Assemblyman PATRICK J. DIEGNAN, JR.
District 18 (Middlesex)
Assemblyman PAUL D. MORIARTY
District 4 (Camden and Gloucester)
Assemblyman GORDON M. JOHNSON
District 37 (Bergen)
Assemblywomen Quigley, Tucker, Assemblymen Coutinho, Coughlin, Caputo, Prieto and Giblin
Reverses certain changes to laws governing State treatment of unclaimed property.
CURRENT VERSION OF TEXT
An Act concerning unclaimed property, amending various sections of the Revised Statutes, supplementing P.L.1960, c.39 (C.56:8-1 et seq.), and repealing section 5 of P.L.2010, c.25.
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. R.S.46:30B-6 is amended to read as follows:
As used in this chapter:
a. “Administrator” means the Treasurer of the State of New Jersey, any individual serving as the Acting Treasurer in the absence of the appointed Treasurer, and any State employee to whom the Treasurer has delegated authority to administer the provisions of this chapter and to execute any pertinent documents;
b. “Apparent owner” means the person whose name appears on the records of the holder as the person entitled to property held, issued, or owing by the holder;
c. (Deleted by amendment, P.L.2002, c.35).
d. “Business association” means a corporation, joint stock company, investment company, business trust, partnership, unincorporated association, joint venture, limited liability company, 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;
e. “Domicile” means the state of incorporation of a corporation and the state of the principal place of business of an unincorporated person;
f. “Financial organization” means a savings and loan association, building and loan association, credit union, savings bank, industrial bank, bank, banking organization, trust company, safe deposit company, private banker, or any organization defined by other law as a bank or banking organization;
g. “Holder” means a person, wherever organized or domiciled, who is the original obligor indebted to another on an obligation;
h. “Insurance company” means an association, corporation, fraternal or mutual benefit organization, whether or not for profit, which is engaged in providing insurance coverage, including accident, burial, casualty, credit life, contract performance, dental, fidelity, fire, health, hospitalization, illness, life (including endowments and annuities), malpractice, marine, mortgage, surety, and wage protection insurance;
i. (Deleted by amendment, P.L.2002, c.35).
j. (Deleted by amendment, P.L.2002, c.35).
k. “Owner” means a person having a legal or equitable interest in property subject to this chapter or the person's legal representative and includes, but is not limited to, 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;
l. “Person” means an individual, business association, state or other government, governmental subdivision or agency, public corporation, public authority, estate, trust, two or more persons having a joint or common interest, or any other legal or commercial entity;
m. “State” means any state in the United States, district, commonwealth, territory, insular possession, or any other area subject to the jurisdiction of the United States;
n. “Utility” means a person who owns or operates for public use any plant, equipment, property, franchise, or license for the transmission of communications or the production, storage, transmission, sale, delivery, or furnishing of electricity, water, steam, or gas;
o. “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 resources, or any other substance defined as a mineral by the law of this State;
p. “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, and includes, but is not limited to, amounts payable:
for the acquisition and retention of a mineral lease, including bonuses, royalties, compensatory royalties, shut-in royalties, minimum royalties, and delay rentals;
for the extraction, production, or sale of minerals, including net revenue interests, royalties, overriding royalties, extraction payments, and production payments; and
under an agreement of option, including a joint operating agreement, pooling agreement, and farm-out agreement;
q. “Money order” means an express money order and a personal money order, on which the remitter is the purchaser;
r. “Property” means tangible property described in R.S.46:30B-45 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, government subdivision, agency, or instrumentality, and all income or increments therefrom, and includes property that is referred to as or evidenced by:
money, a check, draft, deposit, interest, or dividend;
[stored value card;]
credit balance, customer's overpayment, security deposit, refund, credit memorandum, unpaid wage, unused ticket, mineral proceeds or unidentified remittance;
stock or other evidence of ownership of an interest in a business association or financial organization;
a bond, debenture, note, or other evidence of indebtedness;
money deposited to redeem stock, bonds, coupons, or other securities or distributions;
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; and
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, employee savings, supplemental unemployment, insurance, or similar benefits; and
s. “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[; and
t. "Stored value card" means a record that evidences a promise, made for monetary or other consideration, by the issuer or seller of the record that the owner of the record will be provided, solely or a combination of, merchandise, services, or cash in the value shown in the record, which is pre-funded and the value of which is reduced upon each redemption. The term "stored value card" includes, but is not limited to the following items: paper gift certificates, records that contain a microprocessor chip, magnetic stripe or other means for the storage of information, gift cards, electronic gift cards, rebate cards, stored-value cards or certificates, store cards, and similar records or cards].
