Bill Text: CA AB2332 | 2019-2020 | Regular Session | Amended
Bill Title: Preneed funeral arrangements: unclaimed property.
Spectrum: Partisan Bill (Democrat 2-0)
Status: (Engrossed - Dead) 2020-08-20 - In committee: Held under submission. [AB2332 Detail]
Download: California-2019-AB2332-Amended.html
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Amended
IN
Senate
August 06, 2020 |
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Amended
IN
Senate
July 23, 2020 |
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Amended
IN
Assembly
May 04, 2020 |
CALIFORNIA LEGISLATURE—
2019–2020 REGULAR SESSION
Assembly Bill
No. 2332
| Introduced by Assembly Member Kalra (Coauthor: Assembly Member McCarty) |
February 14, 2020 |
An act to amend, repeal, and add Section 7737 of, and to add Sections 7737.1 and 7737.2 to, the Business and Professions Code, and to amend, repeal, and add Sections 1520 and 1560 of, and to add Section 1518.5 to, the Code of Civil Procedure, relating to funeral law.
LEGISLATIVE COUNSEL'S DIGEST
AB 2332, as amended, Kalra.
Preneed funeral arrangements: unclaimed property.
Existing law, the Cemetery and Funeral Act, establishes the Cemetery and Funeral Bureau within the Department of Consumer Affairs and sets forth its powers and duties relating to the regulation of cemeteries, crematoria, funeral establishments, and their personnel. Existing law requires all securities purchased by, and all money received from, the trustor, as defined, for deposit in trust to be placed in trust within 30 days of receipt by the funeral establishment pursuant to a trust agreement executed by the funeral establishment, the trustor, and the trustee. Existing law requires the trustee, upon the signature of a majority of the trustees, to deliver the corpus of the trust and any income accrued in trust, as specified. Existing law specifies that a willful violation of the act is a crime.
Existing law, the Unclaimed Property Law,
provides that all intangible personal property maintained in a deposit or account, and the income or increment on that property held in a fiduciary capacity for the benefit of another that has remained unclaimed by the owner for more than 3 years escheats to the state. Under existing law, a person who claims to have been the owner, as defined, of property paid or delivered to the Controller under that law may file a claim to the property or to the net proceeds from its sale. Existing law requires to Controller to consider each claim, as specified, to determine if the claimant is the owner.
This bill, commencing January 1, 2022, would recast provisions of the Cemetery and Funeral Act to permit the corpus of the trust and any income accrued in the trust, including interest, dividends, and capital gains, to escheat to the state, in accordance with the Unclaimed Property Law, if for more than 3 years after the funds became payable and distributable, as defined, to the
funeral establishment or the trustor, the beneficiary or trustor has not corresponded electronically or in writing concerning the property or otherwise indicated an interest. The bill would require a funeral establishment to report and pay or deliver all unclaimed preneed funeral trust funds, including the corpus of the trust, together with any income accrued, less a revocation fee, to the Controller, as specified.
This bill would also specify that all funds maintained in a preneed funeral trust held by a trustee for a funeral establishment that has been dissolved, sold, closed, or had its license revoked shall be returned to the beneficiary, trustor, or the legal representative of either the beneficiary or trustor within 30 days of providing specified written notice to the trustee according to specified procedures, if the funeral establishment does not transfer its preneed funeral agreements, or within 30 days of the beneficiary, trustor, or legal representative
canceling the preneed funeral agreement according to specified procedures, if the funeral establishment transfers its agreements. The bill would also provide that if that person cannot be located or, in the case of a funeral establishment that does not transfer its preneed funeral agreements, if that person does not provide written direction to the trustee to return the funds to them within 6 months of receiving specified notice, the funds escheat to the state in accordance with the Unclaimed Property Law, as specified. The bill would make other conforming changes.
