Lawlor v. Cloverleaf Memorial Park, Inc.

• Decision Date: 22 June 1970
• Citation: 266 A.2d 569,56 N.J. 326
• Parties: C. Lloyd LAWLOR, as Executor of the Estate of Edith Lawlor and C. Lloyd Lawior, Individually, Plaintiff-Appellant, Cross-Respondent, v. CLOVERLEAF MEMORIAL PARK, INC., a corporation, and Cloverleaf Memorial Park Association, Defendants-Respondents, Cross-Appellants, v. Joseph LEPREE and The Rahway Hospital, Third-Party Defendants-Respondents.
• Court: New Jersey Supreme Court

Page 326

56 N.J. 326

266 A.2d 569

C. Lloyd LAWLOR, as Executor of the Estate of Edith Lawlor and C. Lloyd Lawior, Individually, Plaintiff-Appellant, Cross-Respondent, v. CLOVERLEAF MEMORIAL PARK, INC., a corporation, and Cloverleaf Memorial Park Association, Defendants-Respondents, Cross-Appellants, v. Joseph LEPREE and The Rahway Hospital, Third-Party

Defendants-Respondents.

Supreme Court of New Jersey.

Argued April 7, 1970.

Decided June 22, 1970.

Kenneth J. McGuire, Newark, for plaintiff-appellant and cross-respondent (Stein, Bliablias & Goldman, Newark, attorneys).

Stephen J. Foley, Asbury Park, for defendants-respondents and cross-appellants (Campbell, Mangini, Foley, Lee & Murphy, Asbury Park, attoeneys).

Daniel K. Van Dorn, Newark, for defendant-respondent Rahway Hospital (Gleeson, Hansen & Pantages, Newark, attorneys).

Thomas T. Chappell, Jersey City, for defendant-respondent Dr. Joseph Lepree (Lamb, Blake, Hutchinson & Dunne, Jersey City, attorneys; William J. Cleary, Jr., Jersey City, on the brief).

The opinion of the court was delivered by

JACOBS, J.

The Law Division granted summary judgment in favor of Cloverleaf along with summary judgment in favor of Dr. Lepree and The Rahway Hospital insofar as the plaintiff's claims against them under the Survival Act (N.J.S.A. 2A:15--3) were concerned. It denied summary judgment with respect to the plaintiff's claims against the Doctor and the Hospital under the Wrongful Death Act (N.J.S.A. 2A:31--1 et seq.). 101 N.J.Super. 134, 243 A.2d 293 (1968). On appeal, the Appellate Division reversed the summary judgment as to Cloverleaf, affirmed the summary judgment as to the Survival Act claims and reversed the denial of summary judgment as to the Wrongful Death Act claims. 106 N.J.Super. 374, 256 A.2d 46 (1969). We granted cross petitions for certification. 54 N.J. 582, 258 A.2d 369 (1969).

On September 6, 1964 Mrs. Lawlor went to the Cloverleaf Memorial Park in Woodbridge. While placing flowers on her mother's grave she fell into a concealed hole and was injured. She was later attended to by Dr. Lepree and was hospitalized at The Rahway Hospital. She died on December 23, 1966, allegedly as a result of the injuries sustained in the fall and an infections disease contracted while she was hospitalized.

On February 16, 1965 Mrs. Lawlor and her husband, suing Per quod, filed a complaint against the defendant Cloverleaf Memorial Park, Inc. (the Corporation) and the defendant Cloverleaf Memorial Park Association (the Association). It charged the defendants with negligence and sought compensatory damages. The defendants filed their answer and on July 5, 1966 they filed a third-party complaint against Dr. Lepree and The Rahway Hospital, alleging that the Doctor and the Hospital had negligently attended Mrs. Lawlor and that, as a result of their negligence, Mrs. Lawlor contracted an infections disease and suffered additional injury subsequent to her fall.

On January 26, 1968 the trial court granted leave to substitute Mrs. Lawlor's executor as a plaintiff and to amend the complaint so as to include direct negligence charges by the plaintiff against the Doctor and the Hospital; these charges were admittedly the same as those earlier alleged by Cloverleaf in the third-party complaint against the Doctor and the Hospital.

On Cloverleaf's motion, the trial judge granted summary judgment. He found that the Corporation, Cloverleaf Memorial Park, Inc., was not the owner of the cemetery at the time of Mrs. Lawlor's accident and was therefore not responsible for its maintenance; this finding was never appealed and is not before us. He further found that although the Association, Cloverleaf Memorial Park Association, was the owner of the cemetery and was responsible for its maintenance, it was entitled to the immunity granted by the Legislature to nonprofit associations 'organized exclusively for religious, charitable, educational or hospital purposes.' N.J.S.A. 2A:53A--7.

