AB563: Bill Text

Under current law, if there are no heirs of a decedent in an intestate estate (an estate in which the decedent did not leave a will), or if a legacy or distributive share in an estate cannot be paid to the distributee or is not claimed by the distributee within 120 days after entry of the final judgment, the property escheats to the state and is paid or delivered to the treasurer. The treasurer must publish notice at least annually in the official state newspaper with such information as the name of the decedent, the time and place of death, the amount paid to the treasurer, and how a person may make a claim against the escheated property. Within ten years after the notice is published, a person may make a claim against the escheated property by filing a petition with the probate court that settled the estate and by sending copies of the petition to DOR and the attorney general. If the person establishes his or her claim in a court hearing, the court certifies the claim to DOA, which audits the claim; issues an order for any death tax due; and issues an order distributing the estate. The treasurer pays the claim.

The bill changes this procedure somewhat. A person filing a petition with the probate court must send a copy of the petition to the treasurer, instead of to DOR; the court is no longer required to certify a claim to DOA, which is no longer required to audit claims; and the court is no longer required to issue an order for any death tax due.

The bill also provides a new, optional procedure for making a claim against escheated property. The new procedure is similar to a procedure under current law for claiming abandoned property by filing a claim with the treasurer, except that under the new procedure the value of the claimed escheated property may not exceed $5,000. Rather than filing a petition with the probate court, a person claiming escheated property of $5,000 or less may, within ten years after publication by the treasurer of notice regarding the estate and the escheated property, file a claim with the treasurer, who must consider the claim within 90 days after filing. If the treasurer allows the claim, the treasurer must provide written notice to and obtain the written consent of the attorney general and file written notice of the allowed claim, as well as the written consent of the attorney general, with the probate court that settled the estate. After the necessary filings, the probate court must issue an order requiring the treasurer to pay the claim. If the treasurer does not act on a claim within 90 days after the claim is filed, or if the treasurer disallows a claim, the person filing the claim may file an action in the probate court that settled the estate to establish the claim.

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:

AB563, s. 1 Section 1. 177.02 (1) of the statutes is amended to read:

AB563,4,6 177.02 (1) Except as otherwise provided in this chapter, all intangible property, including any income or increment derived from it, less any lawful charges, that is held, issued or owing in the ordinary course of a holder's business and that has remained unclaimed by the owner for more than 5 3 years after it became payable or distributable is presumed abandoned.

AB563, s. 2 Section 2. 177.06 (3) (b) of the statutes, as affected by 2001 Wisconsin Act 16, is amended to read:

AB563,4,11 177.06 (3) (b) Assess a service charge after December 31 June 30 of the calendar year covered in in which the report concerning that property is required to be filed under s. 177.17 concerning that property.

AB563, s. 3 Section 3. 177.07 (1) and (3) (b) 3. of the statutes are amended to read:

AB563,4,18 177.07 (1) Funds held or owing under any life or endowment insurance policy or annuity contract that has matured or terminated are presumed abandoned if unclaimed for more than 5 3 years after the funds became due and payable as established from the records of the insurance company holding or owing the funds, but property described in sub. (3) (b) is presumed abandoned if unclaimed for more than 2 years.

AB563,5,6 (3) (b) 3. Neither the insured nor any other person appearing to have an interest in the policy within the preceding 2 3 years, according to the records of the company, has assigned, readjusted or paid premiums on the policy, subjected the policy to a loan, corresponded in writing with the company concerning the policy or otherwise indicated an interest as evidenced by a memorandum or other record on file prepared by an employee of the company.

AB563, s. 4 Section 4. 177.10 (1) (intro.) of the statutes, as affected by 2001 Wisconsin Act 16, is repealed and recreated to read:

AB563,5,12 177.10 (1) (intro.) Except as provided under sub. (5), a stock, shareholding, or other intangible ownership interest in a business association that is evidenced by records available to the association is presumed abandoned if all of the following apply:

AB563, s. 5 Section 5. 177.10 (1) (a) and (b) of the statutes are repealed and recreated to read:

AB563,5,16 177.10 (1) (a) The interest in the association is owned by a person who for more than 3 years has failed to do any of the following:

AB563,5,18 1. Claim a dividend, distribution, or other sum payable as a result of the interest.

AB563,5,22 2. Communicate with the association regarding the interest or a dividend, distribution, or other sum payable as a result of the interest as evidenced by a memorandum or other record on file with the association prepared by an employee of the association.

AB563,6,2 (b) The association does not know the location of the owner at the end of the 3-year period under par. (a). The return of official shareholder notifications or communications by the U.S. postal service as undeliverable is evidence that the association does not know the location of the owner.

AB563, s. 6 Section 6. 177.10 (2) and (3) of the statutes, as affected by 2001 Wisconsin Act 16, are repealed and recreated to read:

AB563,6,5 177.10 (2) This section applies to all of the following:

AB563,6,7 (a) The underlying stock, shareholdings, or other intangible ownership interests of an owner.

AB563,6,10 (b) Any stock, shareholdings, or other intangible ownership interest of an owner when the business association is in possession of the certificate or other evidence of ownership.

