Senate Bill 205 History
Senate Bill No. 205
(By Senator Oliverio, By Request)
[Introduced January 13, 2010; referred to the Committee on the
A BILL to amend the Code of West Virginia, 1931, as amended, by
adding thereto a new article, designated §35-5C-1, §35-5C-2,
§35-5C-3, §35-5C-4 §35-5C-5, §35-5C-6, §35-5C-7, §35-5C-8,
§35-5C-9, §35-5C-10, §35-5C-11, §35-5C-12, §35-5C-13,
§35-5C-14, §35-5C-15, §35-5C-16, §35-5C-17, §35-5C-18,
§35-5C-19, §35-5C-20, §35-5C-21, §35-5C-22, §35-5C-23,
§35-5C-24, §35-5C-25, §35-5C-26, §35-5C-27, §35-5C-28 and
§35-5C-29, all relating generally to establishing the West
Virginia Cemetery Act; scope; providing for definitions;
creating the West Virginia Cemetery Commission; providing for
commission logistics; providing for commission powers and
budget; providing for licensure requirements for various
brokers, companies and organizations; cemetery changes of
control; care and maintenance trust funds; perpetual care
funds; trust fund financial reports; license applications, assignability and transferability; cemetery land acreage;
construction of mausoleums and crypts; providing for
penalties; burial public policy; and validation of cemetery
Be it enacted by the Legislature of West Virginia:
That the Code of West Virginia, 1931, as amended, be amended
by adding thereto a new article, designated §35-5C-1, §35-5C-2,
§35-5C-3, §35-5C-4 §35-5C-5, §35-5C-6, §35-5C-7, §35-5C-8,
§35-5C-9, §35-5C-10, §35-5C-11, §35-5C-12, §35-5C-13, §35-5C-14,
§35-5C-15, §35-5C-16, §35-5C-17, §35-5C-18, §35-5C-19, §35-5C-20,
§35-5C-21, §35-5C-22, §35-5C-23, §35-5C-24, §35-5C-25, §35-5C-26,
§35-5C-27, §35-5C-28 and §35-5C-29, all to read as follows:
ARTICLE 5C. WEST VIRGINIA CEMETERY ACT.
§35-5C-1. Short title.
This article may be cited as "West Virginia Cemetery Act."
(a) The provisions of this article apply to all persons
engaged in the business of operating a cemetery as defined herein,
except cemeteries owned and operated by governmental agencies or
(b) Any cemetery beneficially owned and operated by a
fraternal organization or its corporate agent for at least fifty
years prior to September 1, 1975, is exempt from the provisions of
As used in this article, unless otherwise stated or unless the
context or subject matter clearly indicates otherwise:
(1) "Bank of belowground crypts" means any construction unit
of belowground crypts acceptable to the commission which a cemetery
uses to initiate its belowground crypt program or to add to
existing belowground crypt structures.
(2) "Belowground crypts" consists of an interment space in
preplaced chambers, either side by side or multiple depth, covered
by earth and sod and are also known as lawn crypts, westminsters or
turf top crypts.
(3) "Cemetery" means any one or a combination of more than one
of the following in a place used or to be used and dedicated or
designated for cemetery purposes: (a) A burial park, for earth
interment; (b) a mausoleum; (c) a columbarium.
(4) "Cemetery broker" means a legal entity engaged in the
business of arranging sales of cemetery products between legal
entities and which sale does not involve a cemetery company, but
does not mean funeral establishments or funeral directors, when
dealing between legal entities operating wherein one such entity
shall be members of the family of a deceased person or other
persons authorized by law to arrange for the burial and funeral of
such deceased human being. The West Virginia Cemetery Act does not
apply to any cemetery broker selling less than five grave spaces per year.
(5) "Cemetery company" means any legal entity that owns or
controls cemetery lands or property and conducts the business of a
cemetery, including all cemeteries owned and operated by
governmental agencies, churches and fraternal organizations or
their corporate agents for the duration of any sales and management
contracts entered into with cemetery sales organizations or
cemetery management organizations for cemetery purposes, or with
any other legal entity other than direct employees of the
governmental agency, church or fraternal organization.
(6) "Cemetery management organization" means any legal entity
contracting as an independent contractor with a cemetery company to
manage a cemetery but does not mean individual managers employed by
and contracting directly with cemetery companies operating under
(7) "Cemetery sales organization" means any legal entity
contracting with a cemetery which is exempt or not exempt under
this article to conduct sales of cemetery products, but does not
mean individual salesmen or sales managers employed by and
contracting directly with cemetery companies operating under this
article, nor does it mean funeral establishments or funeral
directors operating under licenses when dealing directly with a
cemetery company and with members of the family of a deceased
person or other persons authorized by law to arrange for the burial and funeral of such deceased human being.
(8) "Columbarium" means a structure or building substantially
exposed aboveground intended to be used for the interment of the
cremated remains of a deceased person.
(9) "Commission" means the West Virginia Cemetery Commission.
(10) "Grave space" means a space of ground in a cemetery
intended to be used for the interment in the ground of the remains
of a deceased person.
(11) "Human remains" or "remains" means the bodies of deceased
persons, and includes the bodies in any stage of decomposition, and
(12) "Mausoleum" means a structure or building substantially
exposed aboveground intended to be used for the entombment of
remains of a deceased person.
