(a) Cemetery authorities may secure pecuniary obligations by mortgage or lien upon their property, whether or not the property has been set aside for interment purposes, and may sell plots, crypts, niches, or contracts containing pre-need interment services subject to such mortgage or lien within the limitations and conditions imposed by this chapter.
contract signature

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Terms Used In Hawaii Revised Statutes 441-12

  • Bankruptcy: Refers to statutes and judicial proceedings involving persons or businesses that cannot pay their debts and seek the assistance of the court in getting a fresh start. Under the protection of the bankruptcy court, debtors may discharge their debts, perhaps by paying a portion of each debt. Bankruptcy judges preside over these proceedings.
  • Cemetery: means any property, or part interest therein, dedicated to and used or intended to be used for the permanent interment of human remains. See Hawaii Revised Statutes 441-1
  • Cemetery authority: means any person who undertakes to establish, maintain, manage, operate, improve, or conduct a cemetery to inter human remains; or offers perpetual care of the cemetery; or sells or holds money in trust for pre-need interment services, whether or not the person undertakes such activity for profit; provided that this shall not apply to the designated trustee of the funds. See Hawaii Revised Statutes 441-1
  • Contract: A legal written agreement that becomes binding when signed.
  • Department: means the department of commerce and consumer affairs. See Hawaii Revised Statutes 441-1
  • Foreclosure: A legal process in which property that is collateral or security for a loan may be sold to help repay the loan when the loan is in default. Source: OCC
  • Interment: means the disposition of human remains by cremation and inurnment, entombment, or burial in a place used, or intended to be used, and dedicated for cemetery purposes. See Hawaii Revised Statutes 441-1
  • Lien: A claim against real or personal property in satisfaction of a debt.
  • Mortgage: The written agreement pledging property to a creditor as collateral for a loan.
  • Niche: means a recess of space in a structure or plot of earth used or intended to be used for the permanent inurnment therein of the cremated remains of one or more deceased persons. See Hawaii Revised Statutes 441-1
  • Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
  • Person: means an individual, partnership, corporation, county, association, or any other group however organized. See Hawaii Revised Statutes 441-1
  • Personal property: All property that is not real property.
  • Plot: means a grave or space in a cemetery sold or otherwise disposed of to one or more persons, used or intended to be used, for the permanent interment therein of the remains of one or more deceased persons. See Hawaii Revised Statutes 441-1
  • Pre-need funeral authority: means any person who is engaged in the business of selling pre-need funeral services, or holds money in trust to provide for future funeral services; provided that this shall not apply to the designated trustee of the funds. See Hawaii Revised Statutes 441-1
  • Pre-need interment services: means the furnishing of opening and closing services and related commodities, including but not limited to vaults, markers, and vases, which services are to be rendered at some future date. See Hawaii Revised Statutes 441-1
  • Real property: Land, and all immovable fixtures erected on, growing on, or affixed to the land.
(b) All mortgages and other liens of any nature hereafter contracted for and recorded on the property which has been and was, at the time of the perfection of the lien, dedicated to cemetery purposes pursuant to this chapter, shall not affect or impair the dedication of the property to cemetery use, or the title of any plot, crypt, or niche contract, or the obligation of the cemetery authority to fully perform any contract containing pre-need interment services, but the mortgage or other lien shall be subject and subordinate to the dedication and title of any plot, crypt, or niche contract and the obligation of the cemetery authority to fully perform any contract containing pre-need interment services, and any and all sales made upon foreclosure, insolvency, or federal bankruptcy proceeding shall be subject and subordinate to the dedication and title of any plot, crypt, or niche contract and the obligation of the cemetery authority to fully perform any contract containing pre-need interment services.
(c) A statutory lien is created, without recordation of the lien, upon all real and personal property held by a pre-need funeral authority upon the filing with the department of audited financial statements, audited by an independent certified public accountant, that indicate that its pre-need funeral trusts are not fully funded as required by applicable law. The amount of the lien shall be equal to the amount that the pre-need funeral trusts are underfunded. This lien shall have priority over all subsequent real property mortgages, security interests, and liens created upon the real and personal property of the pre-need funeral authority and shall terminate at the time when the pre-need funeral trusts are properly funded, as evidenced by records and certification of the trustee and subsequent assurance from the independent certified public accountant that the underfunding was corrected.
(d) Notwithstanding any other language to the contrary, sales by a cemetery or pre-need funeral authority of accounts receivables from contracts containing pre-need interment, pre-need funeral, or perpetual care services shall be prohibited. Sales made in violation of this subsection shall be void.
(e) Any transfer of pre-need funeral trust funds and the obligations related thereto shall be to another person subject to section 441-20 or 441-30.5. Any transfer of pre-need funeral trust funds and pre-need funeral contracts and obligations related thereto in accordance with this section shall include the transfer of pre-need funeral contracts made, entered into, or purchased by the pre-need funeral authority prior to the transfer.

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