Western Union Telegraph Company v. Pennsylvania

PETITIONER: Western Union Telegraph Company
RESPONDENT: Pennsylvania
LOCATION: Court of Common Pleas, Dauphin County

DOCKET NO.: 15
DECIDED BY: Warren Court (1958-1962)
LOWER COURT:

CITATION: 368 US 71 (1961)
ARGUED: Oct 12, 1961
DECIDED: Dec 04, 1961
GRANTED: Jan 23, 1961

ADVOCATES:
A. Jere Creskoff - for the appellee
John G. Buchanan, Jr. - for the appellant
Ruth Kessler Toch - for the state of New York as amicus curiae, urging reversal

Facts of the case

Western Union Telegraph Company, headquartered and incorporated in New York, processed money orders between people living in different states. This case concerns money orders between payors in Pennsylvania and payees in other states. Over the years, Western Union accumulated a large sum of money from payees who never claimed the money sent to them. Pennsylvania law states that when property goes unclaimed for seven years and the whereabouts of the owner are unknown, that property escheats to the state. The Commonwealth of Pennsylvania started proceedings to escheat the unclaimed money. Western Union argued that Pennsylvania provided insufficient service of process, and had no power to protect Western Union from other states who might attempt to escheat the same money. The Court of Common Pleas ruled in favor of Pennsylvania and the Supreme Court of Pennsylvania affirmed.

Question

(1) Does Pennsylvania have the authority to escheat unclaimed money from Western Union where the intended payees do not reside in Pennsylvania and other states may attempt to escheat the same money?

(2) Did the service of process by publication violate due process?

Media for Western Union Telegraph Company v. Pennsylvania

Audio Transcription for Oral Argument - October 12, 1961 in Western Union Telegraph Company v. Pennsylvania

Earl Warren:

Number 15, Western Union Telegraph Company, Appellant, versus Pennsylvania, by Sidney Gottlieb, Escheator.

Mr. Buchanan, you may proceed now.

John G. Buchanan, Jr.:

Mr. Chief Justice, may it please the Court.

This appeal is from the affirmance by the Pennsylvania Supreme Court of a decree declaring the escheat to the Commonwealth of Pennsylvania of the amounts of Western Union telegraphic money orders which originated at office in Pennsylvania.

The Western Union Telegraph Company, the appellant, asserts that the Pennsylvania escheat law as here applied is repugnant to the Fourteenth Amend -- the Due Process Clause of the Fourteenth Amendment because it escheats these amounts with which the Pennsylvania has no sufficient contacts without sufficient notice and without giving Western Union the protection to which it is entitled or should be entitled under the Constitution against liability to others for the same amounts.

Western Union is a New York corporation with its principal office in New York City.

It has thousands of offices in the 48 states and District of Columbia where it is registered to do business.

It's not registered in Alaska or Hawaii.

Its interstate business is regulated by the interstate -- by the Federal Communications Commission, formerly by the Intestate Commerce Commission.

It has been continuously regulated.

A telegraphic money order transaction is designed to cause a credit for payment of money to be telegraphed from the office of origin to a payee at another office.

The sender -- sender of the money order goes into Western Union office and fills out an application form and pays the principal amount plus the tolls and gets a receipt.

A message is then sent from the office of origin to the Western Union office closest to the designated payee who is often called the sendee.

This message directs the second office, the office of destination to make payments to the designated sendee by negotiable draft the file tariffs of the -- this telegraph company call for this form of payment.

The office of destination gets to in touch with the sendee.He is called in and given a negotiable draft.

If he wants cash immediately, he can endorse that draft and in fact in return for currency.

But very often, because this draft is in some ways preferable to cash, he walks out of the office with the draft.

Potter Stewart:

And who's the drawee of the draft, who is he?

John G. Buchanan, Jr.:

The drafts are drawn on banks called fiscal agents and sub-fiscal agents of Western Union but they're just banks in various cities throughout the United States but none of those cities are in Pennsylvania.

Potter Stewart:

Western Union is drawer?

John G. Buchanan, Jr.:

Western Union draws against its account at those banks --

Potter Stewart:

But yet, what are -- one of those fiscal agencies?

John G. Buchanan, Jr.:

One of those fiscal agencies?

Potter Stewart:

And the sendee is the -- is the payee of the draft?

John G. Buchanan, Jr.:

The sendee is named as the payee --

Potter Stewart:

Normally --

John G. Buchanan, Jr.:

But of course these are negotiable.

He can endorse them and they can travel as couriers without luggage.

Potter Stewart:

Doesn't really fit differ much with check, does it?

John G. Buchanan, Jr.:

It's a check.