(13) "Mausoleum section" means any construction unit of a
mausoleum acceptable to the commission which a cemetery uses to
initiate its mausoleum program or to add to its existing mausoleum
(14) "Person" means an individual, corporation, partnership,
joint venture or association.
(15) "Vault" means a crypt or underground receptacle which is
used for interment in the ground and which is designed to encase
and protect caskets or similar burial devices. For the purposes of
this article, a vault is a preneed item until delivery to the purchaser.
§35-5C-4. The West Virginia Cemetery Commission.
There is hereby established in the Department of Commerce a
West Virginia Cemetery Commission with the power and duty to adopt
rules to be followed in the enforcement of this article.
§35-5C-5. Cemetery commission; members, selection, quorum.
The Cemetery Commission consists of seven members appointed by
the Governor. Two members shall be owners or managers of
cemeteries in West Virginia. Three members shall be selected from
six nominees submitted by the West Virginia Cemetery and Funeral
Association. Two members shall be public members who have no
financial interest in, and are not involved in management of, any
cemetery or funeral related business. Four members of the initial
commission shall be appointed for a term to expire June 30, 2011,
and three members shall be appointed for a term to expire June 30,
2012. At the end of the respective terms of office of the initial
members of the commission, their successors shall be nominated in
the same manner, selected from the same categories and appointed
for terms of four years and until their successors are appointed
and qualified. Any appointment to fill a vacancy on the commission
created by the resignation, dismissal, death or disability of a
member shall be for the balance of the unexpired term. The
Governor may remove any member of the commission from office for
misfeasance, malfeasance and nonfeasance. A majority of the commission constitutes a quorum for the transaction of business.
At the first meeting of the commission held after September 1,
2010, the commission shall elect one of its members as its chairman
and another as its vice-chairman, both to serve through June 30 of
the next following year. Thereafter, at its first meeting held on
or after July 1 of each year, the commission shall elect from its
members a chairman and vice-chairman to serve through June 30 of
the next following year.
§35-5C-6. Principal office.
The principal office of the commission shall be in the city of
Charleston, West Virginia. Notice of all regular and special
meetings of the commission shall be advertised five or more days in
advance in at least three newspapers in West Virginia having inter-
county circulation in the state. Each member of the commission
shall receive per diem and allowances. The administrator of the
commission, other employees required to attend and legal counsel to
the commission shall be entitled to actual expenses while attending
regular or special meetings of the commission held other than in
Charleston, West Virginia. All expenses of the commission shall be
paid from funds coming to the commission pursuant to this article.
§35-5C-7. Regular and special meetings.
The cemetery commission shall meet at least once in each
quarter and may hold special meetings at any time and place within
the state at the call of the chairman or upon the written request of at least four members.
In addition to other powers conferred by this article, the
cemetery commission has the following powers and duties:
(1) The Governor shall appoint the administrator upon
recommendation of the cemetery commission. The compensation of the
administrator and such other personnel as is necessary to operate
the commission is subject to the relevant provisions of the West
Virginia Code. The commission is authorized and empowered to
employ such staff, including legal counsel, as may be necessary.
(2) To examine a cemetery company's records when a person
applies for a change of control of the company.
(3) Investigate, upon its own initiative or upon a verified
complaint in writing, the actions of any person engaged in the
business or acting in the capacity of a licensee under this
article. The license of a licensee may be revoked or suspended for
a period not exceeding two years, or until compliance with a lawful
order imposed in the final order of suspension, or both, where the
licensee in performing or attempting to perform any of the acts
specified in this article has been guilty of:
(A) Failing to pay the fees required herein;
(B) Failing to make any reports required by this article;
(C) Failing to remit to the care and maintenance trust fund,
merchandise trust fund or preconstruction trust fund the required amounts;
(D) Making any substantial misrepresentation;
(E) Making any false statement of a character likely to
influence or persuade;
(F) A continued and flagrant course of misrepresentation or
making of false promises through cemetery agents or salesmen;
(G) Violating any provision of this article or rule
promulgated by the commission; or
(H) Any other conduct, whether of the same or a different
character than specified in this section, which constitutes fraud
or dishonest dealing.
(4) In all proceedings under this article for the revocation
or suspension of licenses, a license may not be revoked or
suspended except after notice and opportunity for hearing on that
action. The commissioner may issue to a person licensed under this
article an order to show cause why the license should not be
revoked, or should not be suspended for a period not in excess of
six months. The order shall state the place for a hearing and set
a time for the hearing that is no less than ten days from the date
of the order. The hearing shall be conducted in accordance with
the provisions of article five, chapter twenty-nine-a of this code.
The commissioner may appoint a hearing examiner to preside at the
hearing and make a recommended decision. After the hearing the
commissioner shall revoke or suspend the license if he or she finds good cause to do so.
