Westlawn Cemeteries, L.L.C. v. La. Cemetery Bd.

339 So.3d 548

WESTLAWN CEMETERIES, L.L.C.

v.The LOUISIANA CEMETERY BOARD

No. 2021-CA-01414

Supreme Court of Louisiana.

March 25, 2022

Machelle Rae Lee Hall, New Orleans, Ryan Michael Seidemann, Baton Rouge, Jerry W. Sullivan, Metairie, Morgan Ducote Rogers, for Appellant-Defendant.

Daniel Aubry Ranson, Ryan Charlton Higgins, Gretna, Jeffrey Martin Landry, for Appellee-Plaintiff.

McCallum, J.

The Louisiana Cemetery Board ("LCB") challenges the district court's judgment finding Louisiana Administrative Code 46:XIII.1503 C (hereinafter sometimes referred to as the "Rule") to be unconstitutional. The LCB filed a direct appeal with this Court purportedly under La. Const. art. V, § 5 (D)(1), which provides this Court with appellate jurisdiction in a case in which "a law or ordinance has been declared unconstitutional." Whether this Court has appellate jurisdiction was raised as an issue in an Answer to Appeal filed by appellees, Westlawn Cemeteries, L.L.C. ("Westlawn") and the Trustees of the Westlawn Memorial Park Perpetual Care Trust Fund ("Trustees").¹ Therefore, we address this issue first.

Our jurisprudence is clear as to the scope of this Court's appellate jurisdiction under La. Const. art. V, § 5 (D)(1). "[R]ules and regulations promulgated by an administrative agency or department are not ... law[s] or ordinance[s]’ under La. Const. art. V, sec. 5 (D); thus, a trial court's declaration of their unconstitutionality is not directly appealable to the Louisiana Supreme Court." Coastal Drilling Co. v. Dufrene , 2015-1793, p. 3 n.2 (La. 3/15/16), 198 So. 3d 108, 112 ; See also , Holthus v. Louisiana State Racing Comm'n , 569 So. 2d 547, 547 (La. 1990) ; Benelli v. City of New Orleans , 474 So. 2d 1293, 1294 (La. 1985) ; Vicksburg Healthcare, LLC v. State ex rel. Dep't of Health & Hosps ., 2010-1248, p. 3 n.2 (La. App. 1 Cir. 3/25/11), 63 So. 3d 205, 206.

We recognized in Benelli that the appellate jurisdiction of the Court "is narrowly limited by the constitution." This limitation is not arbitrary. It serves the purpose of restricting appeals of right to those instances where "the legislative act of a governing authority, a body which exercises the legislative functions of a political subdivision, has been declared unconstitutional." Id . at p. 1294. This, we found, was consistent with the intent of the legislature as reflected in the convention debates leading to the enactment of La. Const. art. V § 5 (D). Id .

The provision at issue was not enacted by the Louisiana legislature; rather, it is a rule promulgated by the LCB, an administrative agency. The LCB is not a "governing body" and does not exercise "legislative functions." Its rules and regulations, therefore, are not "laws" for which appellate jurisdiction would lie in this Court. Although the district court declared the Rule to be unconstitutional, because its judgment concerned an administrative rule, this Court does not have appellate jurisdiction. The proper forum for an appeal concerning the LCB's rules and regulations is the court of appeal. See La. Const. art. V, § 10 (A).

While we cannot exercise appellate jurisdiction in this case at this time, this Court has the authority to exercise supervisory jurisdiction under La. Const. art. V, § 5 (A).² As we noted in Unwired Telecom Corp. v. Par. of Calcasieu , 2003-0732, p. 8 (La. 1/19/05), 903 So. 2d 392, 400, "the constitutional grant of supervisory authority to this court is plenary, unfettered by jurisdictional requirements, and exercisable at the complete discretion of the court." Thus, although we have "respect for the independence of other courts" and certainly want "to avoid usurping ... appellate jurisdiction not conferred upon us by the constitution," we have historically exercised "supervisory jurisdiction when [we] deem[ed] it necessary." Id ., 2003-0732, p. 9, 903 So. 2d at 400. We have exercised supervisory jurisdiction, for example, in the interest of judicial economy ( State v. Peacock , 461 So. 2d 1040, 1041 (La. 1984) ("since this case has already been briefed and argued in this court, judicial economy will best be served by exercising our supervisory jurisdiction"), and to avoid further delay ( Mayeux v. Charlet , 2016-1463, p. 7 (La. 10/28/16), 203 So. 3d 1030, 1035 ("Because resolution of this issue would greatly aid the parties and the courts as well as avoid further delay[,] ... we find it appropriate pursuant to our supervisory authority to now resolve this question of law, especially in view of the District Court declaring La. Child. Code art. 609 unconstitutional.").

