*1 FOLLAND, (concurring). J. to concur in the reversal of for the
I hesitate this case questions propounded prosecutrix to the reason imply that the defendant had criminal relations with the divulging girl, that in that fact she would divert but atten- probably tion to him and thus work a release of her half- brother, protect, whom she desired and for that reason against the accusation her father. I have she made would hesitancy concurring implication whatever in if the aris- no sought ing questions from the to be asked effect any relations, father was innocent of such but notwithstanding that fact he was accused so as to divert boy. mere attention from the fact that the father unworthy accused motives because would make no dif- guilt if ference as to his he fact had such relations. How- ever, I concur in the reversal I reason am strongly that in such cases as this where the guilt solely testimony person, evidence rests on the of one required, and no that the corroboration is court should allow greatest prose- latitude in cross-examination of the cutrix. J.,
CHERRY, participate C. did herein. WILLIAM BUDGE MEMORIAL HOSPITAL MAUGHAN, County
v. Treasurer. (3 258.) No. 4925. Decided October 1931. Pac. [2d] Rehearing July 23, (13 1119.) denied 1932. P. [2d] *3 Logan, for Preston, of D. both Leon and Geo. Fonnesbeck appellant. City, re-
Stewart, Budge, Lake & of Salt Alexander spondent. HANSON,
EPHRAIM J. enjoin defendant, brought plaintiff this action to the The county, county Maughan, the treasurer of E. N. as Cache year collecting were as- from the taxes for the 1928 which building estate and the thereon and levied on the real sessed occupied by plaintiff. and and the The real estate owned buildings exclusively to and used so taxed were essential the Budge operation plaintiff in Me- the the William Hospital plaintiff the nurses’ home which the morial and its for use in connec- has constructed since training the and the education tion with the employed in its service. who were nurses injunction sought theory property that the The on the was during year exclusively was used for charitable exempt all taxation. That and it was therefore from exclusively property and above stated was used as use, denied; was essential is not but such thereto case, a charitable taken in is connectionwith the facts of this purpose, exempt property taxation, so as to strenuously disputed. during hearing
On the cause the court found that exclusively year for charit- 1928the “was used purposes”; legal conclusion able and therefrom drew the plaintiff “property thereof, whole that the and the during year exempt 1928,” and that from taxation levy against tax said was without author- thereupon ity contrary to law. It entered its decree permanently restraining enjoining the defendant “and acting persons him” from collect- all aid or assistance of ing question. the tax here in assigns judgment appeals
From the the defendant finding making foregoing error the action the court in making foregoing fact; law; and in of entering judgment conclusion of plaintiff, any without evidence support contrary undisputed thereof and evidence in the case. controlling dispute. plaintiff are not in facts general corporation
incorporated under the laws of Utah Budge April Hospital, 29, 1914, in the name of the *4 after on corporations organized of which the manner business are gain, not, note, we here and and under other incorporation provisions law of which authorize societies incorporate to and associations other than profit. pecuniary corporation purpose as
The outlined in its articles operate, hospital Logan build, and maintain a towas places City, Utah, in such other and as the board of directors persons might determine, for the care and treatment of except suffering may ailments, such diseases be by-laws carry institution. To on this excluded purpose by express provision it has of its charter the usual rights acquire any nec- to and hold of kind deemed essary appropriate, rights and or to and the related sell dispose property, privileges, franchises; borrow money provided and incur indebtedness. articles designated a board of directors and and named the members pro- thereof who were to so act until election therein vided. incorporated capital
Plaintiff was an authorized with $35,000, orig- stock of divided into each. The shares $10 incorporation capital inal articles of show that of the stock 2,560% by eight-two persons, shares were subscribed there- by affording capital $25,606.25 with 5,1914, which to commence business. December the articles capital incorporation were amended so as to increase the $50,000, par stock to divided into shares of the value. same April 8, 1915, incorporation again On the articles of were whereby changed amended the name of the Hospital. to Utah Idaho was carried on and did Utah, Logan, at under the name of the Utah Idaho business Hospital February, until time in some when amend- changed ment to its articles of the name was Budge Hospital, Memorial under which William name been carried on and has since the business operation thereof transacted. The and maintenance of the hospital, together operated with nurses’ home in connec- hospital, is the tion with the sole and exclusive business of already plaintiff. stated, have As we on approximately the taxes were levied consisted of a lot which Logan City eight buildings fifteen rods in and the there- building three-story structure, main is a on. The one hun- long forty wide, home, feet feet and the dred nurses’ three-story building eighty long forty also a feet which is fifty hospital. feet There are beds wide. The rates charged day patients per ward; are $2.50 $2.75 given by (both Budge) are Dr. amounts D. C. when $3.25 ward; patients private room, in a for a there are two $4 except charge for each of in two rooms which is$5 *5 operat- charge made. There is an additional for the of $10 ing X-ray charges room, table and and are also made laboratory and for fees. policy charges hospital respect of the in made patients services and its accommodationsfurnished possible.
