AB799: Bill Text

This bill is based on the Uniform Unclaimed Property Act (1995), which was approved by the National Conference of Commissioners on Uniform State Laws in 1995.

This bill clarifies the definition of "property", removes ambiguities over the meaning of "last-known address" and adds new definitions of "mineral", "mineral proceeds" and "money order". It also consolidates several sections that deal with various presumptions of abandonment for different classifications of property into one unified treatment of presumptions of abandonment.

This bill adds an express provision to cover proceeds of class actions, and also adds limitations on dormancy charges. It clarifies the limited nature of the states' burden of proof when the unclaimed obligation is evidenced by negotiable instruments. The bill increases penalties for noncompliance and adds a provision for attorney fees in litigated enforcement actions. Rules of confidentiality are added.

The periods of time after which abandonment is presumed have been reduced in some instances: corporate stock, from seven to five years, and gift certificates, from five to three years. Certain life insurance obligations had five-year and two-year periods of abandonment; they have been unified at three years.

The statute of limitations provision has been clarified so that it does not run in favor of a holder who makes no report or whose report is false or fraudulent.

Under the 1981 law, the administrator could require any person who had not filed a report to file a verified statement disclosing any unclaimed and reportable property. This bill provides that the administrator may also require a report from a person believed to have filed a false or incomplete report. The administrator has a right to audit records whether or not there is reason to believe a person is not complying with the law.

This state has enacted some nonuniform amendments to the 1981 version of the Uniform Unclaimed Property Act. This bill retains some of them, including those providing that unclaimed property is deposited in and paid from the school fund rather than the general fund, and providing that the act does not apply to the escheat of property to counties and municipalities, the forfeiture to a cooperative of unclaimed funds, the proceeds of a sale of property left in a self-storage facility, and unclaimed race prizes.

For further information see the state and local fiscal estimate, which will be printed as an appendix to this bill.

The people of the state of Wisconsin, represented in senate and assembly, do enact as follows:

AB799, s. 1 Section 1. Chapter 177 of the statutes, as affected by 1999 Wisconsin Act 9, is repealed and recreated to read:

AB799,2,3 chapter 177

AB799,2,4 Uniform Unclaimed property act

AB799,2,5 177.01 Definitions. In this chapter:

AB799,2,6 (1) "Administrator" means the state treasurer.

AB799,2,8 (2) "Apparent owner" means a person whose name appears on the records of a holder as the person entitled to property held, issued or owing by the holder.

AB799,2,14 (3) "Business association" means a corporation, joint stock company, investment company, partnership, unincorporated association, joint venture, limited liability company, business trust, trust company, land bank, safe deposit company, safekeeping depository, financial organization, insurance company, mutual fund, utility or other business entity consisting of one or more persons, whether or not for profit.

AB799,3,2 (4) "Domicile" means the state of incorporation of a corporation and the state of the principal place of business of a holder other than a corporation.

AB799,3,5 (5) "Financial organization" means a savings and loan association, building and loan association, savings bank, industrial bank, bank, banking organization or credit union.

AB799,3,7 (6) "Holder" means a person obligated to hold for the account of, or deliver or pay to, the owner property that is subject to this chapter.

AB799,3,13 (7) "Insurance company" means an association, corporation or fraternal or mutual benefit organization, whether or not for profit, engaged in the business of providing life endowments, annuities or insurance, including accident, burial, casualty, credit life, contract performance, dental, disability, fidelity, fire, health, hospitalization, illness, life, malpractice, marine, mortgage, surety, wage protection and workers' compensation insurance.

AB799,3,18 (8) "Mineral" means gas; oil; coal; other gaseous, liquid and solid hydrocarbons; oil shale; cement material; sand and gravel; road material; building stone; chemical raw material; gemstone; fissionable and nonfissionable ores; colloidal and other clay; steam and other geothermal resource; or any other substance defined as a mineral by the law of this state.

AB799,3,21 (9) "Mineral proceeds" means amounts payable for the extraction, production or sale of minerals, or, upon the abandonment of those payments, all payments that become payable thereafter. The term includes any of the following amounts payable:

AB799,3,24 (a) For the acquisition and retention of a mineral lease, including bonuses, royalties, compensatory royalties, shut-in royalties, minimum royalties and delay rentals.

