Case ID: mo-app_12/html/0342-01.html
Source: Caselaw Access Project
Author: {"author": "Bakewell, J.,", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

North St. Louis Gymnastic Society, Respondent, v. N. C. Hudson, Appellant
    June 6, 1882.
    1. Injunction is the proper remedy to prevent the sale of real estate for illegal taxes whereby a cloud would be cast upon the title.
    2. A school building exempted from taxation “ so long as it is used only for the purposes of education” is not made taxable by the renting of a room therein for other purposes, where the proceeds thereof are used exclusively for the benefit of the school.
    Appeal from the St. Louis Circuit Court, Thayer, J.
    
      Affirmed.
    
    Leverett Bell, for the appellant:
    The petition does not state a cause of action. Its purpose is to restrain the tax collector from enforcing a tax-bill against real estate, on the alleged ground that the taxes included in the bill were illegally assessed. These averments furnish no ground for the interposition of a court of equity, and do not entitle plaintiff to relief by injunction. — Dorris v. Rosenblatt, 6 Mo. App. 601. The charter of plaintiff exempts its property to the extent of $50,000 from taxation, “ as long as said property is used only for purposes of education.” The fact that plaintiff leases one part of the building destroys the claim to exemption ; and the result is not changed by the further fact that the rents are applied to the support of the institution.— Wyman v. St. Louis, 17 Mo. 335 ; College v. The State, 19 Ohio, 110 ; Chapel v. Boston, 120 Mass. 212.
    
      Collier & Muench, for the respondent:
    Injunction is the proper remedy in all cases of illegal taxation upon real estate, as in the present instance. — See Mechanics’ Panic v. City of Kansas, 73 Mo. 559, and cases there cited. The property exempted is used for the purposes of education. — The State ex rel. v. Powers, 10 Mo. App. 263; s. c. 74 Mo. 476
   Bakewell, J.,

delivered the opinion of the court.

This is a proceeding to enjoin the collection of taxes for 1881, levied upon real estate described in the petition. The court made a decree in accordance with the prayer of the petition.

There is no dispute about the facts, which are as follows :

Plaintiff is incorporated under a special act of the legislature, approved February 12, 1864, for the purpose of educating children in gymnastics and the elementary branches of education, and the act provides that personal and real property of the institute shall be exempt from taxation, “ as long as said property is used only for the purposes of education,” provided the value thereof does not exceed $50,000. The tax-bill in question is for $197.86, and is for state, city, and school taxes for 1881, and is levied upon the real and personal property of plaintiff, worth less than $50,000, on southeast corner of Fourteenth and Salisbury Streets, St. Louis, where plaintiff carries on a gymnastic school, according to its charter. The personal property owned by plaintiff is devoted wholly to the conduct and purposes of said school. Upon the real estate in question, plaintiff has erected a two-story brick building, paying for .about one-half thereof out of sums realized on shares of •stock issued pursuant to its charter, as also some other means, and the other half then remaining as a debt of the ■society. The entire second floor, and a large part of the first floor of the building, are used and occupied in the conduct of the school, and two corner rooms on the first floor are let by plaintiffs at a monthly rental paid to it, for a saloon and store respectively. This monthly rental is used by plaintiff in defraying the legitimate expenses of conducting the school, paying the salaries of teachers (so far as this expense is not met by the voluntary contributions of the members), keeping the building in repair, and in discharging the indebtedness incurred by the association in erecting the building. Of this indebtedness $6,000 remains unpaid, and is a lien upon the premises.

1. The petition states a good cause of action. Injunction is the proper remedy to prevent the sale of real estate for illegal taxes, whereby a cloud would be cast upon the title. Mechanics’ Bank v. City of Kansas, 73 Mo. 559.

2. This case is not like that of Wyman v. St. Louis (17 Mo. 335), where the plaintiff derived a revenue for his personal benefit from the whole building, renting some stories of the building for stores and concert halls, and occupying the third and fourth floors only for his private school. We think with the learned judge of the trial court, that it comes-within the reasoning of the supreme court and of this court in The State ex rel. v. Powers (10 Mo. App. 263; s. c. 74 Mo. 476).

So far as the corporation is concerned, it uses the entire building only for purposes of education. By its charter, the corporation can pay neither interest nor dividends, so that the members can derive no benefit from the rent of the rooms, which must necessarily be used for the support of the school and for the educational purposes contemplated by the legislature in granting the charter and the exemption. The association is purely a benevolent one.

The case of Trustees, etc., v. City of Boston (101 Mass. 212), we regard as not being in point, because that case is decided upon the peculiar language of the Massachusetts statute, which requires that the real estate of literary and charitable institutions, to be exempt, should belong to the institutions, and “ be occupied by them or their officers for the purposes for which they were incorporated.” Under this provision, the supreme court of Massachusetts held that lodging-houses built on the corporation grounds,, and rented to tenants at the usual rates, were not exempt, though the proceeds were devoted to the charitable uses named in the charter, and this, for the obvious reason that such lodging-houses were not “occupied by the corporation or its officers.”

In Ohio, the statute of exemption under construction, in Cincinnati College v. The State (19 Ohio, 110), expressly provides that the buildings, to be exempt, “shall not be leased, or otherwise used with a view to profit.”

It might be said, in one sense, that a school building in which the janitor lived, with his family or alone, was not-used solely for the purposes of education, but that as to the room occupied by the janitor, it was used for the purpose of lodging, eating, and sleeping. Nevertheless, such a building would not cease to be used solely for the purposes of education within the meaning of the exemption clause in this charter. And we think it is no forced construction, but the natural and obvious construction of the language of plaintiff’s charter, to hold that the claim to exemption is not destroyed where the building is occupied as a school, except as to two rooms, the rent of which is applied, and by the terms of the charter must be applied, to the purposes of the school carried on in the building.

The judgment is affirmed.

All the judges concur.