was to collect in all It cases when that did any patient strictly charity as a case receive without expectation Budge, Dr. direc- reward. D. C. the medical staff, tor and chief of from the or- who has been such ganization hospital hospital, of the aimed testified that the regular charges cases, can; to collect its in all superintendent it as near as only support. hospital that of the charges hospital testified that the made were the standard charges, hospital and that since his connection with the 1928) (July, patient hospital no had been received in the against charge there no whom entered on the books hospital, except members of the staff and their (By hospital, rule immediate families. members dependents charge.) the During and their are staff received free of plaintiff, requesting ruling trial, counselfor in excluding proffered fairly testimony, certain from the court policy plaintiff respect charging stated the to indigent services, care, and treatment rendered to patients as follows: admit we they will collected all “We the fees that were able pay can, and that we collected all we uses charges.” endeavors to collect its its best Budge
Dr. D. C. this connection stated that there had change policy any been no in that at time. Operating policy plaintiff under that had on hand in
1927 an undivided wiping of $31,000, in addition constructing of $10,000 out debt equip- incurred ping building. Up the main to this time there is no claim any gifts, bequests, received or endowments, either absolutely impressed any or with kind of trust, to be support, construction, used for the and maintenance ot any hospital. nothing other this It had more than what *6 their by payment of paid was for the its stockholders $40,240. The shows, which, was stock, so the record far as building for $31,000 profits appropriated undivided straight-out to home. This fund was added nurses’ Budge. gift $5,000 Budge T. B. and Dr. made Dr. D. C. appreciation for as a mark of been done This seems have changing name its corporation in the taken the action Hospital Budge in honor of William Memorial building Although of the donors. deceased father plaintiff’s in- $60,000, equipment approximately cost $8,000. only No trial at the time of the debtedness was paid to the stockholders. dividends were ever declared controlling im- the evidence While do not consider we plaintiff’s as to appears statement portance, from the profit year net 1927 that its profits and for the losses year year $1,475.28, net and the paid by $5,056.57. were to be Taxes 1928 was shown years. preceding plaintiff in 1927 and all state, 13, 2, part of this article § The Constitution provides: * * * * “* * exclusively buildings thereon used Lots with the * * * exempt from taxation.” shall be
charitable Const, (see Sp. p. as amended in 1930' Laws Sess. 21), pro- Comp. 1917, 5863, contains the same Utah Laws § provisions plaintiff foregoing It vision. under the is exempt question property in is from taxa- claims that tion. conclusively appears the real and the build-
It estate ings were assessed were used on which the taxes operation exclusively essential to the con- in and were Hospital. Budge Memorial The nature duct of the William would, under the of the use such character case, with the nature and character of this be identical facts necessarily hospital follows that if the is hospital. It exclusively was used institution a charitable exempt and, purposes, taxation; hence from for charitable enterprise, contrariwise, business if the property is, course, exclusively all, not used either or at purposes, and, therefore, exempt charitable taxation. question here,
The real therefore, resolves itself into this: Budge Is Hospital the William Memorial a charitable or- ganization?
