In Re Gem State Academy Bakery

224 P.2d 529 on respondents fered issues on such contrary, such is- offered evidence In BAKERY. re STATE ACADEMY GEM sues in these cir- his own Under behalf. No. 7608. cumstances, the court we must hold Supreme Court Idaho. jurisdiction custody had to award the April 6, 1950. Carolyn required Ann Derr as welfare her irrespective had she of whether or not Rehearing On Nov. acquired a within the technical domicile State of trial court. Idaho as found appeal, appellant not chal- his does findings to chang- court as

lenge the and that conditions and circumstances

ed required that her

the welfare of the child

custody be awarded to her mother. We

have, therefore, unnecessary to deemed it unsavory out

set details of conduct parties. fully

of both The evidence dis- Carolyn

closes that welfare Ann required

Derr she be remanded

custody of her mother.

Appellant’s assignment sug- last error

gesting sustaining that the court erred objection question asked of McCulley’s physician attending

Eleanor

concerning the birth of last child is her appellant’s On

not discussed brief.

face, assignment appears of error without merit. judgment of the trial court is sus- respondents. Costs are awarded to

tained. J., KEE-

GIVENS, C. TAYLOR and SUTTON, Judge,

TON, JJ., and District

concur. Moffatt, Boise, Furey,

Willis Doane & C. Boise, appellant.

TAYLOR, Justice. Following hearing a the Industrial Ac- Gen., Atty. W. Smylie, E. Robert John Board affirmed a cident determination Gen., respondent. Gunri, Atty. Asst. Security Agency, to the Academy Bakery effect the Gem State payment liable contributions fund, employment security to the drivers, paid remuneration truck en- delivery gaged bakery in the sale and products, bakery. manager dispute The facts are not in and are suc- board; cinctly findings stated in the employer proprietor “I. The real herein is the Idaho Conference of Seventh Adventists, Day religious organization, mainly supported by which is contributions membership. church Among its schools, activities it conducts Academy Gem is a State is one. This boarding school which it maintains and operates Caldwell, Canyon County, Idaho, approximately pupils where religion, educated not intel- vocationally. lectually and As an essential part system of its vocational the school dairy, bakery, maintains a cafeteria and a Academy the latter called Gem State Bakery. bakery years

