Delaware Asks U.S. Supreme Court To Decide Escheat Dispute Between States

On May 26, 2016, Delaware filed a motion with the United States Supreme Court requesting leave to file a bill of complaint against other states regarding escheatment of uncashed "official checks."¹ Specifically, Delaware asserts in its motion that uncashed "official checks" should be escheated to the state where the check issuer is incorporated, not the state where the checks were purchased. Despite the narrow legal dispute, this case could provide the first Supreme Court guidance on unclaimed property since the 1993 case of Delaware v. New York.²

Under the general rules of priority, unclaimed property with an unknown owner address is escheated to the state where the holder is incorporated.³ But in response to litigation over money orders, Congress enacted a law that an unclaimed "money order, traveler's check, or other similar written instrument (other than a third party bank check)" is escheated to the state where the instrument was purchased.⁴ The question