Board of Assessors of Boston v. Garland School of Home Making

• Decision Date: 25 January 1937
• Citation: 6 N.E.2d 374,296 Mass. 378
• Parties: ASSESSORS OF BOSTON v. GARLAND SCHOOL OF HOME MAKING.
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

296 Mass. 378

6 N.E.2d 374

ASSESSORS OF BOSTON v. GARLAND SCHOOL OF HOME MAKING.

Supreme Judicial Court of Massachusetts, Suffolk.

January 25, 1937

January 8, 9, 1936.

Present: RUGG, C.

J., CROSBY, FIELD LUMMUS, & QUA, JJ.

Tax, Exemption. Corporation, Charitable. Charity. Board of Tax Appeals. Words, "Charitable," "Benevolent," "Literary," "Scientific."

Whether conclusions of fact and a general finding by the board of tax appeals upon an agreed statement of facts were warranted is a question of law reviewable by this court on appeal under G.L (Ter. Ed.) c. 58A,

Section 13, as amended by St. 1933, c. 321, Section 7.

Statement by FIELD J., as to what constitute "literary, benevolent charitable and scientific institutions" within G.L. (Ter. Ed.) c. 59,

Section 5, Third. Facts respecting an institution which was incorporated for the purpose of

"training young women in the principles of home making" and gave practical courses to that end, and which from substantial fees charged to its students supported itself without endowment or gifts and made profits which were devoted to capital improvements and to the reduction of the principal of mortgages on real estate owned and used by it for its corporate purposes, and none of whose income or profits properly could be or ever was divided among its members, warranted conclusions that it was not incorporated nor conducted for private profit and was an educational institution and a "literary, benevolent, charitable and scientific" institution within G.L. (Ter. Ed.) c. 59, Section 5, Third, so that its real estate was exempt from local taxation.

The facts, that an educational institution supported itself without gifts or endowment through substantial tuition charges and made profits which it used for capital improvements and to reduce the principal of mortgages on its real estate on which its activities were carried on, did not preclude findings that its occupation of its real estate was directly and dominantly to accomplish its corporate purposes, to which the making of profits was only incidental, and that the real estate was "owned and occupied by . . . [it] for the purposes for which . . . [it was] incorporated" within G.L. (Ter. Ed.) c. 59, Section 5,

Third; nor did such facts require a finding that the income or profits were "used or appropriated for other than literary, educational, benevolent, charitable, scientific or religious purposes" within the meaning of that statute.

APPEAL, filed in the Supreme Judicial Court for the county of Suffolk on September 24, 1935, from a decision by the Board of Tax Appeals.

L. H. Weinstein, Assistant Corporation Counsel, for the board of assessors.

L. S. Apsey, for the taxpayer.

FIELD, J. This is an appeal by the board of assessors of the city of Boston (herein called the assessors) from a decision of the board of tax appeals (herein called the board). G.L. (Ter. Ed.) c 58A, Section 13, as amended by St. 1933, c. 321, Section 7. The Garland School of Home Making (herein called the taxpayer) was assessed as the owner of certain parcels of land and the buildings thereon in said city as of April 1, 1932, and April 1, 1933. It seasonably filed applications for abatement, which were not acted upon by the assessors within four months, and appealed to the board. The board decided that the taxpayer was entitled to an abatement for the year 1932 in the amount of $5,143.95 and an abatement for the year 1933 in the amount of $2,952 -- being the whole amounts of the taxes on those parcels for these years -- because the real estate was exempt from taxation. From this decision the assessors appealed to this court.

The ground on which the abatements were granted was that the real estate in question was exempt from taxation under G.L. (Ter. Ed.) c. 59, Section 5, material parts of which are these: "The following property . . . shall be exempt from taxation: . . . Third, Personal property of literary, benevolent, charitable and scientific institutions and of temperance societies incorporated in the commonwealth, the real estate owned and occupied by them or their officers for the purposes for which they are incorporated, and real estate purchased by them with the purpose of removal thereto, until such removal, but not for more than two years after such purchase, except as follows: (a) If any of the income or profits of the business of the institution or corporation is divided among the stockholders or members, or is used or appropriated for other than literary, educational, benevolent, charitable, scientific or religious purposes, its property shall not be exempt." If the decision that the taxpayer was exempt was without error of law no further question requires consideration. This issue of law was raised in the proceedings before the board by various requests for rulings which were dealt with by the board and is brought before us by specific assignments of error. Discussion of those requests and assignments separately is not required.

