City of Biloxi v. Trustees of Mississippi Annual Conference Endowment Fund

• Decision Date: 19 April 1937
• Docket Number: 32698
• Citation: 179 Miss. 47,173 So. 797
• Court: Mississippi Supreme Court
• Parties: CITY OF BILOXI v. TRUSTEES OF MISSISSIPPI ANNUAL CONFERENCE ENDOWMENT FUND

173 So. 797

179 Miss. 47

CITY OF BILOXI v. TRUSTEES OF MISSISSIPPI ANNUAL CONFERENCE ENDOWMENT FUND

No. 32698

Supreme Court of Mississippi

April 19, 1937

Division A

1. APPEAL AND ERROR.

Contention that religious organization's charter, granted prior to adoption of Constitution in 1890, exempting property from taxation violated Constitution prohibiting passage of local, private, or special laws exempting property from taxation involved question of effect of amendment of organization's charter after adoption of Constitution (Laws 1888, chap. 439; Code 1906, secs. 899, 900; Const. sec 90, subsec. (h)).

2 STATUTES. Taxation.

Where charter of religious organization, granted by special act prior to adoption of Constitution in 1890, exempted organization from taxation, amendment of charter after adoption of Constitution rendered organization subject to provision of Constitution prohibiting passage of local private, or special laws exempting property from taxation and rendered the exemption originally granted to the organization void, notwithstanding amendment of organization's charter merely provided for extension of terms of office of trustees and officers and for filling of vacancies in such offices (Laws 1888, chap. 439; Code 1906, secs. 899, 900; Const sec. 90, subsec. (h); secs. 179, 181, 279).

3. APPEAL AND ERROR.

Supreme Court could not determine whether organization was exempt from taxation under general law granting religious and charitable societies exemption from taxation where question was not considered or passed on in trial court and facts as to ownership and use of property were not sufficiently developed to enable Supreme Court to pass upon and fully determine such question.

HON. W. A. WHITE, Judge.

APPEAL from the circuit court of Harrison county HON. W. A. WHITE, Judge.

Proceeding by the Trustees of the Mississippi Annual Conference Endowment Fund against the City of Biloxi. From an adverse decree, the City of Biloxi appeals. Judgment reversed, and cause remanded.

Reversed and remanded.

J. D. Stennis, Jr., of Biloxi, for appellant.

We respectfully submit that appellee, having failed to allege that application had been made for the assessment of said property to it as purchaser, and that it was the owner of said property at the time of the filing of said application for exemption, was not entitled to proceed on its petition for exemption, and said demurrer on the general grounds that no cause of action or right for relief was stated in the petition should have been sustained.

We respectfully submit to the court that it was manifest error of the trial court in overruling the demurrer for, as shown by the petition and exhibit thereto, appellee's charter, although the charter of said corporation was granted as a special act of the Legislature in 1888 before the adoption of the Constitution of 1890, the property of said corporation might have been exempted from taxation so long as the corporation continued to operate in the manner provided in its charter if it so operated at the time of the adoption of the Constitution of 1890, but after the Constitution was adopted and the Legislature passed general laws respecting corporations and how they might amend their charters, this corporation, taking advantage of the benefits of these laws, sections 899 and 900 of the Code of 1906, by having its charter amended in 1914, under the provisions of the general laws of the state respecting corporations, then by its said acts it conclusively agreed to and did and does hold its charter under the provisions of the Constitution of 1890 (section 179 of the Constitution). Section 182 of the Constitution of 1890 providing that the power to tax corporations and their property should never have been surrendered or abridged by contract or grant, etc., brings this corporation within the same class and category as individuals and other corporations whose property is prohibited to be by special act of the Legislature exempted from taxation. Section 90, paragraph (h), of the Constitution provides: "The Legislature shall not pass local, private or special laws in any of the following enumerated cases, but such matters shall be provided for only by general laws, viz. . . . (Paragraph H) Exemption of property from taxation or from levy or sale." So, regardless of the provisions of its original charter of 1888 which are altogether contrary to the provisions of the general laws of the state, those provisions having been vitiated and made utterly void by the acts of said corporation and said sections of the Constitution, this corporation could claim no rights other than those given under the general laws. Having no right to exemption under the general laws, it seeks to rely on the vitiated provisions of its original charter, which have been vitiated by its own acts in accepting the benefits of the provisions of the general laws of the state with reference to the amendment of its original charter. And, therefore, under subsection or paragraph (h) of section 90 of the Constitution of the State of Mississippi, the provisions of appellee's charter with reference to exemption are a nullity.

