Central Methodist Church v. City of Meridian

• Decision Date: 31 October 1921
• Docket Number: 21916
• Citation: 126 Miss. 780,89 So. 650
• Court: Mississippi Supreme Court
• Parties: CENTRAL METHODIST CHURCH v. CITY OF MERIDIAN et al

89 So. 650

126 Miss. 780

CENTRAL METHODIST CHURCH v. CITY OF MERIDIAN et al

No. 21916

Supreme Court of Mississippi

October 31, 1921

TAXATION. Property which religious society cannot lawfully hold held not exempt from taxation.

In construing statutes all statutes in prima materia are considered, and taking section 4252 Code 1906 (section 6883 Hemingway's Code) and section 934, Code 1906 (section 4110, Hemingway's Code), together, it is manifest that the legislature did not intend to exempt from taxation, in favor of a religious society, property which it could not lawfully hold. The legislative intent was to exempt such property as such society could lawfully hold.

HON. G C. TANN, Chancellor.

APPEAL from chancery court of Lauderdae county, HON. G. C. TANN Chancellor.

Bill in chancery by the trustees of the Central Methodist Church to enjoin the City of Meridian and the Tax Collector thereof from collecting taxes on property alleged exempt. Judgment for defendants, and the plaintiff appeals. Affirmed.

Judgment affirmed.

Thomas L. Bailey, S. M. Graham, and R. F. Cochran, for appellant.

We submit to the court that appellee even granting (and we do not) that appellant is holding property in violation of the law, is pursuing the wrong course. There is a well defined method ordained by law, whereby corporations may be penalized or punished for violating the property holding laws of the state. That method is the law of escheats. The state, under our system of administering law, is the sole and only judge of when this law or policy of government is violated. The state is the only being that invokes this remedy. Otherwise every corporation, charitable or corporate business holder of property would be the target of suits by Tom, Dick and Harry, seeking to penalize them. The state is the keeper of its own conscience, and we respectfully submit that the appellee has rushed in and attempted to start something in a matter with which it has no right or concern. The state is the judge of whether or not its policy is being trampled under foot; it, and it alone, is armed with the power to defend itself. In the case of Farrington et al. v. Putnam, et al., 38 L. R. A. 339, Chief Justice PETERS rendered a clear and conclusively sound opinion touching this proposition. In discussing the matter of the holding of property in excess of the amount fixed by statute, he says: "Certain things are ultra vires of a corporation; but when it has the power to hold property and is forbidden to hold beyond a certain amount, the matter being one of degree merely, or of more or less, this is not a question of ultra vires, but of violation of its charter. A contrary rule would involve many absurdities (the court here stated some of them). The corporation may be amendable to the penalty of violating its charter. Individuals cannot call it in question; its tenants must continue to pay its rents and is debtors their debts; the state alone has the right to proceed against it. The state may or may not see fit to do so. It would depend on the circumstances of the case, the greatness of the excess, the causes which led to it, etc., the state may condone the offence. The legislature may relieve by enlarging its powers. The late Justice BRADLEY was far famed as an original thinker, and his idea that if the contrary rule prevailed, the corporation could never be punished for accepting a bequest which gave it property above the limit allowable, because it could defend upon the ground that the bequest was completely void, is certainly original and forceful." Numerous cases are cited and discussed in this great opinion.

In this state, although taxation is by many regarded as grievous and highly punitive, the policy of the state has never been to punish wrongdoers by the imposition of taxes. If appellant has done any wrong and is answerable to any one as a consequence of its dealings with its property, it has violated the land holding laws of the state and is answerable on this charge alone, and the state alone must call it to task. This property under the laws of the state, is exempt from taxation. Its right to hold property is a matter between it and the state. It is a question of whether or not, in view of all the circumstances, it has violated or infringed upon the rights of the state. The state by failure to act, has recognized the justice and the right of its conduct in holding said property. Appellee can have no "kick."

We respectfully submit that in the light of the record in this case, the decision of the lower court should be reversed and judgment, in accordance with the prayer of appellant's bill, entered here.

Amis & Dunn, for appellee.

The reason why the church is holding the property is not material on the question as to whether or not property actually held by it in excess of its power to hold such property is taxable. The sole question here is as to the proper construction of section 4252 in the light of section 934 under the peculiar facts of this case.

The identical question here under consideration was considered by the supreme court of New Jersey in the case of State v. Atlantic City, reported in 48 A. at page 242, which was affirmed by the appellate court in an opinion reported in 59 Lawyers Report Annotated at page 947. In that case it was held that property acquired and held by a charitable society in excess of its charter powers, was not exempt from taxation under a general statute of New Jersey exempting property devoted to charitable purposes from taxation.

The case of Farrington v. Putnam, reported in 38 L. R. A. at page 339, is not in point, and has no bearing whatever on the issues in this cause. In that case Farrington made a will by which he devised certain property to a charitable society, which property when added to that which the society already owned, was in excess of the value of the property which the charitable society was authorized by its charter to own; and the heirs at law of Farrington were contending that the bequest was void, and that the property descended to the heirs at law. We make no such contention here. We do not contend that Central church has no title to the property here in controversy. On the contrary we admit that it has title, and that it can pass that title to another by a conveyance; we also admit that no one can complain of the fact that it has acquired this property in excess of its corporate powers except the state; and that even if the state did complain, that it could not escheat the property but could only dissolve the corporation and wind up its affairs. But the exact question presented here is whether or not under the provisions of section 4252 construed in the light of and in conjunction with section 834, the church can hold the property in controversy in excess of its charter or statutory powers, and at the same time claim an exemption from taxation. This exact question has never been decided by this court, and so far as we have been able to find, has never been decided by any court in any case, except the New Jersey case above cited.

If the contention of the appellant be sound, then a church might take title to large tracts of valuable real estate in excess of its lawful authority, and gain exemption from taxation, both state and municipal, to the detriment of the public revenue. We submit that the true intent and meaning of section 4252 is to exempt from taxation all of the property, real and personal, lawfully owned by or belonging to any religious or charitable society; and that it was not intended by the legislature to exempt from taxation any property acquired, or held by a religious, or charitable society in excess of its lawful powers to take and hold the same.

The point here under consideration was not made or considered in the case of Adams County v. Catholic Diocese, 71 So....