American Bible Soc. v. Lewisohn

• Decision Date: 10 June 1976
• Citation: 40 N.Y.2d 78,386 N.Y.S.2d 49,351 N.E.2d 697
• Parties: , 351 N.E.2d 697 In the Matter of AMERICAN BIBLE SOCIETY, Appellant, v. Richard LEWISOHN, as Finance Administrator of the City of New York, et al., Respondents, and Attorney-General of the State of New York, Intervenor-Respondent.
• Court: New York Court of Appeals Court of Appeals

Page 49

386 N.Y.S.2d 49

40 N.Y.2d 78, 351 N.E.2d 697

In the Matter of AMERICAN BIBLE SOCIETY, Appellant, v. Richard LEWISOHN, as Finance Administrator of the City of New York, et al., Respondents and Attorney-General of the State of New York, Intervenor-Respondent.

Court of Appeals of New York.

June 10, 1976.

J. Frederic Taylor and Thomas C. Crane, New York City, for appellant.

W. Bernard Richland, Corporation Counsel, New York City (Edith I. Spivack, Stanley Buchsbaum and Russell D. Scott, New York City, of counsel), for respondents.

Louis J. Lefkowitz, Atty. Gen. (Samuel A. Hirshowitz, Bernard Toomin and Sharon Cuff Slater, New York City, of counsel), for intervenor-respondent.

JONES, Justice.

We hold that a corporation organized and conducted exclusively for the purpose of publishing and distributing the Holy Bible, when neither the corporation nor its corporate activity is directly associated with an organized religious denomination or with an organization having as its avowed purpose the furthering of a recognized religion, is entitled only to a qualified exemption from real property taxation under section 421 (subd. 1, par. (b)) of the Real Property Tax Law. In this instance pursuant to the provisions of that same paragraph such qualified exemption has been withdrawn. Accordingly, we conclude that the real property of the American Bible Society located in the City of New York is subject to taxation.

The American Bible Society was founded in 1816 and chartered by special act of the Legislature in 1841 'for the purpose of publishing and promoting a general circulation of the holy scriptures, without note or comment'. (L.1841, ch. 68.) With some expansion and restatement of charter language, the Society has remained faithful to that original purpose to the present day. The 'Bible House' of the Society is located at 1865 Broadway in the City of New York; eight and one-half floors are occupied and used by the Society and the remaining three and one-half floors are leased on a nonprofit basis to three tenants which the city appears to concede are tax exempt organizations. It is from this base that the Society conducts its impressive activities in the translation, publication and world-wide distribution of the Bible.

It appears that the Society was first granted statutory tax exempt status for its real property in 1894 pursuant to the provisions of chapter 498 of the Laws of 1893 (People ex rel. American Bible Soc. v. Commissioners of Taxes & Assessments For City & County of N.Y., 76 Hun. 491, 27 N.Y.S. 1058, affd. 142 N.Y. 348, 37 N.E. 116). The city did not see fit in that case to contest the Society's right to exemption under the 1893 act. ¹ The controversy then revolved rather about the effective date of the act. The real property of the Society thereafter continued to enjoy tax exempt status until the adoption by the City of New York in 1971 of Local Law No. 46 ² pursuant to the authority of section 421 (subd. 1, par. (b)) of the Real Property Tax Law (L.1971, ch. 414), ³ both effective January 1, 1972. The Society's real property was transferred to taxable status on the city tax rolls pursuant to that legislation. The Society paid the taxes assessed under protest, and has duly filed applications for exemption which have routinely been denied. The present article 78 proceeding was instituted in 1973. Special Term directed that the Society's real property be removed from the tax rolls, having found that 'the four organizations occupying the real property in question are organized exclusively for religious and/or charitable and/or educational purposes' and that 'each separate occupancy is used exclusively for one or more such purposes'. The Appellate Division reversed, concluding that petitioner was organized exclusively (which the court correctly interpreted as 'primarily' (Matter of Association of Bar of City of N.Y. v. Lewisohn, 34 N.Y.2d 143, 153, 356 N.Y.S.2d 555, 561, 313 N.E.2d 30, 34, and cases cited) for Bible purposes, and that any religious or educational purposes or benefits were merely incidental and thus insufficient to secure for petitioner the unqualified exemption of section 421 (subd. 1, par. (a)) of the Real Property Tax Law. We agree.

At the threshold, we reject petitioner's suggestion that the decision in People ex rel. American Bible Soc. v. Commissioners of Taxes & Assessment (76 Hun. 491, 27 N.Y.S. 1058, affd. 142 N.Y. 348, 37 N.E. 116, Supra) is dispositive of the present litigation. The statute now under consideration has undergone substantial amendment and is significantly different from the statute involved in the earlier case. Thus, the claim now advanced by the city is not precluded under the principle of Res judicata. Additionally, since, as noted, the entitlement of the American Bible Society to tax exemption was not considered by the court and was not the subject of its deliberative disposition in the earlier case, the doctrine of Stare decisis has no application.

We turn then to the present case. A brief consideration of the historical development of the tax exemption status will be helpful. In 1893 the Legislature carried forward pre-existing exemptions by the enactment of chapter 498 of the laws of that year. That chapter provided for an exemption from taxation of real property of a corporation or organization organized exclusively 'for the moral and mental improvement of men and women or for religious, charitable, missionary, hospital, educational, patriotic, historical or cemetery purposes'. In 1896, the statute was amended to supplement the list of generally exempt purposes by adding seven, more specific purposes--Bible, tract, benevolent, infirmary, scientific, literary and library (L.1896, ch. 908). We conclude that this amendment reflected the intention of the Legislature to accord tax exemption to additional organizations which would not have come under the pre-existing broad categorical umbrellas. This resulted, in the present context, in assuring exemption to all corporations organized exclusively for Bible purposes, irrespective of whether it might otherwise be said that the particular corporation was organized exclusively for religious purposes. In the period 1896 to 1971 exempt status was granted to four more specific purpose categories--public playground, bar association, medical society and enforcement of laws relating to children or animals.

In 1971 the Legislature recast the exemption scheme (L.1971, ch. 414). Whereas prior thereto all enumerated purposes had enjoyed an unqualified exemption, effective January 1, 1972, the exemptions were divided into two categories--unqualified and qualified. The more general purposes in the unqualified category--religious, charitable, hospital, educational and cemetery--continue to enjoy absolute exemption (§ 421, subd. 1, par. (a)). The purposes in the second category, more specific and, significant for present purposes, including Bible, are granted only a qualified exemption--the exemption may be withdrawn by appropriate action of the governing board of the municipal corporation within which the particular real property is located (§ 421, subd. 1, par. (b)). In sum, then, beginning in 1972, unqualified exemption was granted to certain corporations and associations and qualified exemption was granted to others.

The issue presented for our determination is whether the real property of the American Bible Society is entitled to an unqualified exemption under paragraph (a) since the City of New York has taken appropriate action by the adoption of Local Law No 46 to withdraw any qualified exemption which may have existed under paragraph (b).

We conclude that within the contemplation of subdivision 1 of section 421 the American Bible Society is 'exclusively' (in the sense of principally or primarily) organized and conducted for Bible purposes and not for religious or educational purposes. It is true that...