In the present matter, we find that the exercise of our supervisory jurisdiction serves both purposes – it avoids further delay and is in the interest of judicial economy. The latter is particularly significant under the circumstances of this case because, as will be discussed more fully herein, we find that the trial court properly found LAC 46:XIII.1503 C to be unconstitutional. As the only issue in this appeal is the constitutionality of the Rule,³ no purpose would be served by remanding this case to the appellate court before review would inevitably be sought in this Court.

We do not intend our decision to exercise supervisory jurisdiction in this case to have the effect of converting an administrative rule or regulation to a "law or ordinance" for the purposes of La. Const. art. V, § 5 (D)(1). Nor do we intend our decision to set any precedent as to the future exercise of this Court's supervisory jurisdiction when an administrative rule or regulation has been declared unconstitutional.⁴

We now turn to the merits of this case.

FACTUAL AND PROCEDURAL BACKGROUND

Westlawn owns and operates a perpetual or endowed care cemetery located in Gretna, Louisiana. This type of cemetery is defined as "a cemetery wherein lots and other interment spaces are sold or transferred under the representation that the cemetery will receive perpetual or endowed care." La. R.S. 8:1(34). Perpetual or endowed care cemeteries have existed since 1908, when the Louisiana legislature "enact[ed] special legislation for the perpetual upkeep of cemetery lots." Metairie Cemetery Ass'n v. United States , 282 F.2d 225, 228 (5th Cir. 1960). Section 1 of Act 190 of 1908, thus provided that "[a]ny burial lot or tomb in any cemetery controlled by any company ... incorporated for cemetery purposes may, by the owner or owners, be conveyed or willed back to and held by the company ... in perpetual trust for the purpose of its preservation as a place of burial and shall thereafter remain forever inalienable by act of the parties."

Cemeteries in general, and perpetual or endowed care cemeteries, in particular, are governed by Title 8 as amended and reenacted in 1974 by Act 417 of the Louisiana Legislature. In conjunction with the reenactment of Title 8, the legislature created the LCB for the purpose of "enforce[ing] and administer[ing] [its] provisions." La. R.S. 8:66. Included in its duties is the overseeing of perpetual or endowed care cemeteries.

Before any corporation may operate as a perpetual or endowed care cemetery, it must first establish a trust fund in the amount of $50,000.00 for that care. La. R.S. 8:454. Once a trust fund is established, "a minimum of ten percent of the gross sales price received for any interment space sold or transferred under the representation that such interment space shall receive perpetual or endowed care shall be deposited in the trust fund," although the owner of the cemetery is entitled to first be reimbursed for the initial amount deposited in the trust. La. R.S. 8:454.1 C.

Use of a perpetual or endowed care trust fund is limited, as is explicitly set forth in La. R.S. 8:454.1 A, which provides as follows:

The principal of the trust fund shall remain permanently intact and only the income therefrom shall be expended. The income shall be used solely for the care of those portions of the cemetery in which interment spaces have been sold with a provision for perpetual or endowed care. It is the intent of this Section that the income of said fund shall be used solely for the care of interment spaces sold with a provision for perpetual or endowed care and for the care of other portions of the cemetery immediately surrounding said spaces as may be necessary to preserve the beauty and dignity of the spaces sold. The fund or its income shall never be used for the development, improvement, or embellishment of unsold portions of the cemetery so as to relieve the cemetery authority⁵ of the ordinary cost incurred in preparing such property for sale.

(Footnote added). In furtherance of this statutory provision, La. R.S. 8:454.1 B requires that a perpetual care cemetery "be maintained in a reasonable condition which shall include but not be limited to leveling of grounds where interments have been made, removal of all debris, mowing, and edging, resulting in a well-kept appearance at all times."

All perpetual or endowed care cemeteries are required by La. R.S. 8:455 to file annual reports with the trustee no later than "ninety days after the close of the business year ... setting forth the volume and the gross selling price of sales upon which a deposit with the trustee is required by this chapter." No later than sixty days thereafter, the trustee must file with the LCB an annual report setting forth:

(a) All receipts and disbursements of cash, all receipts and deliveries of other trust property during the regular business year of the cemetery authority, and a detailed list of all items of trust property in the trust at the end of each year.

(b) A statement showing the total amount of the endowment and perpetual care trust funds invested in each of the investments authorized by law, and the amount of cash on hand not invested.

La. R.S. 8:456 A(1). Perpetual or endowed care cemeteries are also required to annually file a written report with the LCB setting forth details of their operation, including the number of interment spaces sold, the...