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Union Cemetery Ass'n v. Cooper

OPINION FILED JANUARY 22, 1953.

THE UNION CEMETERY ASSOCIATION OF THE CITY OF LINCOLN, ILLINOIS, ET AL., APPELLANTS,

v.

BENJAMIN O. COOPER, AUDITOR OF PUBLIC ACCOUNTS, ET AL., APPELLEES.



APPEAL from the Circuit Court of Sangamon County; the Hon. DeWITT S. CROW, Judge, presiding.

MR. JUSTICE FULTON DELIVERED THE OPINION OF THE COURT:

Appellants, The Union Cemetery Association of the city of Lincoln, Illinois, an Illinois nonprofit corporation, Riverside Cemetery Association, a corporation, and The Lyndon Cemetery Association of Lyndon Township, Whiteside County, Illinois, an Illinois nonprofit corporation, brought separate actions in the circuit court of Sangamon County against the Auditor of Public Accounts and the Attorney General of the State of Illinois. Each of the complaints filed sought substantially the same relief. The court was asked to declare the rights and obligations of the parties under the Cemetery Care Act; (Ill. Rev. Stat. 1951, chap. 21, par. 64.1 et seq.,) that the act be declared and construed as not applying to appellants or to care funds theretofore deposited with them or which might thereafter be so deposited; that the court declare the act illegal and void in contravention of the constitutions of the United States and of the State of Illinois and that the defendants be enjoined from enforcing the act against the appellants. Motions to dismiss the complaints were filed on behalf of the Auditor and Attorney General in each case alleging that the complaints were insufficient in law and in equity and asserting the constitutionality of the Cemetery Care Act. The cases were later consolidated upon motion of the defendants, and on January 3, 1952, the trial judge entered a decree in the consolidated cause striking the complaints and dismissing the case for want of equity and upon the merits. From this decree appellants have appealed directly to this court because of the constitutional questions involved.

The facts set forth in the complaints show that appellants were similar in purpose, organization and operation. The Union Cemetery Association and The Lyndon Cemetery Association were organized under the act concerning corporations not for pecuniary profit. (Ill. Rev. Stat. 1951, chap. 32, par. 163a.) They have been in existence and continuous operation since 1880 and 1882, respectively. The Riverside Cemetery Association was organized under the provisions of "An Act to provide for the ownership, management and control of Cemetery Associations," approved May 14, 1903. (Ill. Rev. Stat. 1951, chap. 21, par. 35 et seq.) The fact that the Riverside association is organized under a different statute is not material and does not affect the questions raised in this appeal. Each of appellant associations is controlled and managed by a board of trustees chosen by members of the association; each owns certain cemetery property in which a large number of burials have been made over the years and each is a civic or community organization maintained for the public generally with no restriction or discrimination by reason of the race, color or religious affiliation of its members. Appellants are all nonprofit organizations having no capital stock, no shares of stock and no stockholders. The only requirement for membership in these associations is the ownership of a lot or lots in the cemetery controlled and operated by the association. At the time of the filing of the complaints each of these cemetery associations had a perpetual care fund which was held and managed by the same board of trustees who held and managed the real estate of the association. The Union Cemetery Association, for example, had entered into approximately 984 agreements with purchasers of lots and burial space for the application of the income from the perpetual care fund in perpetuity for the care and maintenance of the lots. As of January 1, 1948, the perpetual care fund of this association had investments with a fair market value in excess of $87,000.

It is conceded that there are in existence and in operation in the State of Illinois numerous nonprofit cemetery associations similar to appellants; that many of these are incorporated under the provisions of the act of 1903, with the trustees under the supervision of the county court of the county in which the cemetery is located; that others are managed and operated by trustees according to the rules and regulations of each association and are not incorporated. It is also conceded that there are approximately 14,000 nonprofit corporations of one kind or another organized and operating under the laws of the State of Illinois; that, other than cemeteries, these include principally civic, fraternal, religious, charitable, educational and recreational groups; that many of these have large endowment and trust funds for the maintenance and care of buildings, homes and grounds used by the respective organizations. Among the cemeteries of the State are those operated by municipalities, and by fraternal, religious and family groups.

