Judge Sides with Archdiocese of Newark in Suit over Monument Operations in North Arlington - See More At: Http://www.northjersey.com/news/business/judge-sides-with-archdiocese-of-newark-in-suit-over-monument-operations-in-north-arlington-1.1017114#sthash.6tdm5dk5.dpuf
By Meghan Grant
Worried that their bottom line would suffer once the Archdiocese of Newark entered the monument market, North Arlington tombstone business owners filed a complaint against Holy Cross Cemetery, citing the unfair advantage posed by the church's tax-free status. Judge Frank Ciuffani this week sided with the church, claiming that since the cemetery only served Catholics, it wasn't subject to the same state regulations governing public cemeteries. Six monument sellers surround Holy Cross Cemetery, having provided their services for close to a century to friends and family of the deceased. All six joined the initial suit. The Archdiocese of Newark began an Inscription Rights Program in April 2013, allowing the Archdiocese to purchase and own the monuments and be responsible for setting and inscribing the stone. The Archdiocese contends it is not selling the monuments, but is offering a service. The Archdiocese does not pay taxes on the service program but reported it has paid taxes for wholesale purchase of monument for its clients. Lead by Monument Builders of New Jersey (MBNJ) president John Burns, who operates the 132-year old business Albert H. Monuments in the borough, MBNJ brought the Archdiocese to court in order to stop the church from selling monuments at its cemeteries. According to the complaint filed by MBNJ, a tax-exempt religious institution selling tombstones and other monuments creates "unfair competition" that will hurt private monument makers. The law Direct or indirect sale or manufacturing of memorials and vaults by cemetery companies is prohibited under the New Jersey Cemetery Act of 2003. This excludes religious organizations that own a cemetery which restricts burials to members of that religion. The Archdiocese argued it owns and operates its cemeteries, and they are not open to the public, and limited to Catholics and family members of Catholics. Holy Cross and other cemeteries in the Archdiocese offer inscription services and right of burial in the smaller mausoleums, which are treated as the large mausoleums and ground burials, spokesperson Jim Goodness said. "We do not sell monuments, what we do is offer the inscription rights - we place the monuments there, and the families pay to have them inscribed. They are owned by the Archdiocese but they're inscribed for the families," Goodness said. "Since we own the monument, if something were to happen, we would replace it at no charge." Profit generated by the sale of monuments would go into a maintenance fund for the 10 Archdiocesan cemeteries. The ruling On April 29, Judge Frank Ciuffani issued a decision siding with the Archdiocese. "The court finds because the Archdiocese's cemeteries are restricted to members of the Catholic Church and their immediate families, the Archdiocese's cemeteries are not available to the general public and therefore are not 'public cemeteries,'" the letter read. The New Jersey Legislature's passage of two bills, including this one, to exempt religious cemeteries from certain regulation are evidence that religious cemeteries should not follow the same rules as public cemeteries, the judge wrote. "The enactment in 1971 and re-enactment in 2003 of provisions exempting religious corporations from statutory regulation clearly evidence a legislative intent, on two occasions, to permit activities of religious organizations that are proscribed for non-sectarian organizations," the letter read. The argument Attorney for the Monument Builders Martin Arbus argued even Holy Cross is considered "public" under state law. Arbus pointed to two New Jersey case laws - the first being even with reasonable restrictions, a religious cemetery can still be public. The second offered two classifications - public and private, identifying "public" as one used by the general community, neighborhood or church, and "private" as used only by a family or small portion of the community. "Our position very simply is that a Catholic cemetery and all religious cemeteries qualify as public based on those cases," Arbus said. "Add to that the fact that in the course of the trial, we heard somewhere between 42 and 47 percent of the population in the five counties that the cemeteries operate are Roman Catholic." The Catholic-cemetery-as-public citation is an established authority, with more than 2,000 case rulings in New Jersey, 17 within the last three years alone, Arbus said. This was rejected by the trial judge, he said. MBNJ intends to appeal the decision. Judge Ciuffani cited that the use of a word in a state statute governing Catholic corporations expands the corporation's powers "well beyond the authority" to hold and use lands for cemetery purposes. The word was "hereditament," or any kind of property that can be inherited. "The private mausoleums and monuments purchased by the Archdiocese are installed on the land and owned by the Archdiocese. These private mausoleums and monuments are no different than the buildings erected upon the Archdiocese and are encompassed within the broad common law definition of hereditaments suitable for 'any and all' purposes of having, holding and using the 'cemeteries or buying places,'" the letter read. The sale of inscription rights lie within the Church's statutory powers. "The statutory scheme excludes regulation of religious cemeteries as long as use of the cemeteries is limited to members of that religion," the letter read. Burial of Coptics Despite this contention, the Archdiocese has permitted members of the Coptic religion to be buried in one of its cemeteries, the judge acknowledged in his letter. This did not invalidate the program, the judge said, as the Archdiocese argued Coptics are in "communion" with Roman Catholics. Officially called the Coptic Orthodox Church of Alexandria, the international church is centered on Christ and has a large population of followers in the Middle East. The church also has its own pope separate from the Roman Catholic pope. John Paul II called on Roman Catholics to extend mercy and brotherhood to the eastern sects, including the Coptics, who are being forced from their homeland due to unrest, Goodness explained. According to the Archdiocese of Newark Catholic Cemeteries website, "Catholic cemeteries are intended for the interment of Catholics, catechumens, and members of their families who have this right to Christian burial according to the rules of the Roman Catholic Church." "We are following the directions of the Holy Father," said Goodness, adding this point, it applies to eastern churches. Under the religions section of the state's statutes, the Coptic Church is a separate entity from the Roman Catholic Church, Arbus said. Funeral directors issue response New Jersey State Funeral Directors Association (NJSFDA) Executive Director Wilson Beebe released a statement expressing disappointment that the Archdiocese made the "deliberate decision" to unsettle the understanding that previously governed how the law applies to religious cemeteries. The association asserted the Church's central contention - that it does not sell monuments but rather inscription rights - does not hold up to state statutes, the statement read. Judge Ciuffani's decision also impacts business owners, the NJSFDA indicated. "By choosing to engage in the erection, sale and bundling of monuments with the sale of graves, the Church is contributing to the erosion of the industry's economic diversity and to the diminishment of the livelihoods of small, multi-generational monument dealers," Beebe's statement read. Clientele had requested that the cemeteries provide inscription services, which inspired the onset of the program, the Archdiocese claimed. "We were answering a need and are thankful that the court understood that," Goodness said. Religious cemeteries providing monuments is a practice in place in 40 other states, he added. In court documents, the Archdiocese additionally claimed that it decided to enter the monument business due to vandalism over the years and as a result of storm damage from Hurricane Sandy. With its inscription program the cemetery is responsible for all damage to a monument. MBNJ responded that the claims of vandalism and storm damage were "misleading and irreverent." Competition irrelevant Allegations of unfair competition by the monument builders were dismissed by the judge. Either the Archdiocese is or is not authorized by statute to engage in these programs, Judge Ciuffani wrote, and the church's reasons for implementing the Inscription Program are immaterial. "If the Archdiocese is authorized, then its alleged competitive advantage over the monument builders is also irrelevant," the judge's letter read. "In addition, the consumers are allowed to purchase a mausoleum or monument from any vendor or builder they so desire." Clients have the option of purchasing elsewhere, but as most secure burial plots before memorials, the church has the advantage of making the sale's pitch first, Arbus explained. Archdiocese representatives often visit churches to promote their services to parishioners. Burns, whose monument business sits right across the street from the front entrance of Holy Cross, noted at the filing of the compliant that businesses are subject to expenses such as property and unemployment taxes. Burns was unavailable for immediate comment after the ruling. In his testimony at the trial, Andrew Schafer, Executive Director of Catholic Cemeteries, noted the Archdiocese anticipated capturing between 40 and 50 percent of the market share through its program, Arbus said. "A lot of my clients are feeling the pinch, whether it's from the Archdiocese or other reasons, it's hard to tell after a course of a few months," Arbus said. "I don't think there's any question that it's going to have a substantial impact on the businesses, especially those located right outside the gates." Tax free? The Archdiocese is not subject to the 7 percent use tax imposed by the state on monument builders, which puts them at an unfair advantage, the MBNJ said in their complaint. Use tax is paid when the seller purchases the monuments. During testimony to the Middlesex County Court in November, Schafer admitted the church had not paid use taxes on monuments purchased wholesale. Goodness indicated that the Archdiocese has since paid use taxes for monuments they purchased wholesale for their clients. Whether or not the Archdiocese should pay these taxes, as it is a non-profit, is a matter for the state to decide, he added. "It's possible we may have paid more than we need to pay. At this point, we aren't sure. It's something the state is looking at," Goodness said. Money raised through the inscription rights program ultimately goes to the Archdiocese, in addition to the cemetery maintenance fund. In a December 2012 email to Msgr. Michael Andreano, Schafer anticipated that the sale of inscription rights on headstones and markers supplied by Catholic Cemeteries could produce a revenue gain of $500,000, which would allow the Archdiocese to increase its "assessment" on the cemeteries to $3 million. An assessment is a tribute paid to the Archdiocese by parishes and entities like the cemeteries, Goodness explained. Broken promises At the onset of the legal battle, Burns recalled a broken promise made by Executive Director Schafer for the Archdiocese, that the church would not enter the monument-selling business. Burns approached Schafer in September 2006 because he was concerned with losing business due to the Archdiocese creating and selling spots in private mausoleums or crypts to the public. At the time, Schafer assured Burns that the church was not going to sell monuments. This situation later came to pass in April 2013. While MBNJ did not seek to enforce this assurance in its complaint, a "verbal promise to restrict forever" the use of land is not enforceable, Judge Ciuffani said. Monument dealers are not the only private businesses near Holy Cross that serve cemetery clientele. Flowers and floral grave markers are sold along Ridge Road and at other shops. In flyers distributed back in March, Holy Cross advertised for a program that places palm crosses, an Easter tradition, with floral arrangements on graves for a $10 fee per cross. The Archdiocese's cemeteries website also advertises a floral tribute program offering seasonal fake, silk flower arrangements at six cemeteries on crypts. No prices were listed. This silk flower program has been in place for some time, Goodness said. Email: grantm@northjersey.com
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