“II. The for a number of operated privately owned and as the Bakery. Heights College During that ' “Bakery products at retail on arrangement are sold Academy period the had of routes the more remote rural sections a number which under with the owner tributary in and area to trained there- around the trade vocationally were its students purpose Caldwell. For truck this seven desiring discontinue to in. The owner employed 1, 1948, drivers are a commission basis. April the Conference "business, on employees Such approximate are not teachers students bakery at an or purchased the the church with families. $22,000.00 of con- members of for the cost of Academy’s They regular trips delivering vo- make to in the as a unit tinuing it regular and from time to time program for customers cational a solicit something less than third additional customers. students, Academy’s enrollment. total currently “Gross sales are shown to be operated bakery per been in excess of has somewhat month. $4000.00 then “Since Academy receipts In through book-keeping from the sale Conference products employed bakery up for that are manager set to offset ex- under pense profits, currently compara- what is manager termed receives pose. The small, tively ‘missionary wage’ in the Adventists’ de- are turned over to the Acad- emy parlance, the same as the or Conference. nominational other workers pays to its Conference operation “The bakery whole According the financial state- teachers. gain subsidized the Conference and book-keeping, half ments, in' its mostly capital reflected account. The charged salary ‘selling as ex- manager’s proprietor loss, Conference as absorbs the pense.’ profit, any, if and benefits from the if any. employs bakery students who “III. profit any No inures to benefit of in- course, employment taking the dividual.” part of their being considered voca- question presented is whether or not part employment training. their tional employment involved is aspect, some of them since a charitable has operation attend school. So far otherwise could by the (a) Law terms of section 72-1316 supplied bakery products are as needed performed (7),.I.C.: “Service in the em- Academy and cafeteria. corporation, ploy community chest, aof maintained, pre- “A local sales-room foundation, fund, organized or association products help, where student sumably with religious, public. retail to are sold scientific, charitable, literary, or education- prevention cruelty advertising the al commercial “No animals, part no radio or in children net carried on over bakery is inures the benefit earnings newspapers. the' individual, private statutory test is the character any shareholder or of the or- ganization per- part of which for which the is of the activities service no substantial carrying propaganda, formed.” C.C.H. Insur- or otherwise is Service, 15,033. legislation.” ance On the attempting influence face of quite opposite by the rule of the stated agreed that the Idaho Conference It the board. Day is an Seventh Adventists associa- religious organized and language exemption tion our was part purposes, and that no and educational taken from the federal Social earnings net inures to the benefit 1935, its seq., Act et U.S.C.A. § private individual. any shareholder by which in turn was takén Congress the bakery, including earnings All the of the Code, from its own Internal Revenue Rev. by made resulting from sales those Code, 101(6), 101(6), section U.S.C.A. § by question, the con- employees in are used language exemption of the having been religious promotion ference in of its copied carried down from 1913. We also appears from purposes. It also educational tax Property it in income law. our Re- its charity is one 1931, record that 63-3029(4), lief Act of I.C. The adjunct its re- poses, as an at least general is that the rule construction of activities. ligious courts, by another state its statute of if reasonable, us, will followed rulings said: “It of law board subsequent adoption of the statute of whether first test noted Taylor, legislature. State 59 Idaho our is to be de- covered or not employment is 454; standpoint in- Bishop of the 87 P.2d Morrison- termined To be performing the service. dividual Co., 137 P.2d 963. Knudsen Idaho operation be in an must exempt that service law, legislature income our As to religious educa- devoted mandatory. rule of construction made this apparent that purposes.” It is tional I.C.; 63-3085, Mut. Hancock Section John adopted rule of strict con- has board Haworth, 68 Co. v. Idaho Life Ins. particular exemption, with struction 359. And in 191 P.2d our “exclusively.” upon the word emphasis tacitly legislature Security Law itself the adopted first in Idaho law was this When applicability rule recognizes the of the Session), under 3rd Ex. (Ch. pro- of that law the construction practically identical in terms cooperation with the ad- for state visions quoted above, following Ad- with that of the federal act. Sections ministration interpretation adopted: ministrative I.C., 72-1341, 72-1302(b) as amended. na- the exclusion the “For exemp- Therefore, immaterial; the construction of the service is ture of named, class considered, intended to here the fed- aid them tion as found private when not decisions, quite compelling. gain. conducted for eral Such activities cannot be carried on without Sagrada Trinidad v. Orden De Predica- money; and it is knowledge common dores, 263 U.S. 44 S.Ct. they largely carried on with income re- L.Ed. is a decision concerned with ceived properties dedicated to their application same pursuit. particularly This is true many organization. income religious the of a It charitable, scientific and educational cor- organization was rendered in 1924. The porations measurably and is true of some possessed large was holdings of real religious corporations. Making prop- estate, corporations, private stocks of productive erties the end that the in- interest, money loaned from which it may come be thus used does not alter or rents, derived the bulk its income in enlarge the purposes corpora- for which the It dividends and also in- interest. received ” * * * tion is created and conducted. stocks, wine, come from the sale choco- part late and other articles. No of the The court observed that sales referred private any income inured the benefit of to were public not made to the in com- stockholder or individual. collector petition others, with and further said: “ “operated that it * contended * * ex- That yield transactions clusively” purposes, for the stated but profit some is in the neg- circumstances a operated was also for business and com- ligible factor. gain Financial is not purposes. The said: mercial court end they to which are directed.” The goods fact were not sold to “Whether is well contention taken public appear does not important to be an primarily turns on of the factor. This the view taken clause, quoted excepting the case before from the Circuit, the C.C.A. First in taxing apparent act. Two matters Santee on the White, Club v. 87 F.2d 8. go of the clause far towards settling face meaning. First, recognizes it that a exceptions With some the rule of liberal corporation may organized in exemption construction favor of sug- charitable, religious, for scien- gested the Trinidad case has since been yet tific or educational have followed the federal courts under both says Next, nothing a net income. it about income and social security act. income, the source makes the Commissioner, Cir., Cochran v. 78 F. exemption. the ultimate test of destination 176; 2d Koon Kreek Klub v. Thomas, 5 616; Cir., “Evidently 108 F.2d made in International Re- recognition public of the benefit which the Federation District Unemployment form Compensation Board, U.S.App.D.C. corporate from derives activities of the 337; Orton, spondent) . binding F.2d Commissioner In addition to the force court, Cir., Fair decision F.2d Oklahoma State of the circuit Jones, D.C., F.Supp. municipal points Exposition that the court out charter 630, 631, liability gives con- of the Bureau concerned the definite business- purposes. On organization. Amuse- latter case ground tributions of fair this is- etc., activities, vaudeville, rodeo, distinguished by municipal ment were court augment v. Better Business Bureau of Okla- its funds used for carried on Jones City, Cir., homa exempt purposes. were 123 F.2d These amusements 769. In public, competition gen- that case the court said: offered to the “While tax-exempt eral rule private court said: statutes are to concerns. The strictly be construed gov- favor problem is back “The thrown ernment, apply the rule does not ex- pro- as to whether the amusement Court emption statutes of the character here in- undoubtedly gram, which from the broad liberally volved. Such statute should be scope analysis being evidence as construed so to further rather than supple- auxiliary as carried purpose. hinder its beneficent mentary range aid the wider financial pose encourage of this is to program of and educational the scientific charitable, scientific, religious, literary, and plaintiff plaintiff, shall exclude operating associations not operating exclusively for classification of profit private the any shareholder or purposes.” and educational scientific individual.” See cases cited the foot- particular has found no Court “This note. argument in the that statutes con- solace quite State Courts have likewise generally security employment and social cerning exemp- followed the rule favor of the require a narrower construction than should B.P.O.E., Lodge Fe tion. Santa 460 No. v. concerning income taxes where those Employment Security Comm., 149, 49 N.M. virtually is identi- being construed language 312; Temple Tierney, Lodge 159 P.2d v. satisfying basis for the There no cal. 178, 280; Scripps 37 N.M. 20 P.2d Mem- suggestion.” Hospital Employment orial California v. Appeals for the Dis- S. Court The U. Comm., 669, 109, 24 151 P.2d Cal.2d 155 Rifle in National Ass’n Columbia trict of note; Virginia A.L.R. 360 Mason Hos- 290, 134 U.S.App.D.C. 77 F.2d Young, v. Larson, pital 284, 9 Ass’n v. Wash.2d 114 524, applied the strict rule construction. in Big This P.2d 976. court Wood Canal is cited and followed This case Unemployment Compensation Co. v. Divi- court, municipal D.C. in Better Business 247, 49, sion, 50, 61 100 Idaho P.2d states Unemployment v. District Com- Bureau exemption applicable the rule "a 34 614 Board, (cited by re- A.2d pensation