The test which determines whether a is charitable *7 or purpose, is, otherwise is its that whether it is maintained gain, profit, advantage, for or 462; not. 30 C. J. Union (C. A) Pac. R. v. Artist 365, Co. C. 60 F. 23 L. R. A. question 581. The whether a is maintained purpose for charity or for is to be de termined, incorporated, case the is only powers its charter, defined in its but also from the man ner in which it 462, is conducted. 30 C. J. Stewart v. Cal. Ass’n, 418, Med. M. & B. 46; Bishop, 178 etc., Cal. 176 P. St. Evangelist John the Treasurer, etc., 378, v. 37 Colo. 86 P. corporation 1021. But the by itself is concluded respect declaration of its charter in purpose to its and ob ject. Holy Hosp. v. Sisters Ass’n, Cross 32 Gitzhoffen 46, 691, 695, Utah (N. 88 P. S.) 1161; 8 L. R. A. 11 C. J. 304; Loeb, App. In 588, re Div. 879; 152 Y.N. In re S. Estate, Rep. 255, Altman’s 87 Misc. page 149 N. Y. S. 604. The case of v. Holy Sisters Ass’n, Cross Gitzhoffen
supra, injuries was an action to recover for sustained be- negligence cause of the of the defendant’s nurses. The de- fendant, plaintiff’s exception, over in order to restrict liability, permitted in the by trial court to show ex- trinsic evidence that the defendant was a charitable institu- when in fact the tion articles of showed that organized gain profit. it was this passing In on court, assignment reviewing this after great a many authorities, said: upon purport their face organization “The articles to create an pecuniary profit. quite generally It has been held that the nature corporation must be determined from association, its articles of changed
and that its character cannot be parol modified evi- corporation object or- purpose is for which a dence; that instrument, and it gathered written alone from the ganized must be by testimony or averments varied or contradicted aided or cannot be * * * [Citing are not We itself. cases.] the instrument aliunde stranger question a whether concerned with aliunde the may evidence the association show the real character of respect only question and decided before us this articles. may are therefore not do so. We itself us is that testimony admitting re- erred in the court ferred to.” Holy We think the décision in v. Sisters of Gitzhoffen question Hosp. controlling upon the Ass’n, supra,
Cross plaintiff, how present before us in the case. Counsel it, ever, attempt asserts in an to differentiate case: property, question the character of the use of its “It was not as to simply into the institution
but of the classification which placed reading articles, to determine should be from a of its so as negligence.” liability the rule of as to *8 case, candidly that, upon we We the facts in the confess appreciate force, any, are unable to if in the such statement. reason, evidence, The or the rule of which moved the court classify hospital an to the in the Case as Gitzhoffen organization likewise, pecuniary would, in for present facts, controlling case, the on the same be determining hospital the nature and character of the Further, already question. we have adverted to the here property question the assessed for the taxes in fact exclusively by plaintiff to and used the was essential hospital. Except operation conduct of its the and for the buildings equipment, the and lot on furniture which they property constitute the whole of the used in stand hospital. wards, laboratories, the The the with connection -room, kitchen, home, the operating the nurses’ and in the hospital, are contained in fact all the activities these addition, buildings buildings. by the lot and In were owned plaintiff. property was to such use of the as whether very pecuniary profit in the charitable or for must was upon herein, things, nature of the facts be determined hospital. purpose controlled hospital pur The mere fact that the is used for exempt taxation, poses as all is not to it from sufficient They may hospitals are be not charitable institutions. profit. pecuniary often are maintained and conducted for establishing purpose The fact that for the declared hospital this care and treatment of the was may injured controlling,- for this sick and is not itself profit. plaintiff frequently be and is done for incorporated cor after the manner of the usual business establishing hospital porations purpose at Budge Logan. pursuance purpose In the William of this Hospital True, the name of the Memorial was established. changed corresponding changes in the name to corporation occasions which was done on two incorporation. The articles amendment to the articles of upon purport their face to create an or pecuniary profit. By applying ganization the rule Case, to effect or the Gitzhoffen ganized and conduct a business establish itself cannot extrinsic evidence show to be institution, present case, to the facts a charitable Budge Hospital Memorial is conclu status of the William enterprise pecuniary profit. There sively an fixed as inescapable conclusion is fore
