90 Ky. 409 | Ky. Ct. App. | 1890
delivered the opinion of the court.
The appellant, the city of Louisville, having, by its proper officer, levied upon some furniture in use in the Board of Trade rooms of the appellee, the Louisville Board of Trade, for municipal taxes for the year 1886 upon its building in the city of Louisville, it enjoined their collection upon the ground, mainly, that the property was exempt from taxation.
This claim is based upon a legislative act of 1873, which provides: “Any real estate held by the Louisville Board of Trade in the city of Louisville by pur
The property was purchased by the appellee several years after the passage of this statute. The council of the city adopted a resolution, which contains no reference to the limitation in the legislative act relative to the occupation of the property by the appellee for the purposes of its organization, and which by its terms purports to exempt the property from all city tax. Unquestionably, however, the council could grant an exemption only to the extent that the Legislature could constitutionally, and had, in fact, authorized.
Conceding that an institution may render such a local governmental service to a city as will authorize its exemption from city tax by the Legislature, or by the municipal government acting under legislative authority, and that the appellee does so, yet the first question presented is, whether, upon the facts shown, and under a fair construction of the statute, the property of the appellee is exempt.
The building is five stories high; and when the taxes for 1886 were assessed but two small rooms, constituting a part of the rear of one floor, and which
What is the meaning of the condition “so long as such property shall be held and occupied by the Board of Trade for the purposes contemplated in its organization?” Is the renting of it to strangers an “occupation” of it by the board within the meaning of the exempting statute? And next, if it be, is it an occupation by it “for the purposes contemplated in its organization?” .The taxation of all property is the just and equitable rule. An exemption from it is a special privilege, one in conflict with the universal obligation of all property-holders to aid in the support of the government, and the exception will not be presumed. A surrender upon the part of the State of the right to tax must be shown by express and unequivocal language or necessary inference. The exemption, however meritorious, is of grace, and statutes imposing restrictions upon the taxing power of the State, save so far as they may tend to secure equality of assessment, are to be strictly construed.
These are familiar principles, well settled, not only by the decisions of this court, but of the Supreme Court of the United States. It readily strikes the mind as unjust to all other property-holders, and as
It is claimed for the appellee that the occupation by a tenant is an occupation by it within the meaning of the statute, and that, as the rents are applied to its uses, that this is an occupation “for the purposes contemplated in its organization.” In support of this view we are referred to the construction which has been given by this court to the word “occupation,” as used in our homestead law, but it, unlike the statute under consideration, should be liberally construed. Moreover, if a widow were, by a temporary absence, to lose her homestead right, it would be gone forever, while the appellee, provided it renders such governmental service as to constitutionally entitle it to exemption, may at any time regain the right by such a use of the property as its organization contemplated. If it is entitled to the exemption of a building worth one hundred thousand dollars, upon the ground that, within the fair meaning of the statute, an occupation by a tenant is its occupation, and that an application of the rents to its uses is an occupation for the purposes of its organization, then equally is it entitled to the exemption from the common barden of a building worth millions of dollars. This would serve to render its stock very valuable, perhaps, and place upon its neighbor the burden which it could well afford to bear. No presumption in its favor should
In the case of Appeal Tax Court v. The Grand Lodge of Masons, 50 Md., 421, where the statute exempted the property belonging to benevolent and charitable institutions, so far as the same was used for the purposes of the organization, it was held that where such an institution rented out a portion of its building, such portion was not exempt from taxation, although the rent was applied in aid of the charitable purposes of the organization.
The same construction had been previously adopted by the court in Frederick County v. Sisters of Charity of St. Joseph, 48 Md., 34, where it was contended, as it is here, that the application of the rents to the benevolent objects of the institution entitled it to the exemption of the portion of its property occupied by its tenants. The claim was denied.
In the case of the Chapel of the Good Shepherd v. Boston, 120 Mass, 212, the statute exempted from taxation the property of charitable and religious institutions occupied by them for the purposes of their organization, and the right to an exemption of property which was rented out, and the rents applied to. the purposes of the institution, was denied. Said ■«Chief Justice Gray in .delivering the opinion:
In Pierce v. The Inhabitants of Cambridge, 2 Cushing, 611, where the statute exempted the property of literary and charitable institutions, if actually occupied by them for the purposes of their organization, it was decided that property leased out was not to be considered as in the occupancy of Harvard College so as to exempt it from taxation.
In the recent case of Morris v. Lone Star Chapter of Masons, where the Constitution of the State of Texas authorized its Legislature to exempt from taxation the buildings of institutions of public charity, it was held that such buildings only were intended as were used exclusively and actually by such institutions, and that if certain portions of a building belonging to such an institution were rented out it Avas to that extent taxable,. although the rents were used in furtherance of the charity. (68 Texas, 698.)
In the case of the Bank v. Tennessee, 104 U. S., 493, where a bank was required by its charter to pay a certain tax' upon its capital stock in lieu of all other taxes, and was authorized to hold property for its use as a place of business, it was held that its immunity from taxation extended to only so much of the building as was necessary to the carrying on of its business.
Desty on Taxation, volume 1, page 119, note, says: “If the buildings, or any portion thereof, belonging to a benevolent and charitable institution, are used for other purposes for a profit, the building, to the extent thus used, is liable to taxation, although the proceeds from such extraneous use are devoted to charitable purposes.”
The petition in this case shows that some portions of the appellee’s building are rented out, but it does not point out what portions. It discloses the fact that at least a portion of it is liable to taxation, but it does not disclose what portion. The answer avers that the assessor, in assessing the tax in question, deducted a proportionable part of the building for the two rooms actually in use by the appellee. This is denied by the reply, and not proven, and it is, therefore, urged that the judgment below must be-sustained upon the ground that the tax bill is erroneous. The judgment, however, is, that no taxes can be assessed or collected as to the entire building for the year 1886, and it must, therefore, of course, be .reversed. But a party seeking relief by injunction must make out a clear case for equitable interposition. The burden is upon him. Here the petition shows that at least a portion of the property was