(5) At such time as the commission finds it necessary it may
bring an action in the name of the state in the court of the county
in which the place of business is located against such person to
enjoin such person from engaging in or continuing such violation or
doing any act or acts in furtherance thereof. In any such action,
an order or judgment may be entered awarding such temporary or
permanent injunction as may be deemed proper. However, before any
such action is brought the commission shall give the cemetery at
least twenty days' notice in writing, stating the alleged violation
and giving the cemetery an opportunity within the twenty-day period
to cure the violation. In addition to all other means provided by
law for the enforcement of a temporary restraining order, temporary
injunction, or permanent injunction, the court shall have the power
and jurisdiction to impound and to appoint a receiver for the
property and business of the defendant, including books, papers,
documents and records appertaining thereto or so much thereof as
the court may consider reasonably necessary to prevent further
violation of this article through or by means of the use of the
property and business. The commission may institute proceedings
against the cemetery or its officers, where after an examination,
pursuant to this article, a shortage in the care and maintenance
trust fund, merchandise trust fund or mausoleum and belowground
crypts preconstruction trust fund is discovered, to recover the shortage.
(6) Whenever any special additional audit or examination of a
licensee's premises, facilities, books or records is necessary
because of the failure of the licensee to comply with the
requirements imposed in this article or by the rules of the
commission, to charge a fee based on the cost of the special
examination or audit, taking into consideration the salary of any
employees involved in the special audit or examination and any
(7) Promulgate rules requiring licensees to file with the
commission plans and specifications for the minimum quality of any
product sold. The sale of any product for which plans and
specifications required by the rules have not been filed or sale of
any product of a lesser quality than the plans and specifications
filed with the commission is a violation of this article.
(8) When the commission finds that failure by a licensee to
maintain a cemetery properly has caused that cemetery to be a
public nuisance or a health or safety hazard, the commission may
bring an action for injunctive relief, against the responsible
licensee, in the superior court of the county in which the cemetery
or any part thereof is located.
§35-5C-9. Annual budget of commission; collection of funds.
The commission shall prepare an annual budget and shall
collect the sums of money required for this budget from yearly fees and from any other sources provided in this article. On or before
July 1 of each year, each licensed cemetery shall pay a license fee
to be set by the commission in an amount not to exceed $300. In
addition, each licensed cemetery shall pay to the commission an
inspection fee for each grave space, niche or mausoleum crypt sold
and shall pay a fee for each vault, niche, belowground crypt,
mausoleum crypt, memorial or opening and closing of a grave space
that is included in a preneed cemetery contract. The inspection
fee for each grave space, niche or mausoleum crypt is payable when
the item is sold and may not exceed $2. The fee for each of the
listed items that are included in a preneed cemetery contract is
payable when the contract is made and may not exceed $500.
§35-5C-10. License; cemetery company.
(a) No legal entity may engage in the business of operating a
cemetery company except as authorized by this article and without
first obtaining a license from the commission.
(b) Any legal entity wishing to establish a cemetery shall
file a written application for authority with the commission on
forms provided by the commission.
(c) Upon receipt of the application and filing fee of $800,
the commission shall cause an investigation to be made to establish
the following criteria for approval of the application:
(1) The creation of a legal entity to conduct cemetery
business, and its proposed financial structure;
(2) A perpetual care trust fund agreement, with an initial
deposit of not less than $50,000 and with a bank cashier's check or
certified check attached for the amount made payable to the
trustee. The trust fund agreement must be executed by the
applicant, accepted by the trustee and conditioned only upon
approval of the application;
(3) A plat of the land to be used for the cemetery, showing
the location of the cemetery and the access roads to the cemetery;
(4) Designation by the legal entity wishing to establish a
cemetery of a general manager. The general manager must be a
person of good moral character and have at least one year's
experience in cemeteries;
(5) Development plans sufficient to ensure the community that
the cemetery will provide adequate cemetery services and that the
property is suitable for use as a cemetery.
(d) The commission, after receipt of the investigating report,
shall grant or refuse to grant the authority to organize a cemetery
based upon the criteria set forth in this chapter.
(e) If the commission intends to deny an application, it shall
give written notice to the applicant of its intention to deny. The
notice shall state a time and a place for a hearing before the
commission and a summary statement of the reasons for the proposed
denial. The notice of intent shall be mailed by certified mail to
the applicant at the address stated in the application at least fifteen days prior to the scheduled hearing date. The applicant
shall pay the costs of this hearing as assessed by the commission
unless the applicant notifies the commission by certified mail at
least five days prior to the scheduled hearing date that a hearing
is waived. Any appeals from the commission's decision shall be to
the court having jurisdiction of the applicant or the commission.
(f) If the commission intends to grant the authority, it shall
give written notice that the authority to organize a cemetery has
been granted and that a license to operate will be issued upon the
completion of the following:
(1) Establishment of the care and maintenance trust fund and
receipt by the commission of a certificate from the trust company,
certifying receipt of the initial deposit required under this
(2) Full development, ready for burial, of not less than two
acres including a completed paved road from a public roadway to
said developed section, certified by inspection of the commission
or its representative.
(3) A description, by metes and bounds, of the acreage tract
of such proposed cemetery, together with evidence, by title
insurance policy or by certificate of an attorney-at-law,
certifying that the applicant is the owner in fee simple of such
tract of land, which must contain not less than thirty acres, and
that the title to not less than thirty acres is free and clear of all encumbrances. In counties with a population of less than
thirty-five thousand population according to the latest federal
decennial census the tract need be only fifteen acres.
(4) A plat of the cemetery showing the number and location of
all lots surveyed and permanently staked for sale.
§35-5C-11. Existing companies; effect of article.
