Escheat - Possible Multiple Liability of Abandoned Intangible Personal Property - Western Union Tel. Co. v. Commonwealth of Pennsylvania, 368 U.S. 71 (1961)

Masthead Logo DePaul Law Review Volume 11 Issue 2 Spring-Summer 1962 Article 9 Escheat - Possible Multiple Liability of Abandoned Intangible Personal Property - Western Union Tel. Co. v. Commonwealth of Pennsylvania, 368 U.S. 71 (1961) DePaul College of Law Follow this and additional works at: https://via.library.depaul.edu/law-review Recommended Citation DePaul College of Law, Escheat - Possible Multiple Liability of Abandoned Intangible Personal Property - Western Union Tel. Co. v. Commonwealth of Pennsylvania, 368 U.S. 71 (1961), 11 DePaul L. Rev. 337 (1962) Available at: https://via.library.depaul.edu/law-review/vol11/iss2/9 This Case Notes is brought to you for free and open access by the College of Law at Via Sapientiae. It has been accepted for inclusion in DePaul Law Review by an authorized editor of Via Sapientiae. For more information, please contact , . CASE NOTES but the desirability of putting an end to the conduct involved in mala prohibita offenses is not so pressing as to disregard the individual's rights. The right of a society to restrict individual liberty can only be justified by a compelling social necessity. There exists no such social necessity which would require the imprisonment of individuals for conduct which is not deemed reprehensible and which is not known to be prohibited. ESCHEAT-POSSIBLE MULTIPLE LIABILITY OF ABANDONED INTANGIBLE PERSONAL PROPERTY Appellant, Western Union Telegraph Company, is a New York corporation, having its principal office in that state. It also does business in all other states, the District of Columbia, and in many foreign countries. Besides its telegraphic message system, the company operates a telegraphic money order business. This latter service consists of accepting money for telegraphic transmission in the office nearest the sender to the office nearest the payee. The delivery of such money, given in the form of a negotiable draft, cannot always be made. It also happens that the sending office cannot, in every instance, make a refund to the sender. This money builds up in bank deposits all over the country. It is this specific property that the State of Pennsylvania seeks to escheat-in particular, the amount of money held by the company for money orders bought in that state.' The courts of Pennsylvania declared the funds escheated, stating that since their decree was naturally subject to the full faith and credit clause of the United States Constitution, Western Union need not fear that the funds involved would be subject to double escheat in another state. They brushed aside all other contentions of the company. 2 In reversing the 1The pertinent portion of the Pennsylvania statute reads as follows: "(b) Whensoever the owner, beneficial owner of, or person entitled to any real or personal property within or subject to the control of the Commonwealth or the whereabouts of such owner, beneficial owner or person entitled has been or shall be and remain unknown for the period of seven successive years, such real or personal property, together with the rents, profits, accretions and interest thereof or thereon, shall escheat to the Commonwealth subject to all legal demands on the same. "(c) Whensoever any real or personal property within or subject to the control of this Commonwealth has been or shall be and remain unclaimed for the period of seven successive years, such real or personal property, together with the rents, profits, accretions and interest thereof or thereon, shall escheat to the Commonwealth, subject to all legal demands on the same." PA. STAT. ANN. tit. 72, § 333 (1958). 2 The company contended that such a judgment of escheat rendered in a Pennsylvania court would not protect it from the judgments of other states seeking to escheat the same funds. They further asserted that the senders of the money orders and holders .Y.7o DE PAUL LAW REVIEW Pennsylvania judgment, the United States Supreme Court concluded that it was unnecessary to answer the company's contentions since there was a far more important question raised by the record-whether the state court had power at all to render a judgment of escheat which would bar New York or any other state from escheating the same property. Unless Pennsylvania had the power to protect the company against other claims, including the State of New York,8 who in turn claimed the obligations were within their own jurisdiction, the judgment denied Western Union due process of law. In addition, the potential multi-state claims to the res, which is the subject of the escheat, make it not unlikely that various states will claim in rem jurisdiction over it.4 Western Union Tel. Co. v. Cominonwealth of Pennsylvania, 368 U.S. 71 (1961). At early common law, escheat was an incident of feudal law, whereby a fee reverted to the lord when the tenant died without leaving a succesof negotiable drafts would not be bound by the Pennsylvania judgment since the service by publication did not, for two reasons, give the state court jurisdiction: (1) that under the doctrine of Pennoyer v. Neff, 95 U.S. 714 (1878), the presence of property, called a "res" within the state is a prerequisite for service by publication and that these obligations did not constitute such property within Pennsylvania, and (2) that the notice by publication did not give sufficient information or afford sufficient likelihood of actual notice to meet due process requirements. In addition, the company urged that there were possible escheats of other states which would not be bound by the Pennsylvania judgment because they were not and could not be made parties to that proceeding. 3 The applicable part of the New York statute reads as follows: 1. Any amount held or owing by any organization other than a banking organization for the payment of a travelers check or money order on which such organization is directly liable, sold by such organization on or after January first, nineteen hundred thirty, which shall have been outstanding for more than fifteen years from the date of its sale, shall be deemed abandoned property. N.Y. UNCONSOL. LAWS § 1309 (McKinney 1944). (b) Any amount paid by a consumer or subscriber to such a corporation in advance or in anticipation ofutility services furnished or to be furnished by such corporation which in fact is not furnished, after deducting any sums due to such corporation by such consumer or subscriber for utility services in fact furnished, which shall have remained unclaimed by the person or persons appearing to be entitled thereto for five years after the termination of the utility services for which such amount was paid in advance or in anticipation, or, if during such period utility services are furnished by such corporation to such consumer or subscriber and such amount is applied to the payment in advance or in anticipation of such utility services, for five years after the termination of such utility services. N.Y. UNCONSOL. LAWS § 400 (McKinney 1944). (...truncated)