Section 1. Section 6A.4, subsection 4, Code 2003, is amended to read as follows:

4. CEMETERY ASSOCIATIONSCORPORATIONS. Upon any private

cemetery or cemetery associationcorporation which is

incorporated under the laws of this state relating to

corporations not for pecuniary profit, and having its cemetery

located outside the limits of a city, for the purpose of

acquiring necessary grounds for cemetery use or reasonable

additions thereto. The right granted in this subsection shall

not be exercised until the board of supervisors, of the county

in which the land sought to be condemned is located, has, on

written application and hearing, on such reasonable notice to

all interested parties as it may fix, found that the land,

describing it, sought to be condemned, is necessary for

cemetery purposes. The associationcemetery corporation shall

pay all costs attending such hearing.

Sec. 2. Section 6A.7, Code 2003, is amended to read as follows:

No lands actually platted, used, and devoted to cemetery

purposes shall be taken for any railway purpose without the

consent of the propercemetery corporation's officers or

owners thereof.

Sec. 3. Section 359.28, Code 2003, is amended to read as follows:

The township trustees are hereby empowered to condemn, or

purchase and pay for out of the general fund, or the specific

fund voted for such purpose, and enter upon and take, any

lands within the territorial limits of such township for the

use of existing cemeteries, a community center or juvenile

playgrounds, in the same manner as is now provided for cities.

However, the board of supervisors or a cemetery commission

appointed by the board of supervisors shall control and

maintain pioneer cemeteries as defined in section 331.325.

Sec. 4. Section 359.29, Code 2003, is amended to read as follows:

Civil townships are hereby authorized and empowered to

receive by gift, devise, or bequest, money or property for the

purpose of establishing and maintaining libraries, township

halls, maintaining existing cemeteries, or for any other

public purpose. All such gifts, devises, or bequests shall be

effectual only when accepted by resolution of the board of

trustees of such township.

Sec. 5. Section 427.1, subsection 6, Code 2003, is amended to read as follows:

6. PROPERTY OF CEMETERY ASSOCIATIONSCORPORATIONS. Burial

grounds, mausoleums, buildings and equipment owned and

operated by cemetery associationscorporations incorporated as

a nonprofit corporation under chapter 504A and used

exclusively for the maintenance and care of the cemeteries

devoted to interment of human bodies and human remains. The

exemption granted by this subsection shall not apply to any

property used for the practice of mortuary science.

Sec. 6. Section 450.10, subsection 3, unnumbered paragraph 1, Code 2003, is amended to read as follows:

When the property or any interest therein or income

therefrom, taxable under the provisions of this chapter,

passes in any manner to societies, institutions or

associations incorporated or organized under the laws of any

other state, territory, province or country than this state,

for charitable, educational or religious purposes, or to

cemetery associationscorporations incorporated as a nonprofit

corporation under chapter 504A, including humane societies not

organized under the laws of this state, or to resident

trustees for uses without this state, the rate of tax imposed

shall be as follows:

Sec. 7. Section 459.102, subsection 9, Code 2003, is amended to read as follows:

9. "Cemetery" means a space held for the purpose of

permanent burial, entombment, or interment of human remains

that is owned or managed by a political subdivision or private

entity, or a cemetery regulated pursuant to chapter 523I or

566A. However, "cemetery" does not include a pioneer cemetery

as defined in section 331.325.

Sec. 8. Section 523A.203, subsection 6, paragraph b, Code 2003, is amended to read as follows:

b. Use any funds required to be held in trust under this

chapter or chapter 566A to purchase an interest in any

contract or agreement to which a seller is a party.

Sec. 9. NEW SECTION 523I.101 SHORT TITLE.

This chapter may be cited as the "Iowa Cemetery Act".

Sec. 10. NEW SECTION 523I.102 DEFINITIONS.

For purposes of this chapter, unless the context otherwise

requires:

1. "Authorized to do business within this state" means a

person licensed, registered, or subject to regulation by an

agency of the state of Iowa or who has filed a consent to

service of process with the commissioner for purposes of this

chapter.

2. "Burial site" means any area, except a cemetery, that

is used to inter or scatter remains.

3. "Capital gains" means appreciation in the value of

trust assets for which a market value may be determined with

reasonable certainty after deduction of investment losses,

taxes, expenses incurred in the sale of trust assets, any

costs of the operation of the trust, and any annual audit

fees.

4. "Care" means the maintenance of a cemetery's interment

spaces, niches, and mausoleums.

5. "Care fund" means money or real or personal property

impressed with a trust by the terms of this chapter, a gift,

grant, contribution, payment, legacy, or the terms of a

contract accepted by the cemetery corporation or any trustee

of the trust fund and any accumulated income allocated to

principal.

6. "Casket" means a rigid container which is designed for

the encasement of human remains and which is usually

constructed of wood, metal, fiberglass, plastic, or like

material and ornamented and lined with fabric.

7. "Cemetery" means an area dedicated to and used or

intended to be used to inter or scatter remains.

8. "Cemetery corporation" means a corporation that

operates one or more cemeteries.

9. "Columbarium" means a structure, room, or space in a

mausoleum or other building containing niches or recesses for

disposition of cremated remains.

10. "Commissioner" means the commissioner of insurance or

the deputy administrator authorized in section 523A.801 to the

extent the commissioner delegates functions to the deputy

administrator.

11. "Common business enterprise" means a group of two or

more business entities that share common ownership in excess

of fifty percent.

12. "Credit sale" means a sale of goods, services, or an

interest in land in which all of the following are applicable:

a. Credit is granted either under a seller credit card or

by a seller who regularly engages as a seller in credit

transactions of the same kind.

b. The buyer is a person other than an organization.

c. The goods, services, or interest in land are purchased

primarily for a personal, family, or household purpose.

d. Either the debt is payable in installments or a finance

charge is made.

e. For goods and services, the amount financed does not

exceed twenty-five thousand dollars.

13. "Disinterment" means to remove human remains from

their place of final disposition.

14. "Doing business in this state" means issuing or

performing wholly or in part any term of an interment rights

agreement executed within the state of Iowa.

15. "Financial institution" means a state or federally

insured bank, savings and loan association, credit union,

trust department thereof, or a trust company that is

authorized to do business within this state, that has been

granted trust powers under the laws of this state or the

United States, and that holds funds under a trust agreement.

"Financial institution" does not include a cemetery, a

cemetery corporation, or any person employed by or directly

involved with a cemetery.

16. "Garden" means an area within a cemetery established

by the cemetery as a subdivision for organizational purposes,

not for sale purposes.

17. "Grave space" means a space of ground in a cemetery

that is used or intended to be used for an in-ground burial.

18. "Gross selling price" means the aggregate amount a

purchaser is obligated to pay for interment rights, exclusive

of finance charges.

19. "Inactive cemetery" means a cemetery that is not

operating on a regular basis, is not offering to sell or

provide interments or other services reasonably necessary for

interment, and does not provide or permit reasonable ingress

or egress for the purposes of visiting interment spaces.

20. "Income" means the return in money or property derived

from the use of trust principal after deduction of investment

losses, taxes, and expenses incurred in the sale of trust

assets, any cost of the operation of the trust, and any annual

audit fees. "Income" includes but is not limited to:

a. Rent of real or personal property, including sums

received for cancellation or renewal of a lease and any

royalties.

b. Interest on money lent, including sums received as

consideration for prepayment of principal.

c. Cash dividends paid on corporate stock.

d. Interest paid on deposit funds or debt obligations.

e. Gain realized from the sale of trust assets.

21. "Insolvent" means the inability to pay debts as they

become due in the usual course of business.

22. "Interment rights" means the rights to place remains

in a specific location for use as a final resting place or

memorial.

23. "Interment rights agreement" means an agreement to

furnish memorials, memorialization, opening and closing

services, or interment rights.

24. "Interment space" means a space used or intended to be

used for the interment of remains including, but not limited

to, a grave space, lawn crypt, mausoleum crypt, and niche.

25. "Lawn crypt" means a preplaced enclosed chamber, which

is usually constructed of reinforced concrete and poured in

place, or a precast unit installed in quantity, either side-

by-side or at multiple depths, and covered by earth or sod.

26. "Lot" means an area in a cemetery containing more than

one interment space which is uniquely identified by an

alphabetical, numeric, or alphanumerical identification

system.

27. "Maintenance funds" means any money and real or

personal property held by a nonperpetual cemetery under the

terms of this chapter, and any accumulated income allocated to

principal.

28. "Mausoleum" means an aboveground structure designed

for the entombment of human remains.

29. "Mausoleum crypt" means a chamber in a mausoleum of

sufficient size to contain casketed human remains.

30. "Memorial" means any product, including any foundation

other than a mausoleum or columbarium, used for identifying an

interment space or for commemoration of the life, deeds, or

career of a decedent including, but not limited to, a

monument, marker, niche plate, urn garden plaque, crypt plate,

cenotaph, marker bench, and vase.

31. "Memorial care" means any care provided or to be

provided for the general maintenance of memorials including

foundation repair or replacement, resetting or straightening

tipped memorials, repairing or replacing inadvertently damaged

memorials and any other care clearly specified in the purchase

agreement.

32. "Memorial dealer" means any person offering or selling

memorials retail to the public.

33. "Memorialization" means any permanent system designed

to mark or record the names and other data pertaining to a

decedent.

34. "Merchandise" means any personal property offered or

sold for use in connection with the funeral, final

disposition, memorialization, or interment of human remains,

but which is exclusive of interment rights.

35. "Neglected cemetery" means a cemetery where there has

been a failure to cut grass or weeds or care for graves,

memorials or memorialization, walls, fences, driveways, and

buildings, or for which proper records of interments have not

been maintained.

36. "Niche" means a recess or space in a columbarium or

mausoleum used for placement of cremated human remains.

37. "Opening and closing services" means one or more

services necessarily or customarily provided in connection

with the interment or entombment of human remains or a

combination thereof.

38. "Outer burial container" means any container which is

designed for placement in the ground around a casket or an urn

including, but not limited to, containers commonly known as

burial vaults, urn vaults, grave boxes, grave liners, and lawn

crypts.

39. "Parent company" means a corporation that has a

controlling interest in a cemetery corporation.

40. "Perpetual care cemetery" includes all of the

following:

a. Any cemetery that was organized or commenced business

in this state on or after July 1, 1995.

b. Any cemetery that has established a care fund in

compliance with subchapter 12.

c. Any cemetery that represents that it is a perpetual

care cemetery in its interment rights agreement.

d. Any cemetery that represents in any other manner that

the cemetery provides perpetual, permanent, or guaranteed

care.

41. "Person" means an individual, firm, corporation,

partnership, joint venture, limited liability company,

association, trustee, government or governmental subdivision,

agency, or other entity, or any combination thereof.

42. "Pioneer cemetery" means a cemetery where there were

six or fewer burials in the preceding fifty years.

43. "Purchaser" means a person who purchases memorials,

memorialization, opening and closing services, scattering

services, interment rights, or a combination thereof. The

purchaser need not be a beneficiary of the interment rights

agreement.

44. "Religious cemetery" means a cemetery that is owned,

operated, or controlled by a recognized church or

denomination.

45. "Relocation" means the act of taking remains from the

place of interment or the place where the remains are being

held to another designated place.

46. "Remains" means the body of a deceased human or a body

part, or limb that has been removed from a living human,

including a body, body part, or limb in any stage of

decomposition, or cremated remains.

47. "Scattering services provider" means a person in the

business of scattering human cremated remains.

48. "Seller" means a person doing business within this

state, including a person doing business within this state who

advertises, sells, promotes, or offers to furnish memorials,

memorialization, opening and closing services, scattering

services or interment rights, or a combination thereof,

whether the transaction is completed or offered in person,

through the mail, over the telephone, by the internet, or

through any other means of commerce.

49. "Special care" means any care provided or to be

provided that supplements or exceeds the requirements of this

chapter in accordance with the specific directions of any

donor of funds for such purposes.

50. "Undeveloped space" means a designated area or

building within a cemetery that has been mapped and planned

for future development but is not yet fully developed.

Sec. 11. NEW SECTION 523I.201 DEDICATION.

1. A person that dedicates property for a new cemetery on

or after July 1, 2003, and a cemetery corporation that

dedicates an additional garden on or after July 1, 2003,

shall:

a. In the case of land, survey and subdivide the property

into gardens with descriptive names or numbers and make a map

or plat of the property. Individual spaces do not need to be

set forth visually. The map or plat must include narrative

descriptions for each garden that allow individuals to

determine the location of each interment space. The narrative

descriptions must include appropriate compass directions, the

size of interment spaces in each defined area, and a

description of a progressive numbering system used to organize

individual spaces in each defined area.

b. In the case of a mausoleum or a columbarium, make a map

or plat of the property delineating sections or other

divisions with descriptive names and numbers. Individual

spaces do not need to be set forth visually. The map or plat

must include narrative descriptions for each section or

division that allow individuals to determine the location of

each interment space. The narrative descriptions must include

appropriate compass directions, the size of interment spaces

in each defined area, and a description of a progressive

numbering system used to organize individual spaces in each

defined area.

c. File the map or plat with the commissioner, including a

written certificate or declaration of dedication of the

property delineated by the map or plat, dedicating the

property to cemetery purposes. The certificate or declaration

shall include all of the following:

(1) Provision of information on a form prescribed by the

directors or officers of the cemetery corporation.

(2) The signature of two individuals authorized by the

cemetery corporation for that purpose.

(3) Verification by a notary public.

2. A map or plat and a certificate or declaration of

dedication that is filed pursuant to this section dedicates

the property for cemetery purposes and constitutes

constructive notice of that dedication.

3. A certificate or declaration of dedication may contain

a provision permitting a cemetery corporation to resurvey and

change the shape and size of the property for which the

associated map or plat is filed if that change does not

disturb any interred remains. If a change is made, the

cemetery corporation shall file an amended map or plat and

shall indicate any change in a specific unique number assigned

to an interment space.

4. A cemetery corporation is civilly liable to the state

in an amount not to exceed one thousand dollars for each map

or plat that fails to meet the requirements of this section.

5. A cemetery corporation shall not sell or convey

interment rights in a section or garden until a map or plat

and a certificate or declaration of dedication, if required by

this section, is filed with the commissioner.

Sec. 12. NEW SECTION 523I.202 EFFECT OF DEDICATION.

1. Property may be dedicated for use as a cemetery, and

the dedication is permitted out of respect for the dead, to

provide for the disposition of remains, and in fulfillment of

a duty to and for the benefit of the public.

2. Dedication of property as a cemetery and a property

owner's title to the exclusive interment rights are not

affected by the dissolution of the corporation owning the

cemetery, nonuse, alienation, encumbrance, or forced sale of

the property.

3. Dedication of property as a cemetery may not be

invalidated because of a violation of the law against

perpetuities or the law against the suspension of the power of

alienation of title to or use of property.

4. All property located on land dedicated as a cemetery,

including a road, alley, or walk in the cemetery:

a. Is exempt from public improvements assessments, fees,

and public taxation.

b. Shall not be sold on execution or applied in payment of

debts due from individual owners.

5. If human remains are not interred in a garden, the

dedication of that portion of the property as a cemetery may

be removed if notice is filed with the commissioner. Property

dedicated as a cemetery shall continue to be used for cemetery

purposes until the dedication is removed by filing notice with

the commissioner, by court order, or until maintenance of the

cemetery is enjoined or abated as a nuisance under section

523I.804.

Sec. 13. NEW SECTION 523I.203 REMOVAL OF DEDICATION.

A cemetery corporation may petition a district court of the

county in which a cemetery is located to remove the dedication

with respect to all or any portion of the cemetery if any of

the following occurs:

1. All remains have been removed from that portion of the

cemetery where the dedication is to be removed.

2. No interments were made in that portion of the cemetery

where the dedication is to be removed and that portion of the

cemetery is not used or necessary for interment purposes.

3. A court orders the removal of the dedication upon

notice and proof deemed satisfactory by the court.

Sec. 14. NEW SECTION 523I.301 FORMATION OF CORPORATION TO MAINTAIN AND OPERATE A CEMETERY.

1. A person shall not operate as a cemetery except by

means of a corporation.

2. A corporation may, if authorized to do so by its

articles, establish, maintain, manage, improve, or operate a

cemetery either for or without profit to its members or

stockholders. A nonprofit cemetery corporation shall be

organized pursuant to chapter 504A, the Iowa nonprofit

corporation Act. A for-profit cemetery corporation shall be

organized pursuant to chapter 490, the Iowa business

corporation Act, or chapter 490A, the Iowa limited liability

company Act.

3. The powers, privileges, and duties conferred and

imposed upon any cemetery corporation doing business under

this chapter are hereby enlarged as each particular case may

require to conform to the provisions of this chapter.

4. Unless otherwise limited by law, a cemetery corporation

shall have the same powers granted to other corporations in

general, including the right to enter into contracts secured

by a mortgage, deed of trust, or other obligation upon the

cemetery corporation's property.