exempt from taxation. might point, properly conclude this at this
We plaintiff questions fact that has raised two it not for the were place confidence, considerable which on which seems *9 given opinion, in the ought mention course of the it be lest entirely. thought have overlooked them that we Counsel be Quinn, 332, 23 to Parker Utah plaintiff refer v. 64 P. etc., Naylor, 111, 53 Utah P. Fellows’ v. and Odd building cases the which of these was the sub- In each 214. ject incorporated question of the tax in an was owned organization. charitable each a In case it was shown that part building of the leased to tenants the other part occupied by corporation purposes. for its own part building court in held each case that the of the leased not, therefore, purposes, used for not charitable exempt taxation, though actually from were even the rents carry organization. urged used to on the It is admittedly if counsel that the character of these charit- corporations exempt able effective their was not taxation, plaintiff from the character and nature of the in wholly present immaterial, case “and the articles incorporation on are not even material evidence the issue court.” before the foregoing
The decisions in the cases do sustain or justify argument remotely. such an even place, In the first upon agreed both cases were an submitted statement of ruling admissibility facts and there was no had on either effect, articles of or as to their force and when, all, they ap- if at were received in It evidence. does pear, however, corporations the charitable contended exemption tax, for the of their and the county treasurer, duty tax, whose was to collect the con- nonexemption. corporations tended were not taking position provisions. a in with conflict their charter It is nowhere contended that charter aof hospital doing fixed the business character against stranger or corporation. the tax collector All said in the Case, that was the Gitzhoffen say, all on here is that we as to the charac- purpose corporation, of a ter as the as well by the incorpora- is concluded declaration its articles of respect tion thereto. urged plaintiff
It behalf is also that pecuniary profit carried on for was never for the reason paid were ever declared or no dividends to the stock- paid year and none were declared holders 1928. *10 hospital oper managing The fact that the directors of a earnings profit permit ated for the deemed it advisable to appropriate of the to such institution accumulate and then buildings equipment funds into the benefit hospital, pay to rather than them out divi necessarily stockholders, dends to the not indica purpose. tive of a It often either benevolent or charitable principles inis to withhold divi line with sound business money facilities of dends and convert the into increased Certainly every pecuniarily the institution. stockholder is corporation holdings in are in benefited. His the enhanced management policy, in value. The which dictated such years, plant the of the had in value course when increased proportions, largely to it considerable because was bur by payment taxes, might able dened the of be to dictate profit immense corporation, the to all dissolution of the of Furthermore, earnings corpora of the the the stockholders. unreasonably from the tion cannot be withheld stockholders may They power the of without their consent. invoke arbitrary against court and unreasonable conduct on the in part of the board directors the accumulation of a sur of rights profits plus of their to the of the cor violation poration. there In this connection was received in evidence purported exception defendant taken amendment over incorporation, passed meeting of at a articles of January 31, only 2,266 1928. There were the stockholders 4,024 outstanding represented. shares of shares perpetuate purported foregoing policy amendment declaring that: any management oper- result from the or event shall “In no any hospitals corporation, properties, or of this ation of any therein, person, incorporators, or or to stockholders other ex- public, general for whose benefit this cept has been money any organized, received this and all source actually necessary expenses whatever, excess disburse- objects carrying required corporation, out the this ments shall advantage corporation, benefit and held for sole this used and be furthering of the charitable which has been or- ganized.” may amendment, the effect of do Whatever be this we pass upon. *11 That not now is not now before us. Admittedly it no effect on the tax has assessment for the year 1928. single a are unable to find charit
