Mrs. Birdа Mack brought suit for personal injuries allegedly sustained in a fall on rotten steps at residential premises which she rented from the *714 defendant church corporation. Discovery procedures followed, and defendant moved for summary judgment сlaiming charitable immunity, contending that it was a charitable, nonprofit corporation and had no assets other than charitable assets. Plaintiff amended her complaint alleging that defendant had noncharitable assets which consisted аt least of the rental duplex located on Wabash Avenue, Atlanta, where she was injured as a tenant, as well as commercial property on Auburn Avenue, Atlаnta, and that defendant was liable to her to the extent of the noncharitable assets.
There is no dispute that defendant is a charitable, nonprofit corporation for purposes of the charitable immunities doctrine; that it had no liаbility insurance; that it did own the rental duplex on Wabash Averue, which had formerly been a parsonage, as well as the rental property on Auburn Avenue; and that these properties were not on church grounds but were income-producing properties from which defendant received $10,500 ai erage annual gross incomе.
The trial court granted summary judgment for defendant, and plaintiff appeals. Held:
The only issue in this appeal is whether income-producing real estate, not used dirеctly in charitable activities, is a noncharitable asset. By analogy to cases involving suits against charitable hospitals, we must conclude that it is and that defendant is liable to the extent of such non-charitable assets. In the hospital cases it is held that a paying patient can recover from the hospital for the negligence of its servants to the extent of income derived from noncharitable sources, which in those cases consists of income derived from noncharitаble pay patients.
Morton v. Savannah Hospital,
Hence the test is not the use to which the income is put, but the nature of the source from which the income is derived. This is the same test applied in determining the taxability of property. "The scheme of exemption as to other than public property seems to be this: to exempt all that is used immediаtely and directly as a part of the establishment in the conduct of the regular businеss there carried on, but not such as may be devoted to other uses, such as farming, merchandising, manufacturing, etc., and from which profit or income is derived. It is the use of the property which renders it exempt or non-exempt, not the use of the incоme derived from it. [Citations omitted.] Property used to produce income to be expended in charity is too remote from the ultimate charitable object to be exempt. If property is allowed to be used as taxed propеrty, it also is to be taxed. If it competes, in the common business and occupаtions of life, with the property of other owners, it must bear the tax which theirs bears. Thus, if еven a synagogue or a church were rented out during the week for a storeroom or a shop, though divine service might be performed in it on Saturday or Sunday, .and though the rents were all appropriated to religious or charitable uses, its exemption would be lost.”
Trustees of Academy of Richmond County v. Bohler,
Reversed.