Jurisdiction and Service of Process • Contracts • Interpretation • Land Use and Planning

In Re Archdiocesan Cemeteries, PICS Case No. 14-0167 (C.P. Philadelphia Feb. 4, 2014) Herron, J. (10 pages).

Petitioner Archdiocese of Philadelphia raised the issue of whether entering into a lease and management agreement with a third party cemetery company constituted a diversion of property. The court held the agreements did not constitute a diversion of property.

The Archdiocese petitioned to transfer management of its thirteen cemeteries to StoneMor in an effort to mitigate the administrative and financial burdens that its own management of the cemeteries may otherwise impose. The lease agreement affirmed that the transaction would be for the maintenance, upkeep, improvement and continued mission of the cemeteries “in a manner consistent with the standards, customs and practices of the Roman Catholic Church.” An upfront rental payment of $53,000 was required with additional fixed rent of $1,000,000 per year beginning in the sixth year of the agreement. The agreement had additional provisions which included non-Catholic burials, building of cell phone towers, and sale of undeveloped property. The Archdiocese spelled out the financial considerations and motivations behind the proposed transactions.

During an initial hearing, the court required notice be given to all lot holders and certify that said requisite notice was provided. The Archdiocese forwarded to the court information regarding its good faith attempts to notify all lot holders and well as responses received; the Attorney General issued a letter of no objection taking the position that the transactions did not constitute a diversion of property from the purpose to which the cemeteries had been lawfully dedicated.

Despite the delicate issues of faith and mortality, the court found the lease and management agreements did not constitute a diversion of property. The law of Pennsylvania prevents a diversion of church property from a use to which it was originally dedicated to another inconsistent use. Saint John the Baptist Greek Catholic Church of Allentown v. Musko, 448 Pa. 136, 142 (1972) The court found persuasive the Attorney General’s no objection as he is charged with protecting interests involving diversion of any property from the lawfully dedicated purposes. Further, no other formal objections have been filed despite the extensive notice provided by the Archdiocese. Finally, both the lease and management agreements state their intent to maintain the Catholic nature of the cemeteries. Therefore, the court did not find the transactions would result in a diversion of property from the purposes to which the cemeteries have been lawfully dedicated.