North Manursing Wildlife Sanctuary, Inc. v. City of Rye

• Decision Date: 18 October 1979
• Citation: 397 N.E.2d 693,48 N.Y.2d 135,422 N.Y.S.2d 1
• Parties: , 397 N.E.2d 693 In the Matter of NORTH MANURSING WILDLIFE SANCTUARY, INC., Appellant, v. CITY OF RYE et al., Respondents.
• Court: New York Court of Appeals Court of Appeals

Page 1

422 N.Y.S.2d 1

48 N.Y.2d 135, 397 N.E.2d 693

In the Matter of NORTH MANURSING WILDLIFE SANCTUARY, INC., Appellant, v. CITY OF RYE et al., Respondents.

Court of Appeals of New York.

Oct. 18, 1979.

Aurhur J. Voute, Jr., Donald A. Mead and Richard L. Magro, White Plains, for appellant

Anthony T. Antinozzi, Corp. Counsel, Rye, for respondents.

OPINION OF THE COURT

GABRIELLI, Judge.

This is a proceeding brought pursuant to article 7 of the Real Property Tax Law to challenge the assessment of real property taxes against certain land owned by petitioner and located within respondent City of Rye. Supreme Court, Westchester County, ruled in favor of petitioner and ordered that the property be removed from the tax rolls. The Appellate Division reversed the judgment of Supreme Court, concluding that the property is indeed subject to real property taxes. Petitioner now appeals to this court as of right, pursuant to CPLR 5601 (subd. (a), par. ii). For the reasons discussed below, the order appealed from must be reversed, and the matter remitted to the Appellate Division for review of the facts.

Petitioner is a not-for-profit corporation organized pursuant to the laws of this State. It owns over six acres of land on North Manursing Island, which is a residential community located on Long Island Sound within the boundaries of the City of Rye. Half of the land is upland, whereas the remainder is tidal and underwater land. The property is maintained by petitioner in its natural state, and is allegedly being used as a wildlife sanctuary for birds and small animals. Petitioner contends that the land is exempt from real property taxes by section 421 (subd. 1, par. (a)) of the Real Property Tax Law, which in pertinent part provides an absolute exemption for "(r)eal property owned by a corporation or association organized or conducted exclusively for religious, charitable, hospital, educational, moral or mental improvement of men, women or children or cemetery purposes, or for two or more such purposes, and used exclusively for carrying out thereupon one or more of such purposes".

Respondents argued before the courts below that petitioner's property is not entitled to a tax exemption for either of two reasons. First, respondents contended that the use of real property as a wildlife sanctuary does not constitute a charitable use exempt under the statute. Alternatively, respondents appear to have contended, albeit with some lack of clarity, that even if a bona fide wildlife sanctuary conducted by a legitimate nonprofit organization is exempt from taxation, the instant property nonetheless is not exempt because petitioner organization either is merely "a guise or pretense for directly or indirectly making any * * * pecuniary profit * * * or * * * (is) not in good faith organized or conducted exclusively for" an exempt purpose (Real Property Tax Law, § 421, subd. 1, par. (d)). In addition to responding to these arguments on the merits, petitioner also argued that the doctrine of Res judicata precludes litigation of these issues because they have previously been resolved in a manner adverse to respondents in prior litigation between the parties. Supreme Court dealt with respondents' arguments on the merits, and ruled that the property is entitled to an exemption pursuant to section 421 (subd. 1, par. (a)). The Appellate Division, however, held that the use of property as a wildlife sanctuary, without more, cannot constitute an exempt use, and accordingly reversed the judgment of Supreme Court without reaching the question whether petitioner is a bona fide nonprofit organization.

We have recently held that section 421 (subd. 1, par. (a)) does provide an absolute exemption for real property used as a wildlife sanctuary by a charitable organization (Mohonk Trust v. Board of Assessors, 47 N.Y.2d 476, 418 N.Y.S.2d 763, 392 N.E.2d 876). Hence, the order of the Appellate Division must be reversed, for it was based on an erroneous interpretation of the statute. Since the Appellate Division did not consider respondents' challenge to the validity of petitioner's claim to be a qualified organization, however, we must remit the matter to that court for review of this essentially factual question. As there must be a remittal, we deem it appropriate to first discuss the factors which will be pertinent to that inquiry.

Preliminarily, we note that in light of our decision in Mohonk Trust, there can be no question but that the purposes of petitioner, as stated in its certificate of incorporation and as limited by its activities in operating a wildlife sanctuary, are indeed exempt purposes. The certificate reads as follows: "The purposes for which the corporation is to be formed are: to secure, hold and develop land as a sanctuary for wild birds, including migratory species, and animals; to protect, preserve and promote the continuation of the species of wild birds and animals native to the section where this corporation shall exist; to promote their culture and to introduce and study new species of wild birds; to introduce and disseminate information concerning new species; and to restrict the killing or destruction of wild birds, and to provide a preserve for those presently existing". These purposes are exempt purposes.

Moreover, as is discussed in more detail below, if it is determined on remittal that the property is indeed being used as a wildlife sanctuary and that petitioner is a legitimate corporation organized or conducted for an exempt purpose, the property will be entitled to an exemption even if the surrounding landowners do in fact benefit from the mere existence and operation of the sanctuary. Similarly, the wisdom of locating a wildlife sanctuary on North Manursing Island and the need for such a sanctuary in that area are factors not normally pertinent to the tax-exempt status of the property, except insofar as they may be of some relevance in determining the legitimacy of the organizational purposes.

For property to be entitled to an exemption on the ground that it is being used for a charitable purpose, it must a fortiori be used for a public purpose. For example, one may not establish a trust solely for the benefit of oneself and one's family, and then obtain a tax exemption for property owned by such a trust by claiming that it is a charitable organization. While charity may begin at home, section 421 (subd. 1, par. (a)) provides an exemption only for charitable uses which benefit the public, not for so-called "charities" which benefit only their...