NLR 99/00 - Prepaid Funeral Services Regulations under the Prepaid Funeral Services Act

NEWFOUNDLAND AND LABRADOR REGULATION 99/00 Prepaid Funeral Services Regulations under the Prepaid Funeral Services Act (O.C. 2000-699) Amended by: 2014 cC-10.1 s71 105/17 NEWFOUNDLAND AND LABRADOR REGULATION 99/00 Prepaid Funeral Services Regulations under the Prepaid Funeral Services Act (O.C. 2000-699) (Filed December 20, 2000) Under the authority of section 14 of the Prepaid Funeral Services Act, the Lieutenant-Governor in Council makes the following regulations . Dated at St. Johns , December 19, 2000. Gary Norris Clerk of the Executive Council REGULATIONS Analysis 1. Short title 2. Definition 3. Contract 4. Sellers duties 5. Cancellation of contract 6. Assurance fund 7. Payment into Assurance fund 8. Payment out of fund 9. Long term trust monies Short title 1. These regulations may be cited as the Prepaid Funeral Services Regulations . 99/00 s1 Back to Top Definition 2. In these regulations, "Act" means the Prepaid Funeral Services Act . 99/00 s2 Back to Top Contract 3. (1) A prepaid funeral contract offered by a seller shall be in writing and in plain language. (2) A prepaid funeral contract shall (a) disclose the actual cost, inclusive of all borrowing and other charges, of the funeral goods and services purchased under the contract; (b) disclose all administrative fees and commissions and those fees and commissions shall not, in total, exceed 10% of the cost of the contract disclosed under paragraph (a); (c) disclose the manner in which payment is to be made on any unpaid balance owing on the contract; (d) contain the date of execution of the contract; (e) contain the name and address of the contract seller; (f) contain the full name and address of the contract buyer; (g) contain the full name and address of the contract beneficiary; (h) contain a complete and itemised list, including the price and description, of the funeral goods and services to be provided by the seller under the contract; (i) contain a statement setting out the circumstances and the terms and conditions under which substitution of funeral goods and services may be made by the seller under the contract; (j) where embalming has been contracted, contain specific instructions for that embalming; and (k) contain a statement that the contract may be cancelled at any time by the buyer and that the buyer is entitled to receive repayment of money paid under the contract except the amount referred to in section 5. (3) A seller shall, upon the request of the buyer, provide to the buyer, a statement indicating the amount of prepaid funeral funds together with income accumulated on the funds held in trust by the seller for the buyer. (4) The seller shall provide to the buyer, at the time of the execution of the prepaid funeral contract, a copy of the contract. 99/00 s3 Back to Top Sellers duties 4. (1) A seller shall, with respect to a prepaid funeral contract, maintain a record of the (a) cost of the contract; (b) date upon which the contract is executed; (c) date upon which payment for the contract is deposited into the trust account established under section 6 of the Act; (d) name and address of the buyer of the contract; (e) name, address and, where known, the age of the beneficiary at his or her date of death; (f) date upon which the contract was performed or cancelled; and (g) details respecting the deposit of funds paid by the buyer to the seller under the prepaid funeral contract. (2) A trust account established under section 6 of the Act shall (a) have funds collected under the prepaid funeral contract paid into that account immediately upon receipt of those funds by the seller; and (b) not contain funds other than those accruing from the sale of prepaid funeral contracts and income accrued on those funds. (3) Notwithstanding subsection (2), a seller may, out of the funds collected from a buyer under a prepaid funeral contract, pay to a church, place of worship or non-profit organization, the cost of the purchase of a cemetery plot. (4) A trust account established under section 6 of the Act shall be audited annually by a person who is a public accountant licensed under the Chartered Professional Accountants and Public Accountants Act . (5) Where, before the coming into force of the Act, a seller has entered into a prepaid funeral contract, the seller shall, not later than 90 days after the end of the fiscal year of the seller, provide to the registrar the audited statements and records required under paragraph 17(1)(a) of the Act. (6) Where, upon receipt of an audited statement and records under subsection (5), the registrar determines that all or a portion of the amount of money received in payment under the prepaid funeral contracts that are the subject of the audit has not been deposited into a trust account as required under section 6 of the Act, an amount of money shall be paid into a trust account as required under that section at a rate of not less than 20% of that total amount of money received under the contracts in each year for 5 years immediately after the coming into force of the Act. 99/00 s4 ; 2014 cC-10.1 s71 ; 105/17 s1 Back to Top Cancellation of contract 5. (1) Where a seller and a buyer have entered into a prepaid funeral contract and the buyer cancels the contract under subsection 10(1) of the Act, the seller may, before refunding the money paid for the contract from the trust account established under section 6 of the Act, deduct from the amount returned to the buyer the lesser of $250 or 10% of the money paid under the prepaid funeral contract. (2) Where there is a refund of money to a buyer in accordance with subsection (1), the seller shall also refund to the buyer income accrued on the money. (3) Where a seller and a buyer have entered into a prepaid funeral contract and the buyer cancels the contract under subsection 10(1) of the Act, the seller shall, where the beneficiary and the buyer are not the same person, notify the beneficiary or his or her legal representative, in writing, of that cancellation. 99/00 s5 Back to Top Assurance fund 6. (1) [Rep. by 105/17 s2] (2) The assurance fund shall consist of money paid into the fund under section 7 and income accrued on that money. (3) [Rep. by 105/17 s2] (4) The costs of managing and administering the assurance fund may be paid out of that fund to the Crown. 