Board of Home Missions and Church Extension of Methodist Episcopal v. Philadelphia

• Decision Date: 23 February 1920
• Docket Number: 93
• Citation: 109 A. 664,266 Pa. 405
• Parties: Board of Home Missions and Church Extension of the Methodist Episcopal Church v. Philadelphia, Appellant
• Court: Pennsylvania Supreme Court

109 A. 664

266 Pa. 405

Board of Home Missions and Church Extension of the Methodist Episcopal Church v. Philadelphia, Appellant

No. 93

Supreme Court of Pennsylvania

February 23, 1920

Argued January 13, 1920

Appeal, No. 93, Jan. T., 1920, by defendant, from decree of C.P. No. 2, Philadelphia Co., Dec. T., 1916, No. 1516, on appeal from tax assessment in case of Board of Home Missions and Church Extension of the Methodist Episcopal Church v City of Philadelphia. Affirmed.

Appeal from tax assessment. Before BARRATT, P.J.

From the record it appeared that the petitioner claimed exemption from a portion of the taxes assessed on property, Nos 1701-1703 Arch street, in the City of Philadelphia. The property in question was assessed at $275,000, of which valuation $22,000 was marked exempt and $253,000 taxable. It appeared that the petitioner rented out about one-half of the building owned by it to others, and used the remainder for its own work. The court held that the property was exempt from taxation in so far as it was used for the purposes of the petitioner. On the question of rental value the court found as follows:

"The total value of the rental value of the building of this petitioner is $21,250 per year. The amount used by the petitioner aggregates $10,140; that rented out amounts to $11,110. The amount free, therefore, to that of the whole is as $10,140 to $21,250. As the total valuation of the premises is $275,000, the amount exempt is 10,140/21,250 of $275,000, or $131,223.53.

"The tax, then, is upon the unexempt balance of $143,776.47, and the petitioner's appeal is sustained to this extent."

Other facts appear by the opinion of the Supreme Court.

Error assigned, amongst others, was the decree of the court, quoting it.

The assignments of error are overruled, and the order appealed from is affirmed at cost of appellant.

Mayne R. Longstreth, Assistant City Solicitor, and John P. Connelly, City Solicitor, for appellant. -- Plaintiff was not an institution of "purely public charity": White v. Smith, 189 Pa. 222; Donohugh's App., 86 Pa. 306; Burd Orphan Asylum v. School Dist., 90 Pa. 21; Episcopal Academy v. Phila., 150 Pa. 572; Phila. v. Masonic Home, 160 Pa. 572.

No case has ever decided that a charity with beneficiaries limited exclusively to a single denomination was purely public. In addition to Phila. v. Masonic Home, 160 Pa. 572, and White v. Smith, 189 Pa. 222, which hold such charities taxable, the following cases have been very careful to point out that their institutions were not only nonsectarian but open to all denominations: Northampton Co. v. Lafayette College, 128 Pa. 132; Phila. v. Women's Christian Assn., 125 Pa. 572; Women's Home Mission Society. v. Taylor, 173 Pa. 456; Young Men's Christian Assn. v. Donohugh, 13 Phila. 12; Haverford College v. Rhoads, 6 Pa. Superior Ct. 71; Beaver Co. v. Geneva College, 2 Pa. Dist. R. 70; Phila. v. Penna. Hospital., 8 Pa. C.C.R. 72.

As to the portions of the building rented out to others and from which a revenue is received and which is not from beneficiaries of a charity in part payment therefor, but from a commercial use, there is no dispute that the room space they occupy exclusively is taxable: Phila. v. Barber, 160 Pa. 123; Am. S.S.U. v. Phila., 161 Pa. 307; Pocono Pines Assembly v. Co., 29 Pa.Super. 36.

W. H. G. Gould, for appellee. -- The fact that the managers belong to a single church and that the money is distributed to members of that church does not deprive the institution of being purely public. The facts are that the churches aided are open to all without discrimination and the missionaries serve all persons without discrimination: White v. Smith, 189 Pa. 222; Burd Orphan Asylum v. School Dist. of Upper Darby, 90 Pa. 21; Haverford College v. Rhoads, 6 Pa. Superior Ct. 71; Episcopal Academy v. Phila., 150 Pa. 565; Northampton County v. Lafayette College, 128 Pa. 132.

The fact that part of the building is rented out to others from which an income is received does not deprive the petitioner of its character as a purely public charity: Y.M.C.A. v. Donohugh, 7 W.N.C. 208; American Sunday School Union v. Phila., 161 Pa. 307; Contributors to the Penna. Hospital v. Delaware County, 169 Pa. 305; Mercersburg College v. Mercersburg Borough, 53 Pa.Super. 388.

Before BROWN, C.J., MOSCHZISKER, FRAZER, WALLING and KEPHART, JJ.

OPINION

MR. JUSTICE MOSCHZISKER:

The Board of Home Missions and Church Extension of the Methodist Episcopal Church, a Pennsylvania corporation, not for profit, plaintiff and appellee in these proceedings, acting in conjunction with another corporation, the Philadelphia Tract Society of the Methodist Episcopal Church, erected a double building in the City of Philadelphia, so arranged that the respective parts, belonging to each of the two organizations, can be occupied separately. Plaintiff's section, Nos. 1701-1703 Arch street, was assessed in its name by the City of Philadelphia, defendant here, for purposes of taxation, in 1916, at a total valuation of $275,000; an appeal was taken from this assessment to the Board of Revision of Taxes, asking exemption for so much of the structure as is used by plaintiff in the prosecution of its endeavors, on the ground that the latter is engaged in the work of a purely public charity. A slight exemption was allowed, and, not being satisfied, plaintiff appealed to the common pleas. When the case came on for hearing, the city opposed the appeal, alleging that "plaintiff's work is entirely sectarian and denominational -- not 'purely public' at all." The court below overruled this contention, and, after taking testimony, concluded that the rooms used by the Board of Home Missions and Church Extension, in the prosecution of its work, represents approximately one-half of the whole of plaintiff's section of the building, which portion was decreed exempt from taxation. The city has appealed.

The claim for exemption is based upon section 1 of the Act of June 13, 1911, P.L. 898, which amends the Act of May 29, 1901, P.L. 319, amending the Act of May 14, 1874, P.L. 158. The law, as it now stands, ordains that "all . . . institutions of . . . benevolence or charity . . . maintained by public or private charity . . . be and the same are hereby exempted from all . . . tax."

The Constitution of Pennsylvania, Article IX, Section 1, authorizes the general assembly to exempt from taxation, by general laws, "institutions of purely public charity"; and, of course, to come within the legislative exemption claimed, plaintiff must show itself to be a "purely public charity."

What is, and what is not, "a purely public charity," has been much discussed in our cases, and, on the whole, we have taken a rather broad view of the meaning of that term, as is evidenced by Burd Orphan Asylum v. Upper Darby School District, 90 Pa. 21; Phila. v. Women's Christian Association, 125 Pa. 572; Woman's Home Missionary...