In re Taylor's Estate

• Decision Date: 25 March 1942
• Docket Number: 28778.
• Citation: 139 Ohio St. 417,40 N.E.2d 936
• Parties: In re TAYLOR'S ESTATE. AMERICAN BIBLE SOC. v. DEPARTMENT OF TAXATION.
• Court: Ohio Supreme Court

40 N.E.2d 936

139 Ohio St. 417

In re TAYLOR'S ESTATE.

AMERICAN BIBLE SOC. v. DEPARTMENT OF TAXATION.

No. 28778.

Supreme Court of Ohio

March 25, 1942

Syllabus by the Court.

1. A right to exemption from taxation must appear with reasonable certainty in the language of the Constitution or valid statute and must not depend upon a doubtful construction of such language.

2. There is no presumption of exemption from taxation because the institution claiming it is of a religious or charitable nature.

3. Under Section 5334, General Code, a charitable institution claiming exemption from the payment of inheritance taxes must prove that it is an institution for purposes only of public charity carried on in whole or in substantial part within this state.

4. To secure the exemption from inheritance taxes provided in Section 5334, General Code, a party claiming to be an institution of learning within another state must prove that it is composed of learned persons associated together for the purpose of instructing others in some of the accumulated knowledge, skill or wisdom of mankind.

An institution of learning embraces the idea of capable persons in a position to impact knowledge and skill to others who are in a position to learn same.

Appeal from Court of Appeals, Cuyahoga County.

The American Bible Society, appellant, is a corporation not for profit, incorporated by an act of the New York Legislature passed March 25, 1841. Laws 1841, c. 68. Its purpose, as stated in the act, is 'publishing and promoting a general circulation of the Holy Scriptures, without note or comment.'

Its object is further set forth in its constitution in Article I as follows:

'The sole object shall be to encourage a wider circulation of the Holy Scriptures without note or comment.'

Appellant's general counsel testified: 'Well, the American Bible Society in the main distributes the whole scriptures without note or comment not only throughout the United States but throughout the world. It has colporteurs and agents all over the world and distributes the scriptures without cost, or free, without any charge. No profit of any kind accrues to the society in their work.' On cross-examination, he testified: 'At cost or free. Where people are able to pay a small amount for testaments, etc., they are sold at cost but no profit.'

Sophia Strong Taylor died, leaving a will in which she bequeathed 15 per cent of her residuary estate to the American Bible Society, appellant herein. An inheritance tax having been assessed on this succession, appellant filed its exceptions claiming exemption from the payment of any inheritance tax by virtue of Section 5334, General Code (110 Ohio Laws, 26).

These exceptions were overruled and a tax of $15,448.24 was assessed. A motion for new trial in the Probate Court having been overruled, an appeal on questions of law was taken to the Court of Appeals of Cuyahoga county, where the judgment of the Probate Court was affirmed.

The cause is now before this court following the allowance of a motion to certify the record.

Niman & Buss, of Cleveland, for appellant.

Thomas J. Herbert, Atty. Gen., and Perry L. Graham and W. H. Middleton, Jr., both of Columbus, for appellee.

TURNER Judge.

Appellant, in seeking a reversal of the judgments of the lower courts, propounds two questions:

First, is it (appellant) an institution of learning?

Second, is it an institution for purposes only of public charity?

Section 5334, General Code, provides in part: 'The succession to any property passing to or for the use of the state of Ohio, or to or for the use of a municipal corporation or other political subdivision thereof for exclusively public purposes, or public institutions of learning within the state, or institution of learning within any state of the United States which state does not impose an inheritance, estate or transfer tax on property given, devised or bequeathed by a resident thereof to an institution of learning within this state, or to or for the use of an institution for purposes only of public charity, carried on in whole or in substantial part within this state, shall not be subject to the provisions of the preceding sections of this subdivision (G.C., §§ 5331 to 5348-16) of this chapter.'

It is admitted that appellant gives no formal instruction. In direct examination, Mr. Bruce G. Cameron, in charge of appellant's Ohio office, testified: 'We are unfortunate in the sense that we do no teaching at all.'

