W. Va. Code R. § 110-36-9

Current through Register Vol. XLI, No. 48, November 27, 2024

Section 110-36-9 - Disbursement of Trust Funds Upon Performance of Contract; Mausoleum Construction Required

9.1. Upon performance of the preneed cemetery company contract, the seller shall certify to the trustee by affidavit the amount of specific funds in the trust, identified with the contract performed, which the trustee shall pay to the seller. The seller may in its records itemize the property, goods or services and the consideration paid or to be paid therefore, to which the established deposit requirements apply. In such case the seller may, upon certification to the trustee of performance or delivery of such property, goods or services and of the amount of specific trust funds identified in its records with such items, request disbursement of that portion of the specific funds deposited pursuant to the contract, which the trustee shall pay to the seller.

9.1.1. When disbursing funds to the seller for payment on more than one preneed cemetery company contract, the trustee may combine all such payments into one payment: Provided, That the trustee maintains appropriate records which specify that portion of the total payment which is applied to the identified preneed cemetery company contract and such information is provided to the seller, Provided, However, That the seller may net out funds received from sales and funds to be paid for expenses incurred by depositing only the amount in excess of the disbursements and utilizing the remaining funds for payment of contract expenses: Provided further, That when utilizing the netting out method for recording activities, complete documentation of the transactions must be retained by the seller and provided to the trustee.

9.1.2. When disbursing funds received from the trustee, the seller may combine into one payment the amounts to be paid to a single payee: Provided, That the seller maintains appropriate records which specify that portion of the payment which is applied to the identified preneed cemetery company contract and such information is provided to the payee.

9.2. If the preneed contract provides for two (2) or more persons, the seller may, at its option, designate in its records the consideration paid for each individual in the preneed cemetery company contract. In such case, upon performance of that portion of the contract identified with a particular individual, the seller may request, by certification in the manner described above, the disbursement of trust funds applicable to that portion of the contract, which the trustee shall pay to the seller.

9.3. Any cemetery company that sells space in an unconstructed mausoleum must commence construction within seven (7) years from the date of the first sale or when eighty percent (80%) of the spaces in the original mausoleum plan are sold, whichever occurs first.

9.3.1. Because the preneed cemetery company contract is purchased from the seller and not from the contractor constructing the mausoleum, the cemetery company is the person that contracts with and pays the contractor for construction of the structure.

9.3.2. The cost of constructing a mausoleum shall be borne by the cemetery company: Provided, That if preneed cemetery company contracts are used to sell space in the mausoleum, the proceeds from such sales must be accounted for in the same manner as the proceeds from the sale of other contracts.

9.3.3. Once mausoleum construction has commenced, the cemetery company is authorized to draw down progress payments from the trust funds received from the sale of the mausoleum space funds to pay for the construction: Provided, That such progress payments are according to a schedule incorporated into the construction contract: Provided, However, That the cemetery company must bear any construction expense in excess of the trust funds available from the sale of spaces in the mausoleum being constructed.

W. Va. Code R. § 110-36-9