AB799,4,3 (b) For the extraction, production or sale of minerals, including net revenue interests, royalties, overriding royalties, extraction payments and production payments.

AB799,4,5 (c) Under an agreement or option, including a joint operating agreement, unit agreement, pooling agreement and farm-out agreement.

AB799,4,9 (10) "Money order" includes an express money order and a personal money order, on which the remitter is the purchaser. The term does not include a bank money order or any other instrument sold by a financial organization if the seller has obtained the name and address of the payee.

AB799,4,13 (11) "Owner" means a person who has a legal or equitable interest in property subject to this chapter or the person's legal representative. The term includes a depositor in the case of a deposit, a beneficiary in the case of a trust other than a deposit in trust and a creditor, claimant or payee in the case of other property.

AB799,4,16 (12) "Person" means an individual, business association, financial organization, estate, trust, government, governmental subdivision, agency or instrumentality, or any other legal or commercial entity.

AB799,4,21 (13) "Property" means tangible property described in s. 177.025 or a fixed and certain interest in intangible property that is held, issued or owed in the course of a holder's business, or by a government, governmental subdivision, agency or instrumentality, and all income or increments therefrom. The term includes property that is referred to as or evidenced by any of the following:

AB799,4,22 (a) Money, a check, draft, deposit, interest or dividend.

AB799,4,25 (b) Credit balance, customer's overpayment, gift certificate, security deposit, refund, credit memorandum, unpaid wage, unused ticket, mineral proceeds or unidentified remittance.

AB799,5,2 (c) Stock or other evidence of ownership of an interest in a business association or financial organization.

AB799,5,3 (d) A bond, debenture, note or other evidence of indebtedness.

AB799,5,5 (e) Money deposited to redeem stocks, bonds, coupons or other securities or to make distributions.

AB799,5,8 (f) An amount due and payable under the terms of an annuity or insurance policy, including policies providing life insurance, property and casualty insurance, workers' compensation insurance or health and disability insurance.

AB799,5,12 (g) An amount distributable from a trust or custodial fund established under a plan to provide health, welfare, pension, vacation, severance, retirement, death, stock purchase, profit sharing, employe savings, supplemental unemployment insurance or similar benefits.

AB799,5,14 (14) "Record" means information that is inscribed on a tangible medium or that is stored in an electronic or other medium and is retrievable in perceivable form.

AB799,5,17 (15) "State" means a state of the United States, the District of Columbia, the Commonwealth of Puerto Rico, or any territory or insular possession subject to the jurisdiction of the United States.

AB799,5,21 (16) "Utility" means a person who owns or operates for public use any plant, equipment, real property, franchise or license for the transmission of communications or the production, storage, transmission, sale, delivery or furnishing of electricity, water, steam or gas.

AB799,5,24 177.015 Exemption. Notwithstanding this chapter, a cooperative organized under ch. 185 may effect the forfeiture to the cooperative of unclaimed funds as provided in ss. 185.03 (10) and 185.75 (1).

AB799,6,3 177.02 Presumption of abandonment. (1) Property is presumed abandoned if it is unclaimed by the apparent owner during the time set forth below for the particular property:

AB799,6,4 (a) Traveler's check, 15 years after issuance.

AB799,6,5 (b) Money order, 7 years after issuance.

AB799,6,8 (c) Stock or other equity interest in a business association or financial organization, including a security entitlement under ch. 408, 5 years after the earlier of:

AB799,6,10 1. The date of the most recent dividend, stock split or other distribution unclaimed by the apparent owner.

AB799,6,13 2. The date of the second mailing of a statement of account or other notification or communication that was returned as undeliverable or after the holder discontinued mailings, notifications or communications to the apparent owner.

AB799,6,16 (d) Debt of a business association or financial organization, other than a bearer bond or an original issue discount bond, 5 years after the date of the most recent interest payment unclaimed by the apparent owner.