This bill would require, commencing January 1, 2022, a funeral establishment that intends to cease engaging in business operations pursuant to the act by reason of dissolution, closure, sale, or revocation to also send notices to the bureau, beneficiaries or trustors, or their legal representatives,
and trustees of preneed funeral agreements. agreements, as provided. The bill would require the notices to include specified information depending on whether the funeral establishment plans to transfer or not transfer its agreements to a licensed successor funeral establishment. The bill would require the notices to be sent on forms developed by the bureau and would require the bureau to develop the forms by January 1, 2022. The bill would also require the bureau to adopt and post on their internet website, by January 1, 2022, regulations regarding the type of proof the funeral establishment ceasing operations and the licensed successor funeral establishment are required to retain or provide, as specified.
Because this bill would change the definition of a crime, the bill would
impose a state-mandated local program.
The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.
This bill would provide that no reimbursement is required by this act for a specified reason.
Digest Key
Vote: MAJORITY Appropriation: NO Fiscal Committee: YES Local Program: YESBill Text
The people of the State of California do enact as follows:
SECTION 1.
Section 7737 of the Business and Professions Code is amended to read:7737.
(a) All securities purchased by the trustor for deposit in trust and all money received from the trustor for deposit in trust shall be placed in trust with a trustee within 30 days of their receipt by the funeral establishment pursuant to a trust agreement executed by the funeral establishment, the trustor and trustee that shall provide that the trustee shall hold the money or securities in trust for the purposes for which deposited and that the trustee, upon the signature of a majority of those trustees, shall deliver the corpus of the trust to the funeral establishment upon the filing of a certified copy of the death certificate or other satisfactory evidence of the death of the beneficiary, together with satisfactory evidence that the funeral establishment has furnished the merchandise and services, provided, however, that (1) in the case of a trust agreement between any of the trustees set forth in Section 7736 and a recipient of public assistance, under the provisions of subdivision (a) of Section 11158 or paragraph (1) of subdivision (e) of Section 12152 of the Welfare and Institutions Code, and provided the value limitations of those sections are not exceeded, the trust agreement may further provide that it is irrevocable, and (2) in all other cases the trust agreement shall further provide that at any time before the funeral establishment has furnished the merchandise and services provided for in the contract the trustor or the legally appointed representative may in writing demand and receive the return of the corpus of the trust, together with any income accrued in the trust, less the revocation fee provided for in Section 7735; provided, however, that if and when the trustor becomes otherwise eligible, or in order to become eligible, for public social services, as provided in Division 9 (commencing with Section 10000) of the Welfare and Institutions Code, the trustor may agree, at the trustor’s option, that the trust shall be irrevocable in order to avail the trustor of the provisions of Section 11158 or Section 12152 of the Welfare and Institutions Code. The delivery of the corpus of the trust and the accumulated income to the funeral establishment performing the services, trustor or beneficiary pursuant to the terms of this article and the trust agreement herein referred to, shall relieve the trustee of any further liabilities with regard to those funds or income therefrom.(b) This section shall remain in effect only until January 1, 2022, and as of that date is repealed.
SEC. 2.
Section 7737 is added to the Business and Professions Code, to read:7737.
(a) All securities purchased by the trustor for deposit in trust and all money received from the trustor for deposit in trust shall be placed in trust with a trustee within 30 days of their receipt by the funeral establishment pursuant to a trust agreement executed by the funeral establishment, the trustor, and the trustee. The trust agreement shall provide that the trustee shall hold the money or securities in trust for the purposes for which it was deposited.(b) The trust agreement shall provide that the trustee, upon the signature of a majority of the trustees, shall deliver the corpus of the trust and any income accrued in the trust, including interest, dividends,
and capital gains, as follows:
(1) To the funeral establishment upon the filing of a certified copy of the death certificate or other satisfactory evidence of the death of the beneficiary, together with satisfactory evidence that the funeral establishment has furnished the merchandise and services. In the case of a trust agreement between any of the trustees set forth in Section 7736 and a recipient of public assistance under subdivision (a) of Section 11158 of, or paragraph (1) of subdivision (e) of Section 12152 of, the Welfare and Institutions Code, and if the value limitations of those sections are not exceeded, the trust agreement may further provide that it is irrevocable.