Existing cemetery companies at the time of the adoption of
this article shall continue in full force and effect and be granted
a license but shall hereafter be operated in accordance with the
provisions of this article.
§35-5C-12. Licenses for sales organizations, management
organizations and brokers.
(a) No legal entity may engage in the business of a cemetery
sales organization, a cemetery management organization or a
cemetery broker except as authorized by this article, and without
first obtaining a license from the commission.
(b) Any legal entity wishing to establish and operate the
business of a cemetery sales organization, a cemetery management
organization or a cemetery broker shall file a written application
for authority with the commission on forms provided by the
commission which must contain such of the following documents and
information as may be required by the commission:
(1) The appointment of a West Virginia resident to receive
service of any lawful process in any noncriminal proceedings arising under this chapter against the applicant, its principal
owners, principal stockholders, directors and general manager or
their personal representatives.
(2) The states or other jurisdictions in which the applicant
presently is conducting the business activity applied for or other
similar businesses and any adverse order, judgment or decree
entered against the applicant in each jurisdiction or by any court.
(3) The applicant's name, address and the form, date and
jurisdiction of the organization and the address of each of its
offices within or without this state.
(4) The name, address, principal occupation for the past five
years of every director and officer of the applicant or person
occupying a similar status or performing similar functions.
(5) Copies of the articles of incorporation or articles of
partnership or joint venture agreement or other instrument
establishing the legal entity of the applicant.
(c) The application shall be accompanied by an initial filing
fee of $400 for cemetery sales organization and cemetery management
organization and an initial filing fee of $200 for a cemetery
broker. If ninety percent or more of the applicant is owned by an
existing cemetery company operating under the West Virginia
Cemetery Act, then the initial filing fee shall be one half of the
sums set out herein. On or before July 1 of each year, each
licensed cemetery sales organization, cemetery management organization or cemetery broker shall pay a license renewal fee of
$100 per year.
(d) Upon receipt of the application and filing fee, the
commission shall cause an investigation to be made of the legal
entity to conduct the business applied for and the qualification of
said legal entity to do business in West Virginia.
(e) The commission, after receipt of the investigation report,
shall grant or refuse to grant the authority to organize the
organization applied for after it determines that the applicant
possesses good character and general fitness or, in the case of a
business association, employs and is directed by personnel of good
character and general fitness.
(f) If the commission intends to deny an application, it shall
give written notice to the applicant of its intention to deny. The
notice shall state a time and a place for hearing before the
commission and a summary statement of the reasons for the proposed
denial. The notice of intent shall be mailed by certified mail to
the applicant at the address stated in the application at least
fifteen days prior to the scheduled hearing date. Any appeals from
the commission's decision shall be to the court having jurisdiction
of the applicant, or in the event of an out-of-state applicant,
then to the court having jurisdiction of the commission.
(g) If the commission intends to grant the authority, it shall
give written notice that the authority to organize the business applied for has been granted and that a license to operate will be
issued upon presentment to the commission of a statement of
employment between the applicant and the cemetery or cemeteries to
be serviced thereby.
(h) Any person or any cemetery sales organization or any
cemetery management organization or any cemetery broker violating
this section is guilty of a misdemeanor and, is subject to
revocation of the license to operate.
§35-5C-13. Licenses for persons selling preneed grave space.
(a) No person may offer to sell preneed grave spaces,
mausoleum crypts, niches, memorials, vaults or any other preneed
cemetery merchandise or services under any plan authorized for any
cemetery, cemetery sales group or cemetery management group, before
obtaining a license from the commission.
(b) Persons wishing to obtain a license shall file a written
application with the commission on forms provided by the
commission. The commission may require such information and
documents as it deems necessary to protect the public interest.
(c) The application shall be accompanied by a filing fee of
$15 to cover the expenses of processing and investigation. After
processing and investigation the commission shall grant, or refuse
to grant, the license applied for. The annual license fee shall be
set by the commission but shall not exceed $10.
(d) If the commission refuses to grant the license applied for, it shall give written notice to the applicant. The notice
shall state a time and a place for hearing before the commission,
and a summary statement of the reasons for the refusal to grant the
license. The notice shall be mailed by registered mail or
certified mail to the applicant at the address stated in the
application at least thirty days prior to the scheduled hearing
(e) If the commission intends to grant the license, it shall
give written notice that the license will be issued upon
presentment to the commission of a duly executed statement of
employment between the applicant and the cemetery or cemeteries to
be serviced thereby.
(f) All of the pertinent provisions of section four, article
five, chapter twenty-nine-a of this code, apply to and govern to
appeals or petitions for judicial review by any person or persons
aggrieved by an order or decision of the commission. The judgment
of the circuit court is final unless reversed, vacated or modified
on appeal to the Supreme Court of Appeals in accordance with the
provisions of section one, article six, chapter twenty-nine-a of
this code. Legal counsel and services for the commission in all
appeal proceedings in any circuit court and the Supreme Court of
Appeals shall be provided by the Attorney General or the Attorney
General's assistants and in any circuit court by the prosecuting
attorney of the county as well, all without additional compensation. The commission, with the written approval of the
Attorney General, may employ special counsel to represent the
commission at any such appeal proceedings.
§35-5C-14. Application for a change of control; filing fee.
