United Church of Christ v. Town of West Hartford

• Citation: 519 A.2d 1217,9 Conn.App. 448
• Decision Date: 03 March 1987
• Docket Number: No. 3835,3835
• Parties: UNITED CHURCH OF CHRIST v. TOWN OF WEST HARTFORD.
• Court: Connecticut Court of Appeals

Page 1217

519 A.2d 1217

9 Conn.App. 448

UNITED CHURCH OF CHRIST v. TOWN OF WEST HARTFORD.

No. 3835.

Appellate Court of Connecticut.

Argued Oct. 8, 1986.

Decided Jan. 20, 1987.

Certification Granted March 3, 1987.

Richard T. Stabnick, Hartford, for the appellant (plaintiff).

Marjorie Wilder, with whom, on the brief, was R. Bartley Halloran, Hartford, for the appellee (defendant).

HULL, Judge.

This appeal involves the narrow issue of whether the court erred when it found that the land involved in the plaintiff church's Hart Meadow housing project in West Hartford was not being used exclusively for charitable purposes within the meaning of General Statutes § 12-81(7), ¹ and thus was not qualified for local property tax exemption under General Statutes § 12-88. ²

The town assessor of West Hartford placed the housing units then constructed on the tax list of October 1, 1982. The plaintiff church appealed to the board of tax review for the town of West Hartford, seeking tax exempt status on the ground that the real estate was used exclusively for a charitable purpose. The board denied the petition for tax exempt status.

The plaintiff appealed to the Superior Court, which found the property nonexempt and dismissed the appeal. The court concluded that the plaintiff church had not proved (1) that the project is not and will not be self supporting, and (2) that the individuals admitted to the project, by virtue of their admission, would be less likely to burden society and more likely to become useful citizens.

The court found the following facts which are not in dispute. The plaintiff church is a charitable corporation , incorporated as a nonstock corporation in 1958. It acquired about six acres of land on Flagg Road in West Hartford on which it erected a church building. It used about two acres of the property for its church purposes, leaving about four acres of open land unused, on which it paid taxes to the town of West Hartford. After perceiving a need for housing for the elderly in the community, the church, in 1978, created a committee to make a feasibility study of the use of the unoccupied land for such housing. The study became known as the Hart Meadow Project. In November, 1979, the congregation, at a meeting called "to discuss the Hart Meadow project," voted: "Whereas our congregation feels that a portion of our outreach ministry can be accomplished by the provision of housing on our property for the elderly, and Whereas Phase I of the Feasibility Study has reviewed plans and concepts for such housing which are felt to accomplish our intended purpose and, Whereas there is reason for optimism of success through the efforts of our congregation with guidance and assistance from Church Homes and the Connecticut Conference, it is therefore Moved that the congregation authorize the expenditure by the Hart Meadow Project Committee of approximately $7,000 of church funds so that they may proceed with Phase II of the Feasibility Study involving detailed planning and a zoning application with the town government. If the project is successful, the $7,000 will become part of the capitalization expense and will be returned to the church."

The church obtained a change of zone for the entire six acre parcel to be designated as a special zoning district and proceeded with a development of the four acres to be known as Hart Meadow Village. The plaintiff was to construct sixteen residential units or cottages, each with two bedrooms and equipped with range, refrigerator, air conditioning, carpeting, garbage disposal, master television antenna, and provided with grounds maintenance, project lighting and on-site parking. It is also planned that, in time, the entire project would be administered by Church Homes, Inc., as a subsidiary of its Avery Heights project on New Britain Avenue in Hartford. It is also planned that a full range of recreational, support and health services will be provided for the occupants of the cottages, including pastoral counseling provided by the church minister, support in arranging convalescent services, use of church facilities for cultural and recreational affairs and coordination of public and private transportation.

The plaintiff plans that 87 percent of the projected total $1,212,483 cost of the project will be funded by gifts, with the remainder provided by a commercial loan to the church which will continue to hold title to all the real estate. The funds for construction of each unit will come from individual donors who will make unrestricted gifts to the church to cover the cost of construction of the units. Upon making the payment of $73,000, the individual donor will receive the privilege of being the occupant of the housing unit, as well as receiving health care, as long as he or she is able to live there independently; provided, however, that the occupant pay to the church a monthly maintenance fee now fixed at $350, and that one of the occupants at the time of taking occupancy is at least sixty-two years of age. No leases or written contracts concerning the occupancy will be executed other than a letter from the church to the occupant specifying his rights, privileges and commitments for the maintenance costs. Once a cottage is vacated, a second tenant chosen by Church Homes, Inc., will be given the privilege of occupancy under the same restrictions and subject to the same commitment to pay the monthly maintenance fee.