(2) To the trustor or legally appointed representative of the trustor at any time before the funeral
establishment has furnished the merchandise and services provided for in the contract if the trustor or the legally appointed representative demands in writing the return of the corpus of the trust, together with any income accrued in the trust, less a revocation fee not to exceed the amount reserved pursuant to Section 7735, provided, however, that if and when the trustor becomes otherwise eligible, or in order to become eligible, for public social services, as provided in Division 9 (commencing with Section 10000) of the Welfare and Institutions Code, the trustor may agree, at the trustor’s option, that the trust shall be irrevocable in order to avail themselves of the provisions of Section 11158 or 12152 of the Welfare and Institutions Code.
(3) In accordance with the Unclaimed Property Law (Chapter 7 (commencing with Section 1500)
of Title 10 of Part 3 of the Code of Civil Procedure), funds held in a preneed funeral trust or similar account or plan escheat to the state if the conditions in Section 1518.5 of the Code of Civil Procedure are satisfied.
(4) A funeral establishment shall report and pay or deliver, or cause the trustee to release for payment or delivery, to the Controller all unclaimed preneed funeral trust funds, as determined pursuant to Section 1518.5 of the Code of Civil Procedure. The amount to be paid or delivered shall be the corpus of the trust, together with any income accrued, less a revocation fee not to exceed the amount reserved pursuant to Section 7735.
(c) (1) A funeral establishment that intends to cease engaging in business operations, as authorized under this
chapter, by reason of dissolution, closure, sale, or revocation may transfer its preneed funeral agreements to another funeral establishment only if that successor funeral establishment is licensed pursuant to this chapter and the transfer satisfies the requirements of paragraph (2).
(2) A funeral establishment shall not transfer its preneed funeral agreements to another funeral establishment that is located 60 or more miles away without prior written approval of the beneficiaries or trustors, or legal representatives of the beneficiaries or trustors, and the trustee.
(d) (1) All funds, including accrued income, maintained in a preneed funeral trust or similar account or plan held by a trustee for a funeral establishment that has been dissolved, sold, or
closed, or had its license revoked shall be returned to the beneficiary, the trustor, or the legal representative of either the beneficiary or trustor according to either of the following:
(A) If the funeral establishment does not transfer its preneed funeral agreements to a licensed successor funeral establishment pursuant to subdivision (c), the funds shall be returned within 30 days of the beneficiary, trustor, or their legal representative providing written notice to the trustee, pursuant to subdivision (b) of Section 7737.1, to return those funds.
(B) If the funeral establishment transfers its preneed funeral agreements to a licensed successor funeral establishment pursuant to subdivision (c), the funds shall be returned within 30 days of the beneficiary, trustor, or their
legal representative canceling the agreement pursuant to subdivision (a) of Section 7737.1.
(2) If the funeral establishment or trustee is unable to locate the beneficiary or trustor, or the legal representative of either the beneficiary or trustor, or if the beneficiary or trustor, or their legal representative, does not provide written direction to the trustee to return the funds to them within six months of receiving the notice in subdivision (b) of Section 7737.1, the funeral establishment shall report and pay or deliver or cause the trustee to release for payment or delivery all funds together with accrued income, and these funds shall escheat to the state in accordance with the Unclaimed Property Law (Chapter 7 (commencing with Section 1500) of Title 10 of Part 3 of the Code of Civil Procedure), except that the revocation fee pursuant to
Section 7735 shall not be retained by the funeral establishment.
(3) If the preneed funeral agreement is canceled pursuant to subparagraph (B) of paragraph (1), the revocation fee pursuant to Section 7735 of the Business and Professions Code shall not be retained by the funeral establishment.
