Roger Williams General Hosp. v. Littler

• Decision Date: 05 December 1989
• Docket Number: Nos. 88-126-A,s. 88-126-A
• Citation: 566 A.2d 948
• Parties: ROGER WILLIAMS GENERAL HOSPITAL et al. v. Theodore LITTLER. RHODE ISLAND HOSPITAL et al. v. Theodore LITTLER. ppeal, 88-127-Appeal.
• Court: Rhode Island Supreme Court

Page 948

566 A.2d 948

ROGER WILLIAMS GENERAL HOSPITAL et al. v. Theodore LITTLER.

RHODE ISLAND HOSPITAL et al. v. Theodore LITTLER.

Nos. 88-126-Appeal, 88-127-Appeal.

Supreme Court of Rhode Island.

Dec. 5, 1989.

G. Nebergall, Edwards & Angell, Providence, for plaintiff.

David D. Curtin, City Sol., Joseph A. Rotella, Providence, for defendant.

OPINION

SHEA, Justice.

These consolidated cases are before the Supreme Court on appeal by the plaintiff hospitals from judgments for the defendant tax assessor for the city of Providence. The cases were presented to the Superior Court on an agreed statement of facts accompanied by affidavits from the Purchasing Manager for Rhode Island Hospital and the assistant vice president for finance of Roger Williams General Hospital. We affirm.

Both hospitals are tax exempt charitable corporations operating under charters enacted by the Rhode Island General Assembly in 1863 for Rhode Island Hospital and in 1904 for Roger Williams General Hospital.

The charters are similar. Roger Williams's Charter, last amended in 1982, provides in relevant part:

"Sec 2. The said corporation may take and receive, hold, purchase, and possess real and personal estate, to be used and improved for the support and maintenance of a hospital in the state of Rhode Island and for carrying into effect the charitable and humane intentions of the corporation to such an amount as may in its judgment be necessary not exceeding in the aggregate fifty million dollars ($50,000,000), which shall be exempt from all taxation in this state."

The charter of Rhode Island Hospital, as amended in 1910, provides in relevant part:

"Sec 2. The said corporation may take and receive, hold, purchase and possess, real and personal estate, to be used and improved for the erection, support, and maintenance of a hospital in the state of Rhode Island, and for carrying into full effect the charitable and humane intentions of the corporation; and the property and estate of said corporation, both real and personal, shall not at any time be liable to be assessed in the apportionment of any state or town tax."

In an effort to control expenses, the hospitals entered into commercial lease agreements to acquire equipment from leasing companies. Under the provisions of the leasing agreements the hospitals are responsible for any property taxes assessed against any equipment covered by the lease. On December 31, 1984, and again on December 31, 1985, the Providence city assessor assessed tangible personal property taxes against the equipment leased by the hospitals. The hospitals were billed for the taxes by the leasing companies, which, on receipt of the payment from the hospitals, remitted the taxes to the city of Providence.

The hospitals brought suit in the Superior Court for relief, and the cases were consolidated for trial. After consideration of cross-motions for summary judgment the trial justice granted defendant tax assessor's motions and judgments were entered for defendant. The plaintiffs filed appeals which were ordered consolidated for consideration by this court.

On appeal the hospitals argue that the specific language in the legislative charters insulates them from property taxes. They claim that the language " * * * to take and receive, hold, purchase and possess real and personal estate" without paying taxes implies that leased property is also exempt. They insist that the quoted language evidences a clear intent on the part of the Legislature to base tax exemption upon a broad range of property interests, including leasehold interests. The hospitals also argue that the equipment in question, as it is used exclusively for hospital purposes, is exempt from tax. The exemption, therefore, has nothing to do with the leasing companies which, of course, are not exempt but only with the leased equipment itself. The tax assessor argues that the tax exemption provided by the charters of the hospitals applies only to property that is purchased or owned by the hospital.

The hospitals direct our attention to this court's opinions in Woonsocket Hospital v. Lagace, 113 R.I. 95, 318 A.2d 472 (1974), and Woonsocket Hospital v. Quinn, 54 R.I. 424, 173 A. 550 (1934). In both of those cases taxes were assessed on property that the Woonsocket Hospital owned but had leased to commercial...