Sec. 15. NEW SECTION 523I.302 PROPERTY ACQUISITION BY CEMETERY CORPORATION.

1. A cemetery corporation may acquire by purchase,

donation, or devise property consisting of land or other

property in which remains may be interred under law.

2. A cemetery corporation that acquires property may

record title to its property with the county recorder of the

county in which the property is located if its president and

secretary or other authorized delegate of the cemetery

corporation sign and acknowledge a declaration executed by the

cemetery corporation that describes the property and declares

the cemetery corporation's intention to use the property or a

part of the property for interment purposes.

3. Title recorded pursuant to subsection 2 constitutes

constructive notice as of the date of filing that the property

is intended to be used for interment.

4. A cemetery corporation may by condemnation acquire

property in which remains may be interred when the acquisition

of that property is for a public purpose.

Sec. 16. NEW SECTION 523I.303 AUTHORITY OF CEMETERY CORPORATION.

A cemetery corporation may do any of the following:

1. Divide the cemetery into interment spaces and

subdivisions for cemetery purposes.

2. Charge an assessment on cemetery property for the

purpose of general improvement and maintenance.

3. Take any action that is necessary to carry out the

cemetery's business purposes including those purposes that are

necessarily incidental to the final disposition of human

remains, including any of the following:

a. Convey property or other assets of the corporation.

b. Borrow money.

Sec. 17. NEW SECTION 523I.401 SALE OF INTERMENT RIGHTS.

1. A cemetery corporation may sell and convey exclusive

rights of interment in the cemetery under the following

conditions:

a. The sale or conveyance is allowed by the rules of the

cemetery and the restrictions in the certificate of interment

rights or other instrument of conveyance.

b. The purchase price for the interment rights has been

paid in full.

2. A certificate of interment rights or other instrument

evidencing the conveyance of exclusive rights of interment by

a cemetery corporation must be signed by the president or vice

president and the secretary or other officers authorized by

the cemetery corporation.

3. A conveyance of exclusive rights of interment must be

filed and recorded in the cemetery corporation's office. Any

transfer of the ownership of interment rights must be filed

and recorded in the cemetery corporation's office. The

cemetery corporation may charge a reasonable recording fee to

record the transfer of interment rights.

4. The interment rights in an interment space that is

conveyed by a certificate of ownership or other instrument

shall not be divided without the consent of the cemetery

corporation.

Sec. 18. NEW SECTION 523I.402 INTERMENT RIGHTS.

1. An interment space in which exclusive rights of

interment are conveyed is presumed to be the separate property

of the person named as grantee in the certificate of interment

rights or other instrument of conveyance.

2. The spouse of a person to whom exclusive rights of

interment in an interment space are conveyed has a vested

right of interment of the spouse's remains in the interment

space while the spouse is married to the interment space owner

or if the spouse is married to the interment space owner at

the time of the owner's death.

Sec. 19. NEW SECTION 523I.403 MULTIPLE OWNERS OF INTERMENT RIGHTS.

Two or more owners of interment rights may designate a

person to represent the interment space and file notice of the

designation of a representative with the cemetery corporation.

If notice is not filed, the cemetery corporation may inter or

permit an interment in the space at the request or direction

of a registered co-owner of the interment space.

Sec. 20. NEW SECTION 523I.404 RECORDS OF INTERMENT RIGHTS AND INTERMENT.

1. A cemetery corporation shall keep complete records

identifying the owners of all interment rights sold by the

cemetery corporation and historical information regarding any

transfers of ownership. The records shall include all of the

following:

a. The name and last known address of each owner or

previous owner of interment rights.

b. The date of each purchase or transfer of interment

rights.

c. A unique numeric or alphanumeric identifier that

identifies the location of each interment space sold by the

cemetery corporation.

2. A cemetery corporation shall keep a record of each

interment in a cemetery. The records shall include all of the

following:

a. The date the remains are interred.

b. The name, date of birth, and date of death of the

decedent interred, if those facts can be conveniently

obtained.

c. A unique numeric or alphanumeric identifier that

identifies the location of the interment space where the

remains are interred.

Sec. 21. NEW SECTION 523I.405 ABANDONED INTERMENT SPACES.

1. REVERSION. The ownership or right in or to an

unoccupied interment space shall, upon abandonment, revert to

the cemetery corporation that owns the cemetery in which the

space is located.

2. PRESUMPTION OF ABANDONMENT. Unpaid care assessments

and fees for an unoccupied interment space not under perpetual

care shall create a lien by the cemetery corporation against

the applicable interment space. The continued failure of the

owner to maintain or care for an unoccupied interment space

not under perpetual care, for a period of ten years, or to pay

a lien for care assessments or care fees that exceed the

amount paid for the interment space, shall create the

presumption that the interment space has been abandoned. An

unused interment space under perpetual care in a lot which has

not had a burial for seventy-five years shall create a

presumption that the interment space has been abandoned.

3. NOTICE OF ABANDONMENT. Abandonment shall not be deemed

complete pursuant to subsection 2 until the cemetery

corporation gives notice declaring the interment space to be

abandoned, to the owner of record or, if the owner of record

is deceased or unknown, to the heirs of the owner of record.

4. SERVICE OF NOTICE. Notice of abandonment may be served

personally on the owner of record or the owner of record's

heirs, or may be served by mailing notice by certified mail to

the owner of record, or the owner of record's heirs, at the

last known address of the owner of record or owner of record's

heirs. If the address of the owner of record or the owner of

record's heirs cannot be ascertained, notice of such

abandonment shall be given by one publication of the notice of

abandonment in the official newspaper of the county in which

the cemetery is located.

5. OVERCOMING PRESUMPTION OF ABANDONMENT. If within one

year from the time of serving notice the owner of record or

the owner of record's heirs pay the past due annual care

charges assessed against the interment space, the presumption

of abandonment shall no longer exist and the owner of record

or the owner of record's heirs may be required to make full

payment for future perpetual care.

6. REVERSIONER'S RIGHT TO SELL. When the abandonment is

deemed complete, the reversionary owner of the abandoned

interment space, or a portion thereof, may sell and convey

title to the interment space.

7. USE OF FUNDS. Any funds realized from the sale of an

interment space not under perpetual care which has reverted to

the reversionary owner shall be allocated to the care fund or

to the fund paying the costs of cemetery operation.

8. ABANDONMENT — PERPETUAL CARE PROVIDED BY WILL, COURT ORDER, CONTRACT, OR BY LAW. An unused interment space which

has not had a burial for seventy-five years, but whose

perpetual care has been provided for by will, court order,

contract, or by law, shall not be sold by the reversionary

owner until three years after the date notice was served on

the owner of record or the owner of record's heirs of the

presumed abandonment of the interment space.

Sec. 22. NEW SECTION 523I.501 STATEMENT BY PERPETUAL CARE CEMETERY.

1. A perpetual care cemetery shall include the following

statement in the heading of each interment rights agreement:

"This cemetery is operated as a perpetual care cemetery,

which means that a care fund for its maintenance has been

established in conformity with the laws of the State of Iowa.

At least twenty percent of the purchase price for interment

rights must be placed in the care fund and the care fund's

income is used to maintain, repair, and care for the

cemetery."

2. If the care fund contains less than twenty-five

thousand dollars, the statement shall include a statement that

the balance of the care fund is less than twenty-five thousand

dollars or shall disclose the exact amount contained in the

care fund on a date not more than twelve months prior to the

date of execution of the interment rights agreement.

Sec. 23. NEW SECTION 523I.502 STATEMENT BY NONPERPETUAL CARE CEMETERY.

1. A nonperpetual care cemetery shall include the

following statement in the heading of each interment rights

agreement:

"This cemetery is a nonperpetual care cemetery and has not

established a perpetual trust fund for the cemetery's care."

2. A nonperpetual care cemetery shall not represent that

the cemetery is a perpetual care cemetery or use any similar

title, description, or term indicating that the cemetery

provides guaranteed or permanent maintenance and care. If a

nonperpetual care cemetery has a maintenance fund, trust fund,

or trust funds, any statements about those funds must be

factually accurate and explain any variances between the terms

of the applicable trust and this chapter in regard to the

twenty-five thousand dollar minimum corpus provision, any

provisions regarding invasion of principal, and the amount of

the purchase price placed in trust for each sale of interment

rights.

Sec. 24. NEW SECTION 523I.503 INTERMENT RIGHTS AGREEMENT REQUIREMENTS.

An agreement for interment rights shall be written in

clear, understandable language and shall contain all of the

following:

1. The name of the cemetery where the rights to interment

are located, the name of the cemetery corporation selling

interment rights or the name of a seller other than the

cemetery corporation, and the name of the purchaser.

2. The name and sales permit number of the salesperson.

3. A description of the interment rights to be provided

and the cost of merchandise or services to be provided.

4. The conditions under which substitutions will be

allowed.

5. The total purchase price and the terms under which the

purchase price is to be paid.

6. That the purchase of interment rights is an irrevocable

contract, except as otherwise specified in the cemetery

corporation's rules and regulations.

7. The amount or percentage of money to be placed in the

cemetery corporation's care fund or maintenance fund.

8. A statement explaining that the care fund or

maintenance fund is an irrevocable trust, that deposits cannot

be withdrawn even in the event of cancellation of the

agreement, and that the care fund or maintenance fund must be

used by the cemetery corporation for the care and maintenance

of the cemetery.

9. An explanation of any fees or expenses that may be

charged.

10. An explanation of whether the money to be placed in

the cemetery corporation's care fund or maintenance fund will

be deposited in trust upon payment in full or on an allocable

basis as payments are made.

11. An explanation of whether initial payments on

agreements for multiple items of merchandise or services, or

both, will be allocated first to the purchase of interment

rights. If such an allocation will be made, the agreement

shall provide for the immediate transfer of such interment

rights upon payment in full and prominently state that any

applicable trust deposits under chapter 523A will not be made

until the cemetery has received payment in full for the

interment rights. The transfer of interment rights in an

undeveloped space may be deferred until such space is ready

for burial.

12. A provision that if the transfer of an undeveloped

interment space will be deferred as set forth in subsection

11, there will be written acknowledgement when payment in full

is made, specification of a reasonable time period for

development of the space, a description of what happens in the

event of the purchaser's death prior to development of the

space, and immediate transfer of the interment rights when

development of the space is complete.

13. Specification of the purchaser's right to cancel the

agreement and liability for damages upon such cancellation, if

any.

14. A statement that the insurance division exercises

regulatory oversight over interment rights agreements set

forth in twelve point bold-faced type, in substantially the

following language: THIS AGREEMENT IS SUBJECT TO RULES

ADMINISTERED BY THE IOWA INSURANCE DIVISION. YOU MAY CALL THE

INSURANCE DIVISION AT (___)___________. WRITTEN INQUIRIES OR

COMPLAINTS SHOULD BE MAILED TO THE IOWA INSURANCE DIVISION,

(STREET ADDRESS), (CITY), IOWA (ZIP CODE).

15. If the cemetery corporation offers opening and closing

services, specification of whether opening and closing of

interment spaces are included in the interment rights

agreement, and, if not, the current prices for such opening

and closing services and a statement that these prices are

subject to change.

16. Signatures of the purchaser and the seller.

A seller shall furnish the purchaser with a completed copy

of the interment rights agreement at the time the agreement is

signed.

Sec. 25. NEW SECTION 523I.601 REQUIREMENTS FOR LAWN CRYPTS.

A lawn crypt shall not be installed unless all of the

following apply:

1. The lawn crypt is constructed of concrete and

reinforced steel or other comparable durable material.

2. The lawn crypt is installed on not less than six inches

of rock, gravel, or other drainage material.

3. The lawn crypt provides a method to drain water out of

the lawn crypt.

4. The lawn crypt is capable of withstanding the weight of

the soil and sod above the top surface and the weight of

machinery and equipment normally used in the maintenance of

the cemetery.

5. Except as provided by section 523I.602, the lawn crypt

is installed in multiple units of ten or more.

6. The lawn crypt shall be installed in compliance with

any applicable law or rule adopted by the department of public

health.

Sec. 26. NEW SECTION 523I.602 REQUEST TO INSTALL LAWN CRYPT IN FEWER THAN TEN UNITS.

1. A lawn crypt may be installed in fewer than ten units

if it is installed in an interment space pursuant to a written

request to the commissioner signed by the owner or owners of

the interment space.

2. The written request shall be filed on a form prescribed

by the commissioner and shall contain substantially all of the

following information:

a. The owner's name and address.

b. The name of the cemetery and the owner of the cemetery.

c. The number of lawn crypt units to be installed.

d. A description of the interment spaces.

e. A statement that the lawn crypt meets the requirements

of section 523I.601, including all of the following:

(1) A statement that the lawn crypt will be constructed of

concrete and reinforced steel or other comparable durable

materials.

(2) A statement that the lawn crypt will be installed on

not less than six inches of rock, gravel, or other drainage

material.

(3) A statement that the lawn crypt will provide a method

to drain water out of the lawn crypt.

(4) A statement that the outside top surface of the lawn

crypt at the time of installation will be capable of

withstanding the weight of the soil and sod above the top

surface and the weight of machinery and equipment normally

used in the maintenance of the cemetery.

f. A statement that the space in which the lawn crypt is

to be installed is located in a garden.

g. The date on which the owner or owners signed the form.

Sec. 27. NEW SECTION 523I.603 NEW CONSTRUCTION.

1. A person shall not offer to sell interment rights in a

mausoleum or columbarium that will be built or completed in

the future unless the person has submitted an application to

sell such interment rights with the commissioner on a form

prescribed by the commissioner and accompanied by a fee of one

hundred dollars.

2. The application to sell interment rights in a mausoleum

or columbarium must include the following information:

a. A description of the new facility or the proposed

expansion, including a description of the interment rights to

be offered to prospective purchasers.

b. A statement of the financial resources available for

the project.

c. A copy of the proposed interment rights agreement to be

used, which shall include the following:

(1) That purchase payments will be held in trust in

accordance with the requirements of chapter 523A until

construction of the mausoleum or columbarium is complete.

(2) That the purchaser may request a refund of the

purchase amount, if construction does not begin within five

years of the purchaser's first payment.

(3) That the new facility will operate as a perpetual care

cemetery in compliance with this chapter, even if the facility

is located at a nonperpetual care cemetery.

(4) That the purchaser will receive an ownership

certificate upon payment in full or, if later, when

construction is complete.

3. Unless financing has been secured that is adequate in

amount and terms to complete the facility proposed, new

construction of a mausoleum or columbarium shall not begin

until the application required by this section has been

approved by the commissioner.

Sec. 28. NEW SECTION 523I.701 CEMETERY PERMITS.

1. A cemetery corporation shall not advertise, sell,

promote, or offer to sell interment rights on or after July 1,

2003, without a permit as provided for in this subchapter. If

a cemetery corporation operates more than one cemetery, each

cemetery must have a cemetery permit.

2. A filing fee shall not be required.

3. An application for a cemetery permit shall be filed on

a form prescribed by the commissioner and include a copy of

each interment rights agreement form used by the cemetery.

4. The application shall contain all of the following:

a. The name and address of the cemetery.

b. The name and address of the cemetery corporation.

c. The name and address of each owner, officer, or other

official of the cemetery corporation, including, when

relevant, the chief executive officer and the members of the

board of directors.

d. A description of any common business enterprise or

parent company.

e. A list of the financial institutions used by the

cemetery corporation on a regular basis.

f. The name and address of any trustee holding trust funds

for the cemetery corporation, including the name and location

of the applicable trust account.

5. The commissioner shall grant or deny an application for

a cemetery permit within thirty days after receipt, but the

commissioner's failure to act within that time period shall

not be deemed approval of the application. If the

commissioner does not grant the permit, the commissioner shall

notify the person in writing of the reasons for denial.

6. A cemetery permit is valid for four years.

Sec. 29. NEW SECTION 523I.702 SALES PERMITS.

1. A person shall not advertise, sell, promote, or offer

to sell interment rights without a sales permit. A person

holding a sales permit must be an employee or agent of a

cemetery corporation holding a cemetery permit. This section

shall not apply to a licensed funeral director who merely

collects cash advance payments for interment rights, an agent

or employee of a religious cemetery, or a cemetery owned or

operated by a political subdivision of this state.

2. A person must have a sales permit for each cemetery

corporation for which the person is employed or is an agent.

3. A cemetery corporation is liable for the acts of its

employees and agents performed in advertising, selling,

promoting, or offering to furnish interment rights.

4. An application for a sales permit shall be filed on a

form prescribed by the commissioner.

5. The application shall contain all of the following:

a. The name and address of the person.

b. The name and address of the cemetery and, if different,

the cemetery corporation on whose behalf the person will be

advertising, selling, promoting, or offering to furnish

interment rights.

6. A permit holder shall inform the commissioner of

changes in the information required to be provided by

subsection 5 in the initial application or in an application

for renewal within thirty days of the change.

7. An initial permit shall be accompanied by a five dollar

filing fee and shall expire one year from the date the

application is filed. The permit may be renewed for an

additional four years by filing the form prescribed by the

commissioner under this section, accompanied by a twenty

dollar filing fee.