(cf: P.L.2010, c.25, s.1)
2. R.S.46:30B-11 is amended to read as follows:
46:30B-11. Presumption of abandonment of travelers check. Subject to R.S.46:30B-14, any sum payable on a travelers check that has been outstanding for more than [three] 15 years after its issuance is presumed abandoned unless the owner, within [three] 15 years, has communicated in writing with the issuer concerning it or otherwise indicated an interest as evidenced by a contemporaneous memorandum or other record on file prepared by an employee of the issuer.
(cf: P.L.2010, c.25, s.2)
3. R.S.46:30B-12 is amended to read as follows:
46:30B-12. Presumption of abandonment of money order. Subject to R.S.46:30B-14, any sum payable on a money order or similar written instrument that has been outstanding for more than [three] seven years after its issuance is presumed abandoned unless the owner, within [three] seven years, has communicated in writing with the issuer concerning it or otherwise indicated an interest as evidenced by a contemporaneous memorandum or other record on file prepared by an employee of the issuer.
(cf: P.L.2010, c.25, s.3)
4. R.S.46:30B-13 is amended to read as follows:
46:30B-13. Limitation on holder's power to impose service charges. A holder may not deduct from the amount of a travelers check or money order any charge imposed by reason of the failure to present the instrument for payment unless there is a valid and enforceable written contract between the issuer and the owner of the instrument pursuant to which the issuer may impose a charge and the issuer regularly imposes the charges and does not regularly reverse or otherwise cancel them. The amount of the deduction shall be limited to an amount [not to exceed $2 per month. Notwithstanding any provision of this section to the contrary, no service charge, dormancy fee or other similar charge shall be imposed against a travelers check or money order within the twelve months immediately following the date of sale] that is not unconscionable.
(cf: P.L.2010, c.25, s.4)
5. Section 37 of P.L.2002, c.35 (C.46:30B-43.1) is amended to read as follows:
37. Limitation on holder's power to impose charges. A holder [of property] may not deduct from the amount of any instrument subject to [R.S.46:30B-42, section 5 of P.L.2010, c.25 (C.46:30B-42.1), and] R.S.46:30B-43 [shall not impose on the property a dormancy] any charge [or fee, abandoned property] imposed by reason of the failure to present the instrument for payment unless there is a valid and enforceable written contract between the issuer and owner of the instrument pursuant to which the issuer may impose a charge [or fee, unclaimed property charge or fee, escheat charge or fee, inactivity charge or fee, or any similar charge, fee or penalty for inactivity with respect to the property. Neither the property nor an agreement with respect to the property may contain language suggesting that the property may] and the issuer regularly imposes the charges and does not regularly reverse or otherwise cancel them. The amount of the deduction shall be [subject to that kind of charge, fee or penalty for inactivity] limited to an amount that is not unconscionable.
(cf: P.L.2010, c.25, s.6)
6. R.S.46:30B-62 is amended to read as follows:
46:30B-62. Reimbursement of holder paying claim. A holder who has paid money to the administrator pursuant to this chapter may make payment to any person appearing to the holder to be entitled to payment and, upon filing proof of payment and proof that the payee was entitled thereto, the administrator shall promptly reimburse the holder for the payment without imposing any fee or other charge. If reimbursement is sought for a payment made on a negotiable instrument, including a [stored value card,] travelers check or money order, the holder shall be reimbursed under this section upon filing proof that the instrument was duly presented and that payment was made to a person who appeared to the holder to be entitled to payment. The holder shall be reimbursed for payment made under this section even if the payment was made to a person whose claim was barred under R.S.46:30B-88.
