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Late Spring 2008
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Columns
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“Dear Counselor….” By Bill Stalter Dear Counselor, The Missouri funeral home I purchased
has a block of NPS preneed contracts. The
prior owner rolled over to NPS his joint account contracts and kept 20%.
Can I sue the bank that surrendered the joint accounts? ****************************************** R.S.Mo.
§436.053 governs preneed contracts that are funded with joint bank accounts.
The law sets out the requirements of the agreement between the funeral
home and the purchaser, and contemplates that the parties will have joint
control over the account. The
funeral home, not the bank, has the responsibility for ensuring compliance with
§436.053. The prior owner may have
violated Chapter 436 if he/she terminated the joint accounts and rolled them
over to NPS without the consumers’ consent.
In the months to come, regulators may discover that this type of rollover
happened more frequently than they care to know.
Before
funeral directors criticize their brethren who made such rollovers, they need to
determine how compliant their joint account contracts are.
A funeral director recently provided testimony at a legislative hearing
about how safe his preneed accounts were: in a single CD at his local bank.
The law requires individual accounts.
Since 9/11, the Patriot Act requires financial institutions to obtain
more information when joint accounts are set up.
It is so difficult setting up a joint account these days that §436.053
is no longer practical. Getting
back to the question at hand, you can find an attorney that will be prepared to
take on the bank, but your true cause of action is with the prior owner.
If that becomes your course of action, the purchase agreement and the
issue of your due diligence will be put to the test.
****************************************** Bill Stalter answers our questions for
educational purposes only. It is The Dead Beat’s
intent to give the reader general information about legal issues, not to provide
legal advice. If a reader needs
legal advice, he or she should hire an attorney.
Reading The Dead Beat should
not be used as a substitute for legal advice from an attorney.
When Bill provides legal advice he does so for Stalter Legal Services in
Overland Park, Kansas. Bill also
provides consulting services through Preneed Resource Consultants, which can be
found at www.preneedresource.com.
We
need some questions for the “Dear Counselor….” column. Please send your questions to Bill’s e-mail or The
Dead Beat’s and we will get some answers in future issues. email: wastal@swbell.net bill@stalterlegal.com Or Editor@thedead-beat.com Or Fax: 1-417-537-4797
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ADVERTISERS Brian Simmons Springfield Mortuary Service Miller Coach & Limousine Sales Si Mortuary & Cremation Services Mid-States Professional Services Dallas Institute of Funeral Service American Crematory Equipment Co. Aaron Beasley Embalming Service & Crematory Texas Funeral Directors Association Central Texas Funeral Transport
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