(e) The escheatment of preneed funeral trust funds to the Controller shall release the funeral establishment from the obligation of furnishing the personal property, funeral merchandise, or services originally arranged in the preneed contract associated with the trust. However, if the funeral establishment provided personal property, or funeral merchandise or services to the beneficiary after funds have been escheated, the funeral establishment shall be entitled to recover the escheated
funds upon submission to the Controller of a death certificate and a statement detailing the personal property or funeral merchandise or services provided pursuant to Section 1560 of the Code of Civil Procedure.
(f) Nothing in this section, the Unclaimed Property Law (Chapter 7 (commencing with Section 1500) of Title 10 of Part 3 of the Code of Civil Procedure), or any other law or regulation shall require escheatment of any funds received by a funeral establishment, cemetery, or other person from property or funeral merchandise or services provided under Chapter 4 (commencing with Section 8600) of Part 3 of Division 8 of the Health and Safety Code.
(g) A trustee or a funeral establishment shall not charge the trust, a trustor, or a beneficiary any fees or costs associated with a
search or verification conducted pursuant to this section. However, a trustee or funeral establishment may incorporate fees or costs associated with a search or verification as part of the administration of the trust pursuant to Section 7735.
(h) The delivery of the corpus of the trust and the income accrued to the trust to the funeral establishment, the trustor, the
beneficiary, or the Controller pursuant to this article shall relieve the trustee of any further liability with regard to those funds.
(i) This section shall become operative on January 1, 2022.
SEC. 3.
Section 7737.1 is added to the Business and Professions Code, to read:7737.1.
(a) (1) For purposes of Section 7737, a funeral establishment that intends to cease engaging in business operations, as authorized under this chapter, by reason of dissolution, closure, sale, or revocation and that intends to transfer its preneed funeral agreements to a licensed successor funeral establishment, pursuant to subdivision (c) of Section 7737, shall provide written notice, as described in paragraph (2), at least 60 days prior to the cessation of operations to both of the following:(A) The beneficiaries or trustors, or legal representatives of the beneficiaries or trustors, of the preneed funeral agreements associated with the funeral
establishment ceasing business operations.
(B) The trustees holding the preneed funeral trusts associated with the preneed funeral agreements.
(2) The notice provided pursuant to paragraph (1) shall meet all of the following requirements:
(A) The notice shall be on a form created by the bureau pursuant to Section 7737.2.
(B) The notice shall inform the recipients that their preneed funeral agreements will be transferred and fulfilled by the licensed successor funeral establishment.
(C) The notice shall inform the beneficiaries or trustees, or their legal representatives, that they may cancel
their agreement up to 60 days after receipt of the notice by contacting the trustee, the funeral establishment ceasing business operations, or the licensed successor funeral establishment.
(3) The funeral establishment ceasing business operations shall provide the bureau with a copy of the notice provided pursuant to this paragraph and with a list of all preneed funeral agreements transferred to the licensed successor funeral establishment prior to the cessation of business operations.
(4) (A) The funeral establishment ceasing business operations shall provide the licensed successor funeral establishment with a copy of the notice provided, and proof that the notice was provided, to the beneficiaries or trustees, or their legal representatives, prior to the
cessation of business operations.
(B) The licensed successor funeral establishment shall retain a copy of the notice provided, and proof that the notice was provided, to the beneficiaries or trustors, or their legal representatives, and provide a copy of both to the bureau upon the bureau’s request.
(C) The proof required by this paragraph shall be in compliance with the regulations adopted by the bureau pursuant to Section 7737.2.
(b) (1) For purposes of Section 7737, a funeral establishment that intends to cease engaging in business operations, as authorized under this chapter, by reason of dissolution, closure, sale, or revocation without a transfer of the preneed funeral agreements to a licensed,
successor funeral establishment shall give written notice, as described in paragraph (2), at least 60 days prior to the cessation of operations to both all of the following:
(A) The bureau.
(B) The beneficiaries or trustors of the preneed funeral agreements associated with the original funeral establishment.