Six units had been constructed and were occupied at the time of trial. Plans were under way to erect the remaining planned units as the church received further donations for construction. At the hearing, it also appeared that although there had been discussions with the town authorities about what would be done if the property were sold, no understanding was ever reached. It does not appear that any provision has been made for such a contingency, or for the possibility of the church ceasing to function or deciding to sell the property. Nor has any restriction against its sale been considered. There is no restriction to occupancy by reason of race, creed, color or church membership. Most of the current occupants are not members of the plaintiff church and there is no requirement that they be members. The court found it significant that there is no restriction or limitation upon the extent of the wealth or income of anyone selected for occupancy of the units. While one of the occupants of each unit must have attained the age of sixty-two, occupancy is not limited to the poor, sick, infirm, or to the low income elderly. There is no barrier to admission to occupancy of any of the housing units by any wealthy person. The court concluded that the absence of any financial limitation is of critical significance in determining the merits of the case.

The court stated that under the statutory provisions, there are three requirements for tax exemption. The property must belong to or be held in a trust for an organization exempt from taxation under the provisions of General Statutes § 12-81; it must be held for one of the purposes stated in that statute; and it must produce no rent, profits or income. The court found that the plaintiff failed to prove that the land involved in the Hart Meadow Village project is being used "exclusively" for charitable purposes as that term is used in General Statutes § 12-81(7).

We cite with approval, as did the trial court, the statement in Faith Center, Inc. v. Hartford, 39 Conn.Sup. 142, 473 A.2d 342 (1982), a case affirmed by the Supreme Court in 192 Conn. 434, 436, 472 A.2d 16, cert. denied, 469 U.S. 1018, 105 S.Ct. 432, 83 L.Ed.2d 359 (1984), as follows: "Certain general principles of law govern cases such as the present ones where a party claims that property is exempt from taxation. ' "It is a settled rule of law that statutes which exempt from taxation are to be strictly construed against the party claiming an exemption." ' Crescent Beach Assn. v. East Lyme, 170 Conn. 66, 71, 363 A.2d 1045 (1976); Wiegand v. Heffernan, 170 Conn. 567, 582, 368 A.2d 103 (1976); Hartford Hospital v. Board of Tax Review, 158 Conn. 138, 147, 256 A.2d 234 (1969). 'Exemptions, no matter how meritorious, are of grace, and must be strictly construed. They embrace only what is strictly within their terms.' Hartford v. Hartford Theological Seminary, 66 Conn. 475, 482-83, 34 A. 483 (1895); Woodstock v. The Retreat, Inc., 125 Conn. 52, 56, 3 A.2d 232 (1938). As the Supreme Court noted in Snyder v. Newtown, 147 Conn. 374, 386, 161 A.2d 770 (1960), appeal dismissed, 365 U.S. 299, 81 S.Ct. 692, 5 L.Ed.2d 688 (1961): 'Exemption from taxation is the equivalent of an appropriation of public funds, because the burden of the tax is lifted from the back of the potential taxpayer who is exempted and shifted to the backs of others. Lyman v. Adorno, 133 Conn. 511, 516, 52 A.2d 702 [1947]. The owners of tax exempt property in the community derive the same benefits from government as other property owners but pay no property taxes for those benefits.'

"It is also well settled that the burden of proving entitlement to a claimed tax exemption rests upon the party claiming the exemption. Curly Construction Co. v. Darien, 147 Conn. 308, 160 A.2d 751 (1960); Burritt Mutual Savings Bank v. New Britain, 146 Conn. 669, 154 A.2d 608 (1959); Cooley Chevrolet Co. v. West Haven, 146 Conn. 165, 148 A.2d 327 (1959); Forman Schools, Inc. v. Litchfield, 14 Conn.Sup. 444, rev'd on other grounds, 134 Conn. 1, 54 A.2d 710 (1947)." Faith Center, Inc. v. Hartford, supra, 39 Conn.Sup. at 153-54, 473 A.2d 342.

The court agreed with the plaintiff that over the years the concept of what constitutes a charitable purpose has broadened. It based its conclusion on the following language in Camp Isabella Freedman of Connecticut, Inc. v. Canaan, 147 Conn. 510, 162 A.2d 700 (1960): "The definition of charitable uses and purposes has expanded with the advancement of civilization and the daily...