News

Shepherd funeral home agrees to surrender preneed contracts

A copy of July 15 corporate minutes contained in the court file in the Thos. Shepherd & Son license revocation case shows that Michael Edney, a county commissioner who is the funeral home’s attorney, became chairman and president.

By Bill Moss, Published: February 16, 2022

In May of last year, when Commissioner Daniel Andreotta asked fellow commissioners to join him in sending a complaint to state regulators about the condition of Shepherd Memorial Park, one commissioner objected.

“My brother’s out there and my father’s out there,” Commissioner Michael Edney said. “But I’ve had relationships with the Shepherds over the years so I reached out to them to see what’s going on. The biggest issue is the lack of people willing to work. They haven’t had enough people on staff to do what needed to be done. That is being remedied.”
“I think Raleigh already knows anyway,” he said, adding that he had not “seen a lot of good come from Raleigh for quick fixes for anything.”
Edney’s appeal persuaded three other commissioners to decline signing the letter and Andreotta sent the complaint on Board of Commissioners letterhead over his signature alone.
“Several residents have reached out to me with anguish and frustration over being denied access to their loved ones’ final resting place,” said the letter, dated May 20, the day after the Board of Commissioners mid-month meeting.

What was unknown to the public at the time was that Edney was closely involved with the cemetery and with Thos. Shepherd & Son Funeral Directors, which at the time had its license suspended and would later have its licenses for funeral services revoked. In addition, a judge in November ruled in favor of a motion by the North Carolina Cemetery Commission to put Shepherd Memorial Park into receivership. (A decision by Superior Court Judge Marvin Pope to appoint a receiver is pending.)

Two months after the May Board of Commissioners meeting, Edney became president and chairman of Thos. Shepherd & Son Inc. and Shepherd Memorial Park. The action in a July 15 meeting at Melody and Tom Shepherd’s home in Flat Rock was revealed in a court filing by the N.C. Board of Funeral Services on Jan. 28.

On Wednesday, two days after a Lightning reporter asked him about his public defense of and private behind-the-scenes work for the Shepherd family and business, Edney publicly disclosed his legal representation for the first time.

“In my day job I’m a lawyer and I’ve been working with the Shepherds … to make sure folks are taken care of because that’s what they want,” he told his colleagues during the regular mid-month Board of Commissioners meeting.

Conditions and service at Shepherd Memorial Park, he added, are improving.

“There’s been five or 10 burials in the last month so things are progressing,” he said. “There will be a receiver appointed at some point. I just want to reassure folks that nobody’s being forgotten — things are working and moving forward and everyone top to bottom understands that the Shepherds are part of this community — they’ve been there since 1903 —and people are being taken care of one way or the other.”

One of Edney's efforts on behalf of the now-shuttered business was to file an appeal, on Jan. 10, of the order by the state funeral services board. In response, the board’s general counsel, Catherine E. Lee, filed a motion in Henderson County Superior Court to dismiss the appeal of the board’s decision.
Lee and Edney, who filed the petition for judicial review in the case on behalf of Shepherd, appeared before Superior Court Judge William Coward on Monday at the Transylvania County Courthouse in what was scheduled as a hearing on the state’s motion to dismiss Edney’s appeal. Instead, after a delay of about 30 minutes, Edney and Lee emerged from behind closed doors and announced an agreement to settle the dispute.
Edney told Judge Coward that the agreement would result in his withdrawal of the appeal of the license revocation and the funeral home’s compliance with the Board of Funeral Service order to surrender preneed contracts to the board. Coward accepted the attorneys’ explanation of the agreement, which Lee plans to set forth in writing for the judge’s review and signature.
Edney said after the open court session was over that he is no longer acting as president of the two Shepherd businesses.
“That was a year ago,” he said. “All that’s changed. I haven’t looked to see if it’s updated.”

Edney said Monday there was no conflict in his attempts to help the Shepherd family while also blocking Andreotta’s effort to have the Board of Commissioners send the letter of complaint about the cemetery last May.
“The cemetery and funerals are two separate issues,” he said. “We were working on some things last summer, yeah. I represent both corporations.”
In a Board of Commissioners meeting a few weeks after the May 2021 meeting, Edney reported that managers had hired more help at Shepherd Memorial Park and that things were stabilized. Andreotta said he sees no conflict in Edney’s roles as a commissioner and as an attorney for a distressed business.
“I did know that he was involved with them in trying to work with them and give them assistance to help them work through their issues and get them resolved,” Andreotta said Tuesday. “As far as the final details of his roles and titles through that process, I did not pursue them. They wouldn’t be a concern to me then or now.”
He said Edney had disclosed his relationship with Thomas R. “Tom” Shepherd, who died on Dec. 31, and his wife, Melody.
“We did I think talk about this in a closed session,” he said. “He was very upfront that he was involved in helping. He was also somewhat of a liaison from them to us so we could know what was going on and we could try to be of help. I mean, this is one of the oldest businesses in the county and the last thing we want is to see any business, especially one of that legacy, encounter difficulty.”
Bill Lapsley, the Board of Commissioners chair, is also aware of Edney’s role as the corporations’ attorney. He, along with County Attorney Russ Burrell, were present in Superior Court when Edney defended Shepherd Memorial Park in the receivership petition filed by the Cemetery Commission.

Funeral home withheld preneed contracts

In her response to Edney’s motion for a stay in the funeral service board’s final order revoking the Thos. Shepherd & Son license, Lee wrote that the petition for judicial review “is not supported by any sworn evidence,” nor an “accompanying affidavit.”
The quick scheduling of a hearing on the state board’s motion suggests there was some urgency in the matter, specifically regarding the status and security of the preneed contracts. State law and Board of Funeral Service rules closely regulate the contracts, which are often paid in advance, with the money placed in trust at a bank. Lee’s motion asked the court to order Thos. Shepherd & Son officials to “cease and desist all copying, downloading, and retaining, of active preneed funeral contracts” and to order those officials to immediately turn over hard copies of the contracts to the state and then to destroy all copies they had in their possession. Lee cited the relevant state law that requires a funeral home, when its license is terminated, to “immediately divest of all preneed funeral contracts.”
“To date petitioners have not done so,” Lee said.
Because preneed contracts often contain personal information — including Social Security numbers, bank account numbers and insurance policies — allowing Shepherd officials to retain those files “poses significant harm to hundreds of consumers in and around western North Carolina,” Lee said.
She also said that “counsel for Petitioner” — presumably Edney — had “indicated that copies of such preneed contracts are necessary for the potential sale of the business, even after being informed that Petitioners no longer have any legal right to retain copies” of the files.
In addition to her request that the court order the funeral home to immediately relinquish the preneed contract files, Lee asked that it grant the state board attorney fees for the case and to rule that the funeral home “recover nothing” from the state board.
Attempts to reach Melody Shepherd, Tom Shepherd’s widow and the last family member to be actively involved in running the 119-year-old business, have been unsuccessful.
In the Final Agency Decision it issued on Dec. 8, the Board of Funeral Service directed the board staff to refer the case findings to law enforcement authorities for potential criminal charges. Stephen Davis, the executive director of the regulatory board, said on Dec. 15 that attorneys and compliance officials were still “assessing whether to send any recommendations to law enforcement if criminal violations are identified.”
Outside the Transylvania County Courthouse on Monday, Lee said that review is still under way.
“We’ve been in touch with the district attorney’s office, that’s all I can say,” she said.
Asked whether regulators are concerned about the security of the money that is by law required to be held in a trust, she said, “We’re looking forward to getting the preneed contracts.”