8. The commissioner shall grant or deny a permit

application within thirty days after receipt, but the

commissioner's failure to act within that time period shall

not be deemed approval of the application. If the

commissioner does not grant the permit, the commissioner shall

notify the applicant in writing of the reasons for the denial.

9. The commissioner may, by rule, create or accept a

multijurisdiction sales permit. If the sales permit is issued

by another jurisdiction, the rules shall require the filing of

an application or notice form and payment of the applicable

filing fee of five dollars for each year. The application or

notice form utilized and the effective dates and terms of the

permit may vary from the provisions set forth in subsections

4, 5, 6, and 7.

10. The commissioner may create and accept a joint sales

permit for persons who are also required to hold a sales

permit under section 523A.502. Notwithstanding subsection 7

and section 523A.502, if a joint application is filed for both

sales permits, the fee for an initial joint permit shall be

five dollars and the fee for a renewed joint permit shall be

twenty dollars.

Sec. 30. NEW SECTION 523I.703 DENIAL — SUSPENSION — REVOCATION — SURRENDER OF PERMITS.

1. The commissioner may, subject to chapter 17A, deny any

permit application or immediately suspend or revoke a permit

issued under this chapter for several reasons, including but

not limited to:

a. Committing a fraudulent act, engaging in a fraudulent

practice, or violating any provision of this chapter, or any

implementing rule or order issued under this chapter.

b. Violating any other state or federal law applicable to

the conduct of the applicant's or permit holder's business.

c. Insolvency or financial condition.

d. Engaging in a deceptive act or practice or

misrepresenting or omitting a material fact regarding the sale

of interment rights under this chapter.

e. Conviction of a criminal offense involving dishonesty

or a false statement.

f. Inability to provide the interment rights which the

applicant or permit holder purports to sell.

g. Selling the cemetery without filing a prior notice of

the sale with the commissioner. A cemetery permit shall be

revoked thirty days following such sale.

h. Allowing a person who is not an employee or agent of

the applicant or permit holder to sell interment rights.

i. Inadequate care and maintenance of the cemetery,

including but not limited to the following:

(1) Failure to adequately mow grass.

(2) Failure to adequately edge and trim bushes, trees, and

memorials.

(3) Failure to keep walkways and sidewalks free of

obstructions.

(4) Failure to adequately maintain the cemetery's

equipment and fixtures.

2. The commissioner may, for good cause shown, suspend any

permit for a period not exceeding thirty days, pending

investigation.

3. Except as provided in subsection 2, a permit shall not

be revoked or suspended except after notice and hearing under

chapter 17A.

4. Any permit holder may surrender a permit by delivering

to the commissioner written notice that the permit holder

surrenders the permit, but the surrender shall not affect the

permit holder's civil or criminal liability for acts committed

before the surrender.

5. Denial, revocation, suspension, or surrender of a

permit does not impair or affect the obligation of any

preexisting lawful agreement between the permit holder and any

person.

Sec. 31. NEW SECTION 523I.704 ASSIGNMENTS AND TRANSFERS PROHIBITED.

Permits issued pursuant to this chapter are not assignable

or transferable. This section does not apply to a religious

cemetery if it remains a religious cemetery after the

assignment or transfer of a permit.

Sec. 32. NEW SECTION 523I.705 TRANSFER OF OWNERSHIP.

If an applicant or permit holder sells a cemetery, the

applicant or holder of a cemetery permit for that cemetery

shall notify the commissioner no later than thirty days after

the sale of the cemetery.

Sec. 33. NEW SECTION 523I.801 LIEN AGAINST CEMETERY PROPERTY.

1. A cemetery corporation, by contract, may incur

indebtedness as necessary to conduct its business and may

secure the indebtedness by mortgage, deed of trust, or other

lien against its property.

2. A mortgage, deed of trust, or other lien placed on

dedicated cemetery property, or on cemetery property that is

later dedicated with the consent of the holder of the lien,

does not affect the dedication and is subject to the

dedication. A sale on foreclosure of the lien is subject to

the dedication of the property for cemetery purposes.

Sec. 34. NEW SECTION 523I.803 REMOVAL OF REMAINS FROM NEGLECTED CEMETERY.

1. If a neglected cemetery for which no care fund has been

regularly and legally established is abated as a nuisance, the

court abating the nuisance and enjoining its continuance or

the governing body of the municipality in which the cemetery

is located may authorize the removal of all human remains,

monuments, tombs, and other similar items from the cemetery to

another religious cemetery of the same denomination, if

applicable, or to a perpetual care cemetery in the same

county.

2. If a county does not have a perpetual care cemetery

that under its rules permits the interment of human remains

that have been removed from another cemetery, the human

remains, monuments, tombs, and other similar items may be

removed to a nonperpetual care cemetery in the county that has

provided for assessments for the cemetery's future care.

Sec. 35. NEW SECTION 523I.804 NUISANCE — ABATEMENT — INJUNCTION.

1. A district court of the county in which a cemetery is

located may, by order, abate the cemetery as a nuisance and

enjoin its continuance if the cemetery is either:

a. Maintained, located, or used in violation of this

chapter.

b. Neglected so that it is offensive to the inhabitants of

the surrounding area.

2. A proceeding for abatement may be brought by the county

attorney, the attorney general, or the commissioner.

3. The court shall grant a permanent injunction against

each person responsible for the nuisance if a cemetery

nuisance exists or is threatened.

4. If a cemetery nuisance under subsection 1, paragraph

"b", is located in a municipality, the governing body of the

municipality may authorize the removal of all human remains,

monuments, tombs, or other similar items from the cemetery to

a perpetual care cemetery.

Sec. 36. NEW SECTION 523I.805 RULEMAKING AND ENFORCEMENT.

1. A cemetery corporation may adopt, amend, and enforce

rules for the use, care, control, management, restriction, and

protection of the cemetery, as necessary for the proper

conduct of the business of the cemetery, including, but not

limited to, the use, care, and transfer of any space or right

of interment.

2. A cemetery corporation may restrict and limit the use

of all property within the cemetery by rules that do all of

the following:

a. Prohibit the placement of memorials or memorialization,

buildings, or other types of structures within any portion of

the cemetery.

b. Regulate the uniformity, class, and kind of memorials

and memorialization and structures within the cemetery.

c. Regulate the scattering or placement of cremated

remains within the cemetery.

d. Prohibit or regulate the placement of nonhuman remains

within the cemetery.

e. Prohibit or regulate the introduction or care of trees,

shrubs, and other types of plants within the cemetery.

f. Regulate the right of third parties to open, prepare

for interment, and close interment spaces.

g. Prohibit interment in any part of the cemetery not

designated as an interment space.

h. Prevent the use of space for any purpose inconsistent

with the use of the property as a cemetery.

3. A cemetery corporation shall not adopt or enforce a

rule that prohibits interment because of the race, color, or

national origin of a decedent. A provision of a contract or a

certificate of ownership or other instrument conveying

interment rights that prohibits interment in a cemetery

because of the race, color, or national origin of a decedent

is void.

4. A cemetery corporation's rules shall be plainly printed

or typewritten and maintained for inspection in the office of

the cemetery or, if the cemetery does not have an office, in

another suitable place within the cemetery. The cemetery's

rules shall be provided to owners of interment spaces upon

request.

5. A cemetery corporation's rules shall specify the

cemetery corporation's obligations in the event that memorials

or memorialization are damaged or defaced by acts of

vandalism. The rules may specify a multiyear restoration of a

memorial or memorialization when the damage is extensive or

when money available from the cemetery's trust fund is

inadequate to complete repairs immediately. The owner of a

memorial or memorialization that has been damaged or defaced

shall be notified by the cemetery corporation by restricted

certified mail at the owner's last known address within sixty

days of the discovery of the damage or defacement. The rules

shall specify whether the owner is liable, in whole or in

part, for the cost to repair or replace a damaged or defaced

memorial or memorialization.

6. The cemetery corporation shall not approve any bylaw

which unreasonably restricts competition, or which

unreasonably increases the cost to the owner of interment

rights in utilizing these rights.

Sec. 37. NEW SECTION 523I.806 PROTECTION OF CEMETERIES AND BURIAL SITES.

1. EXISTENCE OF CEMETERY OR BURIAL SITE — NOTIFICATION. If a governmental subdivision or agency is notified of the

existence of a cemetery, or a marked burial site that is not

located in a dedicated cemetery, within its jurisdiction and

the cemetery or burial site is not otherwise provided for

under this chapter, the governmental subdivision or agency

shall, as soon as is practicable, notify the owner of the land

upon which the cemetery or burial site is located of the

cemetery's or burial site's existence and location. The

notification shall include an explanation of the provisions of

this section. If there is a basis to believe that interment

may have occurred more than one hundred fifty years earlier,

the governmental subdivision or agency shall also notify the

state archaeologist.

2. DISTURBANCE OF INTERMENT SPACES — PENALTY. A person

who knowingly and without authorization damages, defaces,

destroys, or otherwise disturbs an interment space commits

criminal mischief in the third degree. Criminal mischief in

the third degree is an aggravated misdemeanor.

3. DUTY TO PRESERVE AND PROTECT. A governmental

subdivision or agency having a cemetery, or a burial site that

is not located within a dedicated cemetery, within its

jurisdiction, for which preservation is not otherwise

provided, shall preserve and protect the cemetery or burial

site as necessary to restore or maintain its physical

integrity as a cemetery or burial site. The governmental

subdivision or agency may enter into an agreement to delegate

the responsibility for the preservation and protection of the

cemetery or burial site to a person interested in historical

preservation. A cemetery corporation shall be formed to

operate the cemetery, if applicable.

4. CONFISCATION AND RETURN OF MEMORIALS. A law

enforcement officer having reason to believe that a memorial

or memorialization is in the possession of a person without

authorization or right to possess the memorial or

memorialization may take possession of the memorial or

memorialization from that person and turn it over to the

officer's law enforcement agency. If a law enforcement agency

determines that a memorial or memorialization the agency has

taken possession of rightfully belongs on an interment space,

the agency shall return the memorial or memorialization to the

interment space, or make arrangements with the person having

jurisdiction over the interment space for its return.

5. INTERMENT SPACES LOCATED ON PRIVATE PROPERTY.

a. A person shall notify a governmental subdivision or

agency if an interment of the person's ancestor exists on

property owned by another person within the jurisdiction of

the governmental subdivision or agency. The owner of the

property shall be notified by the governmental subdivision or

agency that the interment exists and that the owner must

permit the person reasonable ingress and egress for the

purposes of visiting the interment space of the person's

ancestor.

b. Pursuant to section 558.69, a declaration of value

submitted to a county recorder pursuant to chapter 428A shall

also include information concerning the existence of any known

private interment space situated on the property.

6. DISCOVERY OF HUMAN REMAINS. Any person discovering

human remains shall notify the county or state medical

examiner or a city, county, or state law enforcement agency as

soon as is reasonably possible unless the person knows or has

good reason to believe that such notice has already been given

or the discovery occurs in a cemetery. If there is reason to

believe that interment may have occurred more than one hundred

fifty years earlier, the governmental subdivision or agency

notified shall also notify the state archaeologist. A person

who does not provide notice required pursuant to this

subsection commits a serious misdemeanor.

Sec. 38. NEW SECTION 523I.808 COMPLIANCE WITH IOWA CONSUMER CREDIT CODE.

A seller of credit sales agreements pursuant to this

chapter shall comply with the requirements of chapter 537, and

is subject to the remedies and penalties provided for in that

chapter.

Sec. 39. NEW SECTION 523I.809 DISCLOSURE REQUIREMENTS.

1. A cemetery corporation shall disclose, prior to the

sale of interment rights, whether opening and closing of the

interment space is included in the purchase of the interment

rights. If opening and closing services are not included in

the sale and the cemetery corporation offers opening and

closing services, the cemetery corporation must disclose that

the price for this service is subject to change and disclose

the current prices for opening and closing services provided

by the cemetery corporation.

2. The cemetery corporation shall fully disclose all fees

required for interment, entombment, or inurnment of human

remains.

3. A person owning interment rights may sell those rights

to third parties. The cemetery corporation shall fully

disclose, in the cemetery corporation's rules, any

requirements necessary to transfer title of interment rights

to a third party.

Sec. 40. NEW SECTION 523I.810 INSTALLATION OF OUTER BURIAL CONTAINERS.

A cemetery corporation shall provide services necessary for

the installation of outer burial containers or other similar

merchandise sold by the cemetery corporation. This section

shall not require the cemetery corporation to provide for

opening and closing of interment or entombment space, unless

an agreement executed by the cemetery corporation expressly

provides otherwise.

Sec. 41. NEW SECTION 523I.811 ACCESS BY FUNERAL DIRECTORS.

A licensed funeral director shall not be denied access by a

cemetery corporation to conduct a funeral for or to supervise

interment or disinterment of human remains.

Sec. 42. NEW SECTION 523I.812 COUNTY AUDITOR AS TRUSTEE.

1. In the absence of a trustee for care funds, unless

otherwise provided by law, the care funds shall be placed in

the hands of the county auditor, who shall receipt for, loan,

and make annual reports of the care funds.

2. The county auditor shall not be required to post a

bond.

3. The county auditor shall serve without compensation,

but may, out of the income received, pay all proper items of

expense incurred in the performance of the auditor's duties as

trustee, if any.

4. The county auditor shall make a full report of the

trustee's actions and trust funds annually in January. The

net proceeds for care funds received by the county auditor as

trustee shall be apportioned and credited to each of any

separate care funds assigned to the auditor.

5. The county auditor shall turn over the accrued income

from each care fund annually to the person having control of

the cemetery.

Sec. 43. NEW SECTION 523I.813 MEMORIALS AND MEMORIALIZATION.

1. AUTHORIZATION. A cemetery corporation is entitled to

determine whether that a person requesting installation of a

memorial is authorized to do so, to the extent that this can

be determined from the records of the cemetery corporation, as

is consistent with the cemetery corporation's rules. The

owner of an interment space or the owner's agent may authorize

a memorial dealer or independent third party to perform all

necessary work related to preparation and installation of a

memorial.

2. CONFORMITY WITH CEMETERY CORPORATION RULES. A person

selling a memorial shall review the rules of the cemetery

corporation for the cemetery where the memorial is to be

installed to ensure that the memorial will comply with those

rules prior to ordering or manufacturing the memorial.

3. SPECIFICATIONS. Upon request, a cemetery corporation

shall provide reasonable written specifications and

instructions governing installation of memorials, which shall

apply to all installations whether performed by the cemetery

corporation or another person. The written specifications

shall include provisions governing hours of installation or

any other relevant administrative requirements of the

cemetery. A copy of these specifications and instructions

shall be provided upon request, without charge, to the owner

of the interment space, next of kin, or a personal

representative or agent of the owner, including the person

installing the memorial. The person installing the memorial

shall comply with the cemetery corporation's written

installation specifications and instructions. A cemetery

corporation shall not adopt or enforce any rule prohibiting

the installation of a memorial by a memorial dealer or

independent third party, unless the rule is adopted and

enforced uniformly for all memorials installed in the

cemetery.

4. WRITTEN NOTICE. A memorial dealer or independent third

party shall provide the cemetery corporation with at least

seven days' prior written notice of intent to install a

memorial at the cemetery, or such lesser notice as the

cemetery corporation deems acceptable. The notice shall

contain the full name, address, and relationship of the

memorial's purchaser to the person interred in the interment

space or the owner of the interment space, if different. The

notice shall also contain the color, type, and size of the

memorial, the material, the inscription, and the full name and

interment date of the person interred in the interment space.

5. PREPARATION AND INSTALLATION.

a. A person installing a memorial shall be responsible to

the cemetery corporation for any damage caused to the cemetery

grounds, including roadways, other than normal use during

installation of the memorial.

b. Installation work shall cease during any nearby funeral

procession or committal service.

c. Installation work shall be done during the cemetery's

normal weekday hours or at such other times as may be arranged

with the cemetery corporation.

d. A memorial must comply with the cemetery corporation's

rules and regulations for the cemetery. In the event of

noncompliance, the person installing a memorial is responsible

for removal of the memorial and shall pay any reasonable

expenses incurred by the cemetery in connection with the

memorial's removal.

e. The cemetery corporation shall, without charge, provide

information as described on the cemetery's map or plat

necessary to locate the place where a memorial is to be

installed and any other essential information the person

installing the memorial needs to locate the proper interment

space.

f. A person installing a memorial shall follow the

cemetery corporation's instructions regarding the positioning

of the memorial.

g. During the excavation, all sod and dirt shall be

carefully removed with no sod or dirt left on the interment

space except the amount needed to fill the space between the

memorial and the adjacent lawn.

h. A person installing a memorial shall carefully fill in

any areas around the memorial with topsoil or sand, in

accordance with the cemetery corporation's written

instructions.

i. A person installing a memorial shall remove all

equipment and any debris which has accumulated during

installation of the memorial.

j. A person installing a memorial shall check to see if

any adjacent memorials have become soiled or dirty during

installation of the memorial and, if so, clean the adjacent

memorials.

k. If the person who is installing a memorial damages any

cemetery property, the person shall notify the cemetery

corporation immediately. The person installing the memorial

shall then repair the damage as soon as possible, upon

approval by the cemetery corporation. The cemetery

corporation may require a person installing a memorial to

provide current proof of workers' compensation insurance as

required by state law and current proof of liability

insurance, sufficient to indemnify the cemetery corporation

against claims resulting from installation of the memorial.