(C) The trustees holding the preneed funeral trusts associated with the preneed funeral agreements.
(2) The notice provided pursuant to paragraph (1) shall meet all of the following
requirements:
(A) The notice shall be on a form created by the bureau pursuant to Section 7737.2.
(B) The notice shall inform the recipients that their preneed funeral agreements will be canceled and the funds, including the accrued income, will be escheated to the state unless the beneficiary or trustor informs the trustee in writing within six months of receiving the notice that they wish those funds to be returned to them.
(3)The funeral establishment shall provide the bureau with a copy of the notice sent pursuant to this paragraph prior to the cessation of business operations.
(c) This section shall become operative on January 1, 2022.
SEC. 4.
Section 7737.2 is added to the Business and Professions Code, to read:7737.2.
(a) The bureau shall create, and post on its internet website, the forms required by Section 7737.1 by January 1, 2022.(b) The bureau shall adopt and post on its internet website, by January 1, 2022, regulations regarding the type of proof of notice the funeral establishment ceasing operations and the licensed successor funeral establishment are required to provide or retain for purposes of paragraph (4) of subdivision (a) of Section 7737.1.
SEC. 5.
Section 1518.5 is added to the Code of Civil Procedure, to read:1518.5.
(a) Subject to Section 1510, funds maintained in a preneed funeral trust or similar account or plan escheat to the state if, for more than three years after the funds became payable and distributable pursuant to subdivision (b), as established from the records of the funeral establishment or trustee, the beneficiary or trustor has not corresponded electronically or in writing concerning the property or otherwise indicated an interest, as evidenced by a memorandum or other record on file with the funeral establishment or trustee.(b) For the purposes of this section, the corpus of a preneed funeral trust or similar account or plan, together with any income accrued,
less a revocation fee not to exceed the amount reserved pursuant to Section 7735 of the Business and Professions Code, becomes payable and distributable under any of the following circumstances:
(1) The beneficiary of the trust attained, or would have attained if living, 105 years of age.
(2) Forty-five years have passed since execution of the preneed funeral agreement.
(3) The holder received notification of the death or presumed death of the beneficiary and has not provided the contracted funeral merchandise or services.
(4) The preneed funeral trust is a preneed installment trust and the amount due to the funeral establishment from the trustor has not
been paid during the three preceding years and neither the trustor nor the beneficiary has communicated with either the funeral establishment or the trustee about the preneed funeral installment trust during that three-year period.
(c) For purposes of this section, except subdivision (d), the funeral establishment obligated to provide preneed funeral services under the trust or similar account or plan is the holder. For purposes of subdivision (d), the trustee is the holder.
(d) (1) All funds, including accrued income and revocation fees reserved pursuant to Section 7735 of the Business and Professions Code, maintained in a preneed funeral trust or similar account or plan held by a trustee for a funeral establishment that has been dissolved, closed, or had its
license revoked shall escheat to the state if unclaimed by the funeral establishment, beneficiary, trustor, or legal representative of either the beneficiary or trustor within six months after the date of final distribution or liquidation.
(2) Notwithstanding paragraph (1), the revocation fee pursuant to Section 7735 of the Business and Professions Code shall not be retained by the funeral establishment.
(e) Escheatment of preneed funeral trust funds to the Controller shall release the funeral establishment from the obligation of furnishing the personal property, funeral merchandise, or services originally arranged in the preneed funeral contract associated with the trust. However, if the funeral establishment provided personal property, or funeral merchandise or services to the
beneficiary after funds have escheated, the funeral establishment shall be entitled to recover the escheated funds upon submission to the Controller of a death certificate and a statement detailing the personal property or funeral merchandise or services provided pursuant to Section 1560.
(f) Nothing in this section, or any other law or regulation, shall require escheatment of any funds received by a funeral establishment, cemetery, or other person from property or funeral merchandise or services provided under Chapter 4 (commencing with Section 8600) of Part 3 of Division 8 of the Health and Safety Code.