AB563,6,13 (c) The stock, shareholdings, or other intangible ownership interests of dividend-paying business associations and business associations that do not pay dividends, whether or not the interest is represented by a certificate.

AB563,6,15 (3) The business association is the holder of any property presumed abandoned under this section.

AB563, s. 7 Section 7. 177.10 (5) of the statutes, as affected by 2001 Wisconsin Act 16, is amended to read:

AB563,7,5 177.10 (5) This chapter section does not apply to any stock or other intangible ownership interest enrolled in a plan that provides for the automatic reinvestment of dividends, distributions, or other sums payable as a result of the interest unless the records available to the administrator of the plan show, with respect to any intangible ownership interest not enrolled in the reinvestment plan, that the owner has not within 5 years communicated in any manner specified under sub. (1) more than 3 years have elapsed since the location of the owner became unknown to the association, as evidenced by the return of official shareholder notifications or communications by the U.S. postal service as undeliverable, as provided under this subsection. The 3-year period from the return of official shareholder notifications or communications begins at the earlier of the return of the 2nd of those notifications or communications or the date on which the holder discontinues mailings to the owner.

AB563, s. 8 Section 8. 177.12 (1) of the statutes is amended to read:

AB563,7,12 177.12 (1) Intangible property and any income or increment derived from it held in a fiduciary capacity for the benefit of another person is presumed abandoned unless the owner, within 5 3 years after it has become payable or distributable, has increased or decreased the principal, accepted payment of principal or income, communicated concerning the property or otherwise indicated an interest as evidenced by a memorandum or other record on file prepared by the fiduciary.

AB563, s. 9 Section 9. 177.17 (4) (a) 1. of the statutes, as affected by 2001 Wisconsin Act 16, is amended to read:

AB563,7,18 177.17 (4) (a) 1. Before November 1 of each year, each holder shall file a report covering the previous calendar year 12 months preceding July 1 of that year. On written request by any person required to file a report, the administrator may extend the deadline established in this paragraph.

AB563, s. 10 Section 10. 177.22 (1) of the statutes, as affected by 2001 Wisconsin Act 16, is amended to read:

AB563,8,7 177.22 (1) Except as provided in subs. (2) and (4), the administrator, within 3 years after the receipt of abandoned property, shall sell it abandoned property delivered to the administrator under s. 177.06 (4) and 177.17 (4) (a) 2. to the highest bidder at public sale in the city, village or town in this state which, in the judgment of the administrator, affords the most favorable market for the property. The sale shall be held whenever the administrator deems appropriate, but at least once every 5 years. The administrator may decline the highest bid and reoffer the property for sale if, in his or her judgment, the bid is insufficient. If the administrator determines that the probable cost of sale exceeds the value of the property, it need not be offered for sale. Any sale held under this section shall be preceded by the publication of one notice, at least 3 weeks in advance of sale, in a newspaper of general circulation in the county in which the property is to be sold.

AB563, s. 11 Section 11. 177.22 (4) of the statutes, as affected by 2001 Wisconsin Act 16, is amended to read:

AB563,8,18 177.22 (4) Unless the administrator determines that it is in the best interest of this state to do otherwise, he or she shall hold all securities for at least one year before selling them. No person has any claim under this chapter against this state, the holder, any transfer agent, registrar or other person acting for or on behalf of a holder for any appreciation in the value of the property securities occurring after delivery by the date on which the holder delivers the securities to the administrator . Except as provided under s. 177.21, no person has any claim under this chapter against this state for any appreciation in the value of the securities occurring after the date on which the holder delivers the securities to the administrator.

AB563, s. 12 Section 12. 177.23 (1) of the statutes, as affected by 2001 Wisconsin Act 16, is amended to read:

AB563,9,6 177.23 (1) Except as provided in sub. (2), the administrator shall deposit in the school fund all funds received under this chapter, including the clear proceeds from the sale of abandoned property under s. 177.22. Before making the deposit, the administrator shall record the name and last-known address of each person appearing from the holders' reports to be entitled to the property and the name and last-known address of each insured person or annuitant and beneficiary and, with respect to each policy or contract listed in the report of an insurance company, its number, the name of the company and the amount due. The information recorded by the administrator under this subsection is not available for inspection or copying under s. 19.35 (1) until 24 12 months after payment or delivery of the property is due under s. 177.17 (4) (a) 2.

AB563, s. 13 Section 13. 177.34 (1) to (3) of the statutes are amended to read:

AB563,9,12 177.34 (1) A person who fails to pay or deliver property within the time prescribed by this chapter shall pay the administrator may be required by the administrator to forfeit an amount of interest, calculated at the annual rate of 18%, on the property or value thereof from the date the property should have been paid or delivered.

AB563,9,16 (2) A person who wilfully fails to file a report or perform any other duty required under this chapter is subject to a forfeiture of may be required by the administrator to forfeit not less than $100 for each day the report is withheld or the duty is not performed, but not more than $5,000.

AB563,9,20 (3) A person who wilfully fails to pay or deliver property to the administrator as required under this chapter is subject to a forfeiture may be required by the administrator to forfeit an amount equal to 25% of the value of the property that should have been paid or delivered.

