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Legal Memorandum: Property Presumed Abandoned in ND

Issue: Under the North Dakota Uniform Unclaimed Property Act, how does a company handle shares where the registered owners cannot be located?

Area of Law: Corporate & Securities
Keywords: Presumed abandoned; Unclaimed property
Jurisdiction: North Dakota
Cited Cases: None
Cited Statutes: N.D. Cent. Code § 47-30.1-02, § 47-30.1-03.1, § 47-30.1-10, § 47-30.1-17
Date: 12/01/2008

The Uniform Unclaimed Property Act provides that all intangible property that is held in the ordinary course of a holder’s business and has remained unclaimed by the owner for three years after it has become payable or distributable, is presumed abandoned.  N.D. Cent. Code § 47-30.1-02.  As specifically relates to interests in corporations, all tangible property, including any interest, dividend, or other earnings thereon held by a corporation, if the owner has not claimed or corresponded in writing with the corporation concerning the property within three years from the time prescribed for payment or delivery, is presumed abandoned and subject to the custody of the state as unclaimed property if the address of the owner is unknown and the corporation is incorporated in North Dakota.  Id. § 47-30.1-03.1.  It appears this statute is applicable to dividend distributions, and not the underlying shares of stock.

Stock in a corporation, the existence of which is evidenced by records available to the corporation, is presumed abandoned and, with respect to the interest, the corporation is the holder, if a dividend, distribution or other sum payable as a result of the interest has remained unclaimed by the owner for three years and the owner has not communicated in writing with the corporation regarding the interests or a dividend, distribution, or other sum payable as a result of the interest.  Id. § 47-30.1-10.  The failure of the stockholder to communicate in writing can be established by a memorandum prepared by an employee of the corporation.  […]

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