99/00 s6 ; 105/17 s2 Back to Top Payment into Assurance fund 7. (1) After the coming into force of this Act a seller shall pay into the assurance fund established under section 5 of the Act an amount of money that is 1% of the cost of each prepaid funeral contract, less (a) fees and commissions referred to in paragraph 3(2)(b); and (b) money paid out under subsection 4(3). (2) Notwithstanding subsection (1), where a seller must pay money into a trust account in accordance with subsection 4(6) and the total amount paid into that trust account is (a) not more than 20% of the total amount to be paid, an amount of 5% of the cost of each prepaid funeral contract entered into after the coming into force of the Act; (b) more than 20% and not more than 40% of the total amount to be paid, an amount of 4% of the cost of each prepaid funeral contract entered into after the coming into force of the Act; (c) more than 40% and not more than 60% of the total amount to be paid, an amount of 3% of the cost of each prepaid funeral contract entered into after the coming into force of the Act; (d) more than 60% and not more than 80% of the total amount to be paid, an amount of 2% of the cost of each prepaid funeral contract entered into after the coming into force of the Act; and (e) more than 80% of the total amount to be paid, an amount of 1% of the cost of each prepaid funeral contract entered into after the coming into force of the Act, less fees and commissions referred to in paragraph 3(2)(b) and money paid out under subsection 4(3), shall be paid by the seller into the assurance fund established under section 5 of the Act. 99/00 s7 Back to Top Payment out of fund 8. (1) A buyer or an agent or legal representative of a buyer may apply to the registrar, association or board, whichever has been directed by the minister under subsection 5(3) of the Act to administer the assurance fund, for compensation from the assurance fund where, after the coming into force of the Act, (a) a seller has become bankrupt and the trustee does not refund the buyer the amount due him or her under the prepaid funeral contract in bankruptcy; (b) a prepaid funeral contract entered into by the buyer is cancelled and the seller has not, within 6 months of the cancellation, reimbursed the buyer the amount paid by the buyer under the contract together with income accrued on the amount; or (c) a prepaid funeral contract entered into by the buyer has not been carried out as provided for by the contract and the buyer has, as a result, purchased other funeral goods and services. (2) Where a person makes an application under subsection (1), the registrar, association or board, whichever has been directed by the minister under subsection 5(3) of the Act to administer the assurance fund, shall determine the amount due to the buyer or his or her agent or legal representative in accordance with the prepaid funeral contract entered into by that buyer but, where an application is made under paragraph (1)(a), the applicant shall only be reimbursed the difference between the amount due under the contract and an amount paid to the applicant by the trustee in bankruptcy. (3) Notwithstanding subsection (2), where a person makes an application under subsection (1) because he or she believes that the funeral goods or services provided were not in accordance with those required by the prepaid funeral contract, the registrar, association or board, whichever has been directed by the minister under subsection 5(3) of the Act to administer the assurance fund, may award to the person an amount that is determined to be the difference between the goods and services supplied and the goods and services that were contracted under the contract. (4) The minister shall determine the information, forms and documentation that are to be provided in support of an application under subsection (1) and failure to provide the required information is a reason to deny the application. 99/00 s8 ; 105/17 s3 Back to Top Long term trust monies 9. (1) Where (a) a prepaid funeral contract has been entered into and the money received in payment under that contract has been deposited into a trust account under section 6 of the Act and section 4 of these regulations; and (b) the contract has been in effect for 25 or more years; but (c) the contract not been carried out because the seller of the contract has not been notified of the death of the beneficiary under the contract; and (d) the seller of the contract has no knowledge of the death of the beneficiary under the contract, the seller of the contract shall mail to the buyer of the contract at the last known address of that buyer, a letter reminding the buyer of the purchase of the contract and requesting confirmation, within 60 days, that the contract is to continue and the beneficiary is not deceased. (2) Where a seller does not receive a response to a letter sent to a buyer under subsection (1) within the time stated in the letter, the seller, or, where the seller is a corporation, a director of the corporation, shall, in writing, immediately notify the registrar that he or she believes that the money held in trust with respect to the prepaid funeral contract to which subsection (1) applies is and will remain unclaimed and shall state the reasons for this belief. (3) After receiving a letter from a seller under subsection (2), the registrar may instruct the seller and the trustee of the money held with respect to the prepaid funeral contract to pay that money, less an amount referred to in subsection (6), into the assurance fund and that money shall be paid as instructed. (4) A person entitled to money paid into the assurance fund under subsection (3) may apply to the registrar requesting him or her to pay over to the person the money and income that has accrued on the money. (5) Where the registrar is satisfied that a person who has applied under subsection (4) is entitled to be paid money together with accrued income, the registrar shall direct the payment of the money and income set out in the order from the assurance fund to the appropriate person. 99/00 s9 ; 105/17 s4