Process of Escheat- Governmental Powers

By Jackie Perkins

There are four common governmental rights relating to real property. These rights include Police powers, Eminent Domain, Taxation and Escheat. According to Ted Gordon in California Real Estate Law, Escheat is defined as a reversion of property to the state on the death of an owner who has no heirs able to inherit. Escheat is most common when a landowner passes intestate, meaning without a will. Before the state may claim the property, the property must go through a timely process. The first step of the Escheat process is locating Heirs. The state attempts to find an heir capable and willing to take ownership of the property. In most cases this step is a success and the Escheat process ends. However, in few instances the state is incapable of locating a relative or an heir. In these situations the Process must continue with a "waiting period".

The California Law of Escheat allows three years before the estate is transferred to the State of California. Every state must practice Due process and implement a routine procedure for notifying the public. This process may differ in every state. The state of California gives heirs five years to reverse the transaction. After five years the state may permanently transfer the property if a capable and willing heir has not come forward.

After the five year waiting period ends, the state transfer's title of the property most commonly done by a quitclaim deed. A quitclaim deed transfers only whatever right, title, or interest, if any, the grantor owns, without implying any warranty. (Gordon 637) This allows the state to use the property as it desires.

The state usually will choose to use the property in a way that will benefit residents, for instance, offer public housing or develop a park. The state also has the option to sell the property and deposit the money into the state's general fund. To avoid escheatment of your property, create a will and update it annually.

References

Gordan, Ted. "Voluntary Transfers of Property" Real Estate Law.

Ferland, C. Escheat Process. Retrieved May 18, 2011. http://homeguides.sfgate.com/escheat-process-6814.html

Anderson, Ray. California Escheat Law. Retrieved May 20, 2011. http://homeguides.sfgate.com/california-escheat-law-8318.html