539 general applies tax” fav- and then the rule (also cited), Mo. 197 S.W.2d 970 exemption oring agricultural la- pro- was denied because charter Stromberg bor.” harmony non-exempt is in visions purposes. This included Hatchery statute, oper- v. Iowa words of “organized Comm., import 239 Iowa N.W.2d 498. ated” propositions. two Ac- distinct The Iowa court held the exclusion cordingly, exemption has been denied where agricultural to ex- labor not intended incorporation was the charter or articles de- employees clude certain classes of from the purpose exempt. Ex- clare a which is act, benefits of the to exclude the emption denied, was is also without reference where) industry from its burdens. organization charter, to the non-exempt purpose. In Respondent cites, Unemploy- Talley v. cases, however, such deny the courts do not Division, 644, 124 Comp. ment P.2d Idaho non-exempt activity if the 784; Forests, Potlatch 68 Idaho Webster v. merely main incidental 527; Carnegie-Illinois Steel 187 P.2d organization, and all of the income Corp. Board, 117, Ind.App. Review v. activity devoted to such cases are concerned N.E.2d These Sagrada pose. Trinidad Orden De unemployed seeking with claims of workers Predicadores, supra. eligibility, to establish and do not involve us, provisions case before charter question employment of covered under referred It is admitted that are not to. exemption provisions. rule Hence the purposes are organization’s general entire- they application no here. announce has ly exemption, within that all of cites, Unemploy- Respondent also Maine purposes. The income is devoted to such Compensation Androscog- Comm. v. ment surplus 'bakery products appears sale of its 252; Inc., gin Jr., 16 A.2d Me. purposes. to be incidental Compensation Comm. v. 390; Harvey, 179 Va. S.E.2d question again In 1945 before Dept. Hunt, Unemployment Comp. Supreme in Better Court Business 228, 135 P.2d Wash.2d 89. These cases U.S., Bureau U.S. 66 S.Ct. question particu- of whether the involve Referring 90 L.Ed. 67. to the rule of employment lar is covered reason of case, said, the Trinidad the court “It is un- relationship. master and servant We are necessary to decide that issue here.” The provision with not concerned that of the petitioner’s exemption, claim of as an or- Murphy statute in this case. v. Con- ganization devoted to scientific House, Publishing 348 Mo. cordia and educational was denied on note, 1461 and ground largely S.W.2d A.L.R. that its activities and the were Osteopathic Hospital ends, Keitel, Northeast commercial and devoted to that its non-exempt provided policy, requires interpre- ob- charter for these liberal a and broad jects. whole, tation court said: of act a ac- The the order to complish “ Web- purposes. humanitarian * * * beyond apparent dis- 'being ster Forests, supra. none- It is Potlatch primary pute important that if the not exemption, the-less evident that the with pursuit to petitioner’s organization is here, we are intended concerned also promote only an ethical but a not encourage religious, charitable, scientific, community. The ex- profitable business literary, by educational organizations pe- emption unavailable is therefore relieving tax, them of the burden of the titioner.” and accomplishment thus promoting the of their “ * * * activities are Petitioner’s purposes. beneficent for a This calls also largely by this commercial animated interpretation. liberal con- are Thus we pose.” objec- fronted worthy with clash of a two by Cool- is stated general proposition tives. If a must made between choice be ex- states some ey “While as follows: two, by then that choice be made must charitable and educa- emptions religious, legislature, not the The same courts. strictly institutions property tional application conflict has arisen in be that construed, rule seems the better exemptions law, under the tax income requiring a liberal states down in some laid exemptions the same or under the similar in such construction than strict rather problem Security Social is stated Act. strictness the same that at least cases or charities) remedy suggested (as indulged where will of construction compiler note 55 Harvard “ * * such institutions.” * is of in- Law Review 1056: A liberal Ed., Taxation, page 1415. 4th Cooley, terpretation estate, income, under the gift encourages taxes at the ex- charities “Liberal” However, as to question pense taxpayer, general while the secondary in “strict” construction is interpretation same under uniformity with importance to Security encourages the Social Act them at federal Both the federal decisions. * * * cooperation, contemplate expense employees. of their statutes the state interdependent other, overcoming and in But the difficulties inherent in with the each suggests Both phrasing two administrations. coincidence operation ** single objective, remedy Congress. lies toward a are directed uniform, language, interpretation courts the same com- If having used both urged exemptions prevail. deny As under the should not should mon 72-1302, I.C., carefully Act ex- contain- without Social section respondent, public consequences of its inter- legislative amining declaration ing Here, applied Unemployment Compensation other federal taxes.” to the pretation under rule also, if different statute. would seem that it applied to com- is to be cases emphasis According controlling than income tax law ing under our state liberality exemptions contrary applied within the is to to those be previous court, by of this shown holding Law, Security view of the hereafter, completely cases cited dis- supplied by leg- be must differentiation regards Unemployment Compensation islature. statute and its construction. No reason why given greater sanctity should be ac- and the wisdom of

