Illinois General Assembly - Illinois Compiled Statutes

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815 ILCS 390/15

(815 ILCS 390/15) (from Ch. 21, par. 215)

Sec. 15.

(a) Whenever a seller receives anything of value under a
pre-need sales contract, the person receiving such value shall deposit 50%
of all proceeds received into one or more trust funds maintained pursuant
to this Section, except that, in the case of proceeds received for the
purchase of outer burial containers, 85% of the proceeds shall be deposited
into one or more trust funds. Such deposits shall be made until the amount
deposited in
trust equals 50% of the sales price of the cemetery merchandise, cemetery
services and undeveloped spaces included in such contract, except that, in
the case of deposits for outer burial containers, deposits shall be made until
the amount deposited in trust equals 85% of the sales price. In the event
an
installment contract is factored, discounted or sold to a third party, the
seller shall deposit an amount equal to 50% of the sales price of the
installment contract, except that, for the portion of the contract
attributable to the sale of outer burial containers, the seller shall deposit
an amount equal to 85% of the sales price. Proceeds required to be deposited
in trust which
are
attributable to cemetery merchandise and cemetery services shall be held
in a "Cemetery Merchandise Trust Fund". Proceeds required to be deposited
in trust which are attributable to the sale of undeveloped interment,
entombment or inurnment spaces shall be held in a "Pre-construction Trust
Fund". If merchandise is delivered for storage in a bonded warehouse, as
authorized herein, and payment of transportation or other charges totaling
more than $20 will be required in order to secure delivery to the site of
ultimate use, upon such delivery to the warehouse the seller shall deposit
to the trust fund the full amount of the actual or estimated transportation
charge. Transportation charges which have been prepaid by the seller
shall not be deposited to trust funds maintained pursuant to this Section.
As used in this Section, "all proceeds" means the entire amount paid by a
purchaser in connection with a pre-need sales contract, including finance
charges and Cemetery Care Act  contributions, but excluding sales taxes
and credit life insurance premiums.

(b) The seller shall act as trustee of all amounts received for cemetery merchandise, services, or undeveloped spaces until those amounts have been deposited into the trust fund. All trust deposits required by this Act shall be made within 30 days
following the end of the month of receipt. The seller must retain a corporate fiduciary as an independent trustee for any amount of trust funds.  Upon 30 days' prior written notice from the seller to the Comptroller, the seller may change the trustee of the trust fund. Failure to provide the Comptroller with timely prior notice is an intentional violation of this Act.

(c) A trust established under this Act must be maintained with a corporate fiduciary as defined in Section 1-5.05 of the Corporate Fiduciary Act or with a foreign corporate fiduciary recognized by Article IV of the Corporate Fiduciary Act.

(d) Funds deposited in the trust account shall be identified in the records
of the seller by the name of the purchaser. Nothing shall prevent the trustee
from commingling the deposits in  any such trust fund for purposes of the
management thereof and the investment of funds therein as provided in the
"Common Trust Fund Act", approved June 24, 1949, as amended. In addition,
multiple trust funds maintained pursuant to this Act may be commingled or
commingled with other funeral or burial related trust funds, provided that
all record keeping requirements imposed by or pursuant to law are met.

(e) In lieu of a pre-construction trust fund, a seller of undeveloped
interment, entombment or inurnment spaces may obtain and file with the
Comptroller a performance bond in an amount at least equal to 50% of the
sales price of the undeveloped spaces or the estimated cost of completing
construction, whichever is greater.  The bond shall be conditioned on the
satisfactory construction and completion of the undeveloped spaces as
required in Section 19 of this Act.

Each bond obtained under this Section shall have as surety thereon a
corporate surety company incorporated under the laws of the United States,
or a State, the District of Columbia or a territory or possession of the
United States.  Each such corporate surety company must be authorized to
provide performance bonds as required by this Section, have paid-up
capital of at least $250,000 in cash or its equivalent and be able to carry
out its contracts.  Each pre-need seller must provide to the Comptroller,
for each corporate surety company such
seller utilizes, a statement of assets and liabilities of the corporate
surety company sworn to by the president and secretary
of the corporation by January 1 of each year.

The Comptroller shall prohibit pre-need sellers from doing new business
with a corporate surety company if the company is insolvent or is in
violation of this Section.  In addition the Comptroller may direct a
pre-need seller to reinstate a pre-construction trust fund upon the
Comptroller's determination that the corporate surety company no longer is
sufficient security.

All performance bonds issued pursuant to this Section must be irrevocable
during the statutory term for completing construction specified in Section
19 of this Act, unless terminated sooner by the completion of construction.

(f) Whenever any pre-need contract shall be entered into and include  1)
items of cemetery merchandise and cemetery services, and 2) rights to
interment, inurnment or entombment in completed spaces without allocation
of the gross sale price among the items sold, the application of payments
received under the contract shall be allocated, first to the right to
interment, inurnment or entombment, second to items of cemetery merchandise
and cemetery services, unless some other allocation is clearly provided
in the contract.

(g) Any person engaging in pre-need sales who enters into a combination
sale which involves the sale of items covered by a trust or performance
bond requirement and any item not covered by any entrustment or bond
requirement, shall be prohibited from increasing the gross sales price of
those items not requiring entrustment with the purpose of allocating a
lesser gross sales price to items which require a trust deposit or a
performance bond.

(Source: P.A. 96-879, eff. 2-2-10; 97-593, eff. 8-26-11.)