1998 Regular Session
By: Representative Stevens
House Bill 1453
(As Passed the House)
AN ACT TO AMEND SECTION 75-63-3, MISSISSIPPI CODE OF 1972, TO INCREASE THE TRUST FUND DEPOSIT REQUIRED OF ENTITIES SELLING CERTAIN PRENEED FUNERAL SERVICE CONTRACTS; TO CREATE NEW CODE SECTION 75-63-6, MISSISSIPPI CODE OF 1972, TO REQUIRE THE LICENSING OF ENTITIES SELLING PRENEED AND PREARRANGEMENT FUNERAL SERVICE CONTRACTS; TO AMEND SECTION 75-63-18, MISSISSIPPI CODE OF 1972, TO REQUIRE ESTABLISHMENTS SELLING PRENEED, PREARRANGEMENT FUNERAL SERVICE CONTRACTS AND AGREEMENTS TO FILE CERTAIN ANNUAL REPORTS WITH THE DEPARTMENT OF BANKING AND CONSUMER FINANCE; AND FOR RELATED PURPOSES.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:
SECTION 1. Section 75-63-3, Mississippi Code of 1972, is amended as follows:
75-63-3. (1) Any person, firm, corporation, association or partnership entering into any such contract as the seller or the party responsible for providing such services shall deposit an amount of money equal to not less than eighty-five percent (85%) of the value of such property or services as stated in the contract, into a trust fund established for that purpose. Such deposit shall be made not later than forty-five (45) days after the end of the month in which such contract is executed; except in the event that payment for the property and/or service shall be made by the consumer in installments, eighty-five percent (85%) of each installment payment shall be deposited to the trust within forty-five (45) days of the last day of the month within which such payment was made.
(2) Each initial deposit as to each contract into the trust fund shall be identified by the seller by furnishing the trustee with the name of the purchaser, a copy of the contract containing a statement of the value of such property or services and a description of the personal property and/or services to be furnished or provided by the seller thereunder. Nothing therein contained shall prohibit the trustee from commingling the deposits in any such trust fund for purposes of the management thereof and the investment of funds therein.
SECTION 2. The following section shall be codified as Section 75-63-6, Mississippi Code of 1972:
75-63-6. Every business, corporation, establishment and funeral home selling preneed, prearrangement funeral service contracts or agreements shall be registered by application to the Department of Banking and Consumer Finance. The department may charge an initial and subsequent renewal registration fee; such fee shall not exceed Twenty-five Dollars ($25.00) annually. Every such business shall renew its registration on January 1 of each year.
SECTION 3. Section 75-63-18, Mississippi Code of 1972, is amended as follows:
75-63-18. (1) Within thirty (30) days after the end of the calendar or the business' fiscal year, each cemetery merchandise business shall file with the Department of Banking and Consumer Finance an annual account, which account shall contain the following information:
(a) The name of the business, the date of incorporation, if incorporated, and the location of such business or businesses;
(b) The amounts of sales of all property and services for which payment has been made in full during the preceding calendar or fiscal year;
(c) The amounts paid into the merchandise trust fund, and the income earned therefrom during the preceding fiscal year; and
(d) The names and addresses of the owners of the business and, if incorporated, its officers and directors, and any change of control which has occurred during the past fiscal or calendar year.
(2) Within forty-five (45) days after the time by which the trustee's accounting and report is required to be filed with the cemetery merchandise business, as provided by Section 75-63-15, the business shall file a copy of such accounting and report with the department.
(3) As a condition to the transfer of any merchandise trust fund monies from one trust institution to another, the business for which such fund is maintained shall, not less than thirty (30) days before the time when such transfer is to occur, file with the department a written notice of intent to transfer accompanied with a letter of intent to receive such trust fund monies from the trust institution to which such trust fund monies are to be transferred. Such fund monies shall be transferred directly from the existing trust institution to the receiving trust institution.
(4) Before any sale or transfer of any cemetery merchandise business or a controlling interest therein, an independent audit of the merchandise trust fund shall be performed at the expense of the seller and/or buyer or transferor and transferee and filed with the department. Such audit shall be current within thirty (30) days of the proposed sale or transfer.
(5) The department shall maintain a properly indexed book in which there shall be kept, preserved and open for public inspection a copy of each record, report and notice required to be filed with the department under the provisions of this chapter. For filing and indexing the records, reports and notices under this chapter, the department shall be authorized to charge such fees as are provided in Section 25-7-9 for the recording and indexing of deeds.
(6) The department shall, upon the failure to timely receive any of the records, reports or notices provided for under this chapter, immediately give notice by registered letter to the owner or owners of such business, or, if incorporated, its officers and directors at its or their last-known address, that such records, reports or notices have not been received. Failure of such persons to file such records, reports or notices within fifteen (15) days after such registered letter is mailed shall, in the absence of clear justification or excuse, constitute a misdemeanor and each owner and, if incorporated, its officers and directors, shall be subject to the penalties provided for in Section 75-63-23.
(7) Whenever it reasonably appears to the department upon complaint filed with the department by any purchaser, or the family, legal representative or next of kin of any such purchaser, of any property or services contracted for under the provisions of this chapter that (a) such business is insolvent or about to become insolvent; or (b) that no merchandise trust fund has been established for such business or, if established, the trust fund does not contain such funds as are required to be contained therein, the department shall order a private audit and examination of any merchandise trust fund of such business and of all the books, records and papers employed in the transaction of such business.
If such audit and examination shows that the business is insolvent or is about to become insolvent or that a sufficient trust fund is not established or being maintained for such business, the department shall issue such orders * * * as may be necessary to correct and enforce compliance with the provisions of this chapter and all such other orders * * * as shall be just, equitable and in the public interest, including the appointment of receivers, with approval of the chancery court having jurisdiction, to continue or terminate the operation of such business.
(8) All the necessary expenses of any examination or audit performed * * * under the provisions of subsection (7) of this section shall be paid by the owner or owners of such business or, if incorporated, its officers and directors, and in the event that a sale of any such business is ordered by the department, the proceeds of such sale shall first be applied to the costs expended under the provisions of subsection (7) of this section.
SECTION 4. This act shall take effect and be in force from and after January 1, 1999.