The full title of the act challenged by appellants is "An act to regulate the care funds of cemeteries and of lots, graves, crypts, niches, private mausoleums, memorials, markers or monuments in cemeteries." The act was approved July 21, 1947, effective January 1, 1948. An understanding of the purpose, scope and nature of the act requires a brief statement of its essential provisions. After providing for its short title in section 1, section 2 of the act proceeds with a definition of the terms used. "Care," under the act, is stated to mean "the care and maintenance, including overhead, of a cemetery and of the lots, graves, crypts, niches, family mausoleums, memorials and markers therein." "Cemetery authority" means "any person, firm, corporation, trustee, partnership, association or municipality owning, operating, controlling or managing a cemetery or holding lands for burial grounds or burial purposes." A "Family burying ground" is defined as "a cemetery in which no lots are sold to the public and in which interments are restricted to a group of persons related to each other by blood or marriage." A "Fraternal cemetery" is defined as "a cemetery owned, operated, controlled or managed by any fraternal organization or organizations; or a cemetery under the control and supervision of any cemetery authority or any fraternal organization or organizations in which the sale of lots, graves, crypts or niches is restricted principally to members, and members of their families, of such organization or organizations, or auxiliaries thereof." A "Municipal cemetery" under the act is "a cemetery owned, operated, controlled or managed by any city, village, incorporated town, township, county or other municipal corporation, political subdivision or instrumentality thereof authorized by law to own, operate or manage a cemetery." A "Privately operated cemetery" is stated to be "any cemetery other than a fraternal, municipal or religious cemetery or a family burying ground." A "Religious cemetery" is defined as "a cemetery owned, operated, controlled, or managed by any recognized church, religious society, association or denomination, or by any cemetery authority or any corporation administering, or through which is administered, the temporalities of any recognized church, religious society, association or denomination."

Certain provisions of the act apply only to privately operated cemeteries. These cemeteries are required to secure a license from the Auditor of Public Accounts before acquiring care funds. In order to secure such a license detailed information as to personnel and finances must be given and the license may be refused if certain specified conditions are not met. A privately operated and licensed cemtery must file an annual report with respect to its care funds. This report must show the income to and disbursements from the fund and list the securities in which the fund is invested. The books of such cemetery must be open at all times to inspection. In the administration of care funds privately operated cemeteries are subject to examination, supervision and regulation by the Auditor who may, upon certain conditions, revoke the license to handle care funds either temporarily or permanently. Before accepting care funds in connection with the sale of burial space a private authority must specify in writing the nature and extent of the care to be furnished, for which it must require the deposit of a given amount based upon sale price or the size of the burial space. Except where excused by the act, these private associations are required to post a bond to insure the proper handling of care funds.

Some of the provisions of the act apply to all cemeteries. All cemeteries are authorized to receive and hold money or property in trust in perpetuity for cemetery care. When such funds are accepted all cemeteries are required to invest them as provided by the Probate Act. The funds may be commingled. The care funds of cemeteries are exempted from the operation of the statute of mortmain and from the laws against perpetuities and accumulations. No cemetery may, in connection with the sale of burial space or other accommodation, advertise "perpetual care" or "eternal care" or the like, but may advertise, represent, guarantee, promise or contract that care will be furnished only from the net income of care funds held in trust and that cost of administration is to be deducted with other expenses in computing net income. All cemeteries are required to register with the Auditor on or before January 15, 1948, indicating whether it is claimed that operations are of a fraternal, religious, municipal or family character. Where such claim is made and the Auditor reaches a different conclusion a method of hearing and review is provided for.

Appellants contend that the act is in violation of section 22 of article IV of the constitution of 1870 because it confers special privileges on selected cemeteries. It is also contended that the statute discriminates between appellants and other cemeteries, thereby denying to appellants the equal protection of the laws as guaranteed by the fourteenth amendment to the United States constitution and section 2 of article II of the Illinois constitution. Both arguments are based upon the fact that fraternal, religious, municipal and family cemeteries are exempt from the operation of many of the provisions of the act. Appellants say that this is a purely arbitrary discrimination not founded upon any reasonable basis and having no reasonable relation to the ends sought to be attained.