(cf: P.L.2010, c.25, s.7)
7. (New section) a. Notwithstanding any other provisions of law to the contrary, a money order sold after the effective date of P.L.2007, c.326 (C.56:8-182 et seq.) shall retain full value until presented for payment, or shall have all conditions and limitations, as permitted in paragraphs (1) and (2) of this subsection, disclosed to the purchaser of the money order at the time of purchase, as provided in subsection b. of this section.
(1) No dormancy fee shall be charged against a money order within the 12 months immediately following the date of sale.
(2) An issuer of a money order may charge a dormancy fee against a money order, as permitted by this subsection, of not more than $2 per month.
b. The terms of any dormancy fee applicable to a money order, as permitted by subsection a. of this section, shall be disclosed by an issuer to a consumer by:
(1) written notice of the dormancy fee on the money order or the sales receipt for the money order; and
(2) written notice on the money order or the sales receipt for the money order, of a telephone number which the consumer may call for information concerning any dormancy fee.
c. As used in this section, “dormancy fee” means a charge imposed against the value of a money order due to inactivity.
8. (New section) It shall be an unlawful practice and a violation of P.L.1960, c.39 (C.56:8-1 et seq.) to violate the provisions of section 7 of P.L. , c. (C. ) (pending before the Legislature as this bill).
9. (New section) The Director of the Division of Consumer Affairs in the Department of Law and Public Safety shall promulgate regulations pursuant to the “Administrative Procedure Act,” P.L.1968, c.410 (C.52:14B-1 et seq.), to effectuate sections 7 and 8 of P.L. , c. (C. ) (pending before the Legislature as this bill).
10. Section 5 of P.L.2010, c.25 (46:30B-42.1) is repealed.
11. (New section) P.L. , c. (C. ) (pending before the Legislature as this bill) shall supersede the enactment of P.L.2010, c.25. Notwithstanding any provision of the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.) to the contrary, the State Treasurer may adopt immediately upon filing with the Office of Administrative Law such regulations as the director deems necessary to implement the provisions of P.L. , c. (C. ) (pending before the Legislature as this bill) and reimburse issuers for all property which would not have been reported but for P.L.2010, c.25, which regulations shall be effective for a period not to exceed 180 days following the date of enactment of P.L. , c. (C. ) (pending before the Legislature as this bill) and may thereafter be amended, adopted, or readopted by the State Treasurer in accordance with the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.).
12. This act shall take effect immediately and sections 1 through 10 shall be retroactive to July 1, 2010.
This bill reverses certain changes to the laws governing the State’s treatment of unclaimed property. The State’s unclaimed property laws provide for a system whereby certain types of property which have gone unused for prescribed periods of time accrue to the State and are treated as State revenue, though remain subject to the rightful claim by the true owners.
As an ancillary component to the State fiscal year 2010-2011 budget proposal, the Governor proposed various revisions to rationalize the State’s statutory treatment of unclaimed property. What ensued was a measure which aggressively shortened periods of abandonment for money orders and travelers checks and created a State claim on unused stored value cards. These changes have caused significant uncertainty for consumers and businesses alike.
This bill reverses the 2010 changes to the State’s unclaimed property statutes. The bill removes all references and the operative section for the State’s claim on certain unused stored value cards. The bill reenacts the 15 year abandonment period for travelers checks and the seven year abandonment period for money orders, both of which were recently changed to 3 years. The bill restores the previous statutory standard of unconscionability for limiting service charges on travelers checks. The bill also restores the statutory standard of unconscionability for limiting fees associated with a failure to redeem a credit balance, customer overpayment, security deposit, refund, credit memorandum, unused ticket, and similar instruments. Additionally, the bill reenacts certain money order specific consumer protections which had been otherwise configured in statute by recent changes. Lastly, the bill grants the State Treasurer emergency regulatory authority to implement this act and to reimburse issuers that reported unclaimed property under the recent 2010 changes, which would not have been due reportable otherwise.