On motion of Dr. Lepree and The Rahway Hospital, the trial judge dismissed the count in the plaintiff's amended complaint under the Survival Act on the ground that it was barred by the two-year statute of limitations. N.J.S.A. 2A:14--2; 101 N.J.Super. at 140--143, 243 A.2d 293. He took the view that the amendment set forth a new cause of action and did not relate back to the filing date of the original complaint. 101 N.J.Super. at 142--143, 243 A.2d 293. He refused to dismiss the count under the Wrongful Death Act, holding that it embodied an independent action which accrued at the time of Mrs. Lawlor's death and was not barred by the statute of limitations. 101 N.J.Super. at 143--148, 243 A.2d 293.

In the Appellate Division, leave was granted to the plaintiff to take depositions as to the structure of Cloverleaf and its operations. The depositions disclosed pertinent facts which are summarized in 106 N.J.Super. at 384--386, 256 A.2d 46. In 1933 two groups of individuals, the Walker-London group and the Lustgarden group, owned tracks of land which comprised about 110 acres and which they conveyed to Cloverleaf Memorial Park, Inc. London later became a principal stockholder, director and officer of the Corporation and is now a trustee and president of the Cloverleaf Association. In the early 1950's the Corporation sold about 55 to 60 acres of the land to a builder for $60,000. Some of this money was used for cemetery development and the remainder was distributed to the Corporation's stockholders who included members of the two original groups and their descendants.

At about the same time the remaining 50 to 55 acres were transferred to the Association which issued bonds to the stockholders of the Corporation. These bonds were in the face amount of $345,000 and all but $20,000 remain unpaid. In addition, the Association is indebted to its president, Emanuel London, and to other members of his family for back salaries. The outstanding bonds remain in the hands of the original owners of the land or members of their families.

The association charges $450 for a two-grave plot and if all of the available graves were sold at one time the gross receipts would approximate $2,250,000. From the money received from each sale about 5% Is placed in the perpetual care fund which is used for the keeping of the grounds and the maintenance of the graves. The remainder is placed in a general account which is used for Association purposes such as the payment of salesmen's and officers' salaries.

The Appellate Division expressed the view that although the immunity statute (N.J.S.A. 2A:53A--7) did not in specific terms refer to cemetery associations organized under the Rural Cemetery Act (N.J.S.A. 8:1--1 et seq.), it would apply to such associations so long as they were in fact created and operated for charitable purposes rather than private profit. 106 N.J.Super. at 382, 256 A.2d 46. Though the circumstances strongly suggested it, the Appellate Division withheld finding factually that Cloverleaf had been created and operated 'for private profit under the guise of a charitable use'; instead it remanded that factual issue for determination by the trial court. 106 N.J.Super. at 386, 256 A.2d at 53. Our study of the constitutional and legislative treatment of cemeteries within our State, along with the history and terms of N.J.S.A. 2A:53A--7, has led us to the firm belief that the Legislature never contemplated the inclusion of privately promoted nonreligious cemetery associations, such as Cloverleaf, within the highly special immunity afforded to associations 'organized exclusively for religious, charitable, educational or hospital purposes.' That being so, the summary judgment in Cloverleaf's favor may properly be vacated without the further factual finding called for by the Appellate Division.

It must be borne in mind that the question before us is not whether Cloverleaf now functions as a quasi-public charitable trust for under our cases it clearly must. See Frank v. Clover Leaf Park Gem. Assn., 29 N.J. at 193, 148 A.2d 488 (1959); Terwilliger v. Graceland Memorial Park Assn., 35 N.J. 259, 173 A.2d 33 (1961). The precise issue is whether it is an institution within the contemplation of the legislative immunity afforded, without any specific reference to cemeteries, to corporations or associations organized exclusively for 'religious, charitable, educational or hospital purposes.' Cf. 4 Scott, Trusts §§ 348.1, 402 (3d ed. 1967). In In re Kuebler, 106 N.J.Super. 13, 254 A.2d 115 (App.Div.1969), the Fairview Cemetery claimed that a devise to it was not subject to inheritance tax under the provision in N.J.S.A. 54:34--4(d) which exempts devises to institutions or organizations operated exclusively 'for religious, charitable, benevolent, scientific, literary or educational purposes.' The cemetery had been in receivership as a charitable trust and, after the receivership, trustees were appointed to operate it under a supplement to the Rural Cemetery Act (N.J.S.A. 8:1--20.1). The Appellate Division held that, notwithstanding its acknowledged charitable trust aspects, the cemetery was not a charitable institution within the meaning of the tax exemption statute; in the course of its opinion it made the following comments which are highly pertinent here:

Our law has generally not treated cemeteries as equatable with charitable institutions. Whenever it was intended to embrace a cemetery as within the orbit of a tax examption provision, it has always been done so expressly. For example, our 1947 Constitution, Art. VIII, § I, par. 2, refers to exemptions from taxation of real and personal property 'used exclusively for religious, educational, Charitable or cemetery purposes, as defined by law * * *.' (Emphasis added). Again, although N.J.S.A. 54:4--3.6 exempts from taxation buildings and land owned by associations or corporations organized exclusively for 'charitable' and other designated purposes, a Suparate legislative...