(g) A trustee or a funeral establishment shall not charge the trust, a trustor, or a beneficiary any fees or costs associated with a search or verification conducted
pursuant to this section. However, a trustee or funeral establishment may incorporate fees or costs associated with a search or verification as part of the administration of the trust pursuant to Section 7735 of the Business and Professions Code.
(h) Delivery of the corpus of the trust, and the income accrued to the trust, to the funeral establishment, the trustor, the beneficiary, or the Controller pursuant to this article shall relieve the trustee of any further liability with regard to those funds.
(i) This section shall become operative on January 1, 2022.
SEC. 6.
Section 1520 of the Code of Civil Procedure is amended to read:1520.
(a) All tangible personal property located in this state and, subject to Section 1510, all intangible personal property, except property of the classes mentioned in Sections 1511, 1513, 1514, 1515, 1515.5, 1516, 1517, 1518, 1519, and 1521, including any income or increment thereon and deducting any lawful charges, that is held or owing in the ordinary course of the holder’s business and has remained unclaimed by the owner for more than three years after it became payable or distributable escheats to this state.(b) Except as provided in subdivision (a) of Section 1513.5, subdivision (b) of Section 1514, and subdivision (d) of Section 1516, if the holder has in its records an address
for the apparent owner of property valued at fifty dollars ($50) or more, which the holder’s records do not disclose to be inaccurate, the holder shall make reasonable efforts to notify the owner by mail or, if the owner has consented to electronic notice, electronically, that the owner’s property will escheat to the state pursuant to this chapter. The notice shall be mailed not less than 6 nor more than 12 months before the time when the owner’s property held by the business becomes reportable to the Controller in accordance with this chapter. The face of the notice shall contain a heading at the top that reads as follows: “THE STATE OF CALIFORNIA REQUIRES US TO NOTIFY YOU THAT YOUR UNCLAIMED PROPERTY MAY BE TRANSFERRED TO THE STATE IF YOU DO NOT CONTACT US,” or substantially similar language. The notice required by this subdivision shall specify the time when the property will escheat and
the effects of escheat, including the need to file a claim in order for the owner’s property to be returned to the owner. The notice required by this section shall, in boldface type or in a font a minimum of two points larger than the rest of the notice, exclusive of the heading, (1) specify that since the date of last activity, or for the last two years, there has been no owner activity on the deposit, account, shares, or other interest; (2) identify the deposit, account, shares, or other interest by number or identifier, which need not exceed four digits; (3) indicate that the deposit, account, shares, or other interest is in danger of escheating to the state; and (4) specify that the Unclaimed Property Law requires holders to transfer funds of a deposit, account, shares, or other interest if it has been inactive for three years. It shall also include a form, as prescribed by the Controller, by which the
owner may confirm the owner’s current address. If that form is filled out, signed by the owner, and returned to the holder, it shall be deemed that the account, or other device in which the owner’s property is
being held, remains currently active and recommences the escheat period. In lieu of returning the form, the holder may provide a telephone number or other electronic means to enable the owner to contact the holder. With that contact, as evidenced by a memorandum or other record on file with the holder, the account or other device in which the owner’s property is being held shall be deemed to remain currently active and shall recommence the escheat period. The holder may impose a service charge on the deposit, account, shares, or other interest for this notice in an amount not to exceed the administrative cost of mailing or electronically sending the notice and form, and in no case to exceed two dollars ($2).
(c) In addition to the notice required pursuant to subdivision (b), the holder may give additional notice as described
in subdivision (b) at any time between the date of last activity by, or communication with, the owner and the date the holder transfers the property to the Controller.
(d) For purposes of this section, “lawful charges” means charges that are specifically authorized by statute, other than the Unclaimed Property Law, or by a valid, enforceable contract.
(e) This section shall remain in effect only until January 1, 2022, and as of that date is repealed.
SEC. 7.
Section 1520 is added to the Code of Civil Procedure, to read:1520.
