Court Opinion

ID: 9855855
Source: CourtListenerOpinion
Date Created: 2023-09-24 06:32:16.350983+00
Date Added: 2024-06-11T09:37:13.614267
License: Public Domain

HEDRICK, Judge.
Defendant contends, based on his first assignment of error, that the court erred as a matter of law in granting plaintiff’s motion for summary judgment and in denying defendant’s motion for summary judgment. Defendant argues that since plaintiff did not deny operating non-profit elementary and secondary schools, and since the General Assembly amended G.S. § 96-8 effective 1 January 1978 to delete an exemption from unemployment tax coverage for non-profit elementary and secondary schools, in order to come into compliance with the federal statute, all church-related elementary and secondary schools in the State, including the schools operated by plaintiff, are now subject to the unemployment tax provisions of Chapter 96 of the General Statutes. We disagree. While the 1978 amendments did serve to subject non-profit elementary and secondary schools to the provisions of the Employment Security Law (Chapter 96 of the General Statutes), see G.S. §§ 96-8(5)(q); 96-8 (6)(j), these amendments left unchanged the subsection of G.S. § 96-8 that is most relevant to this inquiry. That subsection, G.S. § 96-8(6)k. in pertinent part provides:
The term “employment” shall not include:
*43615. Services performed (i) in the employ of a church or convention or association of churches, or an organization which is operated primarily for religious purposes and which is operated, supervised, controlled or principally supported by a church or convention or association of churches;. ..
See also 26 U.S.C. § 3309(b)(1).
Where the language of a statute is clear and unambiguous there is no room for judicial construction and the courts must give it its plain and definite meaning, Williams v. Williams, 299 N.C. 174, 261 S.E.2d 849 (1980); State ex rel. Utilities Commission v. Southern Bell Telephone and Telegraph Co., 288 N.C. 201, 217 S.E.2d 543 (1975); Fogle v. Gaston County Board of Education, 29 N.C. App. 423, 224 S.E.2d 677 (1976), and the courts are without power to interpolate, or superimpose, provisions and limitations not contained therein. State v. Camp, 286 N.C. 148, 209 S.E.2d 754 (1974); Jackson v. Stanwood Corp., 38 N.C. App. 479, 248 S.E.2d 576 (1978); Swain County v. Sheppard, 35 N.C. App. 391, 241 S.E.2d 525(1978). In addition, when a statute is amended, all portions of the original act which are not in conflict with the provisions of the amendment remain in force with the same meaning and effect that they had before the amendment. G.S. § 12-4; Rice v. Rigsby, 259 N.C. 506, 131 S.E.2d 469 (1963).
In the present case, the cited subsection is, in our view, unmistakably clear in its language. The subsection provides an exemption from unemployment tax liability for all persons rendering services as an employee of a church or group of churches, and for all persons employed by organizations operated primarily for religious purposes and “operated, supervised, controlled, or principally supported” by a church or group of churches, without making any distinction between secular and non-secular workers or the tasks that they perform in such employment. In light of the unambiguous statutory language, we cannot, as defendant would have us do, read into the subsection a limitation that the exemption applies only to Roman Catholic Church employees who are not involved in educational activities. Since the General Assembly left this subsection completely unchanged when it deleted the previous exemption for non-profit elementary and secondary schools, we must presume that the subsection should be given the same meaning and effect as before the amendment. If the Legislature had intended to remove *437Church school employees from the coverage of the subsection, it would have done so. Defendant’s first assignment of error is therefore without merit.
We are also of the view, in response to defendant’s fourth assignment of error, that the cited subsection was properly applied to the facts of this case. The schools in question are considered an important part of the Roman Catholic Church, and the Diocese of Charlotte has adopted comprehensive guidelines for the operation and administration of the schools. Church officials, namely the pastors, are responsible for the operation, administration, and employment of the schools, and the individual parishes provide whatever financial support is necessary to their continued operation. It follows, then, that the Church schools are themselves part of the Church, and thus the employees of the schools must be considered employees of the Church as well. Although it is not necessary for our determination, we also believe that the complaint, affidavit, and supporting documents offered by plaintiff indicate that the Church schools are operated primarily for religious purposes and are operated, supervised, controlled, and principally supported by the Church. The Church schools are therefore exempt from the coverage of the state unemployment tax law, and this assignment of error has no merit.
Defendant next contends, based upon his second assignment of error, that the court erred in refusing to join the United States Secretary of Labor as a necessary party to the action. Defendant bases his argument on the fact that the Employment Security Commission finances its public employment through federal grants, and that the Commission obtains these funds only after the state unemployment tax law is certified by the United States Secretary of Labor as being in compliance with the federal unemployment tax law, thus allowing the state to take a credit against the federal tax. Since the U.S. Secretary of Labor has interpreted the federal statute, to which Chapter 96 of the General Statutes corresponds, to include parochial and parish schools within the scope of the federal unemployment tax provisions, defendant argues, the Commission must subject parochial and parish schools to the state unemployment tax law in order to keep its certification and its funding. Therefore, defendant asserts, as the Secretary’s interpretation has prompted defendant to seek contributions from plaintiff, leading to this litigation, complete relief cannot be afforded without *438the joinder of the Secretary. We disagree.
