Delta Psi Fraternity v. City of Burlington

• Citation: 2008 VT 129,969 A.2d 54
• Decision Date: 10 October 2008
• Docket Number: No. 07-386.,07-386.
• Parties: DELTA PSI FRATERNITY v. CITY OF BURLINGTON.
• Court: United States State Supreme Court of Vermont

969 A.2d 54

2008 VT 129

DELTA PSI FRATERNITY v. CITY OF BURLINGTON.

No. 07-386.

Supreme Court of Vermont.

October 10, 2008.

Heather R. Hammond of Gravel and Shea, Burlington, for Plaintiff-Appellee.

Eugene M. Bergman, Office of the City Attorney & Corporation Counsel, Burlington, for Defendant-Appellant.

Present: REIBER, C.J., DOOLEY, JOHNSON, SKOGLUND and BURGESS, JJ.

¶ 1. SKOGLUND, J.

The City of Burlington appeals the trial court's summary judgment order granting Delta Psi Fraternity tax-exempt status on its uninhabited residential property. The City contends that the trial court erred as a matter of law in ruling that the tax exemption is based solely on the building's ownership and not its use. We reverse.

¶ 2. The relevant facts are uncontroverted. Organized in 1850 and incorporated in 1884 "for the purpose of promoting useful knowledge, [and] intellectual, social, and aesthetic culture," Delta Psi existed as a fraternity at the University of Vermont (UVM) for more than 150 years. From 1924 until January 2004, Delta Psi housed its members at a residence on Summit Street that is the subject of this litigation. Delta Psi is a "local fraternity" with no national affiliation and had a membership comprising both students and alumni. Eventually, both Delta Psi and its residence began a slide into neglect. By 2003, active student membership in Delta Psi had dwindled to five members, the organization was in financial trouble, and the UVM administration had suspended the fraternity for a hazing incident. In December 2003, the house's heating system failed, causing the water pipes to freeze. The fire department and city inspectors, responding to an alarm, discovered standing water, smashed doors and walls, woodwork torn apart, and paths of egress obstructed with debris. Given the condition of the property, the City declared the residence uninhabitable and evicted the few remaining members. UVM then classified the fraternity as "inactive."

¶ 3. Since January 2004, no students have lived at the residence, and the fraternity has remained inactive. Delta Psi's board made a consistent—yet ultimately unsuccessful—effort to raise the substantial funds needed to rehabilitate the house and reorganize the fraternity. After making some basic repairs, the board secured a caretaker to live in the residence rent-free in exchange for providing routine maintenance and in order to prevent vandalism. In June 2006, a second caretaker replaced the first and remained on the property for the remainder of the relevant time period. Between June 2004 and December 2006, alumni members of the fraternity held six administrative meetings in the building and used it for one fundraising "phone-a-thon." In 2005, the City assessor informed Delta Psi that since the fraternity was no longer "recognized"¹ by UVM and did not house UVM students, the property was no longer tax-exempt.

¶ 4. In reaction to the City's determination, Delta Psi sought a declaratory judgment that the property was tax-exempt under 32 V.S.A. § 3802(5), a provision that exempts certain property owned by fraternities unless held for investment purposes. Delta Psi moved for summary judgment, and the City filed a cross-motion for summary judgment. The trial court granted Delta Psi's motion, ruling that the property was tax-exempt because "the fraternity house exemption is based on ownership of the house and the land that it occupies, not its use." This appeal followed.

¶ 5. We review grants of summary judgment de novo, using the same standard applied by the trial court. Openaire, Inc. v. L.K. Rossi Corp., 2007 VT 120, ¶ 7, 182 Vt. 636, 940 A.2d 724 (mem.). To withstand a challenge to summary judgment, the moving party must prove that there is no genuine issue of material fact and that it is entitled to judgment as a matter of law. White v. Quechee Lakes Landowners' Ass'n, 170 Vt. 25, 28, 742 A.2d 734, 736 (1999); V.R.C.P. 56(c)(3). As this case presents no dispute of material facts, our review is strictly limited to deciding whether § 3802(5) grants tax exemptions to residential fraternity properties regardless of their current use. We conclude that the statute requires use of the fraternity property as a residence for student members. As Delta Psi's property was not being used as such for the relevant time period, it is not exempt from property tax for the corresponding tax years.

¶ 6. We look first to the text of the statute. Section 3802(5) exempts from taxation:

Real and personal property held by and for the benefit of college fraternities and societies and corporations owning such property, but this exemption shall not apply to property held for investment purposes. The exemption from taxation of real and personal property held by and for the benefit of college fraternities and societies and corporations owning such property shall not be construed as exempting lands, buildings or property other than a fraternity or society house, the land occupied thereby, the land adjacent thereto and used as a lawn, playground or garden, and the household furniture, and equipment in actual use in such fraternity or society house.