The determination exemptions religious corded of a educa- legislative policies with the de- rests “ * * * payment tional institution from the of un- partment. of omit- The wisdom employment compensation tax than from ad coverage of that Act ting those valorem taxes. employed by religious who cor- people Congress porations is matter for the interpretation entirely Such over O’Leary Social not for us.” statutory looks the rule construction that Board, Cir., 153 F.2d 707. purpose Legislature and intent of the in appellant that the We conclude is not re- a statute is light construed in the enacting it. quired to make the contributions claimed

respondent. The order reversed. Costs “ determining ‘In of a stat- appellant. ute, particular mischief which was remedy

designed to history HOLDEN, KEETON, J., J., C. con- period may and of act itself be con- ” cur. Eugene sidered.’ School Dist. 4No.

Fisk, 159 Or. P.2d page at 267. “ ‘ * * * GIVENS, (dissenting). may And intention Justice be ascer- tained, cases, in doubtful not con- majority rely upon liberal construc- used, sidering by taking the words but also exemptions taxation, tion favor matters, into account other such as the con- statutory uniformity construction text, object view, the evils to be interpretation, Unem- and because the remedied, history times and of exemp- ployment Compensation statute toas legislation subject, public the same exactly Tax tions is as the Income worded policy, contemporaneous construction, statute, given the in- hold the constructions words, the courts the like. other will not that it statute to the effect is the use come law, letter of a blindly follow the when its made of the income and not its source which purpose apparent, consequences right exemption are determines the fore, purpose; and this construing are inconsistent kept Compensation Law, true when the particularly would seem to be this distinction be adopted, interpretation, if results of a literal in mind. ” California would be absurd.’ Jordt The intent and of both Education, Cal.App.2d State Board of governments and National in en State P.2d acting Unemployment Compensation money to raise statute a statute revenue rule that “It ais fundamental money away but raise light do in be construed his- should I.C.; unemployment, 72-1302(a), which with Sec. tory and the conditions of the times special Kane, going Kelly 34 such into a fund for v. prompted its enactment.” 72-1346, I.C., 384, purpose, 588, at Sec. the ad page 386. sole Cal.App.2d 94 P.2d ministration of statute was to ex be command “Also, enforcing of a in liberally who, tended all those under such policy expressed in its terms statute, both construction, be liberal could held to come history implicit in its object and the purview. No within its such intent and recognized.” be Shafer background should legislature in mind Local Union Pharmacists Registered v. Tax, merely imposing the Income 403, page 379, at 1172, 106 P.2d Cal .2d 16 fund, 63-3073, goes general into the Sec. I.C. 406. Lexington Cemetery Commonwealth, Co. v. “ ‘However, blindly will not court this 851, Ky. 699, 181 page 297 S.W.2d at 703. particular given a construction follow Exemptions from ad valorem taxes state from which of a court statute applied eleemosynary as in or charitable it, does not when the decision we borrowed strictly stitutions are to be construed right reason- to us as founded appeal exemptions, against Bassett, Bistline v. ” Estate, 540, 118 Mont. ing.’ In re Strode’s 71, 66, 696, page 47 at Idaho 272 P. 62 A.L. 582; 579, page District State v. at P.2d 167 323; 1485; involving hospi R. 144A.L.R. a 222, 896, Court, page at 173 119 Mont. P.2d exempt tal only as claimed charitable. Not 902, 827. 169 A.L.R. generally, has this rule been followed An Interpretation scope Co., drews v. North Side Canal 52 Idaho given in a will be like words statute con 123, 263; 117, page at 12 P.2d Lewiston Or subsequent in a statute where struction Dist. Gilmore, chards 377, Irr. 53 Idaho Jordan, Perry a exists. setting similar 383, page at 23 720; P.2d Intermountain Cal., 47, page at 50. 207 P.2d Agricultural Payette Ass’n Credit Co., 311, construing 307, 54 at page 267, We Idaho applying Un- P.2d but employment Compensation law, applied In- has likewise been Unemploy not the imperative, Compensation Law; come It Big there- ment Tax statute. Canal Wood Compensation Divi Unemployment innumerable Co. v. instances imposition 251, 49; sion, P.2d of ad and, at valorem page taxes Idaho more limited tax, instances, Batt v. Un number whether or excise property payment from the Division, taxes, Compensation 63 income employment cases few have been page decisively Idaho at 123 P.2d found which point consider the ¡before us; Unemployment namely, 1157; A.L.R. Meader v. whether a commercial activity Division, Compensation at carried out by concededly exempt 64 Idaho organization 984; see Califor P.2d also reason may, of the over- all nia v. Betthesda characteristics of the organization, Commission exempt Foundation, unemployment compensation P.2d Cal.App.2d taxes. exemptions have page 875. Strict at applied organiza against religious been Three exemptions views to tax have tions, Bible Tract Watchtower & Soc. v. expressed: one, been that the over-all char Angeles County, 426, 182 Los 30 Cal.2d P. organization acteristic of the clothes all 178, page 2d activities, regardless of the otherwise non thereof, nature immunity likewise, as for