G.S. § 1A-1, Rule 19(b) provides:
The Court may determine any claim before it when it can do so without prejudice to the rights of any party or to the rights of others not before the court; but when a complete determination of such claim cannot be made without the presence of other parties, the court shall order such other parties summoned to appear in the action.
A “necessary” party is one whose presence is required for a complete determination of the claim, Behr v. Behr, 46 N.C. App. 694, 266 S.E.2d 393 (1980), and is one whose interest is such that no decree can be rendered without affecting the party. Pickelsimer v. Pickelsimer, 255 N.C. 408, 121 S.E.2d 586 (1961); Wallv. Sneed, 13 N.C. App. 719, 187 S.E.2d 454 (1972). In other words, a “necessary” party is one whose interest will be directly affected by the outcome of the litigation. Equitable Life Assurance Society of United States v. Basnight, 234 N.C. 347, 67 S.E.2d 390 (1951).
In the instant case, the U.S. Secretary of Labor was not a necessary party whose joinder was mandatory, as the Secretary’s interests would not be affected by the outcome of this litigation. The present action merely involves a determination based upon Chapter 96 of the North Carolina General Statutes, and in no way does it, or could it, involve an interpretation of the Federal Unemployment Tax Act (FUTA). Whatever interpretation is finally placed on the FUTA by the Secretary, it will not depend on what we interpret our state unemployment law to mean. This assignment of error is without merit.
Defendant lastly contends, based on his third assignment of error, that the court erred in ordering defendant to pay prejudgment interest on the payments refunded to plaintiff. Defendant argues that an award of interest on a refund is prohibited by G.S. § 96-10(e). We disagree. G.S. § 96-10(e) in pertinent part provides:
If not later than five years from the last day of the calendar year with respect to which a payment of any contributions or interest thereon was made, or one year from the date on which such payment was made, whichever shall be the later, an employer or employing unit who has paid such contributions or interest thereon shall make *439application for an adjustment thereof in connection with subsequent contribution payments, or for a refund, and the Commission shall determine that such contributions or any portion thereof was erroneously collected, the Commission shall allow such employer or employing unit to make an adjustment thereof, without interest, in connection with subsequent contribution payments by him, or if such an adjustment cannot be made in the next succeeding calendar quarter after such application for such refund is received, or if said money which constitutes the overpayment has been in the possession of the Commission for six months or more, a cash refund may be made, without interest...
This subsection, however, is not applicable to the present situation. Plaintiff is not making an application for a refund with the Commission due to an overpayment or other adjustment to an otherwise proper contribution, as contemplated by G.S. § 96-10(e); rather, plaintiff is suing the Commission pursuant to G.S. § 96-10(f) to recover payments made to the Commission under protest. G.S. § 96-10(f), the applicable statute for our purposes, provides in pertinent part as follows:
Whenever any employer, person, firm or corporation against whom taxes or contributions provided for in this Chapter have been assessed, shall claim to have a valid defense to the enforcement of the tax or contribution so assessed or charged, such employer, person, firm or corporation shall pay the tax or contribution so assessed to the Commission; but if at the time of such payment he shall notify the Commission in writing that the same is paid under protest, such payment shall be without prejudice to any defenses or rights he may have in the premises, and he may, at any time within 30 days after such payment, demand the same in writing from the Commission; and if the same shall not be refunded within ninety days thereafter, he may sue the Commission for the amount so demanded;... and if, upon the trial it shall be determined that such tax or contribution or any part thereof was for any reason invalid, excessive, or contrary to the provisions of this Chapter, the amount paid shall be refunded by the Commission accordingly. The remedy *440provided by this subsection shall be deemed to be cumulative and in addition to such other remedies as one provided by other subsections of this Chapter.
Unlike subsection (e), subsection (f) contains no reference to refunds being made “without interest,” nor do we see any reason why interest should not be allowed on refunds made under subsection (e). The tax assessed against plaintiff has been found by the trial court to be “contrary to the provisions of this Chapter,” and thus defendant has had improper possession of plaintiffs funds from the time of payment under protest until judgment. Defendant, in the discretion of the trial court, should not therefore be allowed to benefit from the use of the money rightfully belonging to plaintiff. Under the circumstances, the trial court could properly award prejudgment interest on the amount of the protested payment. See also Raintree v. City of Charlotte, 49 N.C. App. 391, 271 S.E. 2d 524 (1980). This assignment of error is without merit.
Since the court did not reach the constitutional questions raised by plaintiff in its determination, we find it unnecessary to address those questions here.
Affirmed.
Judge Clark concurs in the result.
Judge WHICHARD dissents.