Widows' and Orphans' Home of Odd Fellows of Kentucky v. Commonwealth

• Decision Date: 28 June 1907
• Citation: 103 S.W. 354,126 Ky. 386
• Parties: WIDOWS' AND ORPHANS' HOME OF ODD FELLOWS OF KENTUCKY v. COMMONWEALTH.
• Court: Kentucky Court of Appeals

103 S.W. 354

126 Ky. 386

WIDOWS' AND ORPHANS' HOME OF ODD FELLOWS OF KENTUCKY v. COMMONWEALTH.

Court of Appeals of Kentucky.

June 28, 1907

Hobson and Nunn, JJ., dissenting.

Appeal from Circuit Court, Fayette County.

"To be officially reported."

Proceedings by the commonwealth of Kentucky, by the State Auditor's agent, to compel the listing of property of the Widows' and Orphans' Home of the Odd Fellows of Kentucky. From a judgment for plaintiff, defendant appeals. Reversed, with directions to dismiss.

Hobbs &amp Farmer and Jno. S. Gaunt, for appellant.

George R. Hunt, for the Commonwealth.

BARKER J.

This was a procedure by the Auditor's agent of the state of Kentucky, under the statute, to compel the listing, as omitted property, of a note for $4,000 owned by the appellant, the Widows' and Orphans' Home of the Odd Fellows of Kentucky. The one question arising for adjudication upon the record before us is whether or not the property of the appellant corporation is immune from taxation under that provision of section 170 of the Constitution which exempts "institutions of purely public charity." In other words: Is the appellant corporation an "institution of purely public charity?"

The object of the institution, as shown by its constitution, is to provide a suitable home for the destitute widows and orphans of deceased Odd Fellows of Kentucky. There is no dispute as to the facts of the case, upon which the question of law before us must turn. We copy the following excerpt from the answer, which is not denied: "It further says that it is the owner of a parcel of real estate consisting of 30 acres, a part of which is in the city of Lexington, and part in the county of Fayette, and being located at the head of West Sixth street in the city of Lexington, known as the 'McMichael Place.' It further says that upon said real estate there are two houses, one a three-story and the other a four-story house, and said houses contain 107 rooms including halls and cellar. That said land and said houses are used solely and alone for the purpose of caring for widows and orphans of deceased Odd Fellows of Kentucky. That there are now in said home and being cared for, boarded clothed, educated, and trained for useful citizens, 61 children who are orphans of deceased Odd Fellows of Kentucky, and who have no means of support other than that furnished to them by defendant, and, in addition to said 61 children, there are 2 widows of deceased Odd Fellows who are indigent, old, and unable to protect or care for themselves, who are being maintained and cared for by defendant, being totally dependent upon the defendant for their support, and said children range in age from 2 1/2 years to 16 years of age. It further states that, after its institution, it took some 3 or 4 of said children, from county and city institutions of charity, where they were being cared for by the counties or cities, and that in caring for said children and widows this defendant has relieved the said counties and cities from the burden of supporting, maintaining, and educating said children. That this defendant is engaged in a work of purely public charity, and that there are no religious, political, or sectarian rules adopted or prescribed for the admission of widows and orphans to said home. That the children in said home are permitted to go to whatever church they or their relatives may desire them to attend. That there is no creed or dogma of any church or denomination in said home. That Americans, Jews, Italians, or any children of the white or Caucasian race, if their father was a member of an Odd Fellows' Lodge in the state of Kentucky, are eligible to admission in said home. It further states that there is no person or persons who receive compensation or derive profit from the defendant corporation. That said board of directors elect a president, vice president, secretary, treasurer, and superintendent. That the president, vice president, secretary, treasurer, and superintendent serve without compensation, and receive no pecuniary remuneration for their services, and there is no one who receives a salary who is connected with the management of said home and running same, except those who are in immediate charge of said home, and devote all of their time to the nurture and care of said children, to wit, the manager and the matron, who are husband and wife, and live in the home and devote their entire time to the caring for the inmates of said home, and other employés who are necessary to properly care for the said inmates of the said home. It further says that it is an institution of purely public charity, and that no persons receive or derive any profit from it."