This court has in line with illustration, Hedding Meeting Camp Ass’n authorities, held that the all v. Epping, 88 N.H. 189 A. 347. This Compensation liberally must be law con view is largely upon based a liberal con pur strued the end its humanitarian struction favor of such eleemosynary or poses accomplished; Talley v. Unem ganizations which, and applied when to un Compensation Division, ployment 63 Idaho employment compensation taxes, either to 649, 784; Hagadone page at P.2d tally disregards or subordinates the en Kirkpatrick, page 59, Idaho at liberal joined construction of such law. expression being the latest such 181; P.2d Forests, Inc., v. Potlatch Webster Idaho The other extreme that organiza- is if the 187 P.2d at 527. tion, though generally and in the first in- exempt class, stance of engages in any payment relief from the Appellant seeks operation, commercial immunity; loses its unemployment compensation the tax cov- example, Holy Nativity for Sisterhood employment of drivers who sell the ering City Newport, Tax Assessors of R.I. bakery goods to the general and deliver 184; Brooklyn 57 A.2d Smith v. Bar clearly a commission public on basis — Association, App.Div. 44 N.Y.S.2d activity ground the that the commercial —on Id., 620; 292 N.Y. 55 N.E.2d 2nd organization organized oper- is over-all case. religious, for charitable ated then, come, purposes. “We consideration Exemptions which, argue, appellees activities show that sought situations have been similar

under taken the ex court has view which exclusively 'for this appellant is emptions Unemployment the Com under purposes. or educational scientific Act, pensation appellant that is not inure to its activities do most of fact that that Amer contributions under act.” not alone is sufficient public benefit the Review, Ass’n ican Medical v. Board requirements of meet the 350, page at Ill. 65 N.E.2d not a The test is the statute. provisions of between to be found equation balance course, The middle received which has not fulfill do do which those which sanction, that, judicial regard with due question organization. of its the strict construction of the part of its substantial there it, yet is whether against claiming recognizing one to the nowise contributes which eleemosynary activities beneficence of such institu- organization and of its purposes exempted tions, purposes time the same exemp- comply with the said to Unemployment Compensation foe cannot law The act must this act. features of necessity liberally tion construing provision that to the end same, liberally activity construed judged by is to be each it- em- out of persons unfortunate self. be made case last In the cited (Cases.)

