Bona Vacantia

What Is Bona Vacantia?

Bona vacantia, also known as “vacant goods” or "ownerless goods" in Latin, is a legal term for the situation in which property is left without any clear owner. The bona vacantia property may have been abandoned, mislaid, or forgotten by the owner. Bona vacantia can also refer to property left by someone who has died intestate (without a legal will) and has no known heirs.

The precise handling of bona vacantia property varies depending on the jurisdiction. In most cases, the property is held by the government until the rightful owners or heirs recover it. In the case where a person has died intestate, a probate court will frequently be responsible for distributing the assets of the estate to the heirs.

Understanding Bona Vacantia

Bona vacantia property, which remains unclaimed after a certain period of time, sometimes reverts to government ownership. In other cases, the government is obliged to serve as custodian for bona vacantia property into perpetuity.

There are common situations where a property or asset can become bona vacantia. Examples of this include:

• When a person dies without a will and no known heirs or next of kin
• When a business or unincorporated association dissolves and the assets thereof are not distributed appropriately
• When a trust fails (frequently because estate assets have not been correctly identified and added to the trust)
• When the property owner moves without leaving any contact information

Types of Bona Vacantia

Abandoned property is a type of bona vacantia property that is turned over to the state after a number of years of inactivity. This could include dormant financial accounts where no activity has occurred for many years other than the posting of interest or dividends. Examples of this would be inactive checking and savings accounts, 401(k) accounts, individual retirement accounts (IRAs), and brokerage accounts.

Unclaimed funds are money and other assets whose owner cannot be located. Frequently this occurs when a person moves and does not update their address. In many cases, they may not even be aware they have unclaimed money from the government, a former employer, or another source.

Examples of unclaimed funds include:

• Unclaimed back wages, life insurance funds, and pension money
• Unclaimed deposits from bank failures and credit union closures
• Unclaimed or undelivered tax refunds or refunds from an FHA-insured mortgage

In the United States, each state has its own laws regarding abandoned and unclaimed property. State laws require financial institutions to transfer assets held in dormant financial accounts to the state's treasury after a specified time.

Jurisdictions Where Bona Vacantia Applies

As an English common law doctrine, bona vacantia applies in the United Kingdom, where it is also enshrined in statute. You can find legislation regarding bona vacantia in the United States, Scotland, Ireland, New Zealand, and Canada.

In the U.S., bona vacantia property is handled at the state level. With the exception of estates left in intestacy, most bona vacantia is handled as lost, mislaid, or abandoned property. Each state maintains its own unclaimed property office, where it is possible to search for bona vacantia property that may belong to you. States do not assume ownership of such property but merely act as custodians for it until such time as the owner claims it.

Special Considerations

For bona vacantia estates left in intestacy, all 50 states have procedures for distributing the estate to the deceased owner’s heirs. State law will determine who inherits the property, usually prioritizing close relatives, such as spouses or civil partners and children, then more distant relatives such as parents, siblings, grandparents, and their descendants.

Some states allow the descendants of the deceased’s spouse who are not also the descendants of the deceased to inherit if there are no other heirs. If there are no heirs, bona vacantia escheats to the state. Escheatment refers to the government's right to take ownership of unclaimed property or estate assets.