AB799,6,23 (e) A demand, savings or time deposit, including a deposit that is automatically renewable, 5 years after the earlier of maturity or the date of the last indication by the owner of interest in the property; but a deposit that is automatically renewable is deemed matured for purposes of this section upon its initial date of maturity, unless the owner has consented to a renewal at or about the time of the renewal and the consent is in writing or is evidenced by a memorandum or other record on file with the holder.

AB799,7,2 (f) Money or credits owed to a customer as a result of a retail business transaction, 3 years after the obligation accrued.

AB799,7,5 (g) Gift certificate, 3 years after December 31 of the year in which the certificate was sold, but if redeemable in merchandise only, the amount abandoned is deemed to be 60% of the certificate's face value.

AB799,7,10 (h) Amount owed by an insurer on a life or endowment insurance policy or an annuity that has matured or terminated, 3 years after the obligation to pay arose or, in the case of a policy or annuity payable upon proof of death, 3 years after the insured has attained, or would have attained if living, the limiting age under the mortality table on which the reserve is based.

AB799,7,12 (i) Property distributable by a business association or financial organization in a course of dissolution, one year after the property becomes distributable.

AB799,7,14 (j) Property received by a court as proceeds of a class action, and not distributed pursuant to the judgment, one year after the distribution date.

AB799,7,17 (k) Except as provided in ss. 40.08 (8), 800.095 (7m), 852.01 (3), 863.27 (2) and 863.39, property held by a court, government, governmental subdivision, agency or instrumentality, one year after the property becomes distributable.

AB799,7,19 (L) Wages or other compensation for personal services, one year after the compensation becomes payable.

AB799,7,21 (m) Deposit or refund owed to a subscriber by a utility, one year after the deposit or refund becomes payable.

AB799,8,3 (n) Property in an individual retirement account, defined benefit plan or other account or plan that is qualified for tax deferral under the income tax laws of the United States, 3 years after the earliest of the date of the distribution or attempted distribution of the property, the date of the required distribution as stated in the plan or trust agreement governing the plan, or the date, if determinable by the holder, specified in the income tax laws of the United States by which distribution of the property must begin in order to avoid a tax penalty.

AB799,8,5 (o) All other property, 5 years after the owner's right to demand the property or after the obligation to pay or distribute the property arises, whichever first occurs.

AB799,8,8 (2) At the time that an interest is presumed abandoned under sub. (1), any other property right accrued or accruing to the owner as a result of the interest, and not previously presumed abandoned, is also presumed abandoned.

AB799,8,15 (3) Property is unclaimed if, for the applicable period set forth in sub. (1), the apparent owner has not communicated in writing, or by other means reflected in a contemporaneous record prepared by or on behalf of the holder, with the holder concerning the property or the account in which the property is held, and has not otherwise indicated an interest in the property. A communication with an owner by a person other than the holder or its representative who has not in writing identified the property to the owner is not an indication of interest in the property by the owner.

AB799,8,16 (4) An indication of an owner's interest in property includes the following:

AB799,8,21 (a) The presentment of a check or other instrument of payment of a dividend or other distribution made with respect to an account or underlying stock or other interest in a business association or financial organization or, in the case of a distribution made by electronic or similar means, evidence that the distribution has been received.

AB799,8,24 (b) Owner-directed activity in the account in which the property is held, including a direction by the owner to increase, decrease or change the amount or type of property held in the account.

AB799,8,25 (c) The making of a deposit to or withdrawal from a bank account.

AB799,9,7 (d) The payment of a premium with respect to a property interest in an insurance policy; but the application of an automatic premium loan provision or other nonforfeiture provision contained in an insurance policy does not prevent a policy from maturing or terminating if the insured has died or the insured or the beneficiary of the policy has otherwise become entitled to the proceeds before the depletion of the cash surrender value of a policy by the application of those provisions.

AB799,9,10 (5) Property is payable or distributable for purposes of this chapter notwithstanding the owner's failure to make demand or present an instrument or document otherwise required to obtain payment.

AB799,9,16 177.025 Contents of safe deposit box or other safekeeping depository. Tangible property held in a safe deposit box or other safekeeping depository in this state in the ordinary course of the holder's business and proceeds resulting from the sale of the property permitted by other law are presumed abandoned if the property remains unclaimed by the owner for more than 5 years after expiration of the lease or rental period on the box or other depository.

