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DLLR's Division of Occupational and Professional Licensing

 

Southern Memorial Gardens History - Maryland Office of Cemetery Oversight

 

The primary objective of the Office of Cemetery Oversight ("the Office") is to issue permits and registrations and to monitor individuals, partnerships, corporations and limited liability companies operating cemeteries or providing burial goods and services to consumers in Maryland. The Office is responsible for investigating and mediating consumer complaints involving registrants, licensees and permit holders.

After years of good-faith attempts to bring Badtec, Inc. d/b/a/ Southern Memorial Gardens ("Badtec"), into compliance with permit requirements, it became necessary to take administrative, civil and criminal action against the owners and the registrants.

On August 12, 2011, the Circuit Court for Calvert County issued an Order (PDF document, 63KB, download Adobe Acrobat for free) against Badtec. That Order stipulated that the owners and operators of the cemetery were prohibited from performing or assisting in any new burials. The Court ordered that only independent contractors would be allowed to assist families who already owned burial lots. The ruling effectively halted Badtec's operation and upheld the Cease and Desist Orders previously issued to the business. Prior to the August 12 Order, the cemetery property became subject to foreclosure by the bank, which holds the mortgage on the property.

Administrative action was taken by the Office to deny a permit to Badtec and suspend the permit of its owners and the registrations of its employees. The decision to deny the cemetery a permit to operate was upheld by the Office of Administrative Hearings.

The Office of Cemetery Oversight sought criminal prosecution against an owner of the cemetery and an employee of the cemetery for engaging in the operation of the cemetery without the required permit and registrations. The Calvert County State's Attorney's Office is responsible for the prosecution of these cases.

The Office of Cemetery Oversight took whatever steps possible (within its jurisdiction) to protect the families affected by the troubled business. The Office attempted to preserve as many consumer contracts, maps and plats as possible.

The cemetery's Pre-need and Perpetual Care Trust Funds were transferred to the Calvert County Circuit Court's Registry after a Temporary Restraining Order filed by the Office was granted.

On December 7, 2011, Badtec, Inc., d/b/a Southern Memorial Gardens filed for Chapter 7 Bankruptcy in the United States Bankruptcy Court for the District of Maryland. A Meeting of Creditors of Badtec, Inc., d/b/a Southern Memorial Gardens was held at 6305 Ivy Lane, Sixth Floor, Greenbelt, Maryland 20770 on Tuesday, January 10, 2012. Due to time constraints, a second Meeting of Creditors of Badtec, Inc., d/b/a Southern Memorial Gardens was held on Tuesday, February 7, 2012 at 3:00 p.m. at 6305 Ivy Lane, Sixth Floor, Greenbelt, Maryland 20770. Any consumers that should be on the list of creditors should contact the Trustee appointed by the U.S. Bankruptcy Court, Gary A. Rosen, Esq., by mail at One Church Street, Suite 802, Rockville, Maryland 20850 or by phone at (301) 251-0202. No further creditor meetings have been scheduled at this time.

The Office sought and obtained an Interim Order from the U.S. Bankruptcy Court for the District of Maryland to allow independent contractors to continue to perform burials in Southern Memorial Gardens for pre-need contracts entered into prior to August 12, 2011. A hearing to make the Interim Order permanent was held on Friday, January 13, 2012 at 10:30 a.m at the U.S. Bankruptcy Court, Federal Courthouse, 6500 Cherrywood Lane, Suite 300, Courtroom 3-E, Greenbelt, Maryland 20770. The interim order was made final (PDF document, 64KB, download Adobe Acrobat for free) on February 1, 2012.

Since that time, the Office has closely monitored the bankruptcy proceedings and participated in those proceedings when appropriate. When the Office petitioned the Calvert County Circuit Court to place the preneed and perpetual care trust funds in the Circuit Court's registry, it did so in order to protect those trust funds for consumers who had purchased burial plots, goods and services from the cemetery. Upon the sale of Southern Memorial Gardens, it is expected that the new owner will petition the Court to release those funds to the new owner for the purpose of ongoing cemetery maintenance and honoring existing preneed contracts.

On February 5, 2013, Gary A. Rosen, the Chapter 7 Trustee had a conference call with a viable purchaser of the cemetery to work out any remaining issues. The Bankruptcy Trustee then anticipates filing appropriate documents with the Bankruptcy Court to accomplish a transfer of the property. The Office anticipates that very soon the Bankruptcy Trustee will file a motion in court for the sale of Southern Memorial Gardens. We continue to monitor the case.

After the cemetery property has been transferred and the bankruptcy case has been closed, the Office of Cemetery Oversight will work with the purchaser of the cemetery to facilitate an expeditious review of the permit and registration applications which must be filed with the Office prior to the issuance of the permit and registrations necessary for the legal operation of the cemetery.