Evangelical Lutheran Synod v. Hoehn

• Decision Date: 01 August 1946
• Docket Number: No. 39744.,39744.
• Citation: 196 S.W.2d 134
• Court: Missouri Supreme Court
• Parties: THE EVANGELICAL LUTHERAN SYNOD of Missouri, Ohio and Other States, a Corporation, and CONCORDIA PUBLISHING HOUSE, a Corporation, Appellants, v. ARTHUR C. HOEHN, as Assessor of the CITY OF ST. LOUIS (EUGENE M. GUISE Substituted as Party Defendant as Successor in Office to ARTHUR <I>C.</I> HOEHN); LOUIS NOLTE, as Comptroller of the CITY OF ST. LOUIS, and RICHARD GRUNER, as Collector of the CITY OF ST. LOUIS.

196 S.W.2d 134

THE EVANGELICAL LUTHERAN SYNOD of Missouri, Ohio and Other States, a Corporation, and CONCORDIA PUBLISHING HOUSE, a Corporation, Appellants, v. ARTHUR C. HOEHN, as Assessor of the CITY OF ST. LOUIS (EUGENE M. GUISE Substituted as Party Defendant as Successor in Office to ARTHUR C. HOEHN); LOUIS NOLTE, as Comptroller of the CITY OF ST. LOUIS, and RICHARD GRUNER, as Collector of the CITY OF ST. LOUIS.

No. 39744.

Supreme Court of Missouri.

Division Two, August 1, 1946.

Motion for Rehearing or to Transfer to Banc Overruled, September 9, 1946.

Appeal from Circuit Court of City of St. Louis. — Hon. Wm. K. Koerner, Judge.

AFFIRMED.

Louis A. McKeown for appellants.

(1) The legal concept of charity is not confined to the relief of poverty and destitution. It includes such humanitarian activities as tend to improve the mental or moral condition of people, such as "bringing their hearts under the influence of education or religion," and thereby benefit the community by improving its condition or lessening the burdens of government. Bishop's Residence Co. v. Hudson, 91 Mo. 671, 4 S.W. 435; Salvation Army v. Hoehn, 188 S.W. (2d) 826; Young Women's Christian Assn. v. Baumann, 344 Mo. 898, 130 S.W. (2d) 499; In re Rahn's Estate, 316 Mo. 492, 291 S.W. 120; Robinson v. Crutcher, 277 Mo. 1, 209 S.W. 104; Catron v. Scarritt Collegiate Institute, 264 Mo. 713, 175 S.W. 571; 10 Am. Jur., sec. 3, p. 585, sec. 55, p. 624, sec. 56, p. 625; In re McCormick's Estate, 206 N.Y. 100, 99 N.E. 177. (2) Institutions whose object is and which carry on a broad religious and educational program for the advancement of Christianity, for dissemination of the Gospel, educating ministers and teachers to labor in the Church, and carrying on of mission work with no profit resulting to anyone have consistently been recognized as "purely charitable." Bishop's Residence Co. v. Hudson, 91 Mo. 671, 4 S.W. 435; Northwestern Pub. House v. City of Milwaukee, 177 Wis. 401, 188 N.W. 636; In re McCormick's Estate, 206 N.Y. 100, 99 N.E. 177; In re Smith's Estate, 144 Ore. 561, 25 Pac. (2d) 924. (3) The use of property by such an institution for the publication, distribution, and sale of printed literature, which literature serves to directly promote the dominant object of the institution's program, will not prevent such institution from claiming and obtaining tax exemption. Northwestern Pub. House v. City of Milwaukee, 177 Wis. 401, 188 N.W. 636; In re McCormick's Estate, 206 N.Y. 100, 99 N.E. 177; In re Smith's Estate, 144 Ore. 561, 25 Pac. (2d) 924; Congregational Publishing Society v. Board of Review, 290 Ill. 108, 125 N.E. 7; Book Agents v. Hinton, 92 Tenn. 188, 21 S.W. 321; Board of Assessors v. Lamson, 154 A.L.R. 886, 55 N.E. (2d) 215; American Issue Pub. Co. v. Evatt, 137 Ohio St. 264, 28 N.E. (2d) 613; American Sunday School Union v. Philadelphia (American Sunday School Union v. Taylor), 164 Penn. 307, 29 Atl. 26, 23 A.L.R. 695; Zindorf v. Otterbein Press, 138 Ohio St. 287, 34 N.E. (2d) 748; Incorporated Trustees of Gospel Worker Society v. Evatt, 140 Ohio St. 185, 42 N.E. (2d) 900. (4) The receipt of revenue by an institution from such publication, distribution, and sale which is purely incidental or secondary to the religious, educational, and charitable program, and where such revenue is devoted to the furtherance of such program, will not prevent such institution from claiming and obtaining tax exemption. Such institution is entitled thereto under the provisions of Article X, Section 6 of the Constitution of Missouri and Section 10937, R.S. 1939. State ex rel. Alexian Bros. Hospital v. Powers, 10 Mo. App. 263; Young Women's Christian Assn. v. Baumann, 344 Mo. 898, 130 S.W. (2d) 499; Salvation Army v. Hoehn, 188 S.W. (2d) 820; State ex rel. Spillers v. Johnston, 214 Mo. 656, 113 S.W. 1083; Congregational Sunday School & Pub. Society v. Board of Review, 290 Ill. 108, 125 N.E. 7; 154 A.L.R. 900 note; Murdoch v. Pennsylvania, 87 L. Ed. 1292, 63 S. Ct. 870, 146 A.L.R. 82; American Issue Pub. Co. v. Evatt, 137 Ohio St. 264, 28 N.E. 613. (5) The case at bar is not within the class of cases relied on by the trial court where property is used in whole or in part for business purposes and the profits used for benevolent purposes. Y.W.C.A. v. Baumann, supra; Salvation Army v. Hoehn, supra. (6) The following cases distinguished: St. Louis Lodge B.P.O.E. v. Koeln, 262 Mo. 444, 171 S.W. 329; State ex rel. Koeln v. St. L.Y.M.C.A., 259 Mo. 233, 168 S.W. 589; Hairenik Assn. v. City of Boston, 313 Mass. 274, 47 N.E. (2d) 9; United Brethren Publ. Co. v. Shoffen, 74 Ind. App. 178, 123 N.E. 697; American Sunday School Union v. Philadelphia, 161 Pa. 307, 29 Atl. 26, 23 L.R.A. 695; Inc. Trustees of Gospel Workers v. Evatt, 140 Ohio St. 185, 42 N.E. (2d) 900.

