People ex rel. Nelson v. Rockford Masonic Temple Bldg. Ass'n

• Citation: 348 Ill. 567,181 N.E. 428
• Decision Date: 06 April 1932
• Docket Number: No. 21153.,21153.
• Parties: PEOPLE ex rel. NELSON, County Collector, v. ROCKFORD MASONIC TEMPLE BLDG. ASS'N.
• Court: Illinois Supreme Court

348 Ill. 567

181 N.E. 428

PEOPLE ex rel. NELSON, County Collector,

v.ROCKFORD MASONIC TEMPLE BLDG. ASS'N.

No. 21153.

Supreme Court of Illinois.

Feb. 19, 1932.

Rehearing Denied April 6, 1932.

Application by the People, on the relation of Albert N. Nelson, County Collector, for judgment and sale of certain real estate owned by the Rockford Masonic Temple Building Association, whereto the latter filed objections. From a judgment sustaining the objections, relator appeals.

Reversed and remanded, with directions.Appeal from Winnebago County Court; George T. Liddell, Judge.

William D. Knight, State's Atty., Alfred B. Louison, and Robert E. Nash, all of Rockford, for appellant.

Lathrop, Lathrop, Brown & Lathrop, of Rockford (R. H. Brown, of Rockford, of counsel), for appellee.

JONES, J.

A judgment was renderd in the county court of Winnebago county sustaining objections to an application for judgment and sale of certain real estate owned by the Rockford Masonic Temple Building Association, a corporation, for taxes, penalties, and costs for the year 1930, amounting to $1,933.78. The title to the property is held by the corporation for the sole use and benefit of three Masonic orders of Rockford which have equal rights therein and equal representation on all matters of the corporation. The county court held that the property is used by the organizations and by two affiliated orders actually and exclusively for charitable purposes and that it is not leased or otherwise used with a view to profit and therefore is exempt from taxation.

Witnesses for the objector testified to the objects and purposes of the different organizations using the building, and the testimony indisputably disclosed that the object of those organizations is to promulgate the ideals of Masonry, inculcate a moral standard of living, administer to the religious and spiritual life of the members, and practice benevolence and charity. The Constitution of this state does not exempt any property whatsoever from taxation, but section 3 of article 9 provides that the property of the state, counties, and other municipal corporations, both real and personal, and such other property as may be used exclusively for charitable purposes, may be exempted from taxation by general law. Pursuant to the power thus granted to it, the General Assembly by section 2 of the Revenue Act (Smith-Hurd Rev. St. 1931, c. 120, § 2) exempted all property of organizations when actually and exclusively used for beneficentand charitable purposes and not leased or otherwise used with a view to profit.

[1] While the evidence discloses that the various organizations which use the objector's property engage in a number of charitable activities, it does not show that the property is used exclusively for charitable purposes. The building located on the real estate sought to be taxed is known as the Rockford Masonic Temple Building. It is of the size, type, and character necessary and convenient for the use of the several branches of the Masonic order. As a general rule, the purpose for which a corporation is formed is shown by its charter. People v. Wyanet Electric Light Co., 306 Ill. 377, 137 N. E. 834;People v. Western Seaman's Friend Society, 87 Ill. 246;Catholic Knights v. Board of Review, 198 Ill. 441, 64 N. E. 1104;Congregational Publishing Society v. Board of Review, 290 Ill. 108, 125 N. E. 7;People v. Walters Chapter, D. A. R., 311 Ill. 304, 142 N. E. 566;People v. Phi Kappa Sigma, 326 Ill. 573, 158 N. E. 213, 54 A. L. R. 1376. The charter of the objector specifies that the object for which it is formed ‘is mutual benefit and social intercourse of its members.’ From the evidence it is apparent that the primary purpose and object of the various organizations which use the building is to promulgate the ideals of Masonry, which include the maintenance of a high moral standard of living and administration to the religious and spiritual life of its members. In carrying out these ideals charity is but an incidental feature. It is not the principal or the exclusive object of the organization, and under the Constitution of the state no exemption from taxation can be enjoyed by any organization which does not have charity as its primary object. School of Domestic Arts v. Carr, 322 Ill. 562, 153 N. E. 669;Congregational Church v. Board of Review, 254 Ill. 220, 98 N. E. 275,39 L. R. A. (N. S.) 437;Grand Lodge v. Board of Review, 281 Ill. 480, 117 N. E. 1016.

It is the primary use to which property is put which determines the question of tax exemption. Thus, in Grand Lodge v. Board of Review, supra, a 200-acre farm, with buildings thereon, sued exclusively for the care and support of dependent Master Masons, their widows and orphans, was held to constitute a public charity and exempt from taxation; and a home for working girls, with officers serving without compensation, with free medical attention, was likewise held to be a public charity and exempt from taxation. Franklin Square House v. Boston, 188 Mass. 409, 74 N. E. 675. But it is not enough, to exempt property from taxation, that one of several purposes or results is charity. It must be the chief, if not the sole, object. Attorney General v. Detroit, 113 Mich. 388, 71 N. W. 632. In Scottish Rite Building Co. v. Lancaster County, 106 Neb. 95, 182 N. W. 574, 576, 17 A. L. R. 1020, it was urged that the word ‘charitable’ was intended to include a subjective meaning, such as the encouraging of fraternal principles; but the court said: ‘Persons or institutions of wealth or means, however generous, who, even though they systematically allot a fixed part of their income to charity, are yet engrossed in pursuits and interests in which charity, while not entirely excluded, does not play a leading part, are not entitled to claim that they devote themselves chiefly to charity. Neither is a fraternal order entitled to claim exemption of its property from taxation because it encourages charity among its members and itself makes substantial donations to charity, when the evidence shows that its principal activities were not in that direction.’

[4] An organization with charitable objectives may own property which is exempt from taxation and also property which is not exempt. For example, if it has a home used exclusively for the care and support of dependent aged people the property is exempt, but if it owns a building which is primarily used for a club, or for social or fraternal purposes, or for lodge meetings for the conduct of ritualistic work, such property is not exempt from taxation. Under the evidence the property of the objector is not entitled to exemption from taxation. Therefore the objections to the entry of judgment for sale should have been overruled.

The order of the county court with respect to said property is accordingly reversed, and the cause remanded to that court, with directions to overrule the objections and to enter judgment for sale unless the tax, penalties, and costs are previously paid.

Reversed and remanded, with directions.

STONE, C. J., and HEARD, J. (specially concurring).

We concur in the judgment entered in this case for the reason that the record does not show that the Rockford Masonic Temple Building Association, a corporation, is a beneficent and charitable organization. Its charter, which is introduced in evidence, shows the primary purpose of the corporation to be ‘the mutual benefit and social intercourse of its members.’ The statute (Smith-Hurd Rev. St. 1931, c. 120, § 2) exempting property from taxation extends such exemption to ‘all property of beneficent and charitable organizations, whether incorporated in this or in any other State of the United States * * * when such property is actually and exclusively used for such charitable or beneficent purposes, and not leased or otherwise used with a view to profit.’ While the corporation in this case is shown to be affiliated with the masonic order, its primary purpose is not shown to be the furtherance of the beneficent purposes of that order, as was shown in People v. Freeport Masonic Temple, 347 Ill. 180, 179 N. E. 672. The exemption is extended, as shown by the statute quoted, to all property of beneficent and charitable organizations when such property is not leased or otherwise used with a view to profit. That the Masonic...