ployment. Thus those on carried activities placed reliance called attention religious, within clearly scientific, lit the Workmen’s under arising upon cases erary and edtKational ex are to be fields Act, Federal Labor Compensation activities, empt; and though those carried seq., 201 et Act, 29 U.S.C.A. § Standards organisations, a commer if of Act, Bankruptcy 11 U.S. Federal nature, require cial that the employees in that decisions held seq. It was et1 C.A. given protection § such activities be avail; be of cannot these acts under Unemployment Compensation Law. Compensation Act far “ * * *, Render therefore Caesar unto from the oth- purposes in its basic different things Caesar’s; and unto decisions are the to. Nor referred er acts things God the that are God’s.” Matthew Regula- Bureau Federal rules 22:21. tax, binding security to social tions, relating last, course, This or middle into takes Cases. courts.” on the consideration all of might what otherwise appellant “The burden considered, essentially but are not con- exemption re satisfied it has prove flicting every views and accords facet of (G) 2(f)(6) in section set regard, forth the situation due and in quirements principle supported by the following 48, 218(f)(6) authorities: Ill. c. Stats. § [Smith-Hurd Inc., F. Hogue, In re H. 398, 67 Idaho convinced, from We are (Cases.) (G)]. presented 826, here and under the 183 P.2d clearly the record stated an employer and be covered ex- engaged could both charitable. A competitive commercial busi- empt thus, required pay activities; un- ness profit comply for does not employment compensation em- with requirement, tax on some though even ployees recogniz- profits Thus religion.” and not others. are devoted Evangeli- Hoover, ing split employment Synod Hoehn, is State v. cal Lutheran etc. v. Mo. 200 Wash. 93 P.2d 346. at page S.W.2d True, “The rule in general (ex- such instances case above involved ad valorem prop- is that the emptions) taxes, use made of the upholds and excise but it propo- controls, erty rather than the charitable adjunct sition an exempt of an or- character of the owner.— ganization is exempt and accordingly, pellants’ publishing enterprise is conducted may public, such as law tion here is whether the land on pellants’ objectives there is no doubt that a charitable trust of the denomination. Many books are sold pedic publishing concern ous nearly competitively pose. Any publish situation is altered here der that tension erature, lishing House is the advancement and ex- people generally; estate one “Now, getting literature and ^[*] operate all provision. chartered ^[*] knowledge bona publishing sell sales and for profit. fide (for acquire ^[*] back made for books schoolbook or objectives Nor profit) profit plants and profit it is mostly But ^[*] commendable, could to lawyers. Ap- the instant do learning were of the facts that books and lit- authorized to for that we think the to a limited operate ^[*] to members of the Pub- qualify encyclo- among religi- ques- ^[*] case, real un- ap- vation primary and inherent use as over against ligious worship a mere activities 344 Mo. ing these cases it has been noticed that the purely charitable,’ has reference to the emption must be in accord 188 S.W.2d stitution tion 10937, it was said ‘used Section Article X of the (former) Con for re exclusively sively’ as used in suing cludes (i) (6), supra. Keitel, treated Section into the 976: “This the same general Army Hoehn, secondary of Missouri of of a separately. Northeast 826] corporation Mo. from property taxes under ; ** brings S.W.2d Clause and incidental use. Sal cases Y.W.C.A. v. R.S.1939, Osteopathic The same court pur- of the word ‘exclu- supra * 197 S.W.2d involving question, us to (F), 1875, Mo.R.S.A.; 499. In examin claiming the ex or [354 for Mo.R.S.A. § Section 9423 Baumann, thus con- questions examina- purposes Mo. Hospital primary objective [exempted) and round it or out exempt; is tax and our says Constitution though slight, into temporary, land must used dovetail it— religious worship purposes immaterial, purely in a word deviations will not (cid:127) purpose guise Synod et al. under Law Evangelical Luthern be fatal. import giv- exemption purpose. con- the charitable Hoehn, See supra. The tax an ex- upon en as used in dependent ‘exclusively’ the word cases was sidered in these cluding far as (named) (in identical with property for those clause so use enactment legislative owner in purposes (although ‘the material here) and exclusive purposes. legislative purpose those of kindred basic dedicated to (also) must (6), ownership excluding (F), 9423(i) characterized Clause Section that extent To Bu- supra, et Business Synod in the case of Better Evangelical Luthern the use.’ States, 326 Hoehn, 143), United supra, S.W.2d reau of Washington al. exemption is L.Ed. case, de- U.S. whereas, 66 S.Ct. in our Hospital’s wherein Business Bureau was claim- purposes Better pendent objectives ing exemption security taxes as operation. social organization Army operated in ex- corporation organized and the Salvation a of the Y.W.C.A. Army clusively purposes cases for educational within and Salvation Y.W.C.A. charitable, 811(b) and the the of Section of the admittedly (8) both were Act, §'1011(b) con- their activities Social U.S.C.A. whether question was court, instance, (8). were held ‘In this in Slight deviations Said formed. exemption, would claimed deviations to fall within the Substantial order be fatal. case, Coming organization to our must edu- back an be devoted to been fatal. have of Hos- question exclusively. plain- This purposes with the cational treating we were organization- single of a ly presence charitable that the non- means pital’s nature, Manifestly the in purpose, if substantial education purposes. al supra) (6), 9423(i) regardless of the destroy Section will (Clause (F), benefit the great importance truly number or recognition is in ” exclusively purposes.’ institutions public derives non-charitable A substantial charitable. e., Use, operation, not i. destination should Hospital’s organization purpose of is controlling. of tax Battelle Memorial In Otherwise, by non-charitable a fatal. Dunn, 148 Ohio stitute v. St. 73 N.E.2d corporation al- organization, purpose course, is page 92: “Of use of chari- organized for a also though it were property proceeds not the use of the could, in the ex- therefrom, would which is the test ex purpose, table derived exploit nonexemption power, emption from taxation non-charitable its ercise Cases cited. the statute.” under destroy or purpose non-charitable com- fullness of its materially argument bakery shade Anent the welfare; entirely for educational public in the service mitted pertinent: “After all statement this while defeat all the pointedly) more (here said, rules, except uniformity, the main reason for this instruction their naked re- social, political sulting to better the economic uniformity lack of with ad val- appellants’ certainly If, however, status of orem taxation.1 the rule toas members — commendable the insurance taxes; ad namely, property valorem used —but Salesmen, companies, Fuller Brush nature, hard- the activities of a business thus many organizations ware other com- identical principle ‘operation,’ companies employees call their in though mercial conducted organiza- require them tion, stated intervals and to is property at though taxed as other organization attend a school of instruction imbibe other activities exempt, is selling techniques given to make talk and trade effect is identical, both. While not appel- them great more efficient their line. If is there no dissimilarity between the lants’ logic exemptions its ultimate con- followed to from ad valorem taxes: clusion, there no the or- would be end to Property “2. belonging any religious ganizations seeking that would be here tax corporation society state, or of this used ground prop- that their on the exclusively for and pub- in connection with erty pur- to an educational devoted worship, lic any parsonage and belonging 276, pose.” Sparkman, v. 159 Fla. corporation to such or and society occupied Johnson 863, 864, 1067, 31 A.L.R. at So.2d 172 such, any and recreational hall belonging 1069. to and used in connection with activities corporation society. of such or exemptions the rule as to

