LRB-1447/1
PJD:wlj:hmh
1999 - 2000 LEGISLATURE
February 25, 2000 - Introduced by Representatives Gundrum and Cullen,
cosponsored by Senators George and Huelsman. Referred to Committee on
Financial Institutions.
AB799,1,3
1An Act to amend 610.61; and
to repeal and recreate chapter 177 of the
2statutes;
relating to: the Uniform Unclaimed Property Act and granting
3rule-making authority.
Analysis by the Legislative Reference Bureau
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:
AB799,2,44
Uniform Unclaimed property act
AB799,2,5
5177.01 Definitions. In this chapter:
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6(1) "Administrator" means the state treasurer.
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7(2) "Apparent owner" means a person whose name appears on the records of
8a holder as the person entitled to property held, issued or owing by the holder.
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9(3) "Business association" means a corporation, joint stock company,
10investment company, partnership, unincorporated association, joint venture,
11limited liability company, business trust, trust company, land bank, safe deposit
12company, safekeeping depository, financial organization, insurance company,
13mutual fund, utility or other business entity consisting of one or more persons,
14whether or not for profit.
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1(4) "Domicile" means the state of incorporation of a corporation and the state
2of the principal place of business of a holder other than a corporation.
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3(5) "Financial organization" means a savings and loan association, building
4and loan association, savings bank, industrial bank, bank, banking organization or
5credit union.
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6(6) "Holder" means a person obligated to hold for the account of, or deliver or
7pay to, the owner property that is subject to this chapter.
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8(7) "Insurance company" means an association, corporation or fraternal or
9mutual benefit organization, whether or not for profit, engaged in the business of
10providing life endowments, annuities or insurance, including accident, burial,
11casualty, credit life, contract performance, dental, disability, fidelity, fire, health,
12hospitalization, illness, life, malpractice, marine, mortgage, surety, wage protection
13and workers' compensation insurance.
AB799,3,18
14(8) "Mineral" means gas; oil; coal; other gaseous, liquid and solid hydrocarbons;
15oil shale; cement material; sand and gravel; road material; building stone; chemical
16raw material; gemstone; fissionable and nonfissionable ores; colloidal and other clay;
17steam and other geothermal resource; or any other substance defined as a mineral
18by the law of this state.
AB799,3,21
19(9) "Mineral proceeds" means amounts payable for the extraction, production
20or sale of minerals, or, upon the abandonment of those payments, all payments that
21become payable thereafter. The term includes any of the following amounts payable:
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(a) For the acquisition and retention of a mineral lease, including bonuses,
23royalties, compensatory royalties, shut-in royalties, minimum royalties and delay
24rentals.
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1(b) For the extraction, production or sale of minerals, including net revenue
2interests, royalties, overriding royalties, extraction payments and production
3payments.
AB799,4,54
(c) Under an agreement or option, including a joint operating agreement, unit
5agreement, pooling agreement and farm-out agreement.
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6(10) "Money order" includes an express money order and a personal money
7order, on which the remitter is the purchaser. The term does not include a bank
8money order or any other instrument sold by a financial organization if the seller has
9obtained the name and address of the payee.
AB799,4,13
10(11) "Owner" means a person who has a legal or equitable interest in property
11subject to this chapter or the person's legal representative. The term includes a
12depositor in the case of a deposit, a beneficiary in the case of a trust other than a
13deposit in trust and a creditor, claimant or payee in the case of other property.
AB799,4,16
14(12) "Person" means an individual, business association, financial
15organization, estate, trust, government, governmental subdivision, agency or
16instrumentality, or any other legal or commercial entity.
AB799,4,21
17(13) "Property" means tangible property described in s. 177.025 or a fixed and
18certain interest in intangible property that is held, issued or owed in the course of
19a holder's business, or by a government, governmental subdivision, agency or
20instrumentality, and all income or increments therefrom. The term includes
21property that is referred to as or evidenced by any of the following:
AB799,4,2222
(a) Money, a check, draft, deposit, interest or dividend.
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(b) Credit balance, customer's overpayment, gift certificate, security deposit,
24refund, credit memorandum, unpaid wage, unused ticket, mineral proceeds or
25unidentified remittance.
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1(c) Stock or other evidence of ownership of an interest in a business association
2or financial organization.
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(d) A bond, debenture, note or other evidence of indebtedness.
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(e) Money deposited to redeem stocks, bonds, coupons or other securities or to
5make distributions.
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(f) An amount due and payable under the terms of an annuity or insurance
7policy, including policies providing life insurance, property and casualty insurance,
8workers' compensation insurance or health and disability insurance.
AB799,5,129
(g) An amount distributable from a trust or custodial fund established under
10a plan to provide health, welfare, pension, vacation, severance, retirement, death,
11stock purchase, profit sharing, employe savings, supplemental unemployment
12insurance or similar benefits.
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13(14) "Record" means information that is inscribed on a tangible medium or that
14is stored in an electronic or other medium and is retrievable in perceivable form.
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15(15) "State" means a state of the United States, the District of Columbia, the
16Commonwealth of Puerto Rico, or any territory or insular possession subject to the
17jurisdiction of the United States.
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18(16) "Utility" means a person who owns or operates for public use any plant,
19equipment, real property, franchise or license for the transmission of
20communications or the production, storage, transmission, sale, delivery or
21furnishing of electricity, water, steam or gas.
AB799,5,24
22177.015 Exemption. Notwithstanding this chapter, a cooperative organized
23under ch. 185 may effect the forfeiture to the cooperative of unclaimed funds as
24provided in ss. 185.03 (10) and 185.75 (1).