A person who proposes to acquire control of an existing
cemetery company, whether by purchasing the capital stock of the
company, purchasing an owner's interest in the company, or
otherwise acting to effectively change the control of the company,
shall first make application on a form supplied by the commission
for a certificate of approval of the proposed change of control.
The application shall contain the name and address of each proposed
new owner. The commission may issue a certificate of approval only
after it determines that the proposed new owners are qualified by
character, experience and financial responsibility to control and
operate the cemetery company in a legal and proper manner, and that
the interest of the public generally will not be jeopardized by the
proposed change in control. An application for approval of a
change of control must be completed and accompanied by a filing fee
A record shall be kept of every burial in the cemetery of a
cemetery company, showing the date of burial, name of the person
buried, together with lot, plot and space in which such burial was
made therein. All sales, trust funds, accounting records and all other records of the licensee shall be available at the licensee's
principal place of business in this state and shall be readily
available at all reasonable times for examination by an authorized
representative of the commission.
§35-5C-16. Trustees; qualifications; examination of records;
(a) The term "corporate trustee" as used in this article means
either a bank or trust company authorized to do business in West
Virginia under the supervision of the commissioner of banks or any
other corporate entity. However, any corporate entity other than
a bank or trust company which acts as trustee under this article
shall first be approved by the cemetery commission and shall be
subject to supervision by the cemetery commission as provided
(b) Any corporate entity, other than a bank or trust company,
which desires to act as trustee for cemetery funds under this
article shall make application to the commission for approval. The
commission shall approve the trustee when it has become satisfied
(1) The applicant employs and is directed by persons who are
qualified by character, experience and financial responsibility to
care for and invest the funds of others.
(2) The applicant will perform its duties in a proper and
legal manner and the trust funds and interest of the public generally will not be jeopardized.
(3) The applicant will act as trustee for cemetery funds which
will exceed $500,000 in the aggregate.
(4) The applicant is authorized to do business in West
Virginia and has adequate facilities to perform its duties as
(c) Any trustee under this article, other than a bank or trust
company under the supervision of the Commissioner of Banking, shall
maintain records relative to cemetery trust funds as the commission
may by regulation prescribe. The records shall be available at the
trustee's place of business in West Virginia and shall be available
at all reasonable times for examination by a representative of the
commission. The records shall be audited annually, within ninety
days from the end of the trust fund's fiscal year, by an
independent certified public accountant, and a copy of the audit
report shall be promptly forwarded to the commission.
(d) Whenever it appears that an officer, director or employee
of a trustee, other than a bank or trust company, is dishonest,
incompetent, or reckless in the management of a cemetery trust
fund, the commission may bring an action in the courts to remove
the trustee and to impound the property and business of the trustee
as may be reasonably necessary to protect the trust funds.
(e) Any trustee shall invest and reinvest cemetery trust funds
in the same manner as provided by law for the investment of trust funds by the Clerk of the Supreme Court of Appeals.
§35-5C-17. Required trust fund for care and maintenance; remedy of
commission for noncompliance
No cemetery company may establish, or operate if already
established, a cemetery unless provision is made for the future
care and maintenance of such cemetery by establishing a trust fund
and designating a corporate trustee to administer the fund in
accordance with a written trust agreement. If any cemetery company
refuses or otherwise fails to provide or maintain an adequate care
and maintenance trust fund in accordance with the provisions of
this article, the commission, after reasonable notice, shall
proceed to enforce compliance under the powers vested in it under
this article. However, any nonprofit cemetery corporation,
incorporated and engaged in the cemetery business continuously
since and prior to the year 1915 and whose current trust assets
exceed $750,000 is not required to designate a corporate trustee.
The trust fund agreement shall contain and include the following:
Name, location and address of both the licensee and the trustee
showing the date of agreement together with the amounts required
deposited as stated in this article. No person may withdraw or
transfer any portion of the corpus of the care and maintenance
trust fund without first obtaining written consent from the
§35-5C-18. Individual contracts for care and maintenance.
At the time of making a sale or receiving the initial deposit
hereunder, the cemetery company shall deliver to the person to whom
such sale is made, or who makes such deposit, an instrument in
writing which shall specifically state that the net income of the
care and maintenance trust fund shall be used solely for the care
and maintenance of the cemetery, for reasonable costs of
administering such care and maintenance and for reasonable costs of
administering the trust fund.
§35-5C-19. Requirements for perpetual care fund.
A cemetery company may not cause or permit advertising of a
perpetual care fund in connection with the sale or offer for sale
of its property unless the amount deposited in the fund is at least
$40 per grave space, niche or mausoleum crypt sold. Nothing may
prohibit an individual cemetery from requiring a perpetual care
deposit for grave memorial markers to be deposited in the perpetual
care fund so long as the same assessment is uniformly applied to
all grave memorial markers installed in the cemetery.
§35-5C-20. Deposits to perpetual care fund.
