If a New York cemetery decides to provide all annual lot care services itself, does that void existing contracts between lot owners and outside landscapers?

Plain-English summary

The 1998 Legislature passed Chapter 548 (the "Annual Care Law"), which added Not-For-Profit Corporation Law § 1506(l). The new provision gave each cemetery corporation an option to declare itself the exclusive provider of annual care services (lawn care, tree and shrub maintenance, monument cleaning) on its lands, at rates reviewed by the State Cemetery Board. The Secretary of State asked the AG two questions about how this option interacts with existing contracts.

The AG's answer was clean and prospective-only.

When a cemetery exercises the exclusive option, it must include a notice in any contract for sale of a lot, in 10-point bold type, telling the purchaser that "the purchaser of the plot or lot being transferred by this agreement may not contract with any outside party for such annual care services." The statutory notice mechanism, the AG observed, is the legislative tell: it requires notice only to future purchasers, not to existing lot owners. If the Legislature had intended the exclusive option to terminate existing contracts and bar current lot owners from new third-party contracts, presumably it would have required notice to those owners too.

The general default rule for statutes also supports prospective-only application. Morales v Gross (2d Dept 1997), citing the US Supreme Court's Landgraf v USI Film Products, reaffirms that statutes are read prospectively absent express legislative intent to the contrary. The Annual Care Law's text is prospective; nothing in it operates retroactively.

Constitutional reinforcement: the contracts clause and basic due process bar retroactive impairment of contract obligations (Rotodyne v Consolidated Edison; Pioneer Transportation v Kalajian; the cemetery-specific case Grove Hill Realty v Ferncliff Cemetery). The narrow exceptions to that principle (Manigault v Springs) do not apply here.

So the cemetery's exercise of the exclusive option binds only future purchasers. Existing contracts between lot owners and outside contractors continue. Current lot owners can sign new third-party contracts even after the cemetery exercises the option. The exclusivity reaches only forward, as new lots are sold under the new notice regime.

Currency note

This opinion was issued in 1999. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here.

Common questions

What does "annual care" mean?

The opinion notes the typical scope: care of lawns, trees, shrubs, monuments, and markers. The exact services depend on the cemetery's rules and the contract terms.

Why does the statutory notice approach matter?

Because if the Legislature wanted to terminate existing contracts, it would have to give all lot owners (current and future) notice and an opportunity to adjust. The statute requires notice only to future purchasers. That asymmetry is the textual evidence of prospective-only intent.

Could a cemetery raise its prices and effectively force lot owners off third-party contracts?

The statute provides that exclusive-care rates are subject to State Cemetery Board review. A cemetery cannot use unreasonable pricing to coerce lot owners out of third-party contracts. The pricing-review mechanism is the consumer protection.

What happens to an existing third-party contract when the lot owner dies?

The contract terms typically govern what happens at death (assignment to heirs, termination, etc.). The AG opinion does not address that scenario specifically. The relevant principles would be contract law, the lot deed, and the cemetery's rules.

Does this same prospective rule apply to other Annual Care Law provisions?

The 1999 opinion focuses on § 1506(l). § 1506-a was also cited in the statutes-cited line. The same general rule (statutes are prospective absent contrary text) applies across the statute. Each provision should be read for its own temporal scope.

Background and statutory framework

Not-For-Profit Corporation Law Article 15 governs cemetery corporations in New York. The statute regulates governance, finance, and operational standards, with substantial oversight by the State Cemetery Board (within the Department of State). The "Annual Care Law" enacted in 1998 modernized the framework for ongoing lot maintenance services, an area that had been a frequent source of consumer complaints.

The prospective-application doctrine in New York runs through dozens of cases over more than a century. Morales v Gross and Landgraf are the modern lodestars. The doctrine has constitutional roots in due process and contracts clause limits on legislative power. Grove Hill Realty v Ferncliff Cemetery is the cemetery-specific contracts-clause case the AG cited.

The "narrow exceptions" mentioned in Manigault v Springs and similar cases concern situations where retroactive application is needed to address public health emergencies or similar compelling public concerns. None of those exceptions applies to commercial cemetery contracts in the absence of a public emergency.