Proof of liability insurance in an amount of one million

dollars or more shall preclude the cemetery corporation from

requiring a person installing a memorial to obtain a

performance bond.

l. If a cemetery has an office, a person installing a

memorial shall immediately leave notice at the cemetery office

when the memorial has been installed and all work related to

the installation is complete.

6. INSPECTION. A cemetery corporation may inspect the

installation site of a memorial at any time. If the cemetery

corporation determines that cemetery corporation rules are not

being followed during the installation, the cemetery

corporation may order the installation to stop until the

infraction is corrected. The cemetery corporation shall

provide written notice to the installer within seven days if

the cemetery corporation believes that any of the following

have occurred:

a. The memorial has not been installed correctly.

b. The person installing the memorial has damaged property

at the cemetery.

c. Other cemetery corporation requirements for

installation have not been met, such as removal of debris or

equipment.

7. LOCATION AND SERVICE CHARGE. A cemetery corporation

may charge a reasonable service charge for allowing the

installation of a memorial purchased or obtained from and

installed by a person other than the cemetery corporation or

its agents. This service charge shall be based on the

cemetery corporation's actual labor costs, including fringe

benefits, of those employees whose normal duty is to inspect

the installation of memorials, in accordance with generally

accepted accounting practices. General administrative and

overhead costs and any other functions not related to actual

inspection time shall be excluded from the service charge.

8. FAULTY INSTALLATION. If a memorial sinks, tilts, or

becomes misaligned within twelve months of its installation

and the cemetery corporation believes the cause is faulty

installation, the cemetery corporation shall notify the person

who installed the memorial in writing and the person who

installed the memorial shall be responsible to correct the

damage, unless the damage is caused by inadequate written

specifications and instructions from the cemetery corporation

or acts of the cemetery corporation and its agents or

employees, including but not limited to running a backhoe over

the memorial, carrying a vault or other heavy equipment over

the memorial, or opening or closing an interment space

adjacent to the memorial.

9. PERPETUAL CARE. A cemetery corporation may require

contributions from the purchaser of a memorial for perpetual

care, if a perpetual care fund deposit is uniformly charged on

every memorial installed in the cemetery.

Sec. 44. NEW SECTION 523I.814 INTERMENT, RELOCATION, OR DISINTERMENT OF REMAINS.

1. Unless a decedent has left directions in writing for

the disposition of the decedent's remains as provided in

subsection 2, the following persons, in the priority listed,

shall have the right to control the interment, relocation, or

disinterment of the decedent's remains within or from a

cemetery:

a. The person designated in a written instrument signed by

the decedent.

b. The surviving spouse of the decedent.

c. A surviving adult child of the decedent.

d. A surviving parent of the decedent.

e. A surviving adult sibling of the decedent.

f. Any adult person in the next degree of kinship in the

order named by law to inherit the estate of the decedent under

the rules of inheritance for intestate succession.

2. The written instrument referred to in subsection 1,

paragraph "a", shall be in substantially the following form:

Name of person whose remains are to be disposed of as

directed (decedent):

Address:

Telephone Number:

Acceptance of Appointment: (signature of agent)

Date of Signature:

SUCCESSORS

If my agent dies, becomes legally disabled, resigns, or

refuses to act, I hereby appoint the following persons (each

to act alone and successively, in the order named) to serve as

my agent (attorney-in-fact) to control the disposition of my

remains as authorized by this document:

First Successor

Name:

Address:

Telephone Number:

Acceptance of Appointment: (signature of first successor)

Date of Signature:

Second Successor

Name:

Address:

Telephone Number:

Acceptance of Appointment: (signature of second successor)

Date of Signature:

DURATION

This appointment becomes effective upon my death.

PRIOR APPOINTMENTS REVOKED

I hereby revoke any prior appointment of any person to

control the disposition of my remains.

RELIANCE

I hereby agree that any cemetery corporation that receives

a copy of this document may act under it. Any modification or

revocation of this document is not effective as to any such

party until that party receives actual notice of the

modification or revocation. No such party shall be liable

because of reliance on a copy of this document.

ASSUMPTION

THE AGENT, AND EACH SUCCESSOR AGENT, BY ACCEPTING THIS APPOINTMENT, ASSUMES THE OBLIGATIONS PROVIDED IN, AND IS BOUND BY THE PROVISIONS OF, SECTION 523I.

814.

Signed this _____ day

of _____________, ____.

3. A written instrument referred to in subsection 1,

paragraph "a", is legally sufficient if the wording of the

instrument complies substantially with subsection 2, the

instrument is properly completed, the instrument is signed by

the decedent, the agent, and each successor agent, and the

signature of the decedent is acknowledged. Such written

instrument may be modified or revoked only by a subsequent

written instrument that complies with the requirements of this

subsection.

4. A person who represents that the person knows the

identity of a decedent and, in order to procure the interment,

relocation, or disinterment of the decedent's remains, signs

an order or statement, other than a death certificate, that

warrants the identity of the decedent is liable for all

damages that result, directly or indirectly, from that

representation.

5. A person may provide written directions for the

interment, relocation, or disinterment of the person's own

remains in a will, prepaid funeral or cemetery contract, or

written instrument signed and acknowledged by the person. The

directions may govern the inscription to be placed on a grave

marker attached to any interment space in which the decedent

had the right of interment at the time of death and in which

interment space the decedent is subsequently interred. The

directions may be modified or revoked only by a subsequent

writing signed and acknowledged by the person. A person other

than a decedent who is entitled to control the interment,

relocation, or disinterment of a decedent's remains under this

section shall faithfully carry out the directions of the

decedent to the extent that the decedent's estate or the

person controlling the interment, relocation, or disinterment

is financially able to do so.

6. If the decedent's directions for the interment of the

decedent's remains are in a will, the directions shall be

carried out immediately without the necessity of probate. If

a will is not probated or is declared invalid for testamentary

purposes, the directions for the interment of the decedent's

remains are valid to the extent that they have been acted upon

in good faith.

7. A cemetery corporation shall not be liable for carrying

out the written directions of a decedent or the directions of

any person entitled to control the interment, relocation, or

disinterment of the decedent's remains.

8. A dispute among any of the persons listed in subsection

1 concerning their right to control the interment, relocation,

or disinterment of a decedent's remains may be resolved by a

court of competent jurisdiction. A cemetery corporation shall

not be liable for refusing to accept the decedent's remains,

relocate or disinter, inter or otherwise dispose of the

decedent's remains, until the cemetery corporation receives a

court order or other suitable confirmation that the dispute

has been resolved or settled.

9.

a. If good cause exists to relocate or disinter

remains interred in a cemetery, the remains may be removed

from the cemetery pursuant to a disinterment permit as

required under section 144.34, with the written consent of the

cemetery corporation, the current interment rights owner and

the person entitled by this section to control the interment,

relocation, or disinterment of the decedent's remains.

b. If the consent required by this subsection cannot be

obtained, the remains may be relocated by permission of the

district court of the county in which the cemetery is located.

Before the date of application to the court for permission to

relocate remains under this subsection, notice must be given

to the cemetery corporation that operates the cemetery in

which the remains are interred, each person whose consent is

required for relocation of the remains under subsection 1, and

any other person that the court requires to be served.

c. For the purposes of this subsection, personal notice

must be given not later than the eleventh day before the date

of application to the court for permission to relocate the

remains, or notice by certified mail or restricted certified

mail must be given not later than the sixteenth day before the

date of application.

d. This subsection does not apply to the removal of

remains from one interment space to another interment space in

the same cemetery to correct an error, or relocation of the

remains by the cemetery from an interment space for which the

purchase price is past due and unpaid, to another suitable

interment space.

10. A person who removes remains from a cemetery shall

keep a record of the removal, and provide a copy to the

cemetery, that includes all of the following:

a. The date the remains are removed.

b. The name of the decedent and age at death if those

facts can be conveniently obtained.

c. The place to which the remains are removed.

d. The name of the cemetery and the location of the

interment space from which the remains are removed.

11. A cemetery corporation may disinter and relocate

remains interred in the cemetery for the purpose of correcting

an error made by the cemetery corporation after obtaining a

disinterment permit as required by section 144.34. The

cemetery corporation shall provide written notice to the

commissioner and to the person by restricted certified mail

describing who has the right to control the interment,

relocation, or disinterment of the remains erroneously

interred, at the person's last known address and sixty days

prior to the disinterment. The notice shall include the

location where the disinterment will occur and the location of

the new interment space. A cemetery corporation is not

civilly or criminally liable for an erroneously made interment

that is corrected in compliance with this subsection unless

the error was the result of gross negligence or intentional

misconduct.

12. Relocations and disinterments of human remains shall

be done in compliance with sections 144.32 and 144.34.

Sec. 45. NEW SECTION 523I.815 FEE AND CARE ASSESSMENTS AND MAINTENANCE FUNDS AT NONPERPETUAL CARE CEMETERIES.

1.

a. On or after July 1, 2003, a cemetery corporation

that operates a nonperpetual care cemetery shall, prior to

selling any interment rights, establish a maintenance fund to

provide funding for the maintenance of the cemetery.

Maintenance fund income shall be applied in the manner the

directors of the cemetery corporation determine is in the best

interests of the cemetery, provided that, maintenance fund

income shall be used only for the care described in a

resolution, bylaw, or other action or instrument establishing

the maintenance fund, including the general care and

maintenance of memorials, memorialization, and the cemetery.

Maintenance fund income may be used for any of the following

purposes:

(1) Cutting and trimming lawns, shrubs, and trees at

reasonable intervals.

(2) Maintaining drains, water lines, roads, buildings,

fences, and other structures.

(3) Maintaining machinery, tools, and equipment.

(4) Compensating maintenance employees, paying insurance

premiums, and making payments to employees' pension and

benefit plans.

(5) Paying overhead expenses incidental to such payments.

(6) Paying expenses necessary to maintain ownership,

transfer, and interment records of the cemetery.

b. The cemetery corporation's maintenance fund shall be

established as a separate fund. The principal of the

maintenance fund is intended to remain available perpetually

as a funding source for the care of the cemetery. The

principal of the maintenance fund shall not be reduced

voluntarily and must remain inviolable, except as provided in

this section. The cemetery corporation shall maintain the

principal of the maintenance fund separate from all operating

funds of the cemetery corporation.

c. A cemetery corporation shall be responsible for the

deposit of all moneys required to be placed in the maintenance

fund. These moneys shall be invested or deposited in a

financial account or accounts, unless the cemetery is a

religious cemetery or a cemetery owned or operated by a

political subdivision of this state. The maintenance fund may

receive and hold as a part of the maintenance fund or as an

incident to the maintenance fund any property contributed to

the maintenance fund. Moneys to be deposited in a maintenance

funds shall be deposited at a financial institution no later

than the fifteenth day after the close of the month when the

cemetery corporation receives the final payment from the

purchaser.

d. The maintenance fund and contributions to the

maintenance fund are for charitable purposes. The care

financed by the maintenance fund constitutes the discharge of

a duty due by the cemetery corporation to persons interred and

to be interred in the cemetery and for the benefit and

protection of the public by preserving and keeping the

cemetery from becoming a place of disorder, reproach, and

desolation in the community in which the cemetery is located.

e. A contribution to a maintenance fund is not invalid

because of the following:

(1) Indefiniteness or uncertainty as to the identity of

the person designated as a beneficiary in the instrument

establishing the maintenance fund.

(2) A violation of the law against perpetuities or the law

against the suspension of the power of alienation of title to

or use of property.

2. A financial institution holding moneys in a maintenance

fund for a cemetery corporation shall not do any of the

following:

a. Be owned, under the control of, or affiliated with a

cemetery corporation.

b. Use any funds required to be deposited pursuant to this

chapter to purchase an interest in a contract or agreement in

which the cemetery corporation is a party.

c. Otherwise invest moneys in a maintenance fund, directly

or indirectly, in a cemetery corporation's business

operations.

3. A cemetery corporation shall make reasonable investment

decisions and properly oversee and manage moneys in a

maintenance fund. A cemetery corporation shall use the

judgment and care, under the circumstances then prevailing,

that a person of prudence, discretion, and intelligence

exercises in the management of the person's own affairs,

without speculation in the permanent disposition of the

person's own funds, to ensure the probable safety of the

person's capital. The commissioner may take enforcement

action against a cemetery corporation for a breach of

fiduciary duty proven under this chapter.

4. Moneys deposited in a maintenance fund may be

commingled for investment purposes if separate accounting of

principal, interest, and income is maintained for each

cemetery and each deposit includes a detailed listing of the

amount deposited in trust for each purchaser. A cemetery

corporation may establish a common maintenance fund for two or

more cemeteries into which deposits required under this

chapter are made, provided that separate records of principal

and income are maintained for each cemetery for the benefit of

which the common maintenance fund is established.

5. A cemetery corporation may appoint an independent

investment adviser to advise the financial institution about

investment of the moneys in a maintenance fund.

6. Subject to agreement between the parties, a financial

institution may receive a reasonable fee from the maintenance

fund for services performed on behalf of the maintenance fund.

The maintenance fund shall pay the operation costs and any

annual audit fees.

7. All moneys required to be deposited by the cemetery

corporation shall be deposited in the name of the maintenance

fund, pursuant to the terms of a written agreement and the

cemetery corporation shall invest, reinvest, exchange, retain,

sell, and otherwise manage the maintenance fund for the

benefit and protection of the cemetery.

8. This section does not prohibit a cemetery corporation

from moving moneys in a maintenance fund from one financial

institution to another.

9. A cemetery corporation that operates a nonperpetual

care cemetery shall collect a care assessment equal to or

greater than the lesser of fifty dollars or twenty percent of

the gross selling price received by the cemetery corporation

for the sale of interment rights. The cemetery corporation

shall also collect a five dollar fee assessment from each

purchaser of interment rights. The fee assessments collected

by the cemetery corporation shall be submitted to the

commissioner no later than April 1 of the calendar year

following collection and shall be deposited in the insurance

division's cemetery fund. The care assessments shall be

deposited in the cemetery corporation's maintenance fund.

Sec. 46. NEW SECTION 523I.1001 CEMETERY AUTHORIZED.

The governing body of a governmental subdivision may

purchase, establish, operate, enclose, improve, or regulate a

cemetery. A cemetery owned or operated by a governmental

subdivision may sell interment rights subject to the

provisions of this chapter.

Sec. 47. NEW SECTION 523I.1002 TRUST FOR CEMETERY.

1. A governmental subdivision that owns or operates a

cemetery or has control of cemetery property may act as a

permanent trustee for the perpetual maintenance of interment

spaces in the cemetery.

2. To act as a trustee, a majority of the governmental

subdivision's governing body must adopt an ordinance or

resolution stating the governmental subdivision's willingness

and intention to act as a trustee for the perpetual

maintenance of cemetery property. When the ordinance or

resolution is adopted and the trust is accepted, the trust is

perpetual.

Sec. 48. NEW SECTION 523I.1003 AUTHORITY TO RECEIVE GIFTS AND DEPOSITS FOR CARE — CERTIFICATES.

1. A governmental subdivision that is a trustee for the

perpetual maintenance of a cemetery may adopt reasonable rules

governing the receipt of a gift or grant from any source.

2. A governmental subdivision that is a trustee for a

person shall accept the amount the governmental subdivision

requires for permanent maintenance of an interment space on

behalf of that person or a decedent.

3. A governmental subdivision's acceptance of a deposit

for permanent maintenance of an interment space constitutes a

perpetual trust for the designated interment space.

4. Upon acceptance of a deposit, a governmental

subdivision's secretary, clerk, or mayor shall issue a

certificate in the name of the governmental subdivision to the

trustee or depositor. The certificate shall state all of the

following:

a. The depositor's name.

b. The amount and purpose of the deposit.

c. The location, with as much specificity as possible, of

the interment space to be maintained.

d. Other information required by the governmental

subdivision.

5. An individual, association, foundation, or corporation

that is interested in the maintenance of a neglected cemetery

in a governmental subdivision's possession and control may

donate funds to the cemetery's perpetual trust fund to

beautify and maintain the entire cemetery or burial grounds

generally.

Sec. 49. NEW SECTION 523I.1004 INVESTMENT OF CARE FUNDS.

Notwithstanding section 12B.10, a cemetery corporation

owned by a governmental subdivision may invest and reinvest

deposits under this subchapter as set forth in section

523I.1203. The trustee of the trust funds has a fiduciary

duty to make reasonable investment decisions and to properly

oversee and manage the funds entrusted to the trust fund.

