Case Name: THE FIRST EVANGELICAL UNITED BRETHREN CHURCH, LAWRENCE RICH, EARLE RIGGS, JOHN BEHRENS, FRED SCHARF, NICK LERUD, T. JACK KUNDERT AND WARREN PAHL, AS TRUSTEES v. STATE TAX COMMISSION
Court: Oregon Tax Court
Jurisdiction: Oregon
Decision Date: 1963-04-04
Citations: 1 Or. Tax 249
Docket Number: 
Parties: THE FIRST EVANGELICAL UNITED BRETHREN CHURCH, LAWRENCE RICH, EARLE RIGGS, JOHN BEHRENS, FRED SCHARF, NICK LERUD, T. JACK KUNDERT AND WARREN PAHL, AS TRUSTEES v. STATE TAX COMMISSION
Judges: 
Reporter: Oregon Tax Reports
Volume: 1
Pages: 249–264

Head Matter:
THE FIRST EVANGELICAL UNITED BRETHREN CHURCH, LAWRENCE RICH, EARLE RIGGS, JOHN BEHRENS, FRED SCHARF, NICK LERUD, T. JACK KUNDERT AND WARREN PAHL, AS TRUSTEES v. STATE TAX COMMISSION
Al J. Laue, Salem, tried the case for plaintiff. On the brief were Williams & Skopil and Al J. Lane, Salem.
Gerald F. Bartz, Assistant Attorney General, Salem, tried the case and submitted a brief for defendant.
Decision for defendant rendered April 4, 1963.

Opinion:
Peter M. Gunnar, Judge.
This suit is brought by the plaintiff to set aside the defendant's Opinion and Order No. VL 62-82 affirming the denial by the Board of Equalization of Marion County of a charitable exemption from ad valorem property taxes for the plaintiff's house of public worship under ORS 307.140.
Both parties acknowledge that the property in question is a house of public worship and is used exclusively for a purpose exempt under ORS 307.140. The facts of the case, as stipulated, were as follows:
At all times during the calendar year 1961 the plaintiff was a duly incorporated, nonprofit, religious congregation devoted to the practice of Christianity. From 1928 until December 14, 1961, the legal title to the church property was held by the trustees named in the deed of 1928 and their successors, of whom the trustees on January 1, 1961, were the interveners. During this period the entire beneficial interest in the property was in the congregation for whom the trustees held title under the deed of 1928 and the discipline of the church. On December 14, 1961, the property in issue was conveyed to plaintiff corporation.
Without the knowledge of the congregation or the trustees, the corporate mortgagee of the church property paid the taxes assessed against the property for 1961-2 from funds belonging to the incorporated congregation, rendering this a proceeding to obtain a repayment of those taxes.
Following the action of the assessor and the order of the Board of Equalization of Marion County placing the church property on the assessment roll under the names of the trustees, the unincorporated congregation appealed to the defendant commission. After a hearing before a hearing officer, the commission denied the appeal of the congregation on the merits. This suit then was brought by the corporation as the successor in interest to the unincorporated congregation.
NONJOINDER OF PARTIES
To the original complaint, the commission demurred on the ground of a defect in parties plaintiff, contending that the trustees, who held title to the property on January 1, 1961, were the proper parties plaintiff. This demurrer was overruled because the defect did not appear on the face of the complaint. The defendant then filed a plea in abatement upon the same grounds. Before this plea was heard, the trustees petitioned to intervene in this suit and the petition was granted and the complaint in intervention filed. Thereupon, the plaintiff and the interveners filed a general demurrer to the defendant's plea in abatement and, upon argument, the demurrer was sustained and the defendant filed its general denial, upon which this cause was tried.
The burden of both the demurrer and the plea in abatement filed by the defendant was that there was a nonjoinder of parties plaintiff because the trustees were not parties and the congregation was an unincorporated society and therefore incapable of suit. These facts did not appear by allegation upon the face of the complaint. They were pleaded in the plea in abatement. Upon the filing of the plea, assuming its facts to be correct (the stipulation later proved that they were not correct as to the corporate status of the congregation), the plea might have been allowed.
However, the defect of nonjoinder, if there was one, was cured prior to hearing by the intervention of the trustees. ORS 13.130, 306.545(3). See Duke v. Franklin, 177 Or 297, 162 P2d 141 (1945). Since the taxes had been paid, either the trustees or the corporate congregation was entitled to a refund, if the exemption was allowed.
Whether the plea in abatement should have been tried or disposed of upon demurrer, as was done here, is academic. The substance of the defect alleged in the plea no longer existed after the intervention of the trustees. The original complaint, if in fact it was defective, was aided by the complaint in intervention. The affirmative allegations of the plea in abatement, while they applied to the complaint, no longer applied to the cause as a whole and this appeared beyond peradventure from the record. Furthermore, the payment of the taxes required, or at least made advisable, the retention of both the trustees and the corporate congregation as parties.
The right to demur and plead in abatement to a defect of parties plaintiff is recognized so that the defendant cannot be sued twice for the same obligation. Nordling v. Johnson, 205 Or 315, 322, 283 P2d 994, 287 P2d 420 (1955). When this defect is cured before the plea is heard, the grounds for the plea are destroyed. To rule otherwise would not follow the practice and procedure of equity as required by ORS 305.425. "Equity seeks justice rather than technicality, truth rather than evasion, common sense rather than quibbling." State of Oregon v. Dobson, 195 Or 533, 577, 245 P2d 903 (1952).
Though not raised directly, there is also a question of jurisdiction. The commission contended in argument that the corporate congregation had no standing herein because it was incorporated after the assessment, after the appeal to the commission, and after the payment of the tax. It further contended that the unincorporated congregation could neither sue nor be sued.
The record here discloses that the congregation itself was incorporated. This is not a case of a stranger succeeding to the interests of the unincorporated congregation but rather the beneficiaries of the trust, the congregation, claiming in their corporate form. The beneficial interest in the corporation and the trust is in the same people. The tax payment, if refundable, would go to the same congregation in its corporate form.
The commission ruled on the merits of the exemption. If, in fact, the defect was a cognizable one at the commission level, it was waived by the commission in ruling on the merits. By the time that the commission issued its order on March 28, 1962, the tax had been paid from congregation funds, the beneficiaries in their corporate form had a right to the claim to the refund, and the corporate congregation owned the subject property. There was no change in status of any of the parties which occurred between the commission order and filing of this suit. As the corporate form of the trust beneficiaries the corporate congregation had a right to bring this suit because it was the beneficial payer of the tax and the holder of the property.
Furthermore, by granting the petition to intervene, this court was not extending the statutory time for appeal to the only party entitled to do so. This was contended by the defendant in argument but not by properly pleading the statute of limitations. Instead, it was opening a properly brought suit to allow another party to intervene, thereby supplying a missing, necessary party.