Court Opinion

ID: 8193713
Source: CourtListenerOpinion
Date Created: 2022-09-09 23:16:51.961271+00
Date Added: 2024-06-11T16:40:41.567532
License: Public Domain

Rosenberry, J.
The plaintiff contends that the property in Question is exempt pursuant to the provisions of the-statute as follows:
“Sec. 70.11 The property in this section described is exempt from taxation, to wit: (1) . . . (2) . . . (3) . . .
“(4) Personal property owned by any religious, scientific, literary, educational or benevolent association, . . . used exclusively for the purposes of such association, and the real property necessary for the location and convenience of the buildings of such association and embracing the same, not exceeding ten acres; provided such real or personal property is not leased or otherwise used for pecuniary profit. . . .”
While the plaintiff corporation in form is the owner of the real and personal property described in the complaint, it holds the same solely for the use and benefit of the parent •corporation, the Synod. The Synod chooses the board of directors, the corporation is formed for the benefit of the Synod, all profits derived from the business are paid over to the Synod, and the general scheme of organization and operation is such as to leave no doubt that the plaintiff corporation is merely a subsidiary to the Synod, for which to all intents and purposes it holds its property and business. The plaintiff corporation is not a self-perpetuating corporation, but is controlled, managed, and operated by representatives chosen by the Synod. Both corporations are organized under the provisions of ch. 86, Stats., entitled “Organization, powers and dissolution of corporations.”
The defendant contends that under the doctrine laid down in U. S. Nat. Bank v. Poor Handmaids, 148 Wis. 613, 135 N. W. 121, the plaintiff corporation cannot be a religious corporation. The defendant corporation in that case was organized to maintain and teach parochial schools, maintain *407and support hospitals for the benefit of sick, infirm, and aged persons, and help the poor and distressed. It was not organized for profit but was for the benevolent and educational purposes mentioned. The exemption in that case was claimed under the charter of the city of Superior (sec. 244, ch. 124, Laws 1891), which exempted the property of a “religious society, association or corporation,” and in determining whether or not the defendant corporation was a religious corporation significance was given to the fact that it was organized under ch. 86, and it was said:
“It is considered that a corporation organized under ch. 86 of the Statutes for benevolent purposes is not a religious corporation under the Superior charter.”
The Synod was organized for the purpose of co-operation in ecclesiastical work, as the training of ministers and school teachers, the maintenance of the purity of doctrine and unity in sound practice, mutual aid and advice in matters pertaining' to the church, and the extension of the Lutheran Church by missionary work. It is expressly declared that both corporations are not organized for pecuniary profit, but for the purposes hereinbefore set out.
We do not find it necessary to determine in this case whether or not the plaintiff corporation and the Synod are religious corporations in the technical sense. Whether they are or not, it is clear that they are organized for educational and benevolent purposes and not for pecuniary profit, and so are within the express terms of sub. (4), sec. 70.11, Stats. 1921.
“Educational” and “benevolent” are words of very broad and general import. The allegations of the complaint clearly show that the primary purpose and object of the plaintiff corporation is to publish and distribute educational matter in order that purity of doctrine and unity in sound practice of the Lutheran Church may be maintained and extension of its work, by missionaries may be carried on. The distribution *408of the income derived from the operation of this property shows that the Synod is maintained for educational and benevolent purposes. The importance to a sectarian body of controlling and managing the publication and distribution of the literature inculcating its doctrines is well understood. Instilling into the minds of the young, stimulating and deepening the convictions of the mature in matters relating to the faith and doctrine of the Lutheran Church by the publication and distribution of printed matter, are certainly educational purposes within the meaning of that term as it is used in sec. 70.11, Stats, 1921.
This results- from the application of the principles and construction laid down in St. John’s Military Academy v. Edwards, 143 Wis. 551, 128 N. W. 113, and Lawrence University v. Outagamie Co. 150 Wis. 244, 136 N. W. 619.
On the other hand, if the propferty be Regarded as that of the Synod the same situation exists, and the disposition of the so-called profits derived from the business conducted by the plaintiff corporation shows that it is devoted entirely to educational and benevolent purposes. This is not a case of an independent corporation which turns over the profits from its business to be used for educational and benevolent purposes. The method of organization is such in this case as for all substantial purposes to make the corporations one, so far as control and management are concerned. The plaintiff corporation is in effect the arm of the Synod, formed for the purpose of carrying out a synodical program of education. While it has technically a separate corporate existence it can only function when the Synod chooses its directors,'who are chosen no- doubt for the purpose of effectuating, through the management and control of the publishing business, the declared object and purposes of the Synod itself.
We come now to a consideration of the question of whether or not the property in question is used exclusively for educational and benevolent purposes. The claim that it *409is not is based upon the fact that .00277 per cent, of its income is derived from printing of letterheads and envelopes for the convenience of its patrons and in order to give its workmen continuous employment, and from the further fact that a very small part of the floor space is occupied by a sample church bench, school seat, and some baptismal fonts. It is alleged that tírese facts bring it within Gymnastic Asso. v. Milwaukee, 129 Wis. 429, 109 N. W. 109. In Gymnastic Asso. v. Milwaukee a part of the real property which would otherwise have been exempt was rented to third parties who used it for conducting a barber shop and saloon. In this situation it was held that the property was not used exclusively for the purposes of the association, and, it being indivisible, no part of the property could be exempted. In this case the plaintiff has parted with the use of no part of its property. The plaintiff uses it exclusively for educational and benevolent purposes, and as an incident to that use has stored the articles mentioned and has done a very small amount of commercial printing. The property has not thereby been diverted from its primary use. Quite a different situation would be presented if half of the plant were rented to third parties who conducted therein a general publishing business, even though the proceeds of the rent were devoted to the corporate purposes. Even if it were otherwise the departure in this case is so slight as to be negligible and therefore to be disregarded. The occupation of fifteen or twenty square feet of floor space by sample benches and the derivation of one fourth of one per cent, of its income from commercial printing, done as a matter of convenience for its regular customers, does not amount to a sufficient departure to warrant us in saying that the property is not used exclusively for educational and benevolent purposes, particularly where such work is done as incidental to its main purpose. Webb Academy v. Grand Rapids, 209 Mich. 523, 177 N. W. 290.
It must be held that both corporations are organized for *410educational and benevolent purposes. and that the property-assessed is used exclusively for corporate purposes and therefore exempt from taxation.
'By the Court. — The order appealed from is reversed, and the cause remanded for further proceedings according to law.
Vinje, C. J., dissents.