(a) All tangible personal property located in this state and, subject to Section 1510, all intangible personal property, except property of the classes mentioned in Sections 1511, 1513, 1514, 1515, 1515.5, 1516, 1517, 1518, 1518.5, 1519, and 1521, including any income or increment thereon and deducting any lawful charges, that is held or owing in the ordinary course of the holder’s business and has remained unclaimed by the owner for more than three years after it became payable or distributable escheats to this state.(b) Except as provided in subdivision (a) of Section 1513.5, subdivision (b) of Section 1514, and subdivision (d) of Section 1516, if the holder
has in its records an address for the apparent owner of property valued at fifty dollars ($50) or more, which the holder’s records do not disclose to be inaccurate, the holder shall make reasonable efforts to notify the owner by mail or, if the owner has consented to electronic notice, electronically, that the owner’s property will escheat to the state pursuant to this chapter. The notice shall be mailed not less than 6 nor more than 12 months before the time when the owner’s property held by the business becomes reportable to the Controller in accordance with this chapter. The face of the notice shall contain a heading at the top that reads as follows: “THE STATE OF CALIFORNIA REQUIRES US TO NOTIFY YOU THAT YOUR UNCLAIMED PROPERTY MAY BE TRANSFERRED TO THE STATE IF YOU DO NOT CONTACT US,” or substantially similar language. The notice required by this subdivision shall specify the time when the property
will escheat and the effects of escheat, including the need to file a claim in order for the owner’s property to be returned to the owner. The notice required by this section shall, in boldface type or in a font a minimum of two points larger than the rest of the notice, exclusive of the heading, (1) specify that since the date of last activity, or for the last two years, there has been no owner activity on the deposit, account, shares, or other interest; (2) identify the deposit, account, shares, or other interest by number or identifier, which need not exceed four digits; (3) indicate that the deposit, account, shares, or other interest is in danger of escheating to the state; and (4) specify that the Unclaimed Property Law requires holders to transfer funds of a deposit, account, shares, or other interest if it has been inactive for three years. It shall also include a form, as prescribed by the
Controller, by which the owner may confirm the owner’s current address. If that form is filled out, signed by the owner, and returned to the holder, it shall be deemed that the account, or other device in which the owner’s property is being held, remains currently active and recommences the escheat period. In lieu of returning the form, the holder may provide a telephone number or other electronic means to enable the owner to contact the holder. With that contact, as evidenced by a memorandum or other record on file with the holder, the account or other device in which the owner’s property is being held shall be deemed to remain currently active and shall recommence the escheat period. The holder may impose a service charge on the deposit, account, shares, or other interest for this notice in an amount not to exceed the administrative cost of mailing or electronically sending the notice and form,
and in no case to exceed two dollars ($2).
(c) In addition to the notice required pursuant to subdivision (b), the holder may give additional notice as described in subdivision (b) at any time between the date of last activity by, or communication with, the owner and the date the holder transfers the property to the Controller.
(d) For purposes of this section, “lawful charges” means charges that are specifically authorized by statute, other than the Unclaimed Property Law, or by a valid, enforceable contract.
(e) This section shall become operative on January 1, 2022.
SEC. 8.
Section 1560 of the Code of Civil Procedure is amended to read:1560.