Sec. 50. NEW SECTION 523I.1005 APPOINTMENT OF SUCCESSOR TRUSTEE.

A district judge of a county in which a cemetery is located

shall appoint a suitable successor or trustee to faithfully

execute a trust in accordance with this subchapter if a

governmental subdivision renounces a trust assumed under this

subchapter, fails to act as its trustee, a vacancy occurs, or

the appointment of a successor or trustee is otherwise

necessary.

Sec. 51. NEW SECTION 523I.1006 PRIVATE CARE OF GRAVES.

This subchapter does not affect the right of a person who

has an interest in an interment space, or who is related to a

decedent interred in a cemetery, to beautify or maintain an

interment space individually or at the person's own expense in

accordance with reasonable rules established by the

governmental subdivision.

Sec. 52. NEW SECTION 523I.1101 NEGLECTED CEMETERIES.

The commissioner shall create a form that interested

persons may use to report neglected cemeteries to the

commissioner and the county board of supervisors. The board

of supervisors of each county shall accept any neglected

cemetery report forms filed with the board and submit copies

of such report forms received during calendar years 2004,

2005, and 2006 to the commissioner no later than March 1 of

the year following receipt. The commissioner shall prepare an

annual summary of the report forms received, organized by

county.

Sec. 53. NEW SECTION 523I.1102 CONDEMNATION OF NEGLECTED CEMETERIES.

1. When a nonreligious cemetery within a county has been

neglected in whole or in part by the owners, the county may

acquire title to the cemetery by condemnation proceedings, to

be instituted and conducted in the manner prescribed in the

statutes providing for the exercise of the power of eminent

domain by counties. A court with jurisdiction over such

proceedings may, in its discretion, require the county to

acquire the entire cemetery, in which event the county may use

such part of the cemetery as may be necessary for its purposes

and sell the residue. Upon a showing of good cause, the court

may direct that, if possible, remains interred in the cemetery

be removed to another cemetery.

2. In the event that the proceeds from the condemnation

proceedings are insufficient to defray the costs of the suit

and removal and reinterment of the remains, then any

additional funds needed shall be paid by the county

instituting the suit. After payment of proper costs, any

residue of the proceeds shall be paid to the parties entitled

thereto. If there are any unknown parties who are entitled to

a portion of the proceeds, the county shall hold such amount

in trust for those parties, without any accrual of interest or

income. If any amount held in trust is not claimed within

seven years from the date of condemnation or sale of the

cemetery, or a portion thereof, title to the unclaimed funds

shall pass pursuant to the statute of escheats.

Sec. 54. NEW SECTION 523I.1103 REMOVAL OF REMAINS.

1. Upon a showing of good cause, a county cemetery

commission may file suit in a district court in that county to

have remains interred in a cemetery owned and operated by the

commission removed to another cemetery. All persons in

interest, known or unknown, other than the plaintiffs, shall

be made defendants to the suit. If any parties are unknown,

notice may be given by publication. After hearing and a

showing of good cause for the removal, the court may order the

removal of the remains and the remains shall be properly

interred in another cemetery, at the expense of the county.

The removal and reinterment of the remains shall be done

pursuant to a disinterment permit issued under section 144.34

with due care and decency.

2. In deciding whether to order the removal of interred

remains, a court shall consider present or future access to

the cemetery, the historical significance of the cemetery, and

the wishes of the parties concerned if they are brought to the

court's attention, including the desire of any beneficiaries

to reserve their rights to waive a reservation of rights in

favor of removal, and shall exercise the court's sound

discretion in granting or refusing the removal of interred

remains.

3. Any heir at law or descendent of a deceased person

interred in a neglected cemetery may file suit in a district

court in the county where the cemetery is located, to have the

deceased person's remains interred in the cemetery removed to

another cemetery. The owner of the land, any beneficiaries of

any reservation of rights, and any other persons in interest,

known or unknown, other than the plaintiffs shall be made

defendants. If any parties are unknown, notice may be given

by publication. After hearing and upon a showing of good

cause, the court may order removal and the proper interment of

the remains in another cemetery, at the expense of the

petitioner. The removal and reinterment shall be done with

due care and decency.

Sec. 55. NEW SECTION 523I.1201 APPLICABILITY.

1. All cemeteries are designated as either "perpetual care

cemeteries" or "nonperpetual care cemeteries" for the purposes

of this chapter.

2. A cemetery corporation organized or commencing business

in this state on or after July 1, 1995, shall operate as a

perpetual care cemetery and is subject to this subchapter.

3. A cemetery corporation that represents that it is

offering perpetual care is subject to this subchapter.

4. A cemetery corporation that operates a nonperpetual

care cemetery may elect to become a perpetual care cemetery by

complying with the terms of section 523I.1202, if at all times

subsequent to the date of the election, the cemetery

corporation complies with the other requirements of this

subchapter except section 523I.1203, subsection 1.

Sec. 56. NEW SECTION 523I.1202 TRUST AGREEMENT — IRREVOCABLE TRUST.

1. A cemetery corporation operating as a perpetual care

cemetery shall execute a trust instrument and establish an

irrevocable trust fund to provide for the care and maintenance

of the cemetery.

2. The trust agreement shall provide for the appointment

of at least one trustee, with perpetual succession, in case

the cemetery corporation is dissolved or ceases to be

responsible for the cemetery's care and maintenance.

3. A cemetery corporation and the trustee or trustees of

the trust fund may, by agreement, amend the instrument that

established the fund to include any provision that is

necessary to comply with the requirements of this chapter.

4. A cemetery corporation shall be responsible for the

deposit of all moneys required to be placed in a trust fund.

5. The commissioner may require amendments to a trust

agreement that is not in accord with the provisions of this

chapter.

Sec. 57. NEW SECTION 523I.1203 TRUST FUND REQUIREMENTS.

1. A religious cemetery or a cemetery owned or operated by

a political subdivision of this state is not required to make

a minimum initial deposit in a trust fund. A cemetery

corporation organized or commencing business in this state on

or after July 1, 1995, shall not commence operations as a

perpetual care cemetery unless the cemetery corporation has a

trust fund of at least twenty-five thousand dollars in cash.

2. If an initial deposit is made by a cemetery corporation

to satisfy subsection 1, the initial twenty-five thousand

dollar deposit may be withdrawn by the cemetery corporation

when the trust fund balance reaches one hundred thousand

dollars. An affidavit shall be filed with the commissioner

providing prior notice of the intended withdrawal of the

initial deposit and attesting that the money has not

previously been withdrawn. Upon a showing by the cemetery

corporation that the initial deposit has not previously been

withdrawn, the commissioner shall approve withdrawal of the

money and the withdrawal shall take place within one year

after the trust fund balance reaches one hundred thousand

dollars.

3. The trust fund shall be administered under the

jurisdiction of the district court of the county where the

cemetery is located. Notwithstanding chapter 633, annual

reports shall not be required unless specifically required by

the district court. Reports shall be filed with the court

when necessary to receive approval of appointments of

trustees, trust agreements and amendments, changes in fees or

expenses, and other matters within the court's jurisdiction.

A court having jurisdiction over a trust fund shall have full

jurisdiction to approve the appointment of trustees, the

amount of surety bond required, and investment of funds.

4. A trust fund must be established at a financial

institution, unless the cemetery is a religious cemetery or a

cemetery owned or operated by a governmental subdivision of

this state.

a. A financial institution may serve as a trustee if

granted those powers under the laws of this state or of the

United States. A financial institution acting as a trustee of

trust funds under this chapter shall invest the funds in

accordance with applicable law.

b. A financial institution acting as a trustee of trust

funds under this chapter has a fiduciary duty to make

reasonable investment decisions and to properly oversee and

manage the funds entrusted to the financial institution. A

trustee shall use the judgment and care, under the

circumstances then prevailing, that a person of prudence,

discretion, and intelligence exercises in the management of

the person's own affairs, without speculation, in the

permanent disposition of a person's own funds to ensure the

probable safety of the person's capital. The commissioner may

take enforcement action against a financial institution in its

capacity as trustee for a breach of fiduciary duty proven

under this chapter.

c. Moneys deposited under a master trust agreement may be

commingled by the financial institution for investment

purposes if separate accounting of principal, interest, and

income is maintained for each cemetery and each deposit

includes a detailed listing of the amount deposited in trust

for each purchaser. The trustors of two or more care funds

may establish a common trust fund in which deposits required

under this chapter are made, provided that separate records of

principal and income are maintained for each perpetual care

cemetery for the benefit of which the common trust fund is

established.

d. Subject to a master trust agreement, the cemetery

corporation may appoint an independent investment adviser to

advise the financial institution about investment of the trust

fund.

e. Subject to an agreement between the cemetery

corporation and the financial institution, the financial

institution may receive a reasonable fee from the trust fund

for services rendered as trustee. The trust fund shall pay

the trust operation costs and any annual audit fees.

f. If the amount of the trust funds exceeds two hundred

thousand dollars, the cemetery corporation or any officer,

director, agent, employee, or affiliate of the cemetery

corporation shall not serve as trustee unless the cemetery is

a religious cemetery or a cemetery owned or operated by a

governmental subdivision of this state. A financial

institution holding trust funds shall not do any of the

following:

(1) Be owned, under the control of, or affiliated with a

cemetery corporation.

(2) Use any funds required to be held in trust under this

chapter to purchase an interest in a contract or agreement in

which the cemetery corporation is a party.

(3) Otherwise invest trust funds, directly or indirectly,

in a cemetery corporation's business operations.

5. Moneys shall be deposited in the trust fund no later

than the fifteenth day after the close of the month when the

cemetery corporation receives the final payment from a

purchaser of interment rights in an amount equal to or greater

than either of the following:

a. The greater of fifty dollars or twenty percent of the

gross selling price received by the cemetery for the sale of

interment rights.

b. The amount charged for the perpetual care and special

care of a memorial or memorialization placed in the cemetery.

A fee for memorial care shall be uniformly charged on every

installation of a memorial in the cemetery based upon the size

of the memorial, using the height and width of the memorial or

the size of the ground surface area used for the memorial. A

fee for special care of a memorial may be collected if the

terms of the special care items and arrangements are clearly

specified in the interment rights purchase agreement. A

cemetery corporation's liability for acts of God and vandalism

is limited to income available from the care fund.

6. All moneys required to be deposited in the trust fund

by the cemetery corporation shall be deposited in the name of

the trustee, as trustee, under the terms of a trust agreement

and the trustee may invest, reinvest, exchange, retain, sell,

and otherwise manage the trust for the benefit and protection

of the cemetery.

7. This section does not prohibit a cemetery corporation

from moving trust funds from one financial institution to

another.

8. A trust fund may receive and hold as a part of the fund

or as an incident to the fund any property contributed to the

fund.

9. The trust fund and contributions to the trust fund are

for charitable purposes. The care financed by the fund is for

the following purposes:

a. The discharge of a duty due from the cemetery

corporation to persons interred and to be interred in the

cemetery.

b. The benefit and protection of the public by preserving

and keeping the cemetery in a dignified condition so that the

cemetery does not become a nuisance or a place of disorder,

reproach, and desolation in the community in which the

cemetery is located.

10. A contribution to a trust fund is not invalid because

of any of the following:

a. Indefiniteness or uncertainty as to the person

designated as a beneficiary in the instrument establishing the

fund.

b. A violation of the law against perpetuities or the law

against the suspension of the power of alienation of title to

or use of property.

Sec. 58. NEW SECTION 523I.1204 PURPOSES OF CARE FUND.

1. The principal of a care fund is intended to remain

available perpetually as a funding source for care of the

cemetery. The principal of the fund shall not be reduced

voluntarily and shall remain inviolable, except as provided in

this section. The trustee or trustees of the care fund shall

maintain the principal of the care fund separate from all

operating funds of the cemetery corporation.

2. In establishing a care fund, the cemetery corporation

may adopt plans for the care of the cemetery and installed

memorials and memorialization.

3. A cemetery corporation may, by resolution adopted by a

vote of at least two-thirds of the members of its board at any

authorized meeting of the board, authorize the withdrawal and

use of not more than twenty percent of the principal of the

care fund to acquire additional land for cemetery purposes, to

repair a mausoleum or other building or structure intended for

cemetery purposes, or to build, improve, or repair roads and

walkways in the cemetery. The resolution shall establish a

reasonable repayment schedule, not to exceed five years, and

provide for interest in an amount comparable to the care

fund's current rate of return on its investments. However,

the care fund shall not be diminished below an amount equal to

the greater of one hundred thousand dollars or five thousand

dollars per acre of land in the cemetery. The resolution, and

either a bond or proof of insurance to guarantee replenishment

of the care fund, shall be filed with the commissioner thirty

days prior to the withdrawal of funds.

Sec. 59. NEW SECTION 523I.1205 USE OF CARE FUND INCOME AND CAPITAL GAINS.

1. Care fund income may be used in a manner determined by

the directors of the cemetery corporation to be in the best

interests of the cemetery, provided that care fund income

shall be used only for care that is described in a resolution,

bylaw, or other action or instrument establishing the fund,

including the general care and maintenance of memorials,

memorialization, and the cemetery. Fund income may be used

for any of the following purposes:

a. Cutting and trimming lawns, shrubs, and trees at

reasonable intervals.

b. Maintaining drains, water lines, roads, buildings,

fences, and other structures.

c. Maintaining machinery, tools, and equipment.

d. Compensating maintenance employees, paying insurance

premiums, and making payments to employees' pension and

benefit plans.

e. Paying overhead expenses incidental to such purposes.

f. Paying expenses necessary to maintain ownership,

transfer, and interment records of the cemetery corporation.

2. A cemetery corporation may, by amending the cemetery

corporation trust agreement, elect to withdraw capital gains

from the care fund, subject to the following conditions:

a. The amount of principal in the care fund shall be

adjusted annually by allocating income or capital gains as

necessary to adjust the principal of the care fund for

inflation, based on the consumer price index as set by the

commissioner and the amount of principal in the care fund at

the beginning of the prior year. The amount of principal in

the care fund shall also be adjusted by adding the amount of

the deposits received during the prior year, as required by

section 523I.1203, subsection 5.

b. For purposes of this section, "adjusted basis" means

the total of the market value of the care fund on the date of

the conversion, the aggregate amount of the inflation

adjustments required by this section, and the aggregate amount

of deposits received as required by section 523I.1203,

subsection 5, since the date of the conversion.

c. If the adjusted basis of the care fund is more than the

market value of the care fund at the end of the prior year,

the cemetery corporation shall not withdraw capital gains. If

the adjusted basis of the care fund is less than the market

value of the care fund at the end of the prior year, an amount

equal to fifty percent of the excess may be withdrawn and used

for the cemetery's care.

Sec. 60. NEW SECTION 523I.1206 SUIT BY OWNERS OR COMMISSIONER.

1. If the directors of a cemetery corporation do not care

for and maintain the cemetery, the district court of the

county in which the cemetery is located may do the following:

a. By injunction compel the directors to expend the net

income of the care fund as required by this chapter.

b. Appoint a receiver to take charge of the care fund and

expend the net income of the care fund as required by this

chapter.

2. Grant relief on a petition for relief filed pursuant to

this section by the commissioner or by at least five owners of

interment rights in the cemetery.

Sec. 61. NEW SECTION 523I.1207 ADVERTISING.

1. A cemetery corporation shall not advertise, represent,

guarantee, promise, or contract to provide or offer perpetual

care or use terms or phrases like permanent care, permanent

maintenance, care forever, continuous care, eternal care, or

everlasting care to imply that a certain level of care and

financial security will be furnished or is guaranteed except

in compliance with the provisions of this subchapter.

2. A cemetery corporation or person advertising or selling

interment rights shall not represent that the purchase of the

interment rights is or will be a desirable speculative

investment for resale purposes.

Sec. 62. NEW SECTION 523I.1208 PERPETUAL CARE REGISTRY.

1. A cemetery corporation that operates a perpetual care

cemetery shall maintain a registry of individuals who have

purchased interment rights in the cemetery subject to the

trust fund requirements of this subchapter.

2. The registry shall include the amount deposited in

trust for each interment rights agreement entered into on or

after July 1, 1995.

Sec. 63. NEW SECTION 523I.1209 USE OF GIFT FOR SPECIAL CARE.

A trustee may accept and hold money or property transferred

to the trustee in trust for the purpose of applying the

principal or income of the money or property transferred for a

purpose consistent with the purpose of a perpetual care

cemetery, including the following:

1. Improvement or embellishment of any part of the

cemetery.

2. Erection, renewal, repair, or preservation of a

monument, fence, building, or other structure in the cemetery.

3. Planting or cultivation of plants in or around the

cemetery.

4. Special care of or embellishment of an interment space,

section, or building in the cemetery.

Sec. 64. NEW SECTION 523I.1210 GOVERNMENTAL SUBDIVISIONS.

A governmental subdivision subject to this section may

commingle care funds for the purposes of investment and

administration and may file a single report, if each cemetery

is appropriately identified and separate records are

maintained for each cemetery.