We do not find any case which has been before this Honorable Court and which is directly in point where section 179 of the Constitution of 1890 has been construed, but the wording of said section is plain and unambiguous, and expressly provides that the taking of any benefit or advantage from any legislation respecting . . . the alteration or amendment of corporate charter then existing or any general or special laws for the benefit of such corporations . . . shall be conclusively held an agreement by such corporation to thereafter hold its charter and franchise under the provisions of said Constitution.

The court in the case of Adams v. Railroad Co., 77 Miss. 194, 24 So. 200, in the construction of section 181 of the Constitution, held that the meaning of section 181 was that "if corporations organized and existing at the date of adoption of the Constitution should retain the precise corporate existence they then had, such exemptions as they legally had should continue whilst their corporate organizations remained as they were," and that the consolidation of corporations cut off the exemption previously enjoyed by the consolidated corporations.

Section 4169 of the Mississippi Code of 1930 enumerates the kind and amount of property which may be owned or held at any one place by any religious society, ecclesiastical body and/or any congregation thereof. The property described in appellant's petition for exemption from taxation by the City of Biloxi is not alleged to be such property as is entitled to be exempt under section 3108 of the Mississippi Code of 1930, nor is the same described as being property which said religious organization, the Conference Endowment Fund of the Mississippi Annual Conference of the Methodist Episcopal Church, South, had any right to own or hold.

On this latter proposition, which is not raised by the demurrer except under the general assignment that no cause of action is stated by the petition, the court has held in the case of Gunter v. Jackson, 130 Miss. 686, 94 So. 842, 27 A. L. R. 1043, that property owned by a church is not exempt when the church has no right to own it. The same proposition is presented by the case at bar. We respectfully submit that the appellee could not seriously contend that it is entitled to any exemption under the statute. We, therefore, respectfully submit that the court committed manifest error in overruling appellant's demurrer to appellee's petition for the exemption of the property described therein, first, because it is obvious that the appellee did not allege that it was the owner of the property, and if for the sake of argument we may say that its petition inferred that it was the owner thereof, it failed to allege any right of ownership thereof, and from a description of the property contained in the petition itself it is obvious that said property is not such property as religious organizations are, under the statutes, permitted to own, and, therefore, such as is not exempt from taxation; secondly, because by the acts of said corporation in amending its charter after the adoption of the Constitution of 1890, the provisions of the charter of said corporation, which are contrary to the provisions of the general laws and to the Constitution, have been vitiated by said acts drawing said corporation under the provisions of the Constitution, and the provisions of said charter being inhibited by paragraph (h) section 90 of the Constitution of 1890; and thirdly, because the property sought to be exempt is not alleged to be such property as is exempt under the statutes.

Taking up the third assignment of error, we respectfully submit to the court that the trial court committed manifest error in setting aside the assignment made by the City of Biloxi against Seashore Methodist Assembly of the Methodist Conference, and holding the same erroneous, for the assessment roll of the City of Biloxi for the years 1934 and 1935 as well as those for the year 1936 show that this property was assessed to Seashore Methodist Assembly of the Methodist Conference long prior to the filing by appellees of its petition for the exemption of said property from taxation, and there is nothing in the record to show that any application was ever made to the City of Biloxi by any person interested in said property or any other person for the change in said assessment, nor does the petition of the appellee allege that appellee is the owner of said property.

As much as we may desire to favor religious organizations and societies, the law looks with disfavor upon the exemption of property from taxation...