We distinctive plaintiff’s hospital that marks the able feature as a institution. charitable general charity gift public a to the is use which extends “A poor. charity of rich well as to the The test a a and the test of organization principal are in law the same. The charitable and dis organization
tinctive features of a charitable are that no has capital making provision profits, stock and no dividends or but mainly public private charity, and derives its funds and holds objects expressed purposes them in trust and in its charter.” Congregational Sunday Publishing Review, School & Soc. v. Board of 108, 125 7,10; 290 Ill. N. E. 11 C. J. 308. capital payment subscrip- obtained of stock private corporation organized tions for stock in a as a busi- ness entirely to establish and maintain thing, law,
a different from fund created charitably per- the contributions of benevolent and minded object establishing maintaining sons with the and nonprofit corporation. rights as a of the stock- holders and the duties of the directors in the one case are corresponding entirely rights dissimilar to of the donors and duties of the trustees or administrators of the fund case. Likewise is a in the other there marked difference in respect public. to their relations to the state and the In to this relation a charitable reference Supreme very opinion, of Texas in a Court able in the case Infirmary City (Tex. Rosa v. San of Santa Antonio Com. page App.) 985, at 259 S. W. said: very purely “By incorporation for their charitable and benevolent they made a with have contract the state and with effectually constituting named in the charters beneficiaries those charge enterprise express trust, trustees an and their analysis legal in their last and their charters effect become declara- purpose quote trust. It would serve no tions of useful from the sustaining view, following numerous authorities this are but Eng. Ency. (2d.) 4898; cited: Amer. & v. Brown’s of Law Linton (C. C.) Perry 455; Corporations, 1046; Adm’rs 20 F. 2 Moravetz on § (6th Ed.) on Trusts 82.” § findings stated, For the reasons herein fact and judgment hereby of the trial court will be and the are same reversed. The case is remanded to the court of district county judgment Cache with direction to set aside its judgment enter in favor of defendant in accordance with appellant. the views herein stated. Costs to J., CHERRY, STRAUP, HANSEN, C. ELIAS FOLLAND, JJ., concur. *12 Rehearing. July 23,1932. [13 Petition for Decided
On P. (2d) 1119.]
PER CURIAM. petition rehearing. earnestly filed a for
Plaintiff has It is urged support petition opinion heretofore proceeds upon theory in this cause the erroneous filed organized profit precluded by for is its showing property, from articles of that its part exclusively purposes, thereof, or a is used for charitable exempt 13, § 3, from taxation under article and hence of Utah. Constitution corporation,
Plaintiff as shown its articles of incor- organized profit. property poration, for Its was was used incorporation, mentioned in its articles of property put and hence the use to which the was like- profit purposes. and not for charitable The mere wise conducting profits that the derived fact enlargement rather than disbursed to used for its were change did not dividends character of stockholders plaintiff corporation the use to which Increasing put. assets and hence the of the stock held its value stockholders is no sense a purpose. charitable
The facts disclosed the record in this case do not corporation organized involve the of a using purposes, for charitable and therefore it wholly unnecessary, express and we do not an concerning such a state facts. petition rehearing is denied. HADLOCK,
TOOELE CITY v. Bank Com’r. et al. State January 26, (2d) No. 5231. Decided 1932.1 P. [11 329.] Rehearing May 11, Denied 1932. *13 LeRoy Tooele, Shields, E. Mathison, Chris of Salt City, appellant. Lake Draper,
R.S. Thurman D. M. both City, of Salt Lake respondents. petition rehearing, County 1For on see Tooele Board Hadlock, (2d) Education v. 11 P. 327.