(a) Deposits to the care and maintenance trust fund must be
made by the cemetery company holding title to the subject cemetery
lands on or before the last day of the calendar month following the
calendar month in which final payment is received as provided
herein. However, the entire amount required to be deposited into
the fund shall be paid within four years from the date of any contract requiring such payment regardless of whether all amounts
have been received by the cemetery company. If the cemetery
company fails to make timely deposit, the commission may levy and
collect a penalty of $1 per day for each day the deposit is
delinquent on each grave space, niche or mausoleum crypt sold. The
care and maintenance trust fund shall be invested and reinvested by
the trustee in the same manner as provided by law for the
investment of other trust funds by the Clerk of the Supreme Court
of Appeals. The fees and other expenses of the trust fund shall be
paid by the trustee from the net income thereof and may not be paid
from the corpus. To the extent that the net income is not
sufficient to pay such fees and other expenses, the same shall be
paid by the cemetery company.
(b) When a municipal, church-owned or fraternal cemetery
converts to a private cemetery then that cemetery shall establish
and maintain a care and maintenance trust fund pursuant to this
section. However, the initial deposit for establishment of this
trust fund shall be an amount equal to $10 per space for all spaces
either previously sold or contracted for sale in the cemetery at
the time of conversion or $25,000, whichever sum is greater.
(c) In each sales contract, reservation or agreement wherein
burial rights are priced separately, the purchase price of the
burial rights is the only item subject to care and maintenance
trust fund deposits; but if the burial rights are not priced separately therein, the full amount of the contract, reservations
or agreement is subject to care and maintenance trust fund deposits
as provided herein, unless the purchase price of the burial rights
can be determined from the accounting records of the cemetery
(d) When the amount deposited in the perpetual care fund
required by this article of any cemetery company amounts to
$150,000, anything in this article to the contrary notwithstanding,
the cemetery company may make all deposits thereafter either into
the original perpetual care trust fund or into a separate fund
established as an irrevocable trust, designated as Perpetual Care
Trust Fund "A," and invested by the trustee, as directed by the
cemetery company. Funds in a trust fund designated as Trust Fund
"A" may not be invested in another cemetery company.
(e) For special endowments for a specific lot, grave or a
family mausoleum, memorial, marker or monument, the cemetery may
set aside the full amounts received for this individual special
care in a separate trust or by a deposit to a savings account in a
bank or savings and loan association located within and authorized
to do business in the state. However, if the licensee does not set
up a separate trust or savings account for the special endowment
the full amount thereof shall be deposited in perpetual care trust
§35-5C-21. Trust fund; financial reports.
Within sixty days after the end of the calendar or fiscal year
of the cemetery company, the trustee shall furnish adequate
financial reports with respect to the care fund on forms provided
by the commission. However, the commission may require the trustee
to make such additional financial reports as it considers
§35-5C-22. Receipts from sale of personal property or services;
trust account; penalties.
(a) It is contrary to public policy for any person or legal
entity to receive, hold, control or manage funds or proceeds
received from the sale of, or from a contract to sell, personal
property or services which may be used in a cemetery in connection
with the burial of or the commemoration of the memory of a deceased
human being, where payments therefor are made either outright or on
an installment basis prior to the demise of the person or persons
so purchasing them or for whom they are so purchased, unless such
person or legal entity holds, controls or manages the funds,
subject to the limitations and regulations prescribed in this
section. This section applies to all cemetery companies or other
legal entities that offer for sale or sell personal property or
services which may be used in a cemetery in connection with the
burial of, or the commemoration of the memory of, a deceased human
(b) Any cemetery company or other entity entering into a contract for the sale of personal property or services, to be used
in a cemetery in connection with disposing of, or commemorating the
memory of a deceased human being wherein the use of the personal
property or the furnishing of services is not immediately requested
or required, shall comply with the following requirements and
(1) The cemetery company or other entity shall deposit an
amount equal to sixty percent of all proceeds received on such
contracts into a trust account, either in the form of an account
governed by a trust agreement and handled by a corporate trustee or
in the form of a passbook savings account, certificates of deposit
for time certificates, and/or money-market certificates with a
licensed and insured bank or savings institution located in the
State of West Virginia until the amount deposited equals sixty
percent of the actual sale price of the property or services sold.
Such accounts and/or deposits shall be in the name of the cemetery
company or other entity in a form which will permit withdrawals
only with the participation and consent of the cemetery commission
as required by subdivision four of this subsection.
(2) All funds received on account of a contract for the sale
of such personal property or services, whether the funds are
received directly from the purchaser or from the sale or assignment
of notes entered into by the purchase or otherwise, shall be
deposited into the trust account as required by subdivision (1) of this section.
(3) All deposits required herein shall be made into the trust
account so established on or before the last day of the month
following receipt of the funds by the cemetery company or other
(4) Withdrawals from a trust account may be made by the
depositor, but only with the written approval of the commission or
officer or employee of the commission authorized to act for the
commission. Withdrawals may be made only upon delivery of the
merchandise or services for which the funds were deposited,
cancellation of a contract, the presence of excess funds in the
trust account, or under other circumstances deemed appropriate by
the commission. The commission shall promulgate rules governing
withdrawals from trust accounts, including time and frequency of
withdrawals, notice to the commission prior to withdrawals, the
number and identity of persons other than the owner who are
authorized by the owner to make withdrawals, the officers and
employees of the commission authorized to approve withdrawals, and
any other matters necessary to implement the provisions of this
subdivision. Withdrawals will not be allowed if the amount
remaining in the trust account would fall below sixty percent of
all proceeds received on account of contracts for the sale of such
personal property or services.