AB799,9,20 177.03 Rules for taking custody. Except as otherwise provided in this chapter or by other statute of this state, property that is presumed abandoned, whether located in this or another state, is subject to the custody of this state if any of the following conditions is present:

AB799,9,22 (1) The last-known address of the apparent owner, as shown on the records of the holder, is in this state.

AB799,9,25 (2) The records of the holder do not reflect the identity of the person entitled to the property and it is established that the last-known address of the person entitled to the property is in this state.

AB799,10,2 (3) The records of the holder do not reflect the last-known address of the apparent owner and either of the following is established:

AB799,10,4 (a) The last-known address of the person entitled to the property is in this state.

AB799,10,8 (b) The holder is domiciled in this state or is a government or governmental subdivision, agency or instrumentality of this state and has not previously paid or delivered the property to the state of the last-known address of the apparent owner or other person entitled to the property.

AB799,10,12 (4) The last-known address of the apparent owner, as shown on the records of the holder, is in a state that does not provide for the escheat or custodial taking of the property and the holder is domiciled in this state or is a government or governmental subdivision, agency or instrumentality of this state.

AB799,10,15 (5) The last-known address of the apparent owner, as shown on the records of the holder, is in a foreign country and the holder is domiciled in this state or is a government or governmental subdivision, agency or instrumentality of this state.

AB799,10,20 (6) The transaction out of which the property arose occurred in this state, the holder is domiciled in a state that does not provide for the escheat or custodial taking of the property, and the last-known address of the apparent owner or other person entitled to the property is unknown or is in a state that does not provide for the escheat or custodial taking of the property.

AB799,10,25 (7) The property is a traveler's check or money order purchased in this state, or the issuer of the traveler's check or money order has its principal place of business in this state and the issuer's records show that the instrument was purchased in a state that does not provide for the escheat or custodial taking of the property, or do not show the state in which the instrument was purchased.

AB799,11,7 177.09 Dormancy charge. A holder may deduct from property presumed abandoned a charge imposed by reason of the owner's failure to claim the property within a specified time only if there is a valid and enforceable written contract between the holder and the owner under which the holder may impose the charge and the holder regularly imposes the charge, which is not regularly reversed or otherwise canceled. The amount of the deduction is limited to an amount that is not unconscionable.

AB799,11,15 177.11 Burden of proof as to property evidenced by record of check or draft. A record of the issuance of a check, draft or similar instrument is prima facie evidence of an obligation. In claiming property from a holder who is also the issuer, the administrator's burden of proof as to the existence and amount of the property and its abandonment is satisfied by showing issuance of the instrument and passage of the requisite period of abandonment. Defenses of payment, satisfaction, discharge and want of consideration are affirmative defenses that must be established by the holder.

AB799,11,19 177.165 Proceeds from sale of property in self-service storage facility. Notwithstanding s. 177.02 (1), the proceeds of a sale under s. 704.90 (6) of personal property stored in a leased facility located within a self-service storage facility after satisfaction of the operator's lien under s. 704.90 (3) (a) is presumed abandoned.

AB799,11,21 177.17 Report of abandoned property. (1) A holder of property presumed abandoned shall make a report to the administrator concerning the property.

AB799,11,22 (2) The report must be verified and must contain all of the following:

AB799,11,23 (a) A description of the property.

AB799,12,2 (b) Except with respect to a traveler's check or money order, the name, if known, and last-known address, if any, and the social security number or taxpayer identification number, if readily ascertainable, of the apparent owner of property of the value of $50 or more.

AB799,12,3 (c) An aggregated amount of items valued under $50 each.

AB799,12,6 (d) In the case of an amount of $50 or more held or owing under an annuity or a life or endowment insurance policy, the full name and last-known address of the annuitant or insured and of the beneficiary.

AB799,12,9 (e) In the case of property held in a safe deposit box or other safekeeping depository, an indication of the place where it is held and where it may be inspected by the administrator, and any amounts owing to the holder.

AB799,12,12 (f) The date, if any, on which the property became payable, demandable or returnable, and the date of the last transaction with the apparent owner with respect to the property.