The question, then, is whether an institution whose charitable work is based upon the foundation shown by the foregoing excerpt from the answer is a "purely public charity." It may be admitted at the outset that the expression "purely public charity" is one which has not been uniformly defined by the courts before which it has come for construction, either under our own Constitution or under the Constitutions of states having the same provision with reference to exemption from taxation as our own. The expression first came on for definition in our own state in the case of Trustees of Kentucky Female Orphan School v City of Louisville, 100 Ky. 470, 36 S.W. 921, 40 L. R. A. 119. The Kentucky Female Orphan School is a charitable institution located at Midway, Ky. conducted under the auspices of the Christian Church, and in all substantial respects the question which we have here was presented there, and of necessity there arose the question of the meaning of the expression "purely public charity." The following excerpt from a case decided by the Supreme Court of Pennsylvania (Episcopal Academy v. Philadelphia, 150 Pa. 565, 25 A. 55) was quoted in the opinion with approval: "(1) Whatever is done or given gratuitously in relief of the public burdens, or for the advancement of the public good, is a public charity. Where the public is the beneficiary, the charity is public, and where no private or pecuniary return is reserved to the giver or to any particular person, but all the benefit resulting from the gift or act goes to the public, it is a purely public charity; the word 'purely' being equivalent to wholly. (2) A denominational school property, vested in trustees for the purpose of affording encouragement to the education of youth, is a purely public charity, although the school is not open in the same way to the general public as to persons connected with the religious denomination, but the general public are admitted as vacancies occur, and, when admitted, upon the same terms with all other pupils. (3) An institution founded and endowed as a purely public charity does not lose its character as such under the tax laws if it receives a revenue from the recipients of its bounty sufficient to keep it in operation." The court also cites with approval the opinion in Burd Orphan Asylum v. School District of Upper Darby, 90 Pa. 21, as upholding the same principle announced in the excerpt first quoted. In the last-named case a testatrix by her will had provided for the establishment of an asylum whose object was to maintain and educate white female orphan children "who shall have been baptized in the Protestant Episcopal Church in the city of Philadelphia, or in the state of Pennsylvania"; and this was held to be a "purely public charity," under the Constitution of Pennsylvania, which is identical with our own on this subject. In the case of Gerke v. Purcell, 25 Ohio St. 229, this definition of a "purely public charity" is given: "When the charity is public the exclusion of all idea of private gain or profit is equivalent in effect to the force of 'purely,' as applied to public charity in the Constitution." The case of Donohugh v. Library Company, 86 Pa. 306, and Philadelphia v. Women's Christian Association, 125 Pa. 572, 17 A. 475, maintain the same doctrine. In the case of Zable v. Louisville Baptist Orphans' Home, 92 Ky. 89, 17 S.W. 212, 13 L. R. A. 668, it is said: "It is the duty of the state to care for its indigent orphans, and, if done by another, he renders what is properly a public service, and the Legislature may therefore, without regard to the extent of it, exempt the property devoted to such use from taxation." In the case of Norton's Executors and Trustees v. City of Louisville, 82 S.W. 621, 26 Ky. Law Rep. 846, was involved the question we have here. The charity of the defendant corporation, whose property was sought to be taxed by the municipality, was limited by the following language of its charter: "The object of this corporation shall be to procure the control of orphans and destitute children of Baptist parents, and of such other destitute and helpless children as the managers may think proper to receive, for the purpose of supporting and educating them in an institution to be prepared and provided for that purpose by said managers. * * *" It was there held that the institution in question was a purely public charity. In the case of Commonwealth v. Thomas, Trustee, 83 S.W. 572, 26 Ky. Law Rep. 1128, we thus defined the expression "purely public charity," as contained in the Constitution: "Without undertaking to be technically accurate, a 'purely public charity' may be defined as one which discharges, in whole or in part, a duty which the commonwealth owes to its indigent and helpless citizens. Undoubtedly, it is the duty of the state to educate its poor children, and thus fit them for discharging the duties of citizenship; to care for the indigent insane, its helpless orphans, and its poor who are sick and afflicted; and therefore any institution which, serving no selfish interest...