AB799,6,3
1177.02 Presumption of abandonment. (1) Property is presumed
2abandoned if it is unclaimed by the apparent owner during the time set forth below
3for the particular property:
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(a) Traveler's check, 15 years after issuance.
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(b) Money order, 7 years after issuance.
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(c) Stock or other equity interest in a business association or financial
7organization, including a security entitlement under ch. 408, 5 years after the earlier
8of:
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1. The date of the most recent dividend, stock split or other distribution
10unclaimed by the apparent owner.
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2. The date of the second mailing of a statement of account or other notification
12or communication that was returned as undeliverable or after the holder
13discontinued mailings, notifications or communications to the apparent owner.
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(d) Debt of a business association or financial organization, other than a bearer
15bond or an original issue discount bond, 5 years after the date of the most recent
16interest payment unclaimed by the apparent owner.
AB799,6,2317
(e) A demand, savings or time deposit, including a deposit that is automatically
18renewable, 5 years after the earlier of maturity or the date of the last indication by
19the owner of interest in the property; but a deposit that is automatically renewable
20is deemed matured for purposes of this
section upon its initial date of maturity,
21unless the owner has consented to a renewal at or about the time of the renewal and
22the consent is in writing or is evidenced by a memorandum or other record on file with
23the holder.
AB799,7,2
1(f) Money or credits owed to a customer as a result of a retail business
2transaction, 3 years after the obligation accrued.
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(g) Gift certificate, 3 years after December 31 of the year in which the certificate
4was sold, but if redeemable in merchandise only, the amount abandoned is deemed
5to be 60% of the certificate's face value.
AB799,7,106
(h) Amount owed by an insurer on a life or endowment insurance policy or an
7annuity that has matured or terminated, 3 years after the obligation to pay arose or,
8in the case of a policy or annuity payable upon proof of death, 3 years after the insured
9has attained, or would have attained if living, the limiting age under the mortality
10table on which the reserve is based.
AB799,7,1211
(i) Property distributable by a business association or financial organization
12in a course of dissolution, one year after the property becomes distributable.
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(j) Property received by a court as proceeds of a class action, and not distributed
14pursuant to the judgment, one year after the distribution date.
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(k) Except as provided in ss. 40.08 (8), 800.095 (7m), 852.01 (3), 863.27 (2) and
16863.39, property held by a court, government, governmental subdivision, agency or
17instrumentality, one year after the property becomes distributable.
AB799,7,1918
(L) Wages or other compensation for personal services, one year after the
19compensation becomes payable.
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(m) Deposit or refund owed to a subscriber by a utility, one year after the deposit
21or refund becomes payable.
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(n) Property in an individual retirement account, defined benefit plan or other
23account or plan that is qualified for tax deferral under the income tax laws of the
24United States, 3 years after the earliest of the date of the distribution or attempted
25distribution of the property, the date of the required distribution as stated in the plan
1or trust agreement governing the plan, or the date, if determinable by the holder,
2specified in the income tax laws of the United States by which distribution of the
3property must begin in order to avoid a tax penalty.
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(o) All other property, 5 years after the owner's right to demand the property
5or after the obligation to pay or distribute the property arises, whichever first occurs.
AB799,8,8
6(2) At the time that an interest is presumed abandoned under sub. (1), any
7other property right accrued or accruing to the owner as a result of the interest, and
8not previously presumed abandoned, is also presumed abandoned.
AB799,8,15
9(3) Property is unclaimed if, for the applicable period set forth in sub. (1), the
10apparent owner has not communicated in writing, or by other means reflected in a
11contemporaneous record prepared by or on behalf of the holder, with the holder
12concerning the property or the account in which the property is held, and has not
13otherwise indicated an interest in the property. A communication with an owner by
14a person other than the holder or its representative who has not in writing identified
15the property to the owner is not an indication of interest in the property by the owner.
AB799,8,16
16(4) An indication of an owner's interest in property includes the following:
AB799,8,2117
(a) The presentment of a check or other instrument of payment of a dividend
18or other distribution made with respect to an account or underlying stock or other
19interest in a business association or financial organization or, in the case of a
20distribution made by electronic or similar means, evidence that the distribution has
21been received.
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(b) Owner-directed activity in the account in which the property is held,
23including a direction by the owner to increase, decrease or change the amount or type
24of property held in the account.
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(c) The making of a deposit to or withdrawal from a bank account.
AB799,9,7
1(d) The payment of a premium with respect to a property interest in an
2insurance policy; but the application of an automatic premium loan provision or
3other nonforfeiture provision contained in an insurance policy does not prevent a
4policy from maturing or terminating if the insured has died or the insured or the
5beneficiary of the policy has otherwise become entitled to the proceeds before the
6depletion of the cash surrender value of a policy by the application of those
7provisions.
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8(5) Property is payable or distributable for purposes of this chapter
9notwithstanding the owner's failure to make demand or present an instrument or
10document otherwise required to obtain payment.
AB799,9,16
11177.025 Contents of safe deposit box or other safekeeping depository. 12Tangible property held in a safe deposit box or other safekeeping depository in this
13state in the ordinary course of the holder's business and proceeds resulting from the
14sale of the property permitted by other law are presumed abandoned if the property
15remains unclaimed by the owner for more than 5 years after expiration of the lease
16or rental period on the box or other depository.
AB799,9,20
17177.03 Rules for taking custody. Except as otherwise provided in this
18chapter or by other statute of this state, property that is presumed abandoned,
19whether located in this or another state, is subject to the custody of this state if any
20of the following conditions is present: