The 'Non-Cancelable' Preneed Contract

Funding. The threshold question is whether the percentage deposited matches what the Act and Board rules require for a trust-funded preneed and whether it was deposited within the required time. Heritage deposited 80% of $9,400, or $7,520. Confirm the current statutory percentage and deadline rather than assuming 80% is correct; if the rule requires a greater percentage or a different base (for example, excluding certain cash advances), the deposit is short even though the math looks tidy. Heritage must also be able to produce the trust agreement, the depository's statements, and the allocation of earnings to Grace's contract.

Disclosures. A compliant contract tells the purchaser, in writing and in plain terms: the identity of the trustee or depository and that funds are held for the purchaser's benefit; whether the contract is trust-funded or insurance-funded; that the purchaser may cancel and how the refund is calculated; that the purchaser may transfer the contract or change the beneficiary or the funeral provider; and whether prices are guaranteed or subject to change. Heritage's one-page form discloses none of this and adds 'non-cancelable,' a term that cannot override a statutory right to cancel. Undisclosed refund terms and a missing trustee identity are independently citable, and the form itself should be pulled from use pending review.

Start with the trust, not with the offer. Grace's contract has $8,270 sitting in trust after fees. The Act entitles a cancelling purchaser to the funds attributable to the contract - the principal deposited plus accumulated earnings - reduced only by retention the contract and the statute actually permit, such as a stated administrative fee or amounts already advanced for merchandise delivered. Heritage's $3,400 figure is unsupported: 'services already arranged' is not a lawful retention basis when no service has been performed and no goods delivered, and a cancellation fee must have been disclosed and must fall within any statutory cap.

Show the arithmetic. Principal deposited: $7,520. Trust balance: $8,270. If the statute allows a small administrative retention, itemize it and subtract it; if it does not, or if the contract's disclosure failures make the agreement unenforceable as written, the refund runs to the full trust balance and may include interest at the statutory rate. The $1,880 Heritage kept at the outset cannot simply be treated as earned.

Grace also need not use Heritage in Colorado; the contract's portability and beneficiary provisions matter to the refund and should be addressed in the same letter.

Firm-level. The pattern - a one-page form with no trustee, no refund terms, a purported waiver, and a refund offer less than a third of the trust balance - supports findings of deceptive trade practice and violation of the preneed article, not just a clerical error. Expect the Board to demand the trust records for every preneed sold from 2023 forward, the depository statements, and the seller's preneed authorization. Remedies include reprimand, probation, suspension or revocation, an administrative penalty per violation, restitution to Grace, and a requirement that the form be rewritten and previously sold contracts cured by written notice.

Individual-level. The licensed funeral director who signed the contract and the person who computed the refund are both exposed; discipline follows the licensee, not only the entity.

The firm's best move now. Stop using the form, reconcile the trust, refund the balance with a written accounting, and report the correction to the Board before the investigation expands. The worst move is to keep negotiating the refund downward while the trust statement sits in the file.