Applying completely Tax statute the Income disre- >{: s|c ?|c % >\i if. gards purpose effect and and that must be Hospitals homes, refuge “12. Unemployment 'Compensation given equipment, owned, their furniture Act, subject really and when ex- by any religious and controlled apply reason amined, is no more corporation there society or benevolent or interpretations than therewith, ad valorem necessary grounds income used Holy Doss, 491, Tax 17; of Faith v. State v. 150 1. Church Fla. 8 So.2d 403, 777; Commission, Temple N.M. 48 Equal 39 P.2d Masonic Craft v. Board of Knights Py Rocky Hanagan County, v. Ford of ization in and for Lincoln 129 Bldg. 545, Ass’n, 293, 569; Id., 101 Colo. 75 P.2d thias Neb. 261 N.W. 129 Neb. College 780; 827, 150; Lodge Modern Business 263 N.W. Wilson’s Walla Walla 636, 56, County, King P.2d Equali 4 Wash.2d 104 No. I. O. O. F. v. v. of Board Phillips University, zation, 292, 580; 571; v. 129 Neb. Gibson 261 N.W. Equali 901; City Dougherty Board Philadelphia, 158 P.2d Old. Pythian, etc., page 585; Tulsa 195 Okl. Pa. zation v. A. at Peo 904; Application ple Chicago, of Ameri 158 P.2d Y.M.C.A. 365 Ill. 166; Legion, City 151 Ohio St. 86 N.E.2d 6 N.E.2d can Y.W.C.A. v. of New York, 467; Application App.Div. York New Confer 216 N.Y.S. Day Adventists, Ass’n Seventh ence App.Div. N.Y.S.2d 708: State sug- satisfying no basis for the There is be derived profit can no or gain which Expo- gestion.” Oklahoma State Fair by operation. reason of their Jones, D.C., F.Supp. sition exclusively by property used “13. All page 632. educational or the owner school words, operations, prop- like derived, other profit poses, from which no exempt, are erty employer profit or rental which no property all taxed; prop- operations, like not but those used ex- and which held is derived exempt, erty employer of the which are or main- endowment, building clusively for point in “Appj-oaching the will be taxed. purposes of schools or tenance issue, the best say is sufficient 63-105, I.C. Section institutions.” country when a authority reasoned in this Compensation ex- and the property associa- is owned a charitable supra. emptions, part corporation it used for tion only on is based The one construction purposes of the association and the lan- similarity of uniformity from naked profit pur- balance for commercial or used not dissimi- language other on guage; poses, part used for the if severable that habiliments with two clothed lar and say corporation, is to construc- reason; first, strict adherence scientific, municipal, religious, educa- hereto- exemptions from taxation tion may tional, literary, or charitable by this deviation without followed fore part exempt taxation while that regard the aim and court; second, due may profit be taxed.” Cases. used upon, we called Doss, are purpose the statute 150 Fla. 8 of State So.2d it, ignoring apply, not to construe and consequence not sacrific- imperative as an only The Tax Law has Income employees to mere ex- right of ing the raising The one of revenue. —the The administration.

pediency and ease Unemployment Compensation Law raises uniformity with the holding to authorities revenue, for and in connection with they say pay no frankly law tax income hardships purpose ameliorating one — Compensa- Unemployment to the attention exculpatory unemployment. The lode star “This reason to do so. and see no tion Law first sake of of the revenue particular solace in found no revenue; has of the Court the lode star latter Therefore, concerning in coverage. statutes em- fruitional view argument that security require completely should dissimilar ployment and social absolutely inappropriate than construction those con- to use the narrower inter identical clause in language pretation income taxes where the even the cerning other, virtually yard one to the construed is identical. as stick being each

549 Cochran unemployment v. Commissioner of Internal or of the income none Revenue, majority opinion, Cir., or 78 held a F.2d cases cited in the league scientifically organized gather in- investigation, con- upon independent found members, formation for its institutional organization en- of the the effect sidered such as Temperance Canadian Alliance activity bearing as gaging in a commercial * * * League Anti-Saloon of America —“ employees subsidi- in such on whether attain, by legis- means of education and activity ary should covered. lation, (legislation 1933) in eliminated premises of the Trinidad v. Sa- One suppression total throughout world Predicadores, De grada Orden U.S. ” * * * alcoholism, in- was, under the 204, 206, 578, 44 was: S.Ct. L.Ed. law, organized come tax for educational any selling “It is not claimed that there is purposes. No vestige commercial ac- public competition or in with others. tivity, bar, considered, as in the case at was merely bought supplied articles nor unemployment compensation was in- plaintiff’s organiza- for use within the own volved. agencies tion and them for strict- —some Thomas, Cir., Koon Kreek Klub v. use, ly religious and the others for uses F.2d leasing considered land owned purely which are incidental to the work the club to an individual not engaging plaintiff carrying which the on.” And in nonexempt activity. club was es- Unemployment Compensation there was no sentially a fishing and hunting club. The Law, National State then existence revenue from the rented land was used to genesis considered. The deci- maintain the club and did not constitute destination, sion that source, operating way in a commercial so as pertinent bar payment the income as to of the income tax is not of revenue tax, theory relying on the law; Trinidad Compensation Sagrada Orden De Predicadores, supra, Battelle Dunn, Memorial Institute v. destination, that the source, not the of the Ohio St. 88, supra; 73 N.E.2d Santee income controls. The club itself did not White, Cir., 5, 8, Club v. 87 F.2d ul- thus engage in raising and selling livestock. “ * * * timately announced rule: Reform International Federation v. Dist. An corporation keep must ac- Unemployment Compensation Board, 76 U. tivities within scope S.App.D.C. 282, F.2d consid- or it will be taxable such wre outside unemployment compensation ered not in Emphasis it.” Thus, ours. if this case be connection with commercial activity, but— point in apply and rule, we such the busi- “Unless, then, portion that appellant’s of ness of the delivery sale and bakery of activities in relation to Federal and State goods would here be taxed for income. legislation subjects on of moral or social Comm., 56 v. organiza- etc. California charitable unclass it as a