AB563, s. 14 Section 14. 852.01 (3) of the statutes is amended to read:

AB563,9,25 852.01 (3) Escheat. If there are no heirs of the decedent under subs. (1) and (2), the net estate escheats to the state to be added to the capital of the school fund. Claims on amounts escheated to the state may be made under s. 863.39 (3) within 10 years after the date of publication under s. 177.18 (2m). If a claimant resides outside the United States or its territories, the court may require the personal appearance of the claimant before the court.

AB563, s. 15 Section 15. 863.37 (2) (a) of the statutes is renumbered 863.37 (2) and amended to read:

AB563,10,12 863.37 (2) Whenever payment of a legacy or a distributive share cannot be made to the person entitled to payment or it appears that the person may not receive or have the opportunity to obtain payment, the court may, on petition of a person interested or on its own motion, order that the funds be paid or delivered to the state treasurer for deposit as provided under s. 177.23. Claims on the funds may be made under s. 863.39 (3) within 10 years after the date of publication under s. 177.18 (2m). When a claimant to the funds resides outside the United States or its territories the court may require the personal appearance of the claimant before the court.

AB563, s. 16 Section 16. 863.37 (2) (b) of the statutes is repealed.

AB563, s. 17 Section 17. 863.39 (3) (a) of the statutes is amended to read:

AB563,11,5 863.39 (3) (a) Within 10 years after the date of publication under s. 177.18 (2m), any person claiming any amount deposited under sub. (1) or under s. 852.01 (3) or 863.37 (2) may file in the probate court in which the estate was settled a petition alleging the basis of his or her claim. The court shall order a hearing upon the petition, and 20 days' notice of the hearing and a copy of the petition shall be given by the claimant to the department of revenue state treasurer and to the attorney general, who may appear for the state at the hearing. If the claim is established it shall be allowed without interest, but including any increment which may have occurred on securities held, and the court shall so certify to the department of administration, which shall audit the claim. The state treasurer shall pay the claim out of the appropriation under s. 20.585 (1) (j). Before issuing the order distributing the estate, the court shall issue an order determining the death tax due, if any. If real property has been adjudged to escheat to the state under s. 852.01 (3) the probate court which that made the adjudication may adjudge at any time before title has been transferred from the state that the title shall be transferred to the proper owners under this subsection.

AB563, s. 18 Section 18. 863.39 (3) (b) of the statutes is repealed.

AB563, s. 19 Section 19. 863.39 (3) (bm) of the statutes is created to read:

AB563,11,12 863.39 (3) (bm) 1. Notwithstanding par. (a), any person claiming an amount deposited under sub. (1) or under s. 852.01 (3) or 863.37 (2) that does not exceed $5,000 may, within 10 years after the date of publication under s. 177.18 (2m), file with the state treasurer a claim on a form prescribed by the state treasurer and verified by the claimant.

AB563,11,22 2. The state treasurer shall consider each claim within 90 days after it is filed and may refer any claim to the attorney general for an opinion. For each claim referred, the attorney general shall advise the state treasurer either to allow it or to deny it in whole or in part. The state treasurer shall give written notice to the claimant if the claim is denied in whole or in part. The notice shall be given by mailing it to the last address, if any, stated in the claim as the address of the claimant to which notices are to be sent. If no address for notices is stated in the claim, the notice shall be mailed to the last address, if any, stated in the claim as the address of the claimant. No notice of denial need be given if the claim fails to state either the last address to which notices are to be sent or the address of the claimant.

AB563,12,5 3. If the state treasurer determines that the claim should be allowed, the state treasurer shall provide written notice to, and obtain the written consent of, the attorney general. The state treasurer shall file with the probate court in which the estate was settled written notice of the allowed claim, as well as the written consent of the attorney general. The probate court shall issue an order requiring the state treasurer to pay the claim. The state treasurer shall pay the claim, without interest but including any increment that may have occurred on securities held, out of the appropriation account under s. 20.585 (1) (j).

AB563,12,13 4. A person aggrieved by a decision of the state treasurer under this paragraph, or whose claim has not been acted upon by the state treasurer within 90 days after its filing under subd. 1., may bring an action to establish the claim in the probate court in which the estate was settled. The action shall be brought within 90 days after the decision of the state treasurer or within 180 days after the filing of the claim if the state treasurer has failed to act on it. If the person establishes the claim in the action, the court shall award the person costs and reasonable attorney fees against the state treasurer.

AB563, s. 20 Section 20. Nonstatutory provisions.

AB563,12,21 (1) Report of abandoned property. Notwithstanding section 177.17 (4) (a) 1. of the statutes, as affected by this act, if this subsection takes effect after October 31, 2001, the report due under section 177.17 (4) (a) 1. of the statutes, as affected by this act, by November 1, 2002, shall cover the period from January 1, 2000 to June 30, 2002. If this subsection takes effect on or before October 31, 2001, the report due under section 177.17 (4) (a) 1. of the statutes, as affected by this act, by November 1, 2001, shall cover the period from January 1, 2000 to June 30, 2001.

AB563,12,22 (End)