News

Judge orders cemetery receivership to continue

By Bill Moss, Published: May 22, 2024

In a three-day trial that laid bare mismanagement and neglect that nearly led Shepherd Memorial Park to ruin, a judge kept in place a receiver’s control of the cemetery, barred Melody Shepherd from trying to sell the property and ordered numerous other guardrails to keep the business healthy.

Testimony in Henderson County Civil Superior Court came in the ongoing lawsuit by the North Carolina Cemetery Commission after families made numerous complaints about the condition of the cemetery the Shepherd family founded in 1954 on Asheville Highway.

Sharon Alexander, the attorney for the Cemetery Commission, urged Judge Marvin Pope to order the sale of the property as the only way to ensure that problems would not recur.

Witnesses included Gary McDowell, who has managed the property as receiver since April 2022; Michael Edney, who was the Shepherd family’s attorney in 2020 and 2021; Mack McKeller, whom Pope appointed to protect the interest of the business as guardian ad litem; and Randall Sanders, a funeral home owner from Columbus, N.C., whom the Shepherd legal team recruited as a potential manager of the cemetery.

‘Unkept other than lipstick’

Testimony made clear that McDowell had done a herculean job cleaning up the mess he found when he first became receiver.

As soon as he was appointed in April 2022, McDowell drove to Shepherd Memorial Park. The management “was busy spreading mulch, just throwing it on top of weeds, just doing a quick fix in my mind,” he said. He found three employees in the office. “I asked for a business card and they were looking at their feet and at the ceiling,” he said.

Overall, the place was “unkept other than the lipstick the management team had tried to place on things,” he said. “There hadn’t been any marker trimming I would guess in 3 to 5 years.”

The cemetery owed Duke Energy $9,000, propane tanks had been removed for nonpayment of gas bills and there were stacks of unpaid invoices. By the time he got caught up on all the reports required by the Cemetery Commission, “I ended up owing $4,275 in late fees,” he said.

McDowell testified that Melody Shepherd had called him before he became receiver when she heard he might be appointed. Once he was appointed, he stopped responding to her calls and text messages because Judge Pope’s order barred her from having any management role in the business.

At Alexander’s request, he read a text from Shepherd he received on Feb. 8, 2023. “Get off my equipment ASAP,” it read. “Sue me, let’s see who wins. I’m back with a vengeance. Call me, you pussy.” The text was “very consistent with the tone of others,” he said.

Funeral home cars ‘just an eyesore’

As time went on, McDowell hired two men he described as excellent and reliable workers with a strong work ethic — one in charge of mowing and trimming and the other opening and closing graves.

He said one remaining problem is the 10 Thos. Shepherd & Son vehicles Melody Shepherd had moved from the South Church Street parking lot she still owns. (She had been cited several times for code violations for keeping unlicensed vehicles on the property.)

The hearses, vans and limousines are “just an eyesore sitting there” and they provoke families to ask “what are all those cars doing there?,” McDowell said. “Can we operate the cemetery with them there? Yes, but they’re still in the way.”

During his cross examination, Steven Lindsay, Shepherd’s attorney, committed to making sure the vehicles are moved.

Lindsay shaped a lot of testimony attempting to shift blame for mismanagement of the cemetery from Shepherd to Daniel Yaeger, who cast himself as the person in charge in a court filing.

“There are a lot of headaches that I’m dealing with that have his fingerprints on them,” McDowell said.

Although Melody Shepherd didn’t trust Yaeger, according to testimony, Tom Shepherd liked him and wanted his help even at the Shepherds’ home in Kenmure during his illness.

“I think Tom thought more of Yaeger than Yaeger thought of Tom,” Edney testified.

Lindsay asked: “And the light you saw him in was one of taking advantage of elderly people in poor health, even stealing money from them potentially, right?”

Edney said yes.

“That’s why Yaeger got fired because he was stealing from these people and stealing from their business,” Lindsay said.

Melody Shepherd testified that she was so occupied caring for her husband for two to three years before his death on Dec. 31, 2021, that she was unable to manage the cemetery.

“However, I have stated that I would be happy to do anything that I could since I had previously worked there,” she said. “I will do whatever needs to be done for the betterment of the cemetery for the community.”