(a) Upon the payment or delivery of escheated property to the Controller, the state shall assume custody and shall be responsible for the safekeeping of the property. Any person who pays or delivers escheated property to the Controller under this chapter and who, prior to escheat, if the person’s records contain an address for the apparent owner that the holder’s records do not disclose to be inaccurate, has made reasonable efforts to notify the owner by mail or, if the owner has consented to electronic notice, electronically, in substantial compliance with Sections 1513.5, 1514, 1516, and 1520, that the owner’s property, deposit, account, shares, or other interest will escheat to the state, is relieved of all liability to the extent of the value of the property so paid or delivered for any claim that then exists or that thereafter may arise or be made in respect to the property. Property removed from a safe-deposit box or other safekeeping repository shall be received by the Controller subject to any valid lien of the holder for rent and other charges, the rent and other charges to be paid out of the proceeds remaining after the Controller has deducted therefrom their selling cost.(b) Any holder who has paid moneys to the Controller pursuant to this chapter may make payment to any person appearing to that holder to be entitled thereto, and upon filing proof of the payment and proof that the payee was entitled thereto, the Controller shall
forthwith reimburse the holder for the payment without deduction of any fee or other charges. Where reimbursement is sought for a payment made on a negotiable instrument, including a traveler’s check or money order, the holder shall be reimbursed under this subdivision upon filing proof that the instrument was duly presented to them and that payment was made thereon to a person who appeared to the holder to be entitled to payment.
(c) The holder shall be reimbursed under this section even if they made the payment to a person whose claim against them was barred because of the expiration of any period of time as those described in Section 1570.
(d) Any holder who has delivered personal property, including a certificate of any interest in a business association, to the Controller
pursuant to this chapter may reclaim the personal property if still in the possession of the Controller without payment of any fee or other charges upon filing proof that the owner thereof has claimed the personal property from the holder. The Controller may, in their discretion, accept an affidavit of the holder stating the facts that entitle the holder to reimbursement under this subdivision as sufficient proof for the purposes of this subdivision.
(e) This section shall remain in effect only until January 1, 2022, and as of that date is repealed.
SEC. 9.
Section 1560 is added to the Code of Civil Procedure, to read:1560.
(a) Upon the payment or delivery of escheated property to the Controller, the state shall assume custody and shall be responsible for the safekeeping of the property. Any person who pays or delivers escheated property to the Controller under this chapter and who, prior to escheat, if the person’s records contain an address for the apparent owner that the holder’s records do not disclose to be inaccurate, has made reasonable efforts to notify the owner by mail or, if the owner has consented to electronic notice, electronically, in substantial compliance with Sections 1513.5, 1514, 1516, and 1520, that the owner’s property, deposit, account, shares, or other interest will escheat to the state, is relieved of all liability to the extent of the value of the property so paid or delivered for any claim that then exists or that thereafter may arise or be made in respect to the property. Property removed from a safe-deposit box or other safekeeping repository shall be received by the Controller subject to any valid lien of the holder for rent and other charges, the rent and other charges to be paid out of the proceeds remaining after the Controller has deducted therefrom their selling cost.(b) Any holder who has paid moneys to the Controller pursuant to this chapter may make payment to any person appearing to that holder to be entitled thereto, and upon filing proof of the payment and proof that the payee was entitled thereto, the Controller shall forthwith reimburse the holder for the payment without deduction of any fee or other charges. Where reimbursement is sought
for a payment made on a negotiable instrument, including a traveler’s check or money order, the holder shall be reimbursed under this subdivision upon filing proof that the instrument was duly presented to them and that payment was made thereon to a person who appeared to the holder to be entitled to payment.
(c) The holder shall be reimbursed under this section even if they made the payment to a person whose claim against them was barred because of the expiration of any period of time as those described in Section 1570.
(d) Any holder who has delivered personal property, including a certificate of any interest in a business association, to the Controller pursuant to this chapter may reclaim the personal property if still in the possession of the Controller without payment of
any fee or other charges upon filing proof that the owner thereof has claimed such personal property from the holder. The Controller may, in their discretion, accept an affidavit of the holder stating the facts that entitle the holder to reimbursement under this subdivision as sufficient proof for the purposes of this subdivision.
(e) Any holder who has delivered funds maintained under a preneed funeral trust or similar account or plan to the Controller pursuant to this chapter and has fulfilled the services of the preneed funeral trust escheated to the Controller shall be reimbursed under this section upon submission of a death certificate for the beneficiary and a statement detailing the personal property or funeral merchandise or services provided.
(f) This section shall become
operative on January 1, 2022.