However, it is claimed that the term 'institution of learning' is broad enough to include a society whose declared purpose is publishing and promoting a general circulation of the Holy Scriptures without note or comment. With this claim we cannot agree.

The sole object of appellant under its constitution is to encourage a wider circulation of the Holy Scriptures without note or comment.

An institution of learning connotes a teaching staff and students. As stated by the trial court in its opinion:

'The idea which the phrase 'institutions of learning,' brings to mind is an institution composed of a group of learned men and women associated together for the purpose of instructing another group of persons, usually young men and women, in the accumulated knowledge, skill and wisdom of mankind. An institution of learning must at least embrace the idea of someone, possessed of knowledge and skill, capable of and in a position to impart such knowledge and skill to others in position to and capable of learning them. An institution whose sole purpose is to publish books and distribute them does not seem to be in any sense of the term, an institution of learning.'

It remains then to determine whether appellant is an institution for purposes only of public charity.

Whether appellant is a charitable institution is not controlling. The question here is whether it is an institution for purposes only of public charity. While it may circulate its Bibles freely, yet it is circulating the King James Version thereof, which is used only by a part of the people. It is argued that these Bibles are furnished to persons irrespective of creed. Granting this, the appellant then is engaged in the propagation of a branch of the Christian religion.

Appellant's exhibit 19 quotes Article I of its constitution, as follows:

'This society shall be known by the name of the American Bible Society, of which the sole object shall be to encourage a wider circulation of the Holy Scriptures without note or comment. The only copies in the English language, to be circulated by the society, shall be of the version set forth in 1611, and commonly known as the King James Version, whether in its original form as published in the aforesaid year or as revised, the New Testament in 1881 and the Old Testament in 1885, and published in these years under the supervision of the Committee of Revision, or as further revised and edited by the American Committee of Revision and printed under its supervision in 1901.'

This distinction would be readily apparent if appellant's purpose was the publication and circulation of the Koran or the teachings of Buddha or Confucius. Yet our Constitution (Section 7, Article I) declares that all men have a natural and indefeasible right to worship Almighty God according to the dictates of their own conscience and that no preference shall be given by law to any religious society. While recognizing that religion, morality and knowledge are essential to good government, the Constitution makes it the duty of the General Assembly to protect every religious denomination in the peaceable enjoyment of its own mode of public worship.

It is argued that Section 5334, General Code, was amended several years after the decision of this court in Humphreys, Ex'r v. State, 70 Ohio St. 67, 70 N.E. 957, 65 L.R.A. 776, 101 Am.St.Rep. 888, 1 Ann.Cas. 233, so as to include appellant. In the course of the opinion in that case, Judge Price said, at page 77 of 70 Ohio St., at page 959 of 70 N.E.: '* * * and it may be admitted that theirs are works of charity in the broad sense, that the uplifting of men, women, and children to the standard of life taught in the Scriptures is, indeed, a work of charity, the greatest of the three Christian graces.' But Judge Price did not say that such works were public charity only.

Under the phraseology of the amendment, it cannot be assumed (if otherwise it could be) that it was the legislative intention to include appellant as an exempt institution.

To hold that appellant is an institution for purposes only of public charity would require a doubtful construction of Section 5334, General Code. While exemption laws have long been recognized under our Constitution and statutes, yet they have always required strict construction. Or, to put it in the broadest terms recognized by this court, there is no presumption of exemption from taxation irrespective of the character of the institution.

While it is said in 38 Ohio Jurisprudence, 854 that 'the rule of strict construction has been somewhat modified in the case of exemptions of religious, charitable, and educational institutions, it having been declared that, as to such institutions, the policy and spirit of the law should be considered in determining the legislative intent,' such statement of declaration is based largely upon the statement of a single judge of this court in the course of the opinion in the case of Watterson v. Halliday, Aud., 77 Ohio St. 150, at page 169, 82 N.E. 962, 965, 11 Ann.Cas. 1096, where Judge Price said: 'And, while we do not apply strict rules of construction in cases where religious, charitable, and educational institutions seek exemptions, we think such right to exemption should appear in the language of the...