                                  The Attorney           General of Texas
                                                    June 21, 1984
JIM MATTOX
Attorney General



Supreme Court Building
                                 Honorable Jack A. McGaughey            Opinion No. JM-175
P. 0. Box 12546
Austin, TX. 76711. 2546
                                 District Attorney for Archer,
512/475-2501                       Clay, and Montague Counties          Re: Validity of a municipal
Telex 9101674-1367               P. 0. Box 55                           ordinance which prohibits the
Telecopier   5121475-0266        Montague, Texas   76251                transfer of municipal cemetery
                                                                        lots to a party other than the
714 Jackson, Suite 700                                                  city
Dallas, TX. 75202.4506
2141742-6944                     Dear Mr. McGaughey:

4824 Alberta   Ave., Suite 160
                                      You ask us "[wlhether or not a city which owns and operates a
El Paso, TX. 79905.2793
                                 municipal cemetery may lawfully enact an ordinance prohibiting the
9151533-3464                     sale or transfer [by a grantee] of lots in that cemetery to a party
                                 other than the city." We conclude that a city may not enact such an
                                 ordinance, because it would constitute an unreasonable restraint on
    I Texas, Suite 700
                                 alienation.
Houston. TX. 77002-3111
71312235666
                                      You inform us that a city has operated a municipal cemetery
                                 pursuant to articles lOlS(13) and 1015(32), V.T.C.S., since 1966 under
606 Broadway, Suite 312          an ordinance which provides the following at section 7:
Lubbock, TX. 79401.3479
606/747-5236
                                           The sale or transfer of any lot or lots or part of
                                           a lot in the [clemetery is prohibited, except any
4309 N. Tenth, Suite B                     oerson desirinn to sell or transfer a lot or lots
McAllen, TX. 76501.1665                    or a part of a lot in the [clemetery shall sell or
5121682-4547
                                           transfer the same to the [c]lty at a price equal
                                           to the purchase price paid for said lot, lots or
200 MaIn Plaza, suite 400                  parts  of [al lot, and the [cllty shall be
San Antonio. TX. 76205.2797                obligated to purchase the same at -said price.
51212254191                                (Emphasis added).

An Equal Opportunity1
                                 The ordinance provides at section 4(5) that
Affirmative Action Employer
                                           [t]he term 'Certificate of Ownership' as used
                                           herein shall be construed as the instrument
                                           conveying interment rights in lots in the
                                           [clemetery.

                                 We note at the outset that the grantee of a burial lot in a deed of
                                 conveyance does not acquire a fee simple title, but only acquires the
                                 lot for its intended burial purposes; it is clear, however, that such
                                 grantee is not the ordinary owner of an easement and that the interest
                                 passed by a deed to the purchaser of a burial lot is an interest in


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Honorable Jack A. McGaughey - Page 2    (JM-175)




land. Oak Park Cemetery, Inc. V. Donaldson, 148 S.W.2d 994 (Tex. Civ.
APP. - Galveston 1941, writ dism'd judgmt car.).

     Alienability is a legal incident of property, and restraints
against it are not favored. Citizens' State Bank V. O'Leary, 167
S.W.2d 719 (Tex. 1942); Mischer V. Burke, 456 S.W.2d 550 (Tex. Civ.
APP. - Houston [lst Dist.] 1970, writ ref'd n.r.e.). See Tex. Con&.
art. I, 626 (provision prohibiting perpetuities). Suchrestraints are
against public policy and are void. Benson v. Greenville National
Exchange Bank, 253 S.W.2d 918 (Tex. Civ. App. - Texarkana 1952, writ
ref'd n.r.e.). An agreement, on the other hand, which merely provides
for the first refusal to buy or for a preferential right of repurchase
to be exercised within a specified period of time does not restrain
alienation. U.S. Life Title Cornpany of Dallas V. Andreen, 644 S.W.2d
185 (Tex. App. - San Antonio 1982, no writ); Foster V. Bullard, 496
S.W.2d 724 (Tex. Civ. App. - Austin 1973,v.e.);
Courseview, Inc. V. Phillips Petroleum Co., 258 S.W.2d 391 (Tex. Civ.
APP. - Galveston 1953, writ ref'd n.r.e.). In order for a uurchase
agreement to constitute an unreasonable restraint on alienation. the
purchase agreement must contain a direction to the vendee ordering him
not to convey. U.S. Life Title Company of Dallas V. Andreen, supra;
Mattern V. Herzog, 367 S.W.2d 312, 319 (Tex. 1963). At issue in this
request is the proper way to characterize section 7 of the ordinance.

     In Forderhause v. Cherokee Water Company, 623 S.W.2d 435, 437
(Tex:. Civ. App. - Texarkana 1981), rev'd on other grounds, 641 S.W.2d
522 (Tex. 1982), the court declared that the following contractual
provision did not constitute a restraint on alienation and did not
violate the prohibition against perpetuities set forth in article I,
section 26, of the Texas Constitution:

            Grantee is hereby given the first option to
         purchase the oil, gas and other minerals herein
         reserved, at the same price and on the same terms
         as Grantor has agreed to sell to a third party;
         such option to be accented or reiected within five
         (5) days after Grantee-has been furnished with the
         bona fide offer made by such third party. Failure
         to exercise such option on one sale, shall not be
         a waiver to purchasing at any subsequent sale or
         sales by Grantor. (Emphasis added).

The court then concluded:

         The purchase right involved here does not
         constitute    an   unreasonable    restraint   on
         alienation. There is no fixed price. There is no
         absolute option unlimited as to time.    There is
         only the right, exercisable whenever the owner
         desires to sel~l, to purchase the property by
         meeting any bona fide offer. The holder of the
         right cannot force or prevent a sale; neither can



                              p. 771
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        Honorable Jack A. McGaughey - Page 3   (JM-175)




                  he fix the price for a sale.             In those
                  circumstances there is not such a restraint on
                  alienation as would violate our public policy.

        623 S.W.2d 435 at 439. See also Gray v. Vandver, 623 S.W.2d 172 (Tex.
        Civ. App. - Beaumont 1981, no writ) (court held that resenration in
        deed to the effect that grantors reserved their right to repurchase
        property for $175 at any time that grantee, his heirs, executors and
        administrators decide to sell was an unreasonable restraint on
        alienation).

             The ordinance which is the subject of this request does set forth
        a fixed price. It is unlimited as to time. The holder of the right,
        i.e. the city, can act to forbid any sale or transfer. It does act,
        therefore, as a restraint on alienation. Accordingly, we conclude
        that a city which owns and operates a municipal cemetery may not enact
        an ordinance prohibiting the sale or transfer by a grantee of lots in
        that cemetery to a party other than the city.

                                     SUMMARY

                     A city which owns and operates a municipal
                  cemetery may not enact an ordinance prohibiting
                  the sale or transfer by a grantee of lots in that
                  cemetery to a party other than the city.




                                               JIM     MATTOX
                                               Attorney General of Texas

        TOM GREEN
        First Assistant Attorney General

        DAVID R. RICHARDS
        Executive Assistant Attorney General

        Prepared by Jim Moellinger
        Assistant Attorney General

        APPROVED :
        OPINION COMMITTEE

        Rick Gilpin, Chairman
        David Brooks
        Colin Carl
        Susan Garrison
        Jim Moellinger
        Nancy Sutton


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