Blue Ridge Memorial Park, Inc. v. Union National Bank, Inc. , 237 N.C. 547 ( 1953 )

JOHNSON, J.

G.S. 65-26 requires, in connection with the operation of a private cemetery offering perpetual care service, that a trust fund shall be set up and maintained as security for the performance of the obligations of perpetual care.

G.S. 65-29 provides: “In event of the voluntary purchase by any city or town of a cemetery providing perpetual care of lots under this article, it shall be lawful for the cemetery to provide in its agreement with purchasers that in event of the voluntary purchase by such municipality of such cemetery property, such cemetery may retain for its own any amount accumulated in such perpetual care fund on sale of lots made subsequent to the ratification of this article: Provided, such municipality purchasing and accepting a conveyance of said cemetery property shall, as part consideration for making by such cemetery of said conveyance, assume in writing all obligations of sueb cemetery in connection with tbe maintenance thereof.”

In the case at hand the City of Lenoir by its contract with the plaintiff has effectively assumed all obligations of the plaintiff in connection with the maintenance of the cemetery and perpetual care of the lots. The contract is in substantial compliance with the requirements of the foregoing-statute.

The cash consideration which the City is paying the cemetery corporation is $27,500, less the amount of the trust fund and other unaudited items. Therefore, in effect the trust fund is being transferred to the City, and the obligation of the City to perform the perpetual care obligations of the cemetery corporation is being substituted in place of the security provided by the perpetual care fund. This arrangement has the sanction of the statute, G-.S. 65-29.

The court below in declining to release the trust fund rested decision on the fact that the contracts between the cemetery corporation and the purchasers of lots do not contain the specific recital that the cemetery corporation may reclaim the trust fund on sale of the property to a municipality. However, it is noted that each of these contracts between the cemetery corporation and the purchasers of lots recites that it is made “subject also to the General Statutes of North Carolina, Section 65-29.” This recital is sufficient compliance with the provisions of the statute.

As we have seen, the statute law of the state expressly permits a city or town to purchase and take over the property of a private, perpetual care cemetery corporation and assume all the obligations of the corporation as to maintenance and perpetual care. The statute law further provides in effect that the undertaking of the municipality to provide perpetual care may be substituted for the trust fund, and that this fund may be released to the cemetery corporation when the municipality assumes the obligation of perpetual care.

In the case at hand the holders of interment rights are conclusively presumed to have dealt with the plaintiff corporation with full knowledge of the existence of this statute law.

A study of the record impels the conclusion that the plaintiff corporation and the City of Lenoir have complied with the requirements of the controlling statutes, and the plaintiff is therefore entitled to the trust fund held by the defendant bank. It necessarily follows that the court below erred in refusing to require the Bank to pay over to the plaintiff the amount of the fund.

The case will be remanded for the entry of judgment m conformity with this opinion.

Reversed and remanded.