George L. Stemmler, James V. Frank and Charles J. Dolan for respondents.

The property in question herein is not used exclusively for purposes purely charitable. Incorporated Trustees of Gospel Workers Society v. Evatt, 140 Ohio St. 185, 42 N.E. (2d) 900; American Sunday School Union v. Philadelphia, 161 Pa. 307, 29 Atl. 26, 23 L.R.A. 695; United Brethren Pub. Establishment v. Shaffer, 74 Ind. App. 178, 123 N.E. 697; Murphy v. Concordia Pub. House, 348 Mo. 753, 155 S.W. (2d) 122.

ELLISON, P.J.

This is an appeal from a judgment of the circuit court of the City of St. Louis in favor of the defendants-respondents and against the plaintiffs-appellants, in a suit brought by the latter in November, 1944, seeking an adjudication that their real estate in that city was exempt from 1944 city taxes under Sec. 6, Art. X of the Constitution of Missouri, 1875, and Sec. 10937 of the statutes,¹ on the ground that the real estate was and is exclusively used for religious worship and purposes purely charitable; and praying a mandatory injunction requiring the expungement of the city record showing the assessment of those taxes, and a perpetual injunction enjoining their certification and collection.

The plaintiffs-appellants are the Evangelican Lutheran Synod of Missouri, Ohio and Other States, and Concordia Publishing House. Both are Missouri corporations organized under Art. 10, Chap. 33, Sec's 5436-5465 covering benevolent, religious, educational and other like corporations. For convenience we shall refer throughout this opinion to the first named corporation as the Synod, and to the second as the Publishing House. The defendants-respondents are the Assessor, the Comptroller and the Collector of Revenue of the City of St. Louis.

The Publishing House is a subsidiary corporation of the Synod, the latter controlling, through the board of directors elected by it, all the activities of the former. It is conceded that in their activities the two corporations constitute a single unit. The Publishing House does a specialized printing and publishing business, and holds title to the real estate involved for the use and benefit of the Synod. For record purposes it should be stated the real estate consists of eighteen lots described as: Lots 1 to 12, inclusive, the south 15 feet of Lot 21, and all of Lots 22, 23 and 24, all in block 1 of Henry T. Blow's Subdivision; also Lots 11 and 12 in block 1 of Belt and Priest's Subdivision; all in City Block 1562 of the City of St. Louis.

The aforesaid lots 1 to 12 in the Blow subdivision and lots 11 and 12 in the Belt and Priest subdivision all lie together, making 14 lots facing west on Jefferson Avenue with a total frontage of 345 feet 1¼ inches, and a depth of 122 feet 6 inches facing south on Miami Street. On these lots are four abutting brick buildings. The first three are three stories high, and the fourth is one story high. Though built at different times they constitute one unit. Across a fifteen foot alley to the east are lots 24, 23, 22 and the south 15 feet of lot 21 in the Blow subdivision, facing east on Indiana Avenue with a total frontage of 85 feet 5½ inches, and a depth of 122.5 feet facing south on Miami Street. On the south 70 feet 5½ inches of these four lots are two abutting brick buildings, the former being three stories high and the latter one story. These two buildings constitute another unit. The north 15 feet of these lots is vacant.

All the buildings are used solely for the purposes of the two corporations. They contain various offices of the Synod, the Publishing House and church organizations; a book library and a sacred music library, used by the clergy, teachers and musicians; a large auditorium used by the Synod; a large book display room where books may be purchased at retail; a printing plant, and bindery; stock room; storage and warehouse rooms; engine, boiler and heating plant rooms. All the lots were purchased and the improvements thereon constructed solely out of the profits and surplus of the Publishing House.

Part of the books sold by the Publishing House are printed and published by it, and part by others. Most of them are religious books. Some are secular, mainly English Classics and Webster's Dictionary, all these being approved by the Synod. It also prints religious periodicals and supplies material to the denominational churches and parochial schools. The Synod's Regulation No. 10 governing publications by the Publishing House, provides: "The Board (of Directors) shall fix the price of books in accordance with the market and in general, through the General Manager, direct the sale of books and periodicals in a businesslike way." Sundry Regulation No. 1 provides "large and small Bibles" (in the German language) shall be sold at cost. And Sundry Regulation No. 2 admonishes that anyone who does not pay his debts after repeated admonitions shall be refused further credit. Without question, the business of the Publishing House is conducted like a business, but its profits have been used for the extension of its properties, or paid to or held for the Synod. In 1944 there were 2,320,860 cubic feet in all the buildings, of which it...