(5) If for any reason a cemetery company or other entity who has entered into a contract for the sale of personal property or
services cannot or does not provide the personal property or
perform the services called for by the contract after request in
writing to do so, the purchaser or his or her heirs or assigns or
duly authorized representative are entitled to receive the entire
amount paid on the contract and any income if any, earned thereon
by the trust account.
(6) Every year after September 1, 2010, the cemetery company,
the trustee or other entity shall within seventy-five days after
the end of the calendar year, file a financial report of the trust
funds with the commission, setting forth the principal thereof, the
investments and payments made, and the income earned and disbursed.
The commission may require the cemetery, trustee, or other entity
to make such additional financial reports as it may deem advisable.
(c) Whenever a contract for the sale of personal property
and/or services allocates payments to apply to one item at a time
under a specific schedule, the contract shall be considered
divisible. Title to each item of personal property or the right to
each item of services shall pass to the purchaser upon full payment
for that item regardless of the remaining balance on other items
under the same contract.
(d) Any contract for the sale of personal property and/or
services shall state separate costs for each item of personal
property, for each act of installation required by the contract, and for each other item of services included in the contract.
(e) All contracts for the sale of personal property and/or
services must be printed in type size as required by the Truth in
Lending Act, 15 U.S.C. §1601 et. seq., and regulations adopted
pursuant to that act.
(f) In the event of prepayment, interest charged may be no
more than the interest earned on the unpaid balance computed on a
percent per month basis for each month or part of a month up to the
date of final payment. Any excess interest which has been paid by
the purchaser must be refunded to him or her, his or her assigns,
or his or her representative within thirty days after the final
payment. No penalty or additional charge for prepayment may be
(g) In lieu of the deposits required under subsection (b) of
this section, the cemetery company or other entity may post with
the commission a good and sufficient performance bond by surety
company licensed to do business in West Virginia and in an amount
sufficient to cover all payments made directly or indirectly by or
on account of purchasers who have not received the purchased
property and services. Money received from the sale or assignment
of notes entered into by the purchasers, or otherwise, shall be
treated as payments made by the purchasers.
(h) The commission shall from time to time as it may consider
necessary examine the business of any cemetery company or other entity writing contracts for the sale of the property or services
as herein contemplated. The written report of such examination
shall be filed in the office of the commission. Any person or
entity being examined shall produce the records of the company
needed for such examination.
(i) Any provision of any contract for the sale of the personal
property or the performance of services herein contemplated under
which the purchaser or beneficiary waives any of the provisions of
this section is void.
(j) If any report is not received within the time stipulated
by the commission or herein, the commission may levy and collect a
penalty of $25 per day for each day of delinquency.
(k) Within thirty days following the execution of a contract
for the sale of personal property or performance of services, a
purchaser may cancel his or her contract by giving written notice
to the seller. The seller may cancel the contract, upon default by
purchaser, by giving written notice to the purchaser. Within
thirty days of notice of cancellation, the cemetery company or
other entity shall refund to purchaser the principal amount on
deposit in the trust account for his or her benefit on any
undelivered merchandise or services. This amount (no other
obligations owed the purchaser by the seller) shall constitute the
purchaser's entire entitlements under the contract. The seller may
not terminate the contract without complying with this subsection.
§35-5C-23. Applications for license.
Applications for renewal license must be submitted on or
before July 1 each and every year in the case of an existing
cemetery company. Before any sale of cemetery property in the case
of a new cemetery company or a change of ownership or control, an
application for license must be submitted and license issued.
§35-5C-24. License not assignable or transferable.
No license issued under this article is transferable or
assignable and no licensee may develop or operate any cemetery
authorized by this article under any name or at any location other
than that contained in the application for such license.
§35-5C-25. Minimum acreage; sale or disposition of cemetery lands.
(a) Each licensee shall set aside a minimum of thirty acres of
land for use by the licensee as a cemetery, and may not sell,
mortgage, lease or encumber the same.
(b) The fee simple title, or lesser estate, in any lands owned
by licensee and dedicated for use by it as a cemetery, which are
contiguous, adjoining or adjacent to the minimum of thirty acres
described in subsection (a) of this section, may be sold, conveyed
or disposed of, or any part thereof, by the licensee, for use by
the new owner for other purposes than as a cemetery if no bodies
have been previously interred therein. In addition, any and all
titles, interests, or burial rights which may have been sold or
contracted to be sold in such lands which are the subject of such sale shall be conveyed to and revested in the licensee prior to
consummation of any such sale, conveyance or disposition.
(c) Any licensee may convey and transfer to a municipality or
county its real and personal property together with moneys
deposited with the trustee; provided the municipality or county
will accept responsibility for maintenance thereof and prior
written approval of the commission is first obtained.
(d) Subsections (a) and (b) relating to a requirement for
minimum acreage do not apply to those cemeteries licensed on or
before July 1, 1967, which own or control a total of less than
thirty acres of land; provided that such cemeteries may not dispose
of any of such lands. A nongovernment lien or other interest in
land acquired in violation of this section is void.
§35-5C-26. Construction of mausoleums and belowground crypts;
trust fund for receipts from sale of preconstruction
crypts; compliance requirements.