Citations

• Not-For-Profit Corporation Law § 1506(l) (cemetery corporation option to provide exclusive annual care services).
• Not-For-Profit Corporation Law § 1506-a (related provisions).
• Laws of 1998, ch 548 ("Annual Care Law" enactment).
• Morales v Gross, 230 AD2d 7 (2d Dept 1997) (statutes construed prospectively absent express contrary intent).
• Landgraf v USI Film Products, 511 US 244 (1994) (federal default rule of prospective application).
• Rotodyne, Inc. v Consolidated Edison Company of New York, Inc., 55 AD2d 600 (2d Dept 1976) (contracts clause limit on retroactive legislation).
• Pioneer Transportation Corp. v Kalajian, 122 Misc 2d 412 (Kings County 1984) (same).
• Grove Hill Realty Company v Ferncliff Cemetery Association, 7 NY2d 403 (1960) (cemetery contracts and retroactivity).
• Manigault v Springs, 199 US 473 (1905) (narrow exceptions to contract impairment bar).

Source

• Landing page: https://ag.ny.gov/libraries-documents/opinions/opinions-year
• Original PDF: https://ag.ny.gov/sites/default/files/opinions/99-F5_pw.pdf

Original opinion text

NOT-FOR-PROFIT CORPORATION LAW §§ 1506(l), 1506-a; L 1998,
CH 548.
A cemetery corporation's exercise of its option to provide
exclusive annual care of cemetery lots does not affect existing
contracts between lot owners and third-party contractors. The
exercise of the option does not apply to existing lot owners and
does not prohibit them from entering into third-party contracts
for annual care services. The exercise of this option only
applies to future purchasers of lots.

October 15, 1999
Hon. Alexander F. Treadwell
Secretary of State
Department of State
41 State Street
Albany, New York 12231-0001

Formal Opinion
No. 99-F5

Dear Secretary of State Treadwell:
Your counsel has inquired whether a cemetery corporation's
decision to exercise its option to provide exclusive annual care
services pursuant to the "Annual Care Law" (Not-For-Profit
Corporation Law § 1506[l]) supersedes existing contracts for
annual care between third-party contractors and lot owners. Your
counsel also has asked whether exercise of the option prohibits
existing lot owners from entering into such third-party
contracts. We conclude that a cemetery corporation's option to
provide exclusively all annual care services only governs those
who purchase lots after exercise of the option.
The Annual Care Law provides in pertinent part as follows:
Notwithstanding any provision of this
article to the contrary, it shall be the
right of each cemetery corporation, at its
option, to exclusively provide all annual
care services to be performed for
consideration on all or any part of its lands
at rates to be reviewed by the cemetery
board.... Every cemetery corporation that
chooses to provide, on an exclusive basis,
such annual care services shall include in
any contract for the sale of any part of its
lands the following notice, in at least ten
point bold type:

Notice
The ____ (name of cemetery
corporation), pursuant to state law, provides
annual care services on an exclusive basis.
Therefore, the purchaser of the plot or lot
being transferred by this agreement may not
contract with any outside party for such
annual care services. . . . Not-For-Profit
Corporation Law § 1506(l).
We note that "annual care" generally means care of lawns, trees,
shrubs, monuments and markers. Id.
The provisions of the Annual Care Law reflect an intent that
the law apply prospectively, that is, to lots purchased after a
cemetery corporation exercises its option to provide exclusive
annual care services. The statute requires a cemetery
corporation to give notice of its decision to provide exclusive
annual care services only to future purchasers. If the
Legislature had intended to invalidate existing contracts for
annual care or to prevent current lot owners from entering into
new annual care agreements with outside contractors, presumably
it would have required the cemetery corporation to give notice of
its status as exclusive provider to those lot owners as well. We
believe that the statute thus authorizes only prospective annual
care.
Indeed, it is well-settled that statutes are construed to be
prospective absent express legislative intent to the contrary.
Morales v Gross, 230 AD2d 7, 9-10 (2d Dept 1997) (citing,
Landgraf v USI Film Products, 511 US 244, 265 [1994]). Here, by
its terms the Annual Care Law is prospective in application.
Our conclusion also is consistent with precedent holding
that the Legislature generally may not pass a statute which, by
reason of its retroactive operation, impairs obligations under a
contract. See, Rotodyne, Inc. v Consolidated Edison Company of
New York, Inc., 55 AD2d 600, 601 (2d Dept 1976); Pioneer
Transportation Corp. v Kalajian, 122 Misc 2d 412, 414-415 (Kings
County 1984). The limited exceptions to this principle are not
applicable here. See, Grove Hill Realty Company v Ferncliff
Cemetery Association, 7 NY2d 403, 409 (1960), quoting Manigault v
Springs, 199 US 473, 480 (1905).
We conclude that a cemetery corporation's exercise of its
option to provide exclusive annual care of cemetery lots does not
affect existing contracts between lot owners and outside
contractors. Nor does the exercise of the option prohibit
current lot owners from entering into new agreements with outside
contractors for annual care services. The exercise of this
option applies only to lots purchased after the option is
exercised.
Very truly yours,

ELIOT SPITZER
Attorney General