BMS Mortuary and Business Law 5 — Questions and Answers
Question 1: A funeral home embalmer mishandles a body, causing the family severe emotional distress. Under which tort theory may the family recover even without physical injury?
- Negligent infliction of emotional distress (NIED) (Correct answer)
- Strict liability
- Conversion
- Nuisance
Correct answer: Negligent infliction of emotional distress (NIED)
Courts have recognized NIED claims arising from mishandling of human remains because of the unique emotional harm such conduct causes to surviving family members.
Question 2: Which federal law requires funeral homes to provide written notice to employees of potential hazards associated with formaldehyde exposure?
- OSHA Formaldehyde Standard (29 CFR 1910.1048) (Correct answer)
- OSHA Bloodborne Pathogens Standard
- EPA Resource Conservation and Recovery Act
- NIOSH Occupational Exposure Limits Regulation
Correct answer: OSHA Formaldehyde Standard (29 CFR 1910.1048)
OSHA's Formaldehyde Standard requires employers to inform and train employees about formaldehyde hazards, maintain exposure records, and implement controls when levels exceed action levels.
Question 3: A funeral home corporation distributes profits to shareholders proportionally to their stock ownership. This distribution is called a:
- Dividend (Correct answer)
- Draw
- Distribution in kind
- Liquidating payment
Correct answer: Dividend
A dividend is a payment made by a corporation to its shareholders from earnings or profits, distributed proportionally based on shares owned.
Question 4: Under the FTC Funeral Rule, if a consumer selects a third-party casket, the funeral home may charge a handling fee only if:
- The fee and any other consequences are disclosed in advance on the price list (Correct answer)
- The casket does not meet the funeral home's specifications
- The consumer's contract specifically allows such a charge
- The casket is delivered less than 24 hours before the service
Correct answer: The fee and any other consequences are disclosed in advance on the price list
The Funeral Rule permits a casket handling fee for third-party caskets only if the fee is disclosed on the General Price List; the home cannot refuse to perform services.
Question 5: A funeral director is sued for breach of contract after failing to arrange a graveside service as agreed. The plaintiff's best measure of damages is:
- Expectation damages (benefit of the bargain) (Correct answer)
- Punitive damages
- Nominal damages
- Restitutionary damages only
Correct answer: Expectation damages (benefit of the bargain)
Expectation damages aim to put the non-breaching party in the position they would have been in had the contract been performed — the standard remedy for breach of contract.
Question 6: Which type of business insurance covers claims arising from errors or omissions in the professional services a funeral home provides?
- Professional liability (errors and omissions) insurance (Correct answer)
- General liability insurance
- Product liability insurance
- Workers' compensation insurance
Correct answer: Professional liability (errors and omissions) insurance
Professional liability (E&O) insurance covers claims alleging financial harm caused by professional mistakes, negligence, or failure to perform professional duties.
Question 7: An employee funeral director is terminated for reporting a suspected OSHA violation to the agency. This termination likely violates:
- The anti-retaliation provision of the OSH Act (Section 11(c)) (Correct answer)
- The First Amendment of the U.S. Constitution
- Title VII of the Civil Rights Act
- The Fair Labor Standards Act
Correct answer: The anti-retaliation provision of the OSH Act (Section 11(c))
Section 11(c) of the Occupational Safety and Health Act prohibits employers from retaliating against employees who report workplace safety violations to OSHA.
BMS Mortuary and Business Law 5
A funeral home embalmer mishandles a body, causing the family severe emotional distress.
Under which tort theory may the family recover even without physical injury?