interest Cal.App.2d 133 P.2d 47. tion, reversed.” below must be the decision organiza- activities of Holding that the support liberal ex- in of cases cited The all within legislation were tion as to desired of exemptions, the sacrifice tension Herein, field. its educational the orbit of harmony interpretation, are out liberal delivery and clearly that the facts show Big pronouncements court’s with this other connection has no sale of this bread Com- Unemployment Canal Co. Wood v. monetary, than with Division, pensation Batt v. scope appellant. religious Compensation Division, v. Un- Meader supra. Division, Compensation employment Revenue v. Or- Internal Commissioner of ton, Cir., is an income 173 F.2d Practically Federal decisions none of the sale holding profit made from the case involved; here has the feature considered school did not products of ceramic subsidiary or subor- namely, conduct of a solely to edu- the total income devoted bar be; is, may selling business dinate as exempt, fol- being cational commercial ac- delivering as a bread Sagrada theory v. of Trinidad lowing the any bakery. tivity competition with other Unemploy- Predicadores, supra. De Orden surplus its majority say: “The sale involved. compensation was not ment products appears bakery to be incidental may purposes.” bakery Exposition This Fair State Oklahoma activity compared all the educa- split was not- be small as Jones, supra, where of the or- appear sought religious the tax was- tional and activities ed, it not does insignificant as herein, only non-exempt ganization, activities. but it not so on emphasized by as disclosed to lack individual substance inaptness of this case challeng- analysis findings of Board and not in Arnold the of it construction Physical majority opinion ed, Education and as set forth in the Hygiene & College for may disregarded. hold- Chesed Shel Danaher, A.2d 131 Conn. Compen- exempt; Society Unemployment but no Emeth was appellant there ing Comm., activity involved. sation 356 Mo. 203 S.W.2d 454. commercial income, The income tax is levied on ad may be general rules looked While property according on directly valorem to, rulings take into definite must considera value,- personal, unemploy- real or special feature each case. To tion the payroll. compensation tax ment Real lump appearances into outward one all just eleemosynary estate institution to regard distinguishing to inner without class thereby must be used important sight to lose features is Operations, purpose. for that while to a necessity dif basing decision intangible, they arise extent are out certain facts; ferentiating La Societe Francaise an tangibles, property arising of the economic unemployment use of so if ills out of provides eleemosynary exempt if unemployment institution is not benefits charitable, purpos- unemployed other than etc. those through used fault no of their es, reasoning operations so parity Talley on a own. Unemployment Compensa- v. exempt unemploy- Division, would not supra. from tion purpose of The compensation ment tax and such distinc- law should not be thwarted in the name of recognized. have Real- by tions been Central uniformity extending meaning of the Martin, ty phrase Co. S.E. performed v. W.Va. employ” “services in the 2d 720. of an organization to include serv- performed ices property The of the all its use determines sources income. taxation; paid upon wag- its status as to ad valorem Nor Contributions should be es the employees question wegian Church America Lutheran Wooster, manager. one-half wages of the so 176 Wash. P.2d operation the nature of determines as The decision Industrial Accident activity. Readlyn Hospital to a business Board, modified, as thus should be affirm- Hoth, 90, citing Iowa N.W. ed. Bassett, approval supra. Bistline PORTER, J., concurs in this dissent. bar, Gem State Acad- In the case ap- emy Bakery by manager Rehearing On pointed by purposes the Conference. Its PER CURIAM. partly partly are educational and and exten- TAYLOR, J., opinion adheres to the sively commercial. It is a distinct economic ' by heretofore HOLDEN, written him. C. question wages The unit. are earned J., resigned Court and McDOU- employees depart- of the commercial GALL, Judge, District place sat in his bakery. employees ment of Such rehearing. students. services such em- performed Academy PORTER ployees are for the KEETON, JJ., and Mc- Bakery, DOUGALL, Employ- within the District Judge, now concur in Law; although Security the dissent the Confer- ment heretofore written GIVENS, J- entitled owns income ence Bakery. One-half of the man- The Order of the Industrial Accident seven, salary charged also Board, the com-

ager’s holding the drivers come un- Bakery. employment side der covered mercial and the manager purpose of the Employ to the extent of one-half of his wages, humanitarian, therefore, Law Section ment is ordered affirmed. No costs 72-1302, prevention It seeks the I.C. of the allowed.

Case Details

Case Name: In Re Gem State Academy Bakery

Court Name: Idaho Supreme Court

Date Published: Nov 21, 1950

Citation: 224 P.2d 529

Docket Number: 7608

Court Abbreviation: Idaho