Counsel for both sides concede that the questioned statute must be justified, if at all, as an exercise of the legitimate police power of the State of Illinois. This power has been reserved to all of the States by the constitution of the United States. While the legislatures of the various States have the authority to meet existing evils by the passage of appropriate laws in the legitimate exercise of the power, it is not without limitation or restriction under the constitutions, either of the various States or of the United States. (Marallis v. City of Chicago, 349 Ill. 422; Connally v. Union Sewer Pipe Co. 184 U.S. 540.) The power may not be exercised in a purely arbitrary manner, where the result is a denial of equal protection of the laws or the conferring of special privileges. (Frost v. Corporation Commission, 278 U.S. 515; Smith v. Cahoon, 283 U.S. 553; Hartford Insurance Co. v. Harrison, 301 U.S. 459.) What amounts to a denial of equal protection of the laws is always difficult of determination. The Supreme Court of the United States has said that no rule can be formulated which covers every case, but that the guarantee of the equal protection of the laws means "that no person or class of persons shall be denied the same protection of the laws which is enjoyed by other persons or other classes in the same place and under like circumstances." Missouri v. Lewis, 101 U.S. 22, 31.

But, within the indicated limitations, the legislatures of the States have broad discretion in the passage of statutes in exercise of the power, including the making of classifications for police regulation. (People v. Monroe, 349 Ill. 270.) The legislature must determine when evils calling for the exercise of the police power exist. It must also determine what means shall be adopted to prevent them. These are purely legislative as distinguished from judicial functions. When the legislature, having considered the problem, acts upon it by the passage of legislation, the presumption is that the act is a valid exercise of the police power. One assailing the statute must carry the burden of showing that it does not rest upon any reasonable basis but is entirely arbitrary. (Stewart v. Brady, 300 Ill. 425; O'Gorman & Young v. Hartford Insurance Co. 282 U.S. 251.) Though the power cannot be arbitrarily exercised, the legislature may determine upon what difference a distinction may be made for the purpose of statutory classification between objects otherwise having resemblance. (International Harvester Co. v. Missouri, 234 U.S. 199.) A distinction in legislation is not arbitrary if any state of facts reasonably can be conceived that would sustain it, and the existence of that state of facts at the time the law was enacted must be assumed in the absence of proof or judicial knowledge to the contrary. Lindsley v. Natural Carbonic Gas Co. 220 U.S. 61; Borden's Farm Products Co. v. Baldwin, 293 U.S. 194.

A law may be constitutional though the legislature does not extend its regulations to all cases it might possibly reach. The legislature may recognize degrees of harm and confine its regulatory action to those classes of cases where the need is greatest. (Patsone v. Pennsylvania, 232 U.S. 138.) If the evil is specially experienced in a particular branch of business it is not necessary that the prohibition be in all-embracing terms. (Carroll v. Greenwich Insurance Co. 199 U.S. 401.) If the law presumably hits the evil where it is most felt, it is not to be overthrown merely because there are other instances to which it might have been applied. Miller v. Wilson, 236 U.S. 373.

In the recent case of People v. Deatherage, 401 Ill. 25, this court, restating the principles of the validity of legislative classifications, said: "There cannot be a constitutional objection to the classification of persons, or objects, for the purpose of legislative regulation, so long as it is not arbitrary and is founded upon some substantial difference properly related to the classification. Classification is a legislative function. It can never become a judicial question unless a court is confronted with the question whether the legislature acted unreasonably in a particular circumstance. We must be able to say that there is no fair reason for the law which would not require with equal force its extension to others it did not touch. (Hansen v. Raleigh, 391 Ill. 536.) When the classification is reasonably adapted to accomplish the legislative purpose and is not arbitrary, it will be sustained. (Stearns v. City of Chicago, 368 Ill. 112.) The plaintiff must carry the burden of showing the classification is arbitrary and does not rest upon a reasonable array of facts warranting the classification. Stewart v. Brady, 300 Ill. 425."

It appears that prior to the passage of the act here questioned a Cemetery Commission was created by action of the Sixty-fourth General Assembly of the State of Illinois. This commission studied the problems relative to the operation of cemeteries in this State, particularly those relating to advertising for perpetual care and the handling of care funds. As a result of its investigations the commission recommended to the Sixty-fifth General Assembly the passage of the Cemetery Care Act. The act shows upon its face that the principal evils sought to be remedied were those relating to possible frauds or mismanagement in the handling of care funds and those in connection with the advertising and sale of accommodations to which funds for care were to be devoted. It is not denied that the legislature, in the exercise of the police power, had the authority to remedy any evils it found to exist. Presumably the legislature determined, from the facts before it and from experience, that religious, fraternal, municipal and family cemeteries did not need the type or extent of regulation provided in the act for privately operated cemeteries. This, as we have indicated, was a legislative function. It cannot be assailed merely because some persons might ...


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