Kolovrat v. Oregon
Headline: Treaty ruling allows Yugoslavian relatives to inherit Oregon personal property, reversing the state court and preventing Oregon from blocking heirs due to their foreign residence or Yugoslav exchange rules.
Holding: The Court held that an 1881 treaty gives Yugoslavian nationals the same right as American next of kin to inherit personal property in Oregon, and Oregon may not deny that right due to Yugoslav exchange controls.
- Gives foreign heirs equal rights to inherit U.S. property under qualifying treaties.
- Stops states from blocking inheritances because of foreign exchange controls.
- Requires states to honor federal treaty commitments in inheritance disputes.
Summary
Background
Joe Stoich and Muharem Zekieh died in Oregon in 1953 without wills. Their only close relatives were brothers, sisters, nieces, and nephews who lived in Yugoslavia. Oregon law limited inheritance by nonresidents and allowed the State to take property when only ineligible aliens existed. The State filed petitions to escheat the personal property. A trial court found Yugoslavian heirs had reciprocal rights under an 1881 treaty and could inherit, but the Oregon Supreme Court reversed, saying Yugoslavia’s foreign exchange controls might prevent Americans receiving inheritances and therefore disqualified the heirs. The state court also rejected the heirs’ treaty claim.
Reasoning
The Court asked whether the 1881 treaty with Serbia (now part of Yugoslavia) gave Yugoslavian nationals the same inheritance rights as Americans, regardless of where the heirs lived or where the property was located. The Court read the treaty broadly, noting its most-favored-nation clause and related diplomatic history. It found administrative practice and other agreements supported a broad right to acquire and dispose of property. The Court also found that later international monetary agreements, including the Bretton Woods framework and a 1948 U.S.-Yugoslavia agreement, prevent a State from defeating treaty rights simply because foreign exchange controls exist. The result: the treaty rights prevail.
Real world impact
Foreign family members of Americans can inherit personal property in Oregon when a qualifying treaty applies. States cannot defeat such treaty rights by pointing to possible foreign exchange restrictions. The case enforces national treaty policy over conflicting state rules.
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