Ausnnr 11. -x%?&xs
February 11, 1964
Honorable H. I,. Bengtson
DefiUty Banking Commissioner
Depzirttient of Banking
John Hi Reagan State Office Bldg.
Austin, Texas
Opinion No. C-215
Re: Reconsideration of c-187,
concernitig tihether~‘& ceme-
t~ry’~a;ti~dclatlon may make
prepayments Into lta per-
Dear Mr. Bengtson: petual care truet fund.
Your request fdr an opinion aeka the following quee-
tions :
“1. 1May the stockholders df a ceme-
tetip’aadoci&tIon .ptiepay ‘funds into Star
Perpetual F&i+&Tz+uet.‘Fufid, either in ad-
vatice~‘of bales’dr dtiring the life of a
tini&-pa#nent ‘oontraot rather than at the
time final payment Is made?
“2.’ If your answer to the foregoing
Qi6ation is ‘Yea’;: then Where ‘&oh a’
atirplua ~to”ti PerpetuaI C&tie Fund exieta
f%m’auch payments, may credit be taken
againtit’sudh.iiurplue frdm~the aalee of
ptiopert‘jl antStled#,to perpetual oar8 until
the surplus haa been depleted?
I‘
3. Are aontributione’~ofi donations re-
ceived from the etdokholdere oi a oemetery
dad&iation over and above legal require-
menta to be ooneidered in the same light
aa oontrlbutione or donationa from third
F;t$e;,,tmder the provieiona of 912a-18,
. * .
In response to these ueations. it was held in At-
torney General’s Opinion C-l 87 that prepayments into the
perpetual care trust fund provided by the provielone of
-1032-
Hon. Ii. L. Bengtaon, page 2 (C-215)
Article 912a-15, Vernon’s Civil Statutes, could not be made.
On reconsideration, we have concluded that this holding is
erroneous.
The pertinent portions of Article 912a-15, Vernon’s
Civil Statutes, prior to Senate Bill 121, are as Sol~lows:
“Every cemetery association . . :whloh
has established and Ta now~malntalnlng, oper-
ating and/or conducting a perpetual care ceme-
tery, and every atisoclation which shall here-
after establish, maintain, operate and/or con-
duct,~ a perpetual care cemetery wlthln this
State pursuant to this Act, shall establish
. . . an endowment fund . . . . The principal
of auch’fund So? perpetual care shall never
be voluntarily reduoed, but shall maintain
InvlolabIe and shall forever be maln-
ci;emaiJ
ained separate and dlatlnot by the trustee or
trustees from all other funds. And the
net Income arising therefrom shail’b;! used
solely for the general care and malntenande of
the property entitled to perpetualjoare In the
oelileterj for whlch’the fund 1s established,
but shall never be uaed for the lmprove-
ietk’or embellleliment af’uneold property to be
offered for sale. . , .
II
. . .
“A oemetery ,.aaeooiatlon whioh had establlsh-
ed a perpetual oare fund may also take, reoeive,
and hold therefor &nd as ‘a ‘part thereof OF baa an
Incident thereto’any property, real; pereonal or
mixed; bequeathed; devised, grAnted, given or
otherwise contributed to it therkfor.
“The perpetual oare fund authorized by this
Section arWal1 sums paid ‘therein or contributed
thereto are, and ekch’thereof la hereby, expressly
perniltted and shall be and be deemed to‘bh for
charitable and eleemosynary purposes. .. . .
“Bach perpetual oare oemetery shall deposit
in its perpetual care fund an amount e uivalent
to . . . a minimum of twenty cents (20 $ ) per
square Soot of ground area sold or disposed of
as perpetual care property . . . A minimum
of fifteen dollars ($15.00) per each crypt
-1033-
., .
Hon. H. L. Bengtaon, page 3 (C- 215)
Interment right sold or disposed of as per-
petual care propert and a mlnlmum of
five dollars ($5.00 7 per'each niche Interment
right 'sold or'diapoaed of as perpetual care
pronerty . '. . Such minimum requlremehta
shall apply to ail property III whldh the ex-
tiIuslve right of 'sepulture has been sold or
paid for, whether used for lnteiment. purposes
or not.
"The deposit oSsuch funds in the per-
petual care fund shall be made within thirty
(30) days after the receipt ofthe final pur-
dhaae price .of each lot; grave, crypt, or
nidhe a6ld as property entitled to perpetual
care. . . .'
Under the'provlalona of 'Artidle 912a-15, the perpetual
care trust fund provided for therein tionatltutea a trustfund
"for the benefit and protectionof the pub116 by preserving
and keeping cemeteries from be0omSng places of disorder, re-
proach, and desolation In the oommunitles in 'which they are
SitUatedc?.; .Artia‘Le 912a-l5re'quire,s certtilntml.nlmiium dep;o$.lta?
