95 So. 3 | Ala. | 1923
The agreed statement of facts discloses that the property sought to be taxed, although owned by the Church of the Advent, was not actually used for religious purposes, but was rented by the defendant to a person who used the property as a boarding house. The appellee contends that the proceeds derived from this rental were used for religious purposes, and that the property was thereby exempt from taxation, while appellant insisted that the test by which it is to be determined whether or not the property is exempt is the use and not the purpose the proceeds are devoted to. We are of the opinion that the contention on the part of the state is sustained by the holding of this court in Anniston City Land Co. v. State,
"To bring this property within the terms of the section quoted it must be 'used exclusively *634 for literary and educational purposes.' This involves three things: First, that the property is used; second, that it is used for educational purposes; and, third, that it is used for no other purpose. * * * Nor is ownership evidence of use. * * * This is too plain to need either argument or illustration. If the framers of the Constitution had intended to exempt all property belonging to literary and charitable institutions from taxation, the language employed would have been very different."
It was therefore held in this state that exclusive use, irrespective of ownership, was, under this provision of the Constitution, the test of the right of exemption. Under such construction therefore, the question of ownership becomes immaterial, but the matter of exemption is rested upon the use to which the property is put. The rent of the property here in question is but an incident to ownership, and it must necessarily follow as a logical conclusion that if the ownership is immaterial, the disposition of the rent, which is an incident to the ownership, is likewise of no consequence in construing this provision of our Constitution.
This question has been many times determined in other jurisdictions. In Y. M. C. A. v. Douglas County,
"To hold that property rented for business purposes is exempt when the rentals or income therefrom are used exclusively for religious, charitable, or educational purposes is extending the operation of the law further than is warranted by the language used. There is a clear and well-defined distinction between the use of property and the use of the income derived therefrom. * * * Government cannot discriminate between the uses which different societies or individuals will make of the proceeds of their business, and determine that this society or individual will make a more worthy disposition of the proceeds of his business than that, and therefore the one shall be taxed and the other not. * * * The fact that the income derived from rents or parts of the building not used is devoted exclusively to the objects and purposes of the association, and not used for the benefit or profit of its members, can make no difference. The law looks to the property as it finds it in use, and not to what is done with its accumulations."
In Fitterer v. Crawford,
"There is a very material difference between the 'use of a building exclusively for purely charitable purposes' and renting it out, and then applying the proceeds arising therefrom to such purposes. To rent out a building is not to use it, within the meaning of the statute, but, in order to use it, it must be occupied or made use of."
To like effect see the following authorities: First Methodist Church v. City of Chicago,
The act of 1915 (Acts 1915, p. 386), so far as the question here involved is concerned, followed the language in section 91 of the Constitution exempting such property from taxation "when the same are used exclusively for religious worship, educational or purely charitable or fraternal purposes." It is to be noted there is no exemption of property owned and belonging to such institutions, but the exemption applies to such property regardless of ownership when the same is used exclusively for these purposes. Speaking to this question, the Kansas court in the Washburn College Case, supra, said:
"Nor is ownership evidence of use. Full possession and perfect title are consistent with total failure to use. This is too plain to need either argument or illustration. If the framers of the Constitution had intended to exempt all property belonging to literary and charitable institutions from taxation, the language employed would have been very different. They would have used the simple, ordinary language for expressing such intentions. The fact that they ignored 'ownership,' and made 'use' the test of exemption, shows clearly that they recognized the essential distinction between the two, and established the latter rather than the former as the basis of exemption."
The Legislature of 1919 (Acts 1919, p. 282) in order that there may be no misunderstanding, added a proviso to such exemption to the effect that any property owned by any educational or charitable institution let for rent or hire or used for business purposes shall not be exempt from taxation, notwithstanding its income may be used exclusively for educational, religious, or charitable purposes. This was, however, but a plain and definite statement of what we conclude was necessarily implied in the Constitution and the previous act of 1915.
The conclusion which we have here reached appears from the cases cited above to be sustained by the overwhelming weight of authority, and, indeed, where language of a similar character was under construction, we have found no cases to the contrary. State v. Fiske University,
The Anniston City Land Co. Case, supra, reached this court upon a second appeal (Anniston City Land Co. v. State,
The judgment of the court below will accordingly be reversed, and the cause will be remanded for further proceedings therein in accordance with this opinion.
Reversed and remanded.
ANDERSON, C. J., and SAYRE and MILLER, JJ., concur.
