Lamad Ministries v. DOUGHERTY CTY. BD. TAX ASS.

• Decision Date: 29 July 2004
• Docket Number: No. A04A1386.,A04A1386.
• Citation: 602 S.E.2d 845,268 Ga. App. 798
• Parties: LAMAD MINISTRIES, INC. v. DOUGHERTY COUNTY BOARD OF TAX ASSESSORS.
• Court: Georgia Court of Appeals

602 S.E.2d 845

268 Ga. App. 798

LAMAD MINISTRIES, INC. v. DOUGHERTY COUNTY BOARD OF TAX ASSESSORS.

No. A04A1386.

Court of Appeals of Georgia.

July 29, 2004.

Thomas James, Stephen Dillard, James, Bates, Pope & Spivey, Macon, for Appellant.

William Lee, Albany, Peter Olson, Brandon Bowen, Cartersville, Vann Parrott, Long & Denton, Quitman, for Appellee.

ELDRIDGE, Judge.

On January 20, 2004, after a bench trial the Dougherty County Superior Court affirmed the multi-year appeal of Lamad Ministries, Inc. from the Board of Equalization of Dougherty County's decision, finding no tax exemption for it either as a "place[] of religious worship," OCGA § 48-5-41(a)(2.1)(A) or (B), or exempt, as a home for the aged under OCGA § 48-5-41(a)(12). The trial court found that it is not a place of religious worship or a property owned by and operated exclusively as a church, an association or convention of churches, a convention mission agency, or as an integrated auxiliary of a church or convention or association of churches. Further, the trial court found it does not operate as a religious institution. The trial court also found that it provided a residence to persons over the age of 55 but was not as a "nonprofit home for the aged," OCGA § 48-5-41(a)(12)(A), because Lamad Ministries did not operate the home for the aged as a separate tax exempt corporation. Finding errors of law and of factual findings that were clearly erroneous, we affirm in part and reverse in part.

The only evidence in the record was submitted by Lamad Ministries; therefore, there was no conflict in the evidence. The trial court's findings of fact omitted much of the evidence that Lamad Ministries considered essential and is included here for amplification only. In deciding this case, the facts as found by the trial court are relied upon, and the law is applied to the facts thus found.

It is undisputed that Lamad Ministries, as a church, is a member of the Mallary Baptist Association, the Georgia Baptist Convention, and the Southern Baptist Convention. There are no stockholders or ownership interest in this nonprofit tax exempt corporation, and there is no affiliated or brother-sister corporation. The trial court found that Lamad Ministries religious charitable operations include: (1) a broadcast ministry; (2) a church; (3) a Christian counseling center; and (4) a nonprofit Christian home for the aged.

The central issue is the taxability of Lamad Ministries' home for the aged, which it operates as the Seasons Christian Care Center ("SCCC"). The trial court found that "the statute ... calls for non-profit homes for the aged to be separate entities, in order that the tax exemption can be clearly granted to the home." The trial court found that SCCC is comprised of 21 acres, and there are 170 residents in 135 residential units made up of 43 two-and three-person villas and apartments.¹ Residents cannot be younger than 55, and the average age of residents is 77.7 years.

According to Lamad Ministries, an applicant must provide evidence that he is over 55 years of age, capable of living independently, and possess a genuine belief that it is God's will for him or her to reside there. There is no denominational or theological litmus test for prospective residents; in fact, accommodation can be made for atheists or agnostics. After the application, and reservation fees, the resident selects the floor plan and pays a one-time "ministry deposit" that can be afforded by the prospective resident. The balance of the ministry deposit is funded by the Lamad Ministries. Such ministry deposit defrays the cost of construction, of refurbishing the living units, and to refund former residents or their designated heirs between 85 and 100 percent of the initial ministry deposit paid. The initial ministry deposit is refunded at a reduction of three percent per year for the first five years and thereafter eighty five percent is refunded. Depending upon the level of care, i.e., Basic Watchcare, Supervised Watchcare, and Private Home Care, each resident pays a "resident service expense" to defray their living expenses and care costs. If at any time the resident is no longer able to pay the monthly fee, then the fee is waived and the resident continues to occupy his unit.

Lamad Ministries contends that the entire campus of this home for the aged constitutes "a place of worship, prayer, nurture, and care" and is used exclusively for religious, charitable, and educational purposes. The undisputed evidence is that there is a ministry center, including the church offices; the Worship and Fellowship Center where worship services are held; the Gideon Memorial Worship and Prayer Station, where individuals can pray; the Shepard Memorial Meditation Garden in the form of a cross with prayer stations; the Villa Tree Park Worship and Assembly Area and Gazebo; and the outdoor Worship and Confession altar for Catholic residents. The president and CEO of Lamad Ministries is the Reverend Bill Eidernire, an ordained minister, who provides for the religious needs of the residents. Reverend Joe Holden is the associate pastor who conducts the prayer ministry. The worship center office and chapel houses are comprised of: the chapel, kitchen, offices, beauty shop, and exercise room.

