Occidental Life Insurance Co. v. Cranston

California Court of Appeal Oct 15, 1965 No. Civ. 27897Published

Before: Ford

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Holding. The court held that an insurance company is entitled to a refund of unclaimed property payments made to the State Controller under a mistake of law when the underlying claims were already barred by the statute of limitations prior to the effective date of the Uniform Disposition of Unclaimed Property Act.

Issues

Whether the Uniform Disposition of Unclaimed Property Act applies retroactively to claims already barred by the statute of limitations at the time of its enactment.
Whether a payor is entitled to recover funds paid to the State Controller under a mistake of law regarding the Act's application.
Whether the voluntary payment of funds to the Controller constitutes a waiver of the right to rely on the statute of limitations.

Disposition. affirmed

Quotations verified verbatim against the opinion

“it must be interpreted as applying only to claims on which the statute of limitations had not run on the effective date of the act.”

“the life insurance company was entitled to recover the sum of money paid by it because of its misapprehension as to the meaning of the act”

FORD, J.

This is an appeal by the Controller of the State of California from a judgment that Occidental Life Insurance Company of California recover the sum of $8,879.90 which that company had paid to the Controller on the assumption that it was required to do so under the provisions of the Uniform Disposition of Unclaimed Property Act (Code Civ. Proc., §§ 1500-1527) which was enacted in 1959. That sum had been paid prior to the determination in

1962

of the ease of

Douglas Aircraft Co.

Cranston,

58 Cal.2d 462 [24 Cal.Rptr. 851, 374 P.2d 819].

In the

Douglas

case the nature of the Uniform Disposition of Unclaimed Property Act was succinctly set forth as follows (58 Cal.2d, at p. 463): "The act defines abandoned property (§§ 1502-1508) and requires that its holder shall report (§ 1510) and pay or deliver it to the State Controller (§ 1512). The statute of limitations is not a defense to such reporting and payment or delivery (§ 1515), and the act applies to prop

[484]

erty that was abandoned before it took effect (§ 1510, subd. (g)). It provides for notice to the owner by publication and otherwise (§§ 1510, subd. (e), 1511). The owner may appear at any time and claim the property from the Controller after it has been delivered to him (§§ 1517-1520). Delivery to the Controller is a defense to any action by the owner against the holder. (§ 1513.) The objectives of the act are to protect unknown owners by locating them and restoring their property to them and to give the state rather than the holders of unclaimed property the benefit of the use of it, most of which experience shows will never be claimed.” (See Note, 98 A.L.R.2d 304.)

The controversy presently before this court arose upon the determination of the

Douglas

case wherein the Supreme Court stated (58 Cal.2d, at p. 466): “Section 1515 of the Code of Civil Procedure provides that ‘The expiration of any period of time specified by statute or court order, during which an action or proceeding may he commenced or enforced to obtain payment of a claim for money or recovery of property, shall not prevent the money or property from being presumed abandoned property, nor affect any duty to file a report required by this chapter or to pay or deliver abandoned property to the State Controller.’ This section does not expressly provide that it shall be retroactive or apply to claims that were already barred when it was enacted. Accordingly, under section 3 of the code [of Civil Procedure] and the rules set forth in the

Occidental Life Insurance Co. v. Cranston

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FORD, J.

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