defect of an heir or a devisee, escbeats by operation of law without any inquest or judicial proceeding. In other jurisdictions, a proceeding is required either because of statute or because of a presumption that a decedent left heirs. (fn3) Escheat, when regulated by statute, must be established in the manner prescribed and in substantial compliance with statutory requirements. (fn4)

1. HISTORY AND DEVELOPMENT OF ESCHEAT

   The concept of escheat has existed for hundreds of years and began with the idea that abandoned property reverts to the sovereign. (fn5) Escheat grew out of the feudal system during the twelfth century (fn6) At that time, if a fee owner died leaving no heir to carry out his tenure, the mesne lord took possession of the land. If the fee owner held land directly from the Crown, or if there was no mesne lord, the land reverted directly to the Crown upon the death of the fee owner. (fn7)

   Originally, escheat applied only to real property, not to personal property. The Crown obtained abandoned personal property through the doctrine of bona vacantia (goods without an owner), which provided that the Crown's claim to abandoned personal property was superior to that of a stranger, thus avoiding conflict between private claimants. (fn8) Now, most statutes combine the theories of escheat and bona vacantia to regulate abandoned real property as well as personal property. (fn9)

   Escheat based on feudal tenure never gained much acceptance in the United States. The American theory involved land passing to the state as an incident of sovereignty. (fn10) All states began to provide for escheat of property when owners died intestate leaving no heirs capable of inheriting the property.

   Some early escheat statutes also covered intangible property, such as dormant bank deposits, unclaimed utility deposits, money paid to courts for distribution, unclaimed dividends, interest, wages, the unclaimed corpus of trusts, as well as other types of unclaimed property. (fn11)

   Abandoned property acts began appearing in the United States as early as 1872. (fn12) These acts permitted the states to act as custodians of property until owners reappeared to claim it. These acts did not provide for property to escheat to the state; the state merely acted as custodian for property presumed to be abandoned. The state's interest in the property was subservient to the owner or the owner's heirs or assigns, should they surface. (fn13)

2. THE HISTORY OF ESCHEAT IN CONNECTICUT

   The first Connecticut escheat law to apply to the entire colony was passed in 1650. (fn14) It covered both real and personal property and did not distinguish between abandoned personal property and treasure trove. There was a provision for reclamation of the property, apparently without any statute of limitations. (fn15) Since the law of England governed, this law was probably only passed to implement English law and not to replace it.

   The next Connecticut law was enacted in 1712. Under its provisions the judge of probate was appointed as the local functionary to hold an "inquest" or other proceeding to determine ownership of property or lack thereof. (fn16) The 1712 Act gave the state treasurer the power to sell the property. There was also a provision whereby the true owner or heirs could make claim to the property.

   In 1808, the Acts of 1650 and 1712 were compiled, (fn17) without substantial change. In 1821, the compilation was revised to apply to "estate, real and personal," probably to eliminate archaic language and not to change the substance of the law. Subsequent legislation specified particular offices and business organizations which were subject to the law of escheat. (fn18)...