The case was heard by the board on an "agreed statement of facts" and a "supplementary additional agreed statement of facts" -- obviously as evidence and expressly providing that the board might "make inferences" therefrom -- which are incorporated in the record on this appeal.

Facts found by the board bearing on the fundamental issue were these: The taxpayer "is a domestic corporation organized on February 18, 1913, under the provisions of R.L. c. 125 (now G.L. c. 180)." It "was incorporated `for the purpose of training young women in the principles of home making.' Article VIII of the by-laws of said corporation provides as follows: `All property acquired by gift, bequest or otherwise shall be devoted to the purposes of the School; and the Executive Committee is authorized in its discretion to accept and receive in the name of the Corporation all property given in trust or otherwise, in accordance with the provisions of Chapter 180 of the General Laws of the Commonwealth.' There was no evidence of a charitable gift to the school. It offers a one year and a two year course, the students taking the latter course being classified as juniors and seniors. The curriculum comprises the following subjects: General Psychology; Child Psychology; Child Observation and Practice; Family Relationships; Home Nursing; Significance of Play and Play Materials; Literature; Drama; Current Events; Public Questions and Parliamentary Procedure; Appreciation of Design; Interior Decoration; Music in the Home; Home Management; Economic Principles; Family Finance; Selection and Care of the

House; Home Cookery and Table Service; Quantity Cookery; Elementary Clothing; Advanced Clothing; Crafts; and supplementary lectures on related topics. A building at 409 Commonwealth Avenue (not involved in these petitions) houses the class rooms, laboratories and offices and is used exclusively for class room work, teaching and administration. The other three buildings, the subject matter of these appeals, are used as dormitories, dining and practice houses and are designated `Home Houses.' They were purchased by the appellant in 1931 and 1932, subject to mortgages placed thereon. All resident students are required to live and take their meals at the houses, and of a total enrollment of 65 in the school year 1931-1932 and 68 in 1932-1933, 26 students lived at the houses each year. Each house is in charge of a teacher who resides there and who instructs the students living at the houses in the work of managing homes. Under her direction three of the students successively, for a period of two weeks, take over the entire operation of each house. One of the three acts as housekeeper, one as home maker and one as comptroller of the budget. Each house is on a strict budget and the students are required to keep track of all bills, to know exactly what the operation of each house costs, plan meals, order food, do some of the cooking, supervise the help and do a large part of the housework. In addition to the rooms set apart for the teacher and the students, one room is reserved for guests and one room for sick students. In the judgment of the managing officers the houses are occupied to the fullest extent possible in keeping with orderly and efficient fulfilment of the purposes of the corporation and were acquired and have been maintained because their use and operation are reasonably necessary for the accomplishment of the corporate purposes."

The gross income of the taxpayer for the year ending April 1, 1932, was $60,614.38, and for the year ending April 1, 1933, $64,451.83. The expenditures for said years respectively were $50,599.37 and $52,265.91, and the resulting net incomes, $10,015.01 and $12,185.92. "Tuition for non-residents is $550 a year for the one year course and $500 a year for the two year course; for resident students, the tuition is $1,850 a year for one year students and $1,800 a year for two year students. No salaries are paid to members of the corporation other than teachers and employees. During the school year 1931-1932 there were 19 teachers receiving salaries ranging from $300 to $3,425; during the following year there were 20 teachers receiving salaries ranging from $300 to $3,500 a year. The total payroll of the teaching staff for 1931-1932 was $23,095, and in 1932-1933 $25,430."

As conclusions of fact the board found that "none of the income or profits is or ever has been divided among the members of the corporation or used or appropriated for other than literary, educational, benevolent, charitable, scientific or religious purposes . . . that the appellant is a literary and educational institution and that its real estate is occupied by it for the purposes for which it was incorporated."

The parties agreed that...