Edney acted as cemetery manager

Edney testified that when he took over the affairs of the cemetery, he drove out to check it out.

“There was a guy walking around with a gun on his hip,” he said. That turned out to be Yaeger. He had “no education or certification  (in cemetery management) that I was aware of.”

Although the attorneys subpoenaed Yaeger to testify, deputies have not been able to locate him to serve the order.

Once Yaeger was dismissed from the business, Edney took on “much more than I ever wanted to.” Shepherd showed him how to lay out a grave, contract with the vault company to dig graves and install the vaults, he said, later testifying that he ran the finances through his law firm trust account because he had no access to Shepherd Memorial Park bank accounts.

‘The Shepherd way’

Lindsay returned frequently to “the Shepherd way” as he tried to show that the memorial park should remain with the family that started it 70 years ago.

“Mrs. Shepherd told me many times that there's the Shepherd way of doing things which has worked forever and ever and she felt duty bound to make sure that whoever was on site on the ground that it was done the Shepherd way, which was the proper way,” Edney said.

McKeller, the guardian ad litem, praised McDowell’s work to restore the cemetery.

“I believe it’s capable of moving forward as is; I can see no reason for it to be sold,” he said.

He testified that Jimmy Altmeyer, owner of Altmeyer Funeral Homes, called him and offered to buy the cemetery for $200,000. Altmeyer also owns Shuler, Forest Lawn and Church Street funeral homes and Forest Lawn Memorial Park.

“I felt like the Altmeyers were trying to get something for nothing based on what the offer was,” McKeller said. “There was another reason as well. I feel like it’s a disservice to have all the cemeteries in the county owned by one company.”

In closing remarks, Lindsay said the memorial park had always been and is again today “a 5-star operation in a 3-star industry.” He attributed that to the “Shepherd way.”

“A sale of this business on the open market we don’t believe is justified,” he said. “Mrs. Shepherd stepped up the plate and paid her own personal money” to settle the debt to the Cemetery Commission. She also could have been entitled to an overpayment of $56,000 from a vault company that sued for unpaid bills the cemetery owed. Instead, she is willing to allow the money to be held in trust for use as needed to operate the memorial park, Lindsay said.

“If she didn’t care about the community, if she didn’t care at all about Shepherd Memorial Park and the Shepherd way,” he said, “she would have put her middle finger up and said ‘I’m not paying a dime.’”

“I think what you'll find is that the allegations with regard to the mismanagement of the Memorial Park, the mowing, the upkeep, those sorts of things, those have been addressed,” he said. “There was a final accounting done. Once that was turned over, those amounts were paid in full and those accounts made whole. … A sale would be absolutely improper at this point and a permanent injunction is not necessary.”

Alexander urged Pope to order the sale of the property.

“We’re here about one of the most sacred trusts we are all aware of,” she said. Testimony clearly showed, she argued, that Melody Shepherd was to blame for the mismanagement and neglect that led to many complaints. The improvements that have helped to retore its reputation, she said, are all the result of the receiver’s tireless work over the past two years.

“This is something that Mr. McDowell has done,” she said. “He’s gone above and beyond and now we have the McDowell way. I think the record reflects that the obvious remedy is sale of the property at fair market value. It’s the easiest, cleanest way to assure the public and the state that the issues we had cannot recur.”

Pope, who had signaled he favored a remedy short of a court-ordered sale, ruled from the bench as soon as the lawyers finished. The order maintains the preliminary injunction and receivership. The order also:

• Bars Melody Shepherd from selling the cemetery.
• Appoints appraiser John Palmer to make a determination of the value of the grounds and business.
• Retains McKeller as guardian ad litem at the rate of $375/hour.
• Retains McDowell as receiver at his current rate of $50 an hour and grants him a check for $25,000 “as partial payment of the amount owed to him.” He’s also to be repaid for the equipment and supplies he bought with his own money.
• Sets aside the $56,000 overpayment for use for cemetery operations and the cost of the Cemetery Commission’s lawsuit against the memorial park.
• Orders an accounting firm to complete tax returns, which had not been filed since 2019.
• Directs to McKeller obtain liability insurance and umbrella coverage for the cemetery.
• Directs McDowell to obtain the software to begin withholding state and federal payroll taxes for the employees he’s hired.