Erroneously as a matter of law, the trial court found "[t]his case does not present the question of whether the corporation known as `Lamad Ministries, Inc.' is exempt from income tax, but rather, whether the real property (that is, the tax parcels named above) which contains the Seasons Christian Care Center is exempt from ad valorem property tax." However, OCGA § 48-5-41(a)(12) requires such determination. On May 11, 1987, Lamad Ministries filed Form 1023 "Application for Recognition of Exemption Under Section 501(c)(3)" with the Internal Revenue Service("IRS"). Such application for federal tax exemption under 26 USC § 501(c)(3) covered "church related and church supporting Christian ministry designed to promote charitable missionary, evangelistic, biblical instruction, nurture and care activities with a context of worship and prayer." Specifically, the tax exemption covered a church, Christian counseling center, a radio broadcast ministry, and a senior adult Christian care residence ministry. On October 28, 1987, the IRS requested that Lamad Ministries provide additional information regarding its "counseling activities," "plan to operate a Christian care facilities," and church; the IRS required that Lamad Ministries address in detail the 14 criteria of the agency for the classification as a "church." On November 15, 1987, Lamad Ministries provided the IRS an 11-page, single-spaced letter, providing the details of the scope and breadth of its planned ministry. On March 17, 1988, the IRS issued to Lamad Ministries a determination letter stating "[b]ased on the information you supplied, and assuming your operations will be as stated in your application for recognition of exemption, we have determined that you are exempt from federal income tax under section 501(c)(3)." On October 9, 2001, the Georgia Department of Revenue gave a determination letter that under OCGA § 48-7-25, Lamad Ministries was tax exempt.

The trial court found that Lamad Ministries operates its home for the aged as SCCC and that SCCC does not have a 26 USC § 501(c)(3) federal tax exemption as a separate corporation from Lamad Ministries.

1. Lamad Ministries contends that the trial court erred in not requiring the Dougherty County Board of Tax Assessors to prove by a preponderance of the evidence its assessment on the SCCC property under OCGA § 48-5-311(g)(3). We do not agree.

The general appeal procedure under OCGA § 48-5-311(g)(3) covers all appeals. Thus, as general legislation, such Code section must be read in pari materia with OCGA § 48-5-41; such specific legislation must be given effect, since it was neither repealed nor modified when OCGA § 48-5-311(g)(3) was passed. Ryan v. Commrs. of Chatham County, 203 Ga. 730, 732(1), 48 S.E.2d 86 (1948); Allison v. Domain, 158 Ga.App. 542, 544, 281 S.E.2d 299 (1981); Undercofler v. L.C. Robinson & Sons, Inc., 111 Ga.App. 411, 414-415(1), 141 S.E.2d 847 (1965), aff'd, L.C. Robinson & Sons, Inc. v. Undercofler, 221 Ga. 391, 144 S.E.2d 755 (1965); see also Monticello, Ltd. v. City of Atlanta, 231 Ga.App. 382, 383(1), 499 S.E.2d 157 (1998) (physical precedent only). Generally, in statutory construction, a specific statute prevails over a more general statute when they are in conflict, absent any indication of a contrary legislative intent. Ga. Mental Health Institute v. Brady, 263 Ga. 591, 592(2), 436 S.E.2d 219 (1993); First Nat. Bank of Atlanta v. Sinkler, 170 Ga.App. 668, 670(1), 317 S.E.2d 897 (1984); see also Monticello, Ltd. v. City of Atlanta, supra at 384, 499 S.E.2d 157. "The construction which will give effect to a statute or rule is preferred to a construction which will destroy it." (Citations omitted.) Brown v. State Merit System of Personnel Admin., &c., 245 Ga. 239, 242(1)(d), 264 S.E.2d 186 (1980). Newer statutes are construed in connection and in harmony with existing laws, because "[a]ll statutes are presumed to be enacted by the legislature with full knowledge of the existing condition of the law and with reference to it; they are to be construed in connection and in harmony with the existing law." (Citation and punctuation omitted.) State of Ga. v. Davis, 246 Ga. 761-762(1), 272 S.E.2d 721 (1980); McPherson v. City of Dawson, 221 Ga. 861, 862, 148 S.E.2d 298 (1966).

Under OCGA § 48-5-41, anyone seeking exemption must carry the burden of proof to show entitlement, and the exemption statute is strictly construed against the person claiming the exemption. Fulton County Bd. of Tax Assessors v. Visiting Nurse Health System of Metro. Atlanta, 243 Ga.App. 64, 67(2), 532 S.E.2d 416 (2000); see also decided under former law Leggett v. Macon Baptist Assn.,...