Sec. 65. NEW SECTION 523I.1211 ANNUAL REPORT BY PERPETUAL CARE CEMETERIES.

1. A cemetery corporation that operates a perpetual care

cemetery corporation shall file a written report at the end of

each fiscal year of the cemetery that includes the following:

a. The name and address of the cemetery.

b. The name and address of the cemetery corporation.

c. An affidavit that the cemetery is in compliance with

this chapter.

d. Copies of all sales agreement forms used by the

cemetery.

e. The amount of the principal of the cemetery

corporation's care funds at the end of the fiscal year.

f. The number of interments made and interment spaces sold

during the fiscal year.

2. The report and a five-dollar filing fee for each

certificate of interment rights issued during the fiscal year

of the cemetery shall be filed with the commissioner within

four months following the end of the cemetery corporation's

fiscal year in the form required by the commissioner. The

filing fee may be charged directly to the purchaser of the

interment rights.

Sec. 66. NEW SECTION 523I.1212 UNIFIED ANNUAL REPORTS.

The commissioner shall permit the filing of a unified

report in the event of commonly owned or affiliated

cemeteries.

Sec. 67. NEW SECTION 523I.1301 MISLEADING FILINGS.

It is unlawful for a person to make or cause to be made, in

any document filed with the commissioner, or in any proceeding

under this chapter, any statement of material fact which is,

at the time and in the light of the circumstances under which

it is made, false or misleading, or, in connection with such

statement, to omit to state a material fact necessary in order

to make the statements made, in the light of the circumstances

under which they are made, not misleading.

Sec. 68. NEW SECTION 523I.1302 MISREPRESENTATIONS OF GOVERNMENT APPROVAL.

It is unlawful for a seller under this chapter to represent

or imply in any manner that the seller has been sponsored,

recommended, or approved, or that the seller's abilities or

qualifications have in any respect been passed upon by the

commissioner.

Sec. 69. NEW SECTION 523I.1303 FRAUDULENT PRACTICES.

A person who commits any of the following acts commits a

fraudulent practice and is punishable as provided in chapter

714:

1. Knowingly fails to comply with any requirement of this

chapter.

2. Knowingly makes, causes to be made, or subscribes to a

false statement or representation in a report or other

document required under this chapter, implementing rules, or

orders, or renders such a report or document misleading

through the deliberate omission of information properly

belonging in the report or document.

3. Conspires to defraud in connection with the sale of

memorials, memorialization, opening and closing services,

scattering services, interment rights, or a combination

thereof under this chapter.

4. Fails to deposit funds under section 523I.815 or

section 523I.1203 or withdraws funds in a manner inconsistent

with this chapter.

5. Knowingly sells memorials, memorialization, opening and

closing services, scattering services, interment rights, or a

combination thereof without the permits required under this

chapter.

6. Deliberately misrepresents or omits a material fact

relative to the sale of memorials, memorialization, opening

and closing services, scattering services, interment rights,

or a combination thereof.

Sec. 70. NEW SECTION 523I.1401 ADMINISTRATION.

1. This chapter shall be administered by the commissioner.

The deputy administrator appointed pursuant to section 502.601

shall be the principal operations officer responsible to the

commissioner for the routine administration of this chapter

and management of the administrative staff. In the absence of

the commissioner, whether because of vacancy in the office due

to absence, physical disability, or other cause, the deputy

administrator shall, for the time being, have and exercise the

authority conferred upon the commissioner. The commissioner

may by order from time to time delegate to the deputy

administrator any or all of the functions assigned to the

commissioner in this chapter. The deputy administrator shall

employ officers, attorneys, accountants, and other employees

as needed for administering this chapter.

2. It is unlawful for the commissioner or any

administrative staff to use for personal benefit any

information which is filed with or obtained by the

commissioner and which is not made public. This chapter does

not authorize the commissioner or any staff member to disclose

any such information except among themselves or to other

cemetery and funeral administrators, regulatory authorities,

or governmental agencies, or when necessary and appropriate in

a proceeding or investigation under this chapter or as

required by chapter 22. This chapter neither creates nor

derogates any privileges that exist at common law or otherwise

when documentary or other evidence is sought under a subpoena

directed to the commissioner or any administrative staff.

Sec. 71. NEW SECTION 523I.1402 SCOPE.

1. This chapter applies to cemeteries, to any person

advertising or offering memorials, memorialization, opening

and closing services, scattering services at a cemetery,

interment rights, or a combination thereof for sale, and to

interments made in areas not dedicated as a cemetery by a

person other than the state archaeologist.

2. This chapter applies when a purchase agreement is

executed within this state or an advertisement, promotion, or

offer to furnish memorials, memorialization, opening and

closing services, scattering services, interment rights, or a

combination thereof is made or accepted within this state. An

offer to furnish memorials, memorialization, opening and

closing services, scattering services, interment rights, or a

combination thereof is made within this state, whether or not

either party is then present in this state, when the offer

originates from this state or is directed by the offeror to

this state and received by the offeree in this state through

the mail, over the telephone, by the internet, or through any

other means of commerce.

3. If a foreign person does not have a registered agent or

agents in the state of Iowa, doing business within this state

shall constitute the person's appointment of the secretary of

state of the state of Iowa to be its true and lawful attorney

upon whom may be served all lawful process of original notice

in actions or proceedings arising or growing out of any

contract or tort.

Sec. 72. NEW SECTION 523I.1403 INVESTIGATIONS AND SUBPOENAS.

1. The commissioner may, for the purpose of discovering

violations of this chapter, or implementing rules or orders

issued under this chapter:

a. Make such public or private investigations within or

outside of this state as the commissioner deems necessary to

determine whether any person has violated or is about to

violate this chapter, implementing rules, or orders issued

under this chapter, or to aid in enforcement of this chapter,

or in the prescribing of rules and forms under this chapter.

b. Require or permit any person to file a statement in

writing, under oath or otherwise as the commissioner or

attorney general determines, as to all the facts and

circumstances concerning the matter to be investigated.

c. Notwithstanding chapter 22, keep confidential the

information obtained in the course of an investigation.

However, if the commissioner determines that it is necessary

or appropriate in the public interest or for the protection of

the public, the commissioner may share information with other

administrators, regulatory authorities, or governmental

agencies, or may publish information concerning a violation of

this chapter, implementing rules, or orders issued under this

chapter.

d. Investigate the cemetery corporation and examine the

books, accounts, papers, correspondence, memoranda, purchase

agreements, files, or other documents or records used by every

applicant and permit holder under this chapter.

e. Administer oaths and affirmations, subpoena witnesses,

compel their attendance, take evidence, and require the

production of any books, accounts, papers, correspondence,

memoranda, purchase agreements, files, or other documents or

records which the commissioner deems relevant or material to

any investigation or proceeding under this chapter and

implement rules, all of which may be enforced under chapter

17A.

f. Apply to the district court for an order requiring a

person's appearance before the commissioner or attorney

general, or a designee of either or both, in cases where the

person has refused to obey a subpoena issued by the

commissioner or attorney general. The person may also be

required to produce documentary evidence germane to the

subject of the investigation. Failure to obey a court order

under this subsection constitutes contempt of court.

2. The commissioner may issue and bring an action in

district court to enforce subpoenas within this state at the

request of an agency or administrator of another state, if the

activity constituting an alleged violation for which the

information is sought would be a violation of this chapter had

the activity occurred in this state.

Sec. 73. NEW SECTION 523I.1404 MEDIATION.

1. The commissioner may order a cemetery corporation to

participate in mediation in any dispute regarding a purchase

agreement. Mediation performed under this section shall be

conducted by a mediator appointed by the commissioner and

shall comply with the provisions of chapter 679C.

2. Mediation of disputes pursuant to subsection 1 shall

include attendance at a mediation session with a mediator and

the parties to the dispute, listening to the mediator's

explanation of the mediation process by the mediator,

presentation of each party's view of the dispute, and

listening to the response by the other party. Participation

in mediation does not require that the parties reach a

mediation agreement.

3. Parties to the mediation shall have the right to advice

and presence of counsel at all times. The parties to the

mediation shall present any mediation agreement reached

through the mediation to the commissioner. If a mediation

agreement is not reached, the mediator shall file a report

with the commissioner. The costs of the mediation shall be

approved by the commissioner and shall be borne by the

insurance division's cemetery fund created pursuant to section

523I.1413.

Sec. 74. NEW SECTION 523I.1405 CEASE AND DESIST ORDERS — INJUNCTIONS.

If it appears to the commissioner that a person has engaged

or is about to engage in an act or practice constituting a

violation of this chapter, or implementing rules or orders

issued under this chapter, the commissioner or the attorney

general may do any of the following:

1. Issue a summary order directed to the person that

requires the person to cease and desist from engaging in such

act or practice. A person may request a hearing within thirty

days of issuance of the summary order. If a hearing is not

timely requested, the summary order shall become final by

operation of law. The order shall remain effective from the

date of issuance until the date the order becomes final by

operation of law or is overturned by a presiding officer

following a request for hearing. Section 17A.18A is

inapplicable to summary cease and desist orders issued under

this section.

2. Bring an action in the district court in any county of

the state for an injunction to restrain a person subject to

this chapter and any agents, employees, or associates of the

person from engaging in conduct or practices deemed contrary

to the public interest. In any proceeding for an injunction,

the commissioner or attorney general may apply to the court

for a subpoena to require the appearance of a defendant and

the defendant's agents, employees, or associates and for the

production of any books, accounts, papers, correspondence,

memoranda, purchase agreements, files, or other documents or

records germane to the hearing upon the petition for an

injunction. Upon a proper showing, a permanent or temporary

injunction, restraining order, or writ of mandamus shall be

granted and a receiver may be appointed for the defendant or

the defendant's assets. The commissioner or attorney general

shall not be required to post a bond.

Sec. 75. NEW SECTION 523I.1406 COURT ACTION FOR FAILURE TO COOPERATE.

1. If a person fails or refuses to file a statement or

report or to produce any books, accounts, papers,

correspondence, memoranda, purchase agreements, files, or

other documents or records, or to obey a subpoena issued by

the commissioner, the commissioner may refer the matter to the

attorney general, who may apply to a district court to enforce

compliance. The court may order any or all of the following:

a. Injunctive relief restricting or prohibiting the offer

or sale of memorials, memorialization, opening and closing

services, scattering services, interment rights, or a

combination thereof.

b. Revocation or suspension of a permit issued under this

chapter.

c. Production of documents or records including but not

limited to books, accounts, papers, correspondence, memoranda,

purchase agreements, files, or other documents or records.

d. Such other relief as may be required.

2. A court order issued pursuant to subsection 1 is

effective until the person files the statement or report or

produces the documents requested, or obeys the subpoena.

Sec. 76. NEW SECTION 523I.1407 PROSECUTION FOR VIOLATIONS OF LAW.

1. A violation of this chapter or rules adopted or orders

issued under this chapter is a violation of section 714.16,

subsection 2, paragraph "a". The remedies and penalties

provided by section 714.16, including but not limited to

injunctive relief and penalties, apply to violations of this

chapter.

2. If the commissioner believes that grounds exist for the

criminal prosecution of persons subject to this chapter for

violations of this chapter or any other law of this state, the

commissioner may forward to the attorney general or the county

attorney the grounds for the belief, including all evidence in

the commissioner's possession, so that the attorney general or

the county attorney may proceed with the matter as deemed

appropriate. At the request of the attorney general, the

county attorney shall appear and prosecute the action when

brought in the county attorney's county.

Sec. 77. NEW SECTION 523I.1408 COOPERATION WITH OTHER AGENCIES.

1. The commissioner may cooperate with any governmental

law enforcement or regulatory agency to encourage uniform

interpretation and administration of this chapter and

effective enforcement of this chapter and effective regulation

of the sale of memorials, memorialization, and cemeteries.

2. Cooperation with other agencies may include but is not

limited to:

a. Making a joint examination or investigation.

b. Holding a joint administrative hearing.

c. Filing and prosecuting a joint civil or administrative

proceeding.

d. Sharing and exchanging personnel.

e. Sharing and exchanging relevant information and

documents.

f. Formulating, in accordance with chapter 17A, rules or

proposed rules on matters such as statements of policy,

regulatory standards, guidelines, and interpretive opinions.

Sec. 78. NEW SECTION 523I.1409 RULES, FORMS, AND ORDERS.

1. Under chapter 17A, the commissioner may from time to

time make, amend, and rescind such rules, forms, and orders as

are necessary or appropriate for the protection of purchasers

and the public and to administer the provisions of this

chapter, its implementing rules, and orders issued under this

chapter.

2. A rule, form, or order shall not be made, amended, or

rescinded unless the commissioner finds that the action is

necessary or appropriate to protect purchasers and the public

and is consistent with the policies and provisions of this

chapter, its implementing rules, and orders issued under this

chapter.

3. A provision of this chapter imposing any liability does

not apply to an act done or omitted in good faith in

conformity with any rule, form, or order of the commissioner,

notwithstanding that the rule, form, or order may later be

amended or rescinded or be determined by judicial or other

authority to be invalid for any reason.

Sec. 79. NEW SECTION 523I.1410 DATE OF FILING — INTERPRETIVE OPINIONS.

1. A document is filed when it is received by the

commissioner.

2. Requests for interpretive opinions may be granted in

the commissioner's discretion.

Sec. 80. NEW SECTION 523I.1411 RECEIVERSHIPS.

1. The commissioner shall notify the attorney general of

the potential need for establishment of a receivership if the

commissioner finds that a cemetery subject to this chapter

meets one or more of the following conditions:

a. Is insolvent.

b. Has utilized trust funds for personal or business

purposes in a manner inconsistent with this chapter.

c. The amount of care funds currently held in trust for

perpetual care is less than the amount required by this

chapter.

2. The commissioner or attorney general may apply to the

district court in any county of the state for the

establishment of a receivership. Upon proof that any of the

conditions described in this section have occurred, the court

may grant a receivership.

Sec. 81. NEW SECTION 523I.1412 LIQUIDATION PROCEDURES.

1. GROUNDS FOR LIQUIDATION. The commissioner may petition

the district court for an order directing the commissioner to

liquidate a cemetery corporation on any of the following

grounds:

a. The cemetery corporation did not deposit funds pursuant

to subchapter 12 or withdrew funds in a manner inconsistent

with this chapter and is insolvent.

b. The cemetery corporation did not deposit funds pursuant

to subchapter 12 or withdrew funds in a manner inconsistent

with this chapter and the condition of the cemetery

corporation is such that further transaction of business would

be hazardous, financially or otherwise, to purchasers or the

public.

2. LIQUIDATION ORDER.

a. An order to liquidate the business of a cemetery

corporation shall appoint the commissioner as liquidator and

shall direct the liquidator to immediately take possession of

the assets of the cemetery corporation and to administer them

under the general supervision of the court. The liquidator is

vested with the title to the property, contracts, rights of

action, and the books and records of the cemetery corporation,

wherever located, that is ordered liquidated as of the entry

of the final order of liquidation. The filing or recording of

the order with the clerk of court and the recorder of deeds of

the county in which the principal office or place of business

of the cemetery corporation is located, or, in the case of

real estate with the recorder of deeds of the county where the

property is located, constitutes the same notice as a deed,

bill of sale, or other evidence of title duly filed or

recorded with the recorder of deeds.

b. Upon issuance of an order, the rights and liabilities

of a cemetery corporation and of the cemetery corporation's

creditors, purchasers, owners, and other persons interested in

the cemetery corporation's estate shall become fixed as of the

date of the entry of the order of liquidation, except as

provided in subsection 14.

c. At the time of petitioning for an order of liquidation,

or at any time after the time of petitioning, the

commissioner, after making appropriate findings of a cemetery

corporation's insolvency, may petition the court for a

declaration of insolvency. After providing notice and hearing

as it deems proper, the court may make the declaration.

d. An order issued under this section shall require

accounting to the court by the liquidator. Accountings, at a

minimum, must include all funds received or disbursed by the

liquidator during the current period. An accounting shall be

filed within one year of the liquidation order and at such

other times as the court may require.

e. Within five days after the initiation of an appeal of

an order of liquidation, which order has not been stayed, the

commissioner shall present for the court's approval a plan for

the continued performance of the cemetery corporation's

obligations during the pendency of an appeal. The plan shall

provide for the continued performance of interment rights

agreements in the normal course of events, notwithstanding the

grounds alleged in support of the order of liquidation

including the ground of insolvency. If the defendant cemetery

corporation's financial condition, in the judgment of the

commissioner, will not support the full performance of all

obligations during the appeal pendency period, the plan may

prefer the claims of certain purchasers and claimants over

creditors and interested parties as well as other purchasers

and claimants, as the commissioner finds to be fair and

equitable, considering the relative circumstances of such

purchasers and claimants. The court shall examine the plan

submitted by the commissioner and if it finds the plan to be

in the best interests of the parties, the court shall approve

the plan. An action shall not lie against the commissioner or

any of the commissioner's deputies, agents, clerks,

assistants, or attorneys by any party based on preference in

an appeal pendency plan approved by the court.