32 V.S.A. § 3802(5) (emphasis added).

¶ 7. When interpreting statutes, "[t]he bedrock rule of statutory construction is to determine and give effect to the intent of the Legislature." In re C.S., 158 Vt. 339, 343, 609 A.2d 641, 643 (1992); see also Wesco, Inc. v. Sorrell, 2004 VT 102, ¶ 14, 177 Vt. 287, 865 A.2d 350 ("Our primary objective in construing a statute is to effectuate the Legislature's intent."). We effectuate this intent by first "examin[ing] the plain meaning of the language used in light of the statute's legislative purpose .... If that plain language resolves the conflict without doing violence to the legislative scheme, there is no need to go further." Lubinsky v. Fair Haven Zoning Bd., 148 Vt. 47, 49, 527 A.2d 227, 228 (1986). But "if the literal meaning of the words is inconsistent with [legislative] intent, the intent must prevail." Inst. of Prof'l Practice, Inc. v. Town of Berlin, 174 Vt. 535, 536, 811 A.2d 1238, 1240 (2002) (mem.). Such inconsistency occurs if applying the "precise wording" of a statute produces "results which are manifestly unjust, absurd, unreasonable or unintended, or conflicts with other expressions of legislative intent." Town School Dist. of St. Johnsbury v. Town School Dist. of Topsham, 122 Vt. 268, 271, 169 A.2d 352, 354 (1961). The legislative "intent is most truly derived from a consideration of not only the particular statutory language, but from the entire enactment, its reason, purpose and consequences." Lubinsky, 148 Vt. at 50, 527 A.2d at 228; see also In re Carroll, 2007 VT 19, ¶ 9, 181 Vt. 383, 925 A.2d 990 (noting that we determine legislative intent by considering "the whole statute, the subject matter, its effects and consequences, and the reason and spirit of the law"). Finally, "[w]here there are similar statutes in other jurisdictions, we are also guided by the interpretations of those statutes." Human Rights Comm'n v. Benevolent & Protective Order of Elks, 2003 VT 104, ¶ 13, 176 Vt. 125, 839 A.2d 576.

¶ 8. Nothing in the statute expressly requires that a fraternity house be used as a student residence in order to qualify for the exemption. However, the term "fraternity house," which is not defined by statute, could nevertheless be construed to impose a residential use requirement, many common definitions of "house" imply use as a residence. Black's Law Dictionary defines "house" as a "home, dwelling, or residence." Black's Law Dictionary 756 (8th ed. 2004). Webster's Dictionary defines "house" first as a "structure intended or used for human habitation." Webster's New International Dictionary of the English Language 1207 (2d ed. 1961). On the other hand, "the term house is generally interpreted in accordance with [its] context." Id. Thus, there are numerous nondwelling-place definitions of "house." See, e.g., Black's Law Dictionary, supra, at 756 (defining house as "[a] branch of a legislature"); Webster's, supra, at 1207 ("[a] religious fraternity ... [a] college in a university ... [a] theatre or playhouse"). This definitional variety makes it unclear whether the "fraternity house" language requires use as a residence. Given that our primary objective is to give effect to legislative intent, however, neither the lack of statutory language explicitly requiring use nor the ambiguity of "fraternity house" controls the question presented in this case. We conclude that it was the Legislature's intent to limit the tax exemption to fraternity-owned property used for the public purpose of housing students.

¶ 9. As a threshold matter, the legislative history giving rise to § 3802(5) suggests that the exemption is intended to be a limited one. In 1906, the Legislature first freed all fraternity-owned property from the tax rolls, except property owned for investment purposes. 1906, No. 27, § 1. In 1939, the Legislature restricted the fraternity exemption to the language still in effect today by limiting it to the "fraternity ... house" and the surrounding "lawn, playground or garden." 1939, No. 12, § 1 (codified at 32 V.S.A. § 3802(5)). Finally, in 1941, the Legislature further limited the exemptions for fraternities by making any property bought after 1941 taxable at the assessed value of the last assessment date prior to the purchase, provided that the municipality's voters do not vote to grant an exemption. 1941, No. 12, § 1 (codified as amended at 32 V.S.A. § 3831(a)). While this last act has no bearing on Delta Psi's situation, as it acquired the house in 1924, it illustrates the increasing restrictions the Legislature has placed on fraternity tax exemptions.

¶ 10. Moreover, the history of § 3802(5) and its predecessor statutes—especially when viewed in the context of the history of Vermont fraternities generally—shows that the Legislature has always intended the exemption as a...