Bishop and Chapter of Cathedral of St. John the Evangelist v. Treasurer of City and County of Denver

• Citation: 86 P. 1021,37 Colo. 378
• Parties: BISHOP AND CHAPTER OF CATHEDRAL OF ST. JOHN THE EVANGELIST v. TREASURER OF CITY AND COUNTY OF DENVER.
• Decision Date: 02 July 1906
• Court: Supreme Court of Colorado

86 P. 1021

37 Colo. 378

BISHOP AND CHAPTER OF CATHEDRAL OF ST. JOHN THE EVANGELIST v. TREASURER OF CITY AND COUNTY OF DENVER.

Supreme Court of Colorado, En banc.

July 2, 1906

Appeal from District Court, City and County of Denver; F. T Johnson, Judge.

Action by the bishop and chapter of the Cathedral of St. John the Evangelist against the treasurer of the city and county of Denver. From a judgment in favor of defendant, plaintiff appeals. Reversed and remanded with directions to grant the relief prayed for.

Benedict & Phelps and Rogers, Shafroth & Gregg, for appellant.

Henry A. Lindsley and Charles R. Brock, for appellee.

GODDARD J.

The appellant, plaintiff below, is an organization duly incorporated under the laws of Colorado for purposes other than pecuniary profit, viz., for religious benevolent, and charitable purposes. On the 22d day of June A. D. 1895, John F. Spaulding conveyed to it, upon a nominal consideration, certain real estate situate in the city and county of Denver, Colo., for the purpose of building, furnishing, and maintaining thereon a building to be known as the 'Home for Consumptives,' to be held as a function of the plaintiff corporation; such corporation to have the general control touching the character and management thereof, with the due execution of the trust involved, and, as incidental thereto, to receive and expend all funds given for the purpose of building and maintaining said establishment. The deed further provided that, in consideration of his being the originator of the plan for the establishment of the home, and of his efforts in raising funds sufficient to commence its building, his character, and fitness for the raising of further funds for the superintendency and management of the institution which he had announced to be his future life work, the Reverend Frederick W. Oakes should be superintendant thereof for life, or during his pleasure, subject to disability, removal from diocese, or failure to legally and faithfully execute the duties of the office. Through his instrumentality large sums of money were donated, and in course of time spacious, commodious, and comfortable buildings arranged for the purpose were erected upon the land so conveyed to the corporation, and equipped and furnished as a home for people suffering with the disease commonly known as 'consumption.' The money used in the construction and furnishing of these buildings was donated by benevolent persons, largely residents and citizens of states other than the state of Colorado, and was furnished solely as an act of benevolence and charity, and as a gift outright, without any hope of, or wish for, pecuniary profit or gain. Since the completion, and down to the present time, the buildings have been kept open and maintained as a home for consumptives, and very many persons suffering from such disease, and none other, have been received, kept, and provided for therein. Not having been endowed with funds for the maintenance, or for any portion of the operating expenses, thereof, it has been, and still is, necessary, to maintain the home and carry on the trust, to charge the patients sufficient to cover the cost, as nearly as possible, of the actual running expenses of the institution--that is to say, the cost of food, light, help, and supervision--and to this extent charges have been made, as to most of the patients, of weekly sums for the purpose of covering such expenses, but nothing has been charged, accepted, or paid in excess of such actual expenses; nor has the amount so charged been equal, in any year, to such actual expenses. Nothing has been required or paid for the purpose of making a return by way of interest, rent, or otherwise, upon the money invested in the land and buildings, but funds to the amount of many thousands of dollars have been required outside of what has been paid by the patients to pay actual cost and expenses for the purposes aforesaid.

The home was opened in the year 1895, and for the first year the expense of food, light, heat, etc., exceeded the receipts from guests by something over $5,000. Every year since there has been even a larger deficit. These deficits have, from time to time, been made good by donations by various benevolent and charitably disposed people. The management has been economical, and the deficits are in no way chargeable to any extravagance or unreasonable conduct of the affairs of the home. Mr. Oakes, after testifying to receipts and disbursements, states: 'As to the matter in regard to compensation to be paid by guests, there are two questions we ask of any one that comes to the home. It is understood that the rates at the home are thus and so, and when persons come to the home the persons must have consumption and must understand that if they come to the home they are to conduct themselves like a lady or gentleman, and if no questions are asked they are charged the usual rates, * * * for the home proper, $25 to $45 a month, and it is simply the charge that is made on what it will cost to live in the home. If any one has made a request for a reduction, and that person has come with proofs of their worthiness, I do not know of an instance where what they have asked for has not been met.' And, after stating a certain instance, continued: 'I don't suppose there is ever a time or a day since the institution has been opened that there has not been some one there absolutely free, and not only one person, but many, who are receiving help to a degree. * * * Of course, the institution cannot support itself; if there is nothing to help with there can be nothing given. But there has never been a time when it has been denied; that is, having the building, ground, and furniture all up, it would yet be impossible to take guests unless something was paid by the guests to cover operating expenses, or else it was made up by some one else. The institution was started without endowment fund, and that is something that is looked to in the future. Every one who is there and who has made a request to me which has been considered at all reasonable has been met, as regards compensation, whatever they have asked. Private nurses have been furnished for people who could not afford to pay them, and they have lacked nothing in care. Everything has been given them, not only what they asked for, but what we found in our power to do. It has been a question of our seeking. We are not there for remuneration; we are there to serve. As to worthy people, consumptives, the fact that they haven't money has never debarred them from entering. If debarred it is one of three reasons, viz., that I did not have the room, or that I did not have any means, or the person was shown not to be worthy.' Most of the persons received into the institution have been able to pay, and have paid, for what they received upon a basis, however, not sufficient to cover the actual cost of food, heat, light, and services. The appellee, defendant below, placed great stress upon the fact that Mr. Oakes had issued a prospectus concerning the work and progress of the institution, in which it was stated that the home was not a charitable institution, and that he had, on other occasions, used expressions to the same effect. He explained that he used the term as meaning that the institution would not be conducted to provide for those wholly destitute of means, using the word 'charity' as synonymous with 'pauperism.' Plaintiff objected to this evidence for the reason that the question as to whether the use of the buildings was, or was not, for strictly charitable purposes, was not to be determined by declarations of employés, of whatever rank they might be.

We think the objection was well taken. The character of the institution is to be determined by the purpose of its construction and the manner of its operation, and not by the opinion of any individual as to whether its work conforms to his notion of charity or not. What constitutes a charity, and what is a charitable purpose, have been defined by judges in many cases. In Harrington v. Pier (Wis.) 82 N.W. 345, 50 L.R.A. 307, 76 Am.St.Rep. 924, the court had under consideration the question whether a bequest for the promotion of temperance was a proper subject for a charitable trust. After discussing the law as to trusts in general Marshall, J., says: 'A general statement of the essentials of a charity, as regards the...