3. POWERS OF LIQUIDATOR.

a. The liquidator may do any of the following:

(1) Appoint a special deputy to act for the liquidator

under this chapter, and determine the special deputy's

reasonable compensation. The special deputy shall have all

the powers of the liquidator granted by this section. The

special deputy shall serve at the pleasure of the liquidator.

(2) Hire employees and agents, legal counsel, accountants,

appraisers, consultants, and other personnel as the

commissioner may deem necessary to assist in the liquidation.

(3) With the approval of the court, fix reasonable

compensation of employees and agents, legal counsel,

accountants, appraisers, and consultants.

(4) Pay reasonable compensation to persons appointed and

defray from the funds or assets of the cemetery corporation

all expenses of taking possession of, conserving, conducting,

liquidating, disposing of, or otherwise dealing with the

business and property of the cemetery corporation. If the

property of the cemetery corporation does not contain

sufficient cash or liquid assets to defray the costs incurred,

the commissioner may advance the costs so incurred out of the

insurance division's cemetery fund. Amounts so advanced for

expenses of administration shall be repaid to the insurance

division's cemetery fund for the use of the division out of

the first available moneys of the cemetery corporation.

(5) Hold hearings, subpoena witnesses, and compel their

attendance, administer oaths, examine a person under oath, and

compel a person to subscribe to the person's testimony after

it has been correctly reduced to writing, and in connection to

the proceedings require the production of books, accounts,

papers, correspondence, memoranda, purchase agreements, files,

or other documents or records which the liquidator deems

relevant to the inquiry.

(6) Collect debts and moneys due and claims belonging to

the cemetery corporation, wherever located. Pursuant to this

subparagraph, the liquidator may do any of the following:

(a) Institute timely action in other jurisdictions to

forestall garnishment and attachment proceedings against

debts.

(b) Perform acts as are necessary or expedient to collect,

conserve, or protect its assets or property, including the

power to sell, compound, compromise, or assign debts for

purposes of collection upon terms and conditions as the

liquidator deems best.

(c) Pursue any creditor's remedies available to enforce

claims.

(7) Conduct public and private sales of the property of

the cemetery corporation.

(8) Use assets of the cemetery corporation under a

liquidation order to transfer obligations of purchase

agreements to a solvent cemetery corporation, if the transfer

can be accomplished without prejudice to the applicable

priorities under subsection 18.

(9) Acquire, hypothecate, encumber, lease, improve, sell,

transfer, abandon, or otherwise dispose of or deal with

property of the cemetery corporation at its market value or

upon terms and conditions as are fair and reasonable. The

liquidator shall also have power to execute, acknowledge, and

deliver deeds, assignments, releases, and other instruments

necessary to effectuate a sale of property or other

transaction in connection with the liquidation.

(10) Borrow money on the security of the cemetery

corporation's assets or without security and execute and

deliver documents necessary to that transaction for the

purpose of facilitating the liquidation. Money borrowed

pursuant to this subparagraph shall be repaid as an

administrative expense and shall have priority over any other

class 1 claims under the priority of distribution established

in subsection 18.

(11) Enter into contracts as necessary to carry out the

order to liquidate and affirm or disavow contracts to which

the cemetery corporation is a party.

(12) Continue to prosecute and to institute in the name of

the cemetery corporation or in the liquidator's own name any

and all suits and other legal proceedings, in this state or

elsewhere, and to abandon the prosecution of claims the

liquidator deems unprofitable to pursue further.

(13) Prosecute an action on behalf of the creditors,

purchasers, or owners against an officer of the cemetery

corporation or any other person.

(14) Remove records and property of the cemetery

corporation to the offices of the commissioner or to other

places as may be convenient for the purposes of efficient and

orderly execution of the liquidation.

(15) Deposit in one or more banks in this state sums as

are required for meeting current administration expenses and

distributions.

(16) Unless the court orders otherwise, invest funds not

currently needed.

(17) File necessary documents for recording in the office

of the recorder of deeds or record office in this state or

elsewhere where property of the cemetery corporation is

located.

(18) Assert defenses available to the cemetery corporation

against third persons, including statutes of limitations,

statutes of fraud, and the defense of usury. A waiver of a

defense by the cemetery corporation after a petition in

liquidation has been filed shall not bind the liquidator.

(19) Exercise and enforce the rights, remedies, and powers

of a creditor, purchaser, or owner, including the power to

avoid transfer or lien that may be given by the general law

and that is not included within subsections 7 through 9.

(20) Intervene in a proceeding wherever instituted that

might lead to the appointment of a receiver or trustee, and

act as the receiver or trustee whenever the appointment is

offered.

(21) Exercise powers now held or later conferred upon

receivers by the laws of this state which are not inconsistent

with this chapter.

b. This subsection does not limit the liquidator or

exclude the liquidator from exercising a power not listed in

paragraph "a" that may be necessary or appropriate to

accomplish the purposes of this chapter.

4. NOTICE TO CREDITORS AND OTHERS.

a. Unless the court otherwise directs, the liquidator

shall give notice of the liquidation order as soon as possible

by doing both of the following:

(1) Mailing notice, by first-class mail, to all persons

known or reasonably expected to have claims against the

cemetery corporation, including purchasers, at their last

known address as indicated by the records of the cemetery

corporation.

(2) Publication of notice in a newspaper of general

circulation in the county in which the cemetery corporation

has its principal place of business and in other locations as

the liquidator deems appropriate.

b. Notice to potential claimants under paragraph "a" shall

require claimants to file with the liquidator their claims

together with proofs of the claim under subsection 13 on or

before a date the liquidator shall specify in the notice.

Claimants shall keep the liquidator informed of their changes

of address, if any.

c. If notice is given pursuant to this subsection, the

distribution of assets of the cemetery corporation under this

chapter shall be conclusive with respect to claimants, whether

or not a claimant actually received notice.

5. ACTIONS BY AND AGAINST LIQUIDATOR.

a. After issuance of an order appointing a liquidator of a

cemetery corporation, an action at law or equity shall not be

brought against the cemetery corporation within this state or

elsewhere, and existing actions shall not be maintained or

further presented after issuance of the order. Whenever in

the liquidator's judgment, protection of the estate of the

cemetery corporation necessitates intervention in an action

against the cemetery corporation that is pending outside this

state, the liquidator may intervene in the action. The

liquidator may defend, at the expense of the estate of the

cemetery corporation, an action in which the liquidator

intervenes under this section.

b. Within two years or such additional time as applicable

law may permit, the liquidator, after the issuance of an order

for liquidation, may institute an action or proceeding on

behalf of the estate of the cemetery corporation upon any

cause of action against which the period of limitation fixed

by applicable law has not expired at the time of the filing of

the petition upon which the order is entered. If a period of

limitation is fixed by agreement for instituting a suit or

proceeding upon a claim, or for filing a claim, proof of

claim, proof of loss, demand, notice, or the like, or if in a

proceeding, judicial or otherwise, a period of limitation is

fixed in the proceeding or pursuant to applicable law for

taking an action, filing a claim or pleading, or doing an act,

and if the period has not expired at the date of the filing of

the petition, the liquidator may, for the benefit of the

estate, take any action or do any act, required of or

permitted to the cemetery corporation, within a period of one

hundred eighty days subsequent to the entry of an order for

liquidation, or within a further period as is shown to the

satisfaction of the court not to be unfairly prejudicial to

the other party.

c. A statute of limitations or defense of laches shall not

run with respect to an action against a cemetery corporation

between the filing of a petition for liquidation against the

cemetery corporation and the denial of the petition. An

action against the cemetery corporation that might have been

commenced when the petition was filed may be commenced for at

least sixty days after the petition is denied.

6. COLLECTION AND LIST OF ASSETS.

a. As soon as practicable after the liquidation order but

not later than one hundred twenty days after such order, the

liquidator shall prepare in duplicate a list of the cemetery

corporation's assets. The list shall be amended or

supplemented as the liquidator may determine. One copy shall

be filed in the office of the clerk of court, and one copy

shall be retained for the liquidator's files. Amendments and

supplements shall be similarly filed.

b. The liquidator shall reduce the assets to a degree of

liquidity that is consistent with the effective execution of

the liquidation.

c. A submission of a proposal to the court for

distribution of assets in accordance with subsection 11

fulfills the requirements of paragraph "a".

7. FRAUDULENT TRANSFERS PRIOR TO PETITION.

a. A transfer made and an obligation incurred by a

cemetery corporation within one year prior to the filing of a

successful petition for liquidation under this chapter is

fraudulent as to then existing and future creditors if made or

incurred without fair consideration, or with actual intent to

hinder, delay, or defraud either existing or future creditors.

A fraudulent transfer made or an obligation incurred by a

cemetery corporation ordered to be liquidated under this

chapter may be avoided by the liquidator, except as to a

person who in good faith is a purchaser, lienor, or obligee

for a present fair equivalent value. A purchaser, lienor, or

obligee, who in good faith has given consideration that is

less than the present fair equivalent value for such transfer,

lien, or obligation may retain the transfer, lien, or

obligation as security for repayment. The court may, on due

notice, order any such transfer, lien, or obligation to be

preserved for the benefit of the cemetery corporation and in

that event, the receiver shall succeed to and may enforce the

rights of the purchaser, lienor, or obligee.

b. (1) A transfer of property other than real property is

made when it becomes perfected so that a subsequent lien

obtainable by legal or equitable proceedings on a simple

contract could not become superior to the rights of the

transferee under subsection 9, paragraph "c".

(2) A transfer of real property is made when it becomes

perfected so that a subsequent bona fide purchaser from the

cemetery corporation could not obtain rights superior to the

rights of the transferee.

(3) A transfer that creates an equitable lien is not

perfected if there are available means by which a legal lien

could be perfected.

(4) A transfer not perfected prior to the filing of a

petition for liquidation is deemed to be made immediately

before the filing of the successful petition.

(5) This subsection applies whether or not there are or

were creditors who might have obtained a lien or persons who

might have become bona fide purchasers.

8. FRAUDULENT TRANSFER AFTER PETITION.

a. After a petition for liquidation has been filed, a

transfer of real property of the cemetery corporation made to

a person acting in good faith is valid against the liquidator

if made for a present fair equivalent value. If the transfer

is not made for a present fair equivalent value, the transfer

is valid to the extent of the present consideration actually

paid for which amount the transferee shall have a lien on the

property transferred. The commencement of a proceeding in

liquidation is constructive notice upon the recording of a

copy of the petition for or order of liquidation with the

recording of deeds in the county where any real property in

question is located. The exercise by a court of the United

States or a state or jurisdiction to authorize a judicial sale

of real property of the cemetery corporation within a county

in a state shall not be impaired by the pendency of a

proceeding unless the copy is recorded in the county prior to

the consummation of the judicial sale.

b. After a petition for liquidation has been filed and

before either the liquidator takes possession of the property

of the cemetery corporation or an order of liquidation is

granted:

(1) A transfer of the property, other than real property,

of the cemetery corporation made to a person acting in good

faith is valid against the liquidator if made for a present

fair equivalent value. If the transfer was not made for a

present fair equivalent value, then the transfer is valid to

the extent of the present consideration actually paid for

which amount the transferee shall have a lien on the property

transferred.

(2) If acting in good faith, a person indebted to the

cemetery corporation or holding property of the cemetery

corporation may pay the debt or deliver the property, or any

part of the property, to the cemetery corporation or upon the

cemetery corporation's order as if the petition were not

pending.

(3) A person having actual knowledge of the pending

liquidation is not acting in good faith.

(4) A person asserting the validity of a transfer under

this subsection has the burden of proof. Except as provided

in this subsection, a transfer by or on behalf of the cemetery

corporation after the date of the petition for liquidation by

any person other than the liquidator is not valid against the

liquidator.

c. A person receiving any property from the cemetery

corporation or any benefit of the property of the cemetery

corporation which is a fraudulent transfer under paragraph "a"

is personally liable for the property or benefit and shall

account to the liquidator.

d. This chapter does not impair the negotiability of

currency or negotiable instruments.

9. VOIDABLE PREFERENCES AND LIENS.

a. (1) A preference is a transfer of the property of a

cemetery corporation to or for the benefit of a creditor for

an antecedent debt made or suffered by the cemetery

corporation within one year before the filing of a successful

petition for liquidation under this chapter, the effect of

which transfer may be to enable the creditor to obtain a

greater percentage of this debt than another creditor of the

same class would receive. If a liquidation order is entered

while the cemetery corporation is already subject to a

receivership, then the transfers are preferences if made or

suffered within one year before the filing of the successful

petition for the receivership, or within two years before the

filing of the successful petition for liquidation, whichever

time is shorter.

(2) A preference may be avoided by the liquidator if any

of the following exist:

(a) The cemetery corporation was insolvent at the time of

the transfer.

(b) The transfer was made within four months before the

filing of the petition.

(c) At the time the transfer was made, the creditor

receiving the transfer or to be benefited by the transfer or

the creditor's agent acting with reference to the transfer had

reasonable cause to believe that the cemetery corporation was

insolvent or was about to become insolvent.

(d) The creditor receiving the transfer was an officer, or

an employee, attorney, or other person who was in fact in a

position of comparable influence in the cemetery corporation

to an officer whether or not the person held the position of

an officer, owner, or other person, firm, corporation,

association, or aggregation of persons with whom the cemetery

corporation did not deal at arm's length.

(3) Where the preference is voidable, the liquidator may

recover the property. If the property has been converted, the

liquidator may recover its value from a person who has

received or converted the property. However, if a bona fide

purchaser or lienor has given less than the present fair

equivalent value, the purchaser or lienor shall have a lien

upon the property to the extent of the consideration actually

given. Where a preference by way of lien or security interest

is voidable, the court may on due notice order the lien or

security interest to be preserved for the benefit of the

estate, in which event the lien or title shall pass to the

liquidator.

b. (1) A transfer of property other than real property is

made when it becomes perfected so that a subsequent lien

obtainable by legal or equitable proceedings on a simple

contract could not become superior to the rights of the

transferee.

(2) A transfer of real property is made when it becomes

perfected so that a subsequent bona fide purchaser from the

cemetery corporation could not obtain rights superior to the

rights of the transferee.

(3) A transfer which creates an equitable lien is not

perfected if there are available means by which a legal lien

could be created.

(4) A transfer not perfected prior to the filing of a

petition for liquidation is deemed to be made immediately

before the filing of the successful petition.

(5) This subsection applies whether or not there are or

were creditors who might have obtained liens or persons who

might have become bona fide purchasers.

c. (1) A lien obtainable by legal or equitable

proceedings upon a simple contract is one arising in the

ordinary course of the proceedings upon the entry or docketing

of a judgment or decree, or upon attachment, garnishment,

execution, or like process, whether before, upon, or after

judgment or decree and whether before or upon levy. It does

not include liens which under applicable law are given a

special priority over other liens which are prior in time.

(2) A lien obtainable by legal or equitable proceedings

may become superior to the rights of a transferee, or a

purchaser may obtain rights superior to the rights of a

transferee within the meaning of paragraph "b", if such

consequences follow only from the lien or purchase itself, or

from the lien or purchase followed by a step wholly within the

control of the respective lienholder or purchaser, with or

without the aid of ministerial action by public officials.

However, a lien does not become superior and a purchase does

not create superior rights for the purpose of paragraph "b"

through an act subsequent to the obtaining of a lien or

subsequent to a purchase which requires the agreement or

concurrence of any third party or which requires further

judicial action or ruling.

d. A transfer of property for or on account of a new and

contemporaneous consideration, which is under paragraph "b",

made or suffered after the transfer because of delay in

perfecting it, does not become a transfer for or on account of

an antecedent debt if any acts required by the applicable law

to be performed in order to perfect the transfer as against

liens or a bona fide purchaser's rights are performed within

twenty-one days or any period expressly allowed by the law,

whichever is less. A transfer to secure a future loan, if a

loan is actually made, or a transfer which becomes security

for a future loan, shall have the same effect as a transfer

for or on account of a new and contemporaneous consideration.

e. If a lien which is voidable under paragraph "a",

subparagraph (2), has been dissolved by the furnishing of a

bond or other obligation, the surety of which has been

indemnified directly or indirectly by the transfer or the

creation of a lien upon property of a cemetery corporation

before the filing of a petition under this chapter which

results in the liquidation order, the indemnifying transfer or

lien is also voidable.

f. The property affected by a lien voidable under

paragraphs "a" and "e" is discharged from the lien. The

property and any of the indemnifying property transferred to

or for the benefit of a surety shall pass to the liquidator.