to. be made.cJinto.the' perpetual caretrust Sun&; The& provislohs
mm@ .a$ fr%l>ows~:
"Each ,perpetual care cemetery shall de-
pbslt In ~lta perpetual care truat.Sund an
amount equivalent ~to'sudh amount aa may have
been"atlpulated in any oontraot under which
pex+tual oare.progerty was sold prior ,to
March 15, 1934, plus a minimum of twenty
cents (208) per square foot of ground area
sold or disposed of as perpetual oare prop-
erty after Maroh 15, 1934, until auah fund
reaohea a minimum ofOne Hundred Thousand
Dollars ($lCiO,~OQO~OO),after~whloh .eabh such
oembt@r$ ahall deposit an amount~equivalent
to a minimum of ten cents (104) per square
Soot of ground area sold or diapoaed of aa
perpetual care property after Maroh 15, 1934,
until September 3, 1945. Eaoh auoh cemetery
shall deposit In Its perpetual care trust
'fund an amount e ulvalent~to a minimum of
twenty cents (20 B) per square foot of ground
area aold or disposed of as perpetual oare
property after September 3, 1945, until July
1, 1963. A mlnlmum of Fifteen Dollars ($15.00)
per each orypt interment right for mausoleum
-1034-
Hon. H. L:Bengtaon,, page 4 (C-215)
interment sold br disposed of as'perpetual
care property atid a mlniniumsd Five Dollars
($5.00) per each niche internient right for
columbarlum lnterment'sold,or diePosed of
as etipetual care property between March 15,
,193 & and July 1, 1963, ah&l1 alao'be placid
in such perpetual care trust fund. From and
after July 1, 1963, each Budh ceinetery'ahaS1
deposit In Its gerpetual care trust fund ati
amount equlvtilent to's minimum of Tlfty cents
(504) per square foot of &o+d:ai%& sold or
dbapoaed~of as perpetual care property afte?
said date. A minimum df Forty Dollars ($40.00)
per each crypt interment right for mausoleum
interment sold or disposed of as perpetual
care groperty, except that on crypts ticceaal-
ble only through another crypt the minimum re-
quirement ahall'be !Pwenty Dollars ($20.00) per
each'auoh crypt, and a minimum oS'Ten Dollars
($10.00) -per Cach niche IntWment~right for
colu&artv Interment aold or disposed of 'aub-
sequent to Jul$,l, 1963, shall al&o be'plaodd
in such ,perpetual care trmat fund. such niltil-
mumrequirements shall Bp$ly to all prop'erty
In which the exolualve right of aepulture has
been sold and paid for, whether used for in-
terment purpoeea or'not.
"After July 1, 1963, each agreement for
the sale of burial apace in a perpetual aare
cemetery shall eet out separately the-part
of the'aggregate amount agreed to be,paid by
the~purohaaer which la to be deposited In the
perpitual ~oare trust fund. If the aggregate
amount agreed to be paid bJr the purohaaer ie
payable In lnatallmenta, a&l amounta paid there-
on ah811 be applied, first* to the part thereof
not required to be deposited in the perpetual
care trust fund, to t#he extent thereof, and the
remainder ah&U, when received by the Belier,
be deposited in the perpetiual oare trust $und+
Any funds required to be 'deposited In Its pen-
petual care trust Sund,by a aeller of bull181
apace shall be so deposited not later than ten
(10) days after the end of the 'calendar month
during which they are received. . . ."
It will be noted by the foregoing provlalona that each
perpetual care cemetery is required to make certain minimum
-IO35-
Hon. H. L. Benitson', page 5 (C- 215)
deposits-into the trust fund and to maintain a certain mlnl-
mumamount at all tlniea in the perpetual care trust fund.
mere IS no ptiovlslon tihlch prohibits a cemetery aasoclatlon
from depositing or malntalnlng'ln the trust Sund'amounts In
bxciss of th&~minimuin -ti@Quir@d; Furthermori, there iti no pro-
vlaioti ivhlch either &preiasly or iriiglledly prohibits requlr-
ed deposits from being made in advance.
The construction :placed on'tlie provleldna of Article
9128-15 by Attorney Oeneral'a Oplnlon C-187 In'CIfSeot prohlblte
the demetery asaoclatlon S&m nialntalnlng a'ptirfietual trust -fund
in excess 6S the minimum required to be mtilntalned by the,mak-
lng of ,prepayment&. It %a our opinion that'thls conattitition
doea violence to the purpose of the trust and such construction
is not atithorlzed.
In Wood v. State, 133 Tex. 110, 126 S.W.2d 4 (1939), the
Supreme Court atated,the rule of'atatutory~oonatruotlon appll-
cable to gour questions as follows:
"It la'the 'aettiCd law~that statuteti'
should be'contittied tie ati td carry out'the'
L~glslatlve intent, and when aubh intent .la.
,oxic@ aaoertained, It ahould'be glvefi effedt',
&en thoUgK'th& literal meaning of thb.tidedti
used thereIn ta tiot~ SoSl&@di "Also,: statutes
ah&Id nevdr be 'given'a'conetruction that' '*
leads to tintiert&nty, ltijutitioe, or oonftialbti,
lS~lt,,la ,poaalble to construe them otherwise.
. . .
In view of the foregoing, you are advised that the stook-
holders of a oemtitery association may prepay funds into its "'
perpetual care trust fund *ither ln'advance of sale8 or during
the life of the time-payment contract.
In answer to yoursecond question, you are advlaed that
where a surplus exists in a perpetual bare fund from prepay-
ments, credit may be taken againat suah aurplua, providing the
minimum required is maintained at all times. In detemihlng
whether a aurplua exists from prepaymenta, no part of the trust
fund reaulting'from donations to the trust fund may be o'onalder-
ed. Attorney General's Opinion c-187 is modified to oonform
with, the holding herein.
SUMMARY
A~oemet~ry"aasociatlon may make prdpay-
ment of Sunda Into ita perpetual care trust
-103.6-
. . -
eon. H. L. Bengtaon, page 6 (c- 215)
fund, either in advance df sale8 or'during
the life df a titie-ptiyinent contract.. Iri
determlning whether a surplus exlats from
prepa$ment&, no p&tit of the trust fund
tieaultlng from dotiatlons to the t-at fund
may be considered.
Yours very truly,
WAQCiONERCARR
Attorney General
‘tie?’
Aeeletant
JR:ms
APPROVED:
OPINIONcoMMITTlE$
W; V; Geppert, Chairman
J. C. Davle'
Linward Shlvera
Edward M@Y'ett
APPROVEDFORTHEATTORNEYGENERAL
By: .Stanton Stone
-1037-