(a) A cemetery company is required to start construction of
that section of a mausoleum or bank of belowground crypts in which
sales, contracts for sale, reservations for sales or agreements for
sales are being made, within forty-eight months after the date of
the first such sale. The construction of such mausoleum section or
bank of belowground crypts shall be completed within five years
after the date of the first sale made. However, extensions for
completion, not to exceed one year, may be granted by the commission for good reasons shown.
(b) A cemetery company which plans to offer for sale space in
a section of a mausoleum or bank of underground crypts prior to its
construction shall establish a preconstruction trust account. The
trust account shall be administered and operated in the same manner
as the merchandise trust account and shall be exclusive of the
merchandise trust account or such other trust accounts or funds
that may be required by law. The personal representative of any
purchaser of such space who dies before completion of construction
shall be entitled to a refund of all moneys paid for such space
including any income earned thereon.
(c) Before a sale, contract for sale, reservation for sale or
agreement for sale in the first mausoleum section or bank of
underground crypts in each cemetery may be made, the funds (one
hundred twenty percent of construction cost) to be deposited to the
preconstruction trust account shall be computed as to the section
or bank of crypts and such trust account payments must be made on
or before the last day of the calendar month following receipt by
the cemetery company or its agent of each payment. The trust
account portion of each such payment shall be computed by dividing
the cost of the project plus twenty percent of the cost, as
computed by a licensed contractor, engineer or architect by the
number of crypts in the section or bank of crypts to ascertain the
cost per unit. The unit cost shall be divided by the contract sales price of each unit to obtain a percentage which shall be
multiplied by the amount of each payment. The formula shall be
computed as follows: Cost plus twenty percent divided by number of
crypts = cost per unit; cost per unit divided by contract sales
price = Percentage x payment received = deposit required to
preconstruction trust account.
(d) The cemetery company is entitled to withdraw the funds
from the preconstruction trust account only after the commission is
satisfied that construction has been completed. However, that
during construction of the mausoleum or bank of belowground crypts
the commission may, in its discretion, authorize a specific
percentage of the funds to be withdrawn when it appears that at
least an equivalent percentage of construction has been completed.
(e) If a mausoleum section or bank of underground crypts is
not completed within the time limits set out in this section, the
corporate trustee, if any, shall contract for and cause the project
to be completed and paid therefor from the trust account funds
deposited to the project's account paying any balance, less cost
and expenses, to the cemetery company. In the event there is no
corporate trustee, the commission shall appoint a committee to
serve as trustees to contract for and cause the project to be
completed and paid therefor from the trust account funds deposited
to the project's account paying any balance, less cost and
expenses, to the cemetery company.
(f) In lieu of the payments outlined hereunder to the
preconstruction trust account the cemetery company may deliver to
the commission a good and sufficient completion or performance bond
in an amount and by surety companies acceptable to the commission.
(a) Except as provided in this subsection, a person violating
any provisions of this article, of any order or rule promulgated
under this article, or of any license issued by the commission is
guilty of a misdemeanor and, upon conviction thereof, shall be
fined not less than $100 nor more than $1,000 for each occurrence,
or incarcerated in jail for a term not to exceed one year, or both
fined and confined. Each failure to deposit funds in a trust fund
in accordance with this article is a separate offense. A person
who has failed to deposit funds in a trust fund in accordance with
this article and whose delinquent deposits equal or exceed $20,000
is guilty of a felony and, upon conviction thereof, shall be fined
not less than $500 nor more than $3,000, or imprisoned in a state
correctional facility not less than one nor more than three years,
or, in the discretion of the court, be confined in jail for a term
not to exceed one year.
(b) The officers and directors or persons occupying similar
status or performing similar functions of any cemetery company,
cemetery sales organization, cemetery management organization or
cemetery broker, as defined in this article, failing to make required contributions to the care and maintenance trust fund and
any other trust fund or escrow account are liable for any offense
based on the failure and upon conviction for the offense shall be
punished in the manner prescribed by law.
§35-5C-28. Burial without regard to race or color, religion,
national origin, or ancestry.
(a) It is the public policy of the state that all cemetery
companies or other legal entities conducting or maintaining public
or private cemeteries shall sell to all applicants and bury all
deceased human beings on equal terms without regard to race or
color, religion, national origin or ancestry. Anything contrary
hereto is void and of no legal effect. Bylaws, rules, contracts,
deeds, etc, may permit designation of parts of cemeteries or burial
grounds for the specific use of persons whose religious code
required isolation. Any program offering free burial rights to
veterans or any other person or group of persons shall not be
conditioned by any requirement to purchase additional burial rights
(b) Any cemetery company or other legal entity violating the
provisions of this section is guilty of a misdemeanor and, upon
conviction thereof, shall be fined not less than $100 nor more than
$1,000 for each occurrence, or incarcerated in jail for a term not
to exceed one year, or both fined and incarcerated.
§35-5C-29. Validation of certain deeds for cemetery lots executed by suspended corporations.
Any deed for a cemetery lot or lots which was executed prior
to January 1, 2010, and which would have been valid if the charter
of the grantor corporation had not been suspended at the time the
deed was executed, is hereby validated.
NOTE: The purpose of this bill is to create a cemetery
commission to regulate private cemeteries and to address the
various concerns with cemetery care
This article is new; therefore, strike-throughs and
underscoring have been omitted.