Court Opinion

ID: 9761627
Source: CourtListenerOpinion
Date Created: 2023-08-29 01:48:14.694082+00
Date Added: 2024-06-11T10:24:38.925835
License: Public Domain

STEAKLEY, Justice
(dissenting).
I am unsure of the rule the Court has now established governing the exemption from taxation of charitable institutions, and of what has been done to our established precedents.
It was emphasized in Santa Rose Infirmary v. City of San Antonio, 259 S.W. 926 (Tex.Comm’n. App.1924, jdgmt adopted) that the assets of the charitable corporations there were “appropriately bound by both corporate charters to the exclusive purposes of their general charitable declarations and intentions.”
We said in River Oaks Garden Club v. City of Houston, 370 S.W.2d 851 (Tex.1963), that an organization is not an institution of purely public charity within the meaning of the constitutional exemption, “unless its funds, property and assets are pledged and used to provide for the basic needs of the sick, distressed and needy.”
We said in Hilltop Village, Inc. v. Kerrville Independent School District, 426 S.W.2d 943 (Tex.1968), that to qualify for the exemption, “the institution must be one whose properties and assets are pledged in perpetuity to the relief of persons in financial need.”
Here, as the Court recognizes, the Articles of Incorporation of the Society stipulate that its properties are to be owned, operated and managed in the accomplishment of “benevolent work of a charitable and religious nature”, and, further, that upon dissolution, the assets of the corporation shall be distributed “to a non-profit fund, foundation or corporation which is organized and operated exclusively for charitable and religious purposes.” It is thus apparent that the Society is not bound to the exclusive use of its properties for charitable purposes, i. e., the relief of those in want, sickness and distress, or those in financial need. Charity and religion are not the same when considered in the context of tax exemption under the Constitution and statutes of our State; and the use of properties for charitable and religious purposes is not the use of such properties exclusively for charitable purposes as heretofore required for tax exemption under the rationale of Santa Rosa, River Oaks and Hilltop Village. Overruling the latter where “inconsistent”, as the Court is now saying, leaves untouched the former decisions to the same effect, together with a profusion of questions unanswered. To illustrate: the Court now says “Nor does it follow that all religious or other benevolent activities must be excluded in the operation of the hospital or home.” Are we now saying that an institution may be part charity and part religious, or part something else, and yet be an institution of purely public charity as required by the Constitution for tax exemption; and that such an institution is nonetheless bound exclusively to charity? Or, that it no longer must be? Santa Rosa, supra, and cited in the opinion of the Court, recognizes that “the Constitution requires the property, as a prerequisite to its right to exemption, to be exclusively used by the charitable institution . . .” How can this be so if the property is used in part for religious or other benevolent activities? Are we now saying, further, that the properties and assets of an institution may be pledged at times to the relief of persons in need, and at such times the institution is tax exempt; whereas, later, and perhaps off and on, the pledge may be altered and the exemption lost? Must institutions claiming the tax exemption be annually examined by the taxing authorities to determine if its policies, or the current tax exemption pledge of its funds, property and assets, have either or both been changed since the last taxing date?
We said in City of Houston v. Scottish Rite Benev. Ass’n., 111 Tex. 191, 230 S.W. 978 (1921), that a requisite to charitable exemption is that the institution benefit *813“persons, indefinite in numbers and in personalities, by preventing them, through absolute gratuity, from becoming burdens to society and to the State.”
We said in River Oaks Garden Club, that the institution must assume “to a material extent, that which otherwise might become the obligation or duty of the community or the state.”
We said in Hilltop Village, that the properties and assets of the institution must be pledged in perpetuity to the relief of persons in financial need in obtaining the care they must have to prevent their becoming a burden on society.
The Court speaks here of the Society having established a policy to the effect that “no person who applies for treatment or care is denied admission or once admitted is discharged because of poverty or riches, creed, station or color.” The establishment of a policy is far different from being appropriately bound to the relief of a burden on society, the only fair, reciprocal and accepted basis for tax exemption in the first place. See Santa Rosa, supra. The Court cites no showing here whereunder the Society is precluded from modifying its current policy so as to utilize its funds and properties for a combination of charitable and religious purposes, or, indeed, for charitable purposes that may not relieve a burden that otherwise would be that of the community or of the State.
I would hold that the Society has not established its right to tax exemption under our precedents.
McGEE and JOHNSON, JJ., join in this dissent.