However, the court may on due notice order a lien to be

preserved for the benefit of the estate and the court may

direct that the conveyance be executed to evidence the title

of the liquidator.

g. The court shall have summary jurisdiction of a

proceeding by a liquidator to hear and determine the rights of

the parties under this section. Reasonable notice of hearing

in the proceeding shall be given to all parties in interest,

including the obligee of a releasing bond or other like

obligation. Where an order is entered for the recovery of

indemnifying property in kind or for the avoidance of an

indemnifying lien, upon application of any party in interest,

the court shall in the same proceeding ascertain the value of

the property or lien. If the value is less than the amount

for which the property is indemnified or less than the amount

of the lien, the transferee or lienholder may elect to retain

the property or lien upon payment of its value, as ascertained

by the court, to the liquidator within the time as fixed by

the court.

h. The liability of a surety under a releasing bond or

other like obligation is discharged to the extent of the value

of the indemnifying property recovered or the indemnifying

lien nullified and avoided by the liquidator. Where the

property is retained under paragraph "g", the liability of the

surety is discharged to the extent of the amount paid to the

liquidator.

i. If a creditor has been preferred for property which

becomes a part of the cemetery corporation's estate, and

afterward in good faith gives the cemetery corporation further

credit without security of any kind, the amount of the new

credit remaining unpaid at the time of the petition may be set

off against the preference which would otherwise be

recoverable from the creditor.

j. If within four months before the filing of a successful

petition for liquidation under this chapter, or at any time in

contemplation of a proceeding to liquidate, a cemetery

corporation, directly or indirectly, pays money or transfers

property to an attorney for services rendered or to be

rendered, the transaction may be examined by the court on its

own motion or shall be examined by the court on petition of

the liquidator. The payment or transfer shall be held valid

only to the extent of a reasonable amount to be determined by

the court. The excess may be recovered by the liquidator for

the benefit of the estate. However, where the attorney is in

a position of influence in a cemetery corporation of an

affiliate, payment of any money or the transfer of any

property to the attorney for services rendered or to be

rendered shall be governed by the provisions of paragraph "a",

subparagraph (2), subparagraph subdivision (d).

k. (1) An officer, manager, employee, shareholder,

subscriber, attorney, or other person acting on behalf of the

cemetery corporation who knowingly participates in giving any

preference when the person has reasonable cause to believe the

cemetery corporation is or is about to become insolvent at the

time of the preference is personally liable to the liquidator

for the amount of the preference. There is an inference that

reasonable cause exists if the transfer was made within four

months before the date of filing of the successful petition

for liquidation.

(2) A person receiving property from the cemetery

corporation or the benefit of the property of the cemetery

corporation as a preference voidable under paragraph "a" is

personally liable for the property and shall account to the

liquidator.

(3) This subsection shall not prejudice any other claim by

the liquidator against any person.

10. CLAIMS OF HOLDER OF VOID OR VOIDABLE RIGHTS.

a. A claim of a creditor who has received or acquired a

preference, lien, conveyance, transfer, assignment, or

encumbrance, voidable under this chapter, shall not be allowed

unless the creditor surrenders the preference, lien,

conveyance, transfer, assignment, or encumbrance. If the

avoidance is effected by a proceeding in which a final

judgment has been entered, the claim shall not be allowed

unless the money is paid or the property is delivered to the

liquidator within thirty days from the date of the entering of

the final judgment. However, the court having jurisdiction

over the liquidation may allow further time if there is an

appeal or other continuation of the proceeding.

b. A claim allowable under paragraph "a" by reason of a

voluntary or involuntary avoidance, preference, lien,

conveyance, transfer, assignment, or encumbrance may be filed

as an excused late filing under subsection 12, if filed within

thirty days from the date of the avoidance or within the

further time allowed by the court under paragraph "a".

11. LIQUIDATOR'S PROPOSAL TO DISTRIBUTE ASSETS.

a. From time to time as assets become available, the

liquidator shall make application to the court for approval of

a proposal to disburse assets out of marshaled assets.

b. The proposal shall at least include provisions for all

of the following:

(1) Reserving amounts for the payment of all the

following:

(a) Expenses of administration.

(b) To the extent of the value of the security held, the

payment of claims of secured creditors.

(c) Claims falling within the priorities established in

subsection 18, paragraphs "a" and "b".

(2) Disbursement of the assets marshaled to date and

subsequent disbursement of assets as they become available.

c. Action on the application may be taken by the court

provided that the liquidator's proposal complies with

paragraph "b".

12. FILING PROOFS OF CLAIMS.

a. Proof of all claims shall be filed with the liquidator

in the form required by subsection 13 on or before the last

day for filing specified in the notice required under

subsection 4.

b. The liquidator may permit a claimant making a late

filing to share in distributions, whether past or future, as

if the claimant were not late, to the extent that the payment

will not prejudice the orderly administration of the

liquidation under any of the following circumstances:

(1) The existence of the claim was not known to the

claimant and the claimant filed the claim as promptly as

reasonably possible after learning of it.

(2) A transfer to a creditor was avoided under subsections

7 through 9, or was voluntarily surrendered under subsection

10, and the filing satisfies the conditions of subsection 10.

(3) The valuation under subsection 17 of security held by

a secured creditor shows a deficiency, which is filed within

thirty days after the valuation.

c. The liquidator may consider any claim filed late and

permit the claimant to receive distributions which are

subsequently declared on any claims of the same or lower

priority if the payment does not prejudice the orderly

administration of the liquidation. The late-filing claimant

shall receive at each distribution the same percentage of the

amount allowed on the claim as is then being paid to claimants

of any lower priority. This shall continue until the claim

has been paid in full.

13. PROOF OF CLAIM.

a. Proof of claim shall consist of a statement signed by

the claimant that includes all of the following that are

applicable:

(1) The particulars of the claim, including the

consideration given for it.

(2) The identity and amount of the security on the claim.

(3) The payments, if any, made on the debt.

(4) A statement that the sum claimed is justly owing and

that there is no setoff, counterclaim, or defense to the

claim.

(5) Any right of priority of payment or other specific

right asserted by the claimant.

(6) A copy of the written instrument which is the

foundation of the claim.

(7) The name and address of the claimant and the attorney

who represents the claimant, if any.

b. A claim need not be considered or allowed if it does

not contain all the information identified in paragraph "a"

which is applicable. The liquidator may require that a

prescribed form be used and may require that other information

and documents be included.

c. At any time the liquidator may request the claimant to

present information or evidence supplementary to that required

under paragraph "a", and may take testimony under oath,

require production of affidavits or depositions, or otherwise

obtain additional information or evidence.

d. A judgment or order against a cemetery corporation

entered after the date of filing of a successful petition for

liquidation, or a judgment or order against the cemetery

corporation entered at any time by default or by collusion

need not be considered as evidence of liability or of the

amount of damages. A judgment or order against a cemetery

corporation before the filing of the petition need not be

considered as evidence of liability or of the amount of

damages.

14. SPECIAL CLAIMS.

a. A claim may be allowed even if contingent, if it is

filed pursuant to subsection 12. The claim may be allowed and

the claimant may participate in all distributions declared

after it is filed to the extent that it does not prejudice the

orderly administration of the liquidation.

b. Claims that are due except for the passage of time

shall be treated as absolute claims are treated. However, the

claims may be discounted at the legal rate of interest.

c. Claims made under employment contracts by directors,

principal officers, or persons in fact performing similar

functions or having similar powers are limited to payment for

services rendered prior to the issuance of an order of

liquidation under subsection 2.

15. DISPUTED CLAIMS.

a. If a claim is denied in whole or in part by the

liquidator, written notice of the determination shall be given

to the claimant or the claimant's attorney by first-class mail

at the address shown in the proof of claim. Within sixty days

from the mailing of the notice, the claimant may file

objections with the liquidator. Unless a filing is made, the

claimant shall not further object to the determination.

b. If objections are filed with the liquidator and the

liquidator does not alter the denial of the claim as a result

of the objections, the liquidator shall ask the court for a

hearing as soon as practicable and give notice of the hearing

by first-class mail to the claimant or the claimant's attorney

and to any other persons directly affected. The notice shall

be given not less than ten nor more than thirty days before

the date of hearing. The matter shall be heard by the court

or by a court-appointed referee. The referee shall submit

findings of fact along with a recommendation.

16. CLAIMS OF OTHER PERSON. If a creditor, whose claim

against a cemetery corporation is secured in whole or in part

by the undertaking of another person, fails to prove and file

that claim, then the other person may do so in the creditor's

name and shall be subrogated to the rights of the creditor,

whether the claim has been filed by the creditor or by the

other person in the creditor's name to the extent that the

other person discharges the undertaking. However, in the

absence of an agreement with the creditor to the contrary, the

other person is not entitled to any distribution until the

amount paid to the creditor on the undertaking plus the

distributions paid on the claim from the cemetery

corporation's estate to the creditor equal the amount of the

entire claim of the creditor. An excess received by the

creditor shall be held by the creditor in trust for the other

person.

17. SECURED CREDITOR'S CLAIMS.

a. The value of the security held by a secured creditor

shall be determined in one of the following ways, as the court

may direct:

(1) By converting the security into money according to the

terms of the agreement pursuant to which the security was

delivered to the creditors.

(2) By agreement, arbitration, compromise, or litigation

between the creditor and the liquidator.

b. The determination shall be under the supervision and

control of the court with due regard for the recommendation of

the liquidator. The amount so determined shall be credited

upon the secured claim. A deficiency shall be treated as an

unsecured claim. If the claimant surrenders the security to

the liquidator, the entire claim shall be allowed as if

unsecured.

18. PRIORITY OF DISTRIBUTION. The priority of

distribution of claims from the cemetery corporation's estate

shall be in accordance with the order in which each class of

claims is set forth. Claims in each class shall be paid in

full or adequate funds retained for the payment before the

members of the next class receive any payment. Subclasses

shall not be established within a class. The order of

distribution of claims is as follows:

a. CLASS 1. The costs and expenses of administration,

including but not limited to the following:

(1) Actual and necessary costs of preserving or recovering

assets of the cemetery corporation.

(2) Compensation for all authorized services rendered in

the liquidation.

(3) Necessary filing fees.

(4) Fees and mileage payable to witnesses.

(5) Authorized reasonable attorney fees and other

professional services rendered in the liquidation.

b. CLASS 2. Reasonable compensation to employees for

services performed to the extent that they do not exceed two

months of monetary compensation and represent payment for

services performed within one year before the filing of the

petition for liquidation. Officers and directors are not

entitled to the benefit of this priority. The priority is in

lieu of any other similar priority which may be authorized by

law as to wages or compensation of employees.

c. CLASS 3. Claims under purchase agreements.

d. CLASS 4. Claims of general creditors.

e. CLASS 5. Claims of the federal or of any state or

local government. Claims, including those of a governmental

body for a penalty or forfeiture, are allowed in this class

only to the extent of the pecuniary loss sustained from the

act, transaction, or proceeding out of which the penalty or

forfeiture arose, with reasonable and actual costs incurred.

The remainder of such claims shall be postponed to the class

of claims under paragraph "g".

f. CLASS 6. Claims filed late or any other claims other

than claims under paragraph "g".

g. CLASS 7. The claims of shareholders or other owners.

19. LIQUIDATOR'S RECOMMENDATIONS TO THE COURT.

a. The liquidator shall review claims duly filed in the

liquidation and shall make further investigation as necessary.

The liquidator may compound, compromise, or in any other

manner negotiate the amount for which claims will be

recommended to the court except where the liquidator is

required by law to accept claims as settled by a person or

organization. Unresolved disputes shall be determined under

subsection 15. As soon as practicable, the liquidator shall

present to the court a report of the claims against the

cemetery corporation with the liquidator's recommendations.

The report shall include the name and address of each claimant

and the amount of the claim finally recommended.

b. The court may approve, disapprove, or modify the report

on claims by the liquidator. Reports not modified by the

court within sixty days following submission by the liquidator

shall be treated by the liquidator as allowed claims, subject

to later modification or to rulings made by the court pursuant

to subsection 15. A claim under a policy of insurance shall

not be allowed for an amount in excess of the applicable

policy limits.

20. DISTRIBUTION OF ASSETS. Under the direction of the

court, the liquidator shall pay distributions in a manner that

will ensure the proper recognition of priorities and a

reasonable balance between the expeditious completion of the

liquidation and the protection of unliquidated and

undetermined claims, including third-party claims.

Distribution of assets in kind may be made at valuations set

by agreement between the liquidator and the creditor and

approved by the court.

21. UNCLAIMED AND WITHHELD FUNDS.

a. Unclaimed funds subject to distribution remaining in

the liquidator's hands when the liquidator is ready to apply

to the court for discharge, including the amount distributable

to a creditor, owner, or other person who is unknown or cannot

be found, shall be deposited with the treasurer of state, and

shall be paid without interest, except as provided in

subsection 18, to the person entitled or to the person's legal

representative upon proof satisfactory to the treasurer of

state of the right to the funds. Any amount on deposit not

claimed within six years from the discharge of the liquidator

is deemed to have been abandoned and shall become the property

of the state without formal escheat proceedings and be

transferred to the insurance division's cemetery fund.

b. Funds withheld under subsection 14 and not distributed

shall upon discharge of the liquidator be deposited with the

treasurer of state and paid pursuant to subsection 18. Sums

remaining which under subsection 18 would revert to the

undistributed assets of the cemetery corporation shall be

transferred to the insurance division's cemetery fund and

become the property of the state as provided under paragraph

"a", unless the commissioner in the commissioner's discretion

petitions the court to reopen the liquidation pursuant to

subsection 23.

c. Notwithstanding any other provision of this chapter,

funds as identified in paragraph "a", with the approval of the

court, shall be made available to the commissioner for use in

the detection and prevention of future insolvencies. The

commissioner shall hold these funds in the insurance

division's cemetery fund and shall pay without interest,

except as provided in subsection 18, to the person entitled to

the funds or to the person's legal representative upon proof

satisfactory to the commissioner of the person's right to the

funds. The funds shall be held by the commissioner for a

period of two years at which time the rights and duties to the

unclaimed funds shall vest in the commissioner.

22. TERMINATION OF PROCEEDINGS.

a. When all assets justifying the expense of collection

and distribution have been collected and distributed under

this chapter, the liquidator shall apply to the court for

discharge. The court may grant the discharge and make any

other orders, including an order to transfer remaining funds

that are uneconomical to distribute, as appropriate.

b. Any other person may apply to the court at any time for

an order under paragraph "a". If the application is denied,

the applicant shall pay the costs and expenses of the

liquidator in resisting the application, including a

reasonable attorney fee.

23. REOPENING LIQUIDATION. At any time after the

liquidation proceeding has been terminated and the liquidator

discharged, the commissioner or other interested party may

petition the court to reopen the proceedings for good cause,

including the discovery of additional assets. The court shall

order the proceeding reopened if it is satisfied that there is

justification for the reopening.

24. DISPOSITION OF RECORDS DURING AND AFTER TERMINATION OF LIQUIDATION. If it appears to the commissioner that the

records of a cemetery corporation in the process of

liquidation or completely liquidated are no longer useful, the

commissioner may recommend to the court and the court shall

direct what records shall be retained for future reference and

what records shall be destroyed.

25. EXTERNAL AUDIT OF LIQUIDATOR'S BOOKS. The court may

order audits to be made of the books of the commissioner

relating to a liquidation established under this chapter, and

a report of each audit shall be filed with the commissioner

and with the court. The books, records, and other documents

of the liquidation shall be made available to the auditor at

any time without notice. The expense of an audit shall be

considered a cost of administration of the liquidation.

26. APPLICABILITY. This section shall not apply to a

religious cemetery or a cemetery owned or operated by a

governmental subdivision of this state.

Sec. 82. NEW SECTION 523I.1413 INSURANCE DIVISION'S CEMETERY FUND.

A special revenue fund in the state treasury, to be known

as the insurance division's cemetery fund, is created under

the authority of the commissioner of insurance. The

commissioner shall allocate annually from the fees paid

pursuant to section 523I.1211, four dollars for each sale of

interment rights reported by a cemetery corporation on the

cemetery corporation's annual report, for deposit to the

insurance division's cemetery fund. The commissioner shall

also deposit four dollars into the insurance division's

cemetery fund for each care assessment submitted, as provided

in section 523I.815. The moneys in the cemetery fund shall be

retained in the fund. The moneys are appropriated and,

subject to authorization by the commissioner, shall be used to

pay auditors, audit expenses, investigative expenses, the

expenses of mediation ordered by the commissioner, consumer

education expenses, the expenses of a toll-free telephone line

for consumer complaints, and the expenses of receiverships

established under section 523I.1411. The commissioner shall

not make an annual allocation to the cemetery fund if the

current balance of the fund exceeds two hundred thousand

dollars.

Sec. 83. NEW SECTION 523I.1414 VIOLATIONS OF LAW — REFERRALS TO THE DEPARTMENT OF PUBLIC HEALTH.

If the commissioner discovers a violation of a provision of

this chapter or any other state law or rule concerning the

disposal or transportation of human remains, the commissioner

shall forward all evidence in the possession of the

commissioner concerning such a violation to the department of

public health for such proceedings as the department of public

health deems appropriate.

Sec. 84.

Sections 359.37, 359.40, and 359.41, Code 2003,

are repealed.

Sec. 85.

Chapters 523I, 566 and 566A, Code 2003, are

repealed.