In that case, people are just saying it wrong--it should be something like, "It was in absolutely the LAST place I would've expected it to be." Like finding a wristwatch underneath the toilet lid or something.
I think it was originally "the last place I would have looked," meaning who would have thought to look there. Over time it eroded to 'last place I'd a looked' and then down to 'last place I looked'.
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