Commitments and Contingencies

9 Months Ended

Jul. 31, 2011

Commitments and Contingencies [Abstract]

Commitments and Contingencies

(7) Commitments and Contingencies

Litigation

     The Company was unable to finalize its negotiations with its insurance carrier related to damages from Hurricane Katrina, and as a result filed suit against the carrier in August 2007. In 2007, the carrier advanced an additional $1,100, which the Company did not record as income but as a liability pending the resolution of the ongoing litigation. In August 2011, the insurance litigation was settled, and the Company will receive $11,325 in additional insurance proceeds. As of July 31, 2011, the Company recorded these insurance proceeds and the $1,100 received in 2007 discussed above in the “hurricane related recoveries (charges), net” line in the condensed consolidated statements of earnings for the three and nine months ended July 31, 2011. The Company also recorded the $11,325 in insurance proceeds in current receivables in the condensed consolidated balance sheet as of July 31, 2011.

     The Company is a defendant in a variety of litigation matters that have arisen in the ordinary course of business, which are covered by insurance or otherwise not considered to be material. The Company carries insurance with coverages and coverage limits that it believes to be adequate.

Other Commitments and Contingencies

     In those states where the Company has withdrawn realized net capital gains in the past from its cemetery perpetual care trusts, regulators may seek replenishment of the realized net capital losses either by requiring a cash deposit to the trust or by prohibiting or restricting withdrawals of future earnings until they cover the loss. As of July 31, 2011, the Company had $12,407 recorded as a liability for an estimated probable funding obligation. As of July 31, 2011, the Company had net unrealized losses of approximately $34,730 in the cemetery perpetual care trusts in these states. Because some of these trusts currently have assets with a fair market value less than the aggregate amounts required to be contributed to the trust, any additional realized net capital losses in these trusts may result in an additional corresponding funding liability and increase in cemetery costs.

     From time to time, unidentified contracts are presented to the Company relating to contracts sold prior to the time the Company acquired certain businesses. In addition, from time to time, the Company has identified in its backlog, certain contracts in which services or merchandise have previously been delivered. Using historical trends and statistical analyses, the Company has recorded an estimated net liability for these items of approximately $2.0 million and $3.0 million as of July 31, 2011 and October 31, 2010, respectively.

     The Company is required to maintain a bond ($23,456 as of July 31, 2011) to guarantee its obligations relating to funds the Company withdrew in fiscal year 2001 from its preneed funeral trusts in Florida. This amount would become senior secured debt if the Company was required to borrow funds under the senior secured revolving credit facility and return to the trusts the amounts it previously withdrew that relate to the remaining undelivered preneed contracts in lieu of this bond.