IN BANC.
Suit to enjoin collection of tax on plaintiff's realty. A demurrer to the complaint was sustained and plaintiff
Exemption from taxation of college fraternity house, see notes in 35 A.L.R. 1045; 54 A.L.R. 1381. See, also, 26 R.C.L. 323. See 26 R.C.L. 315. See 26 R.C.L. 313. *Page 167 refused to plead further and appeals from resulting judgment. Affirmed.
This suit was instituted by plaintiff to enjoin the defendants from collecting a tax on real property belonging to plaintiff. Plaintiff is a Greek letter society and owns a lot or tract of land 90x100 feet in Salem on which is its fraternity house. Plaintiff claims its property exempt on the ground that it is a benevolent, charitable, literary and scientific society. The specific grounds on which plaintiff bases its claim for exemption are stated as follows:
"That at and during all the times herein mentioned the plaintiff has actually occupied and is actually occupying the above described premises and maintains thereon a college fraternity house used exclusively for the purposes for which the plaintiff was and is incorporated and not otherwise, as follows, to-wit:
"(a) That the said premises and each and every part and the whole thereof have been, are, and will be actually occupied and used as a fraternal home for students who have attended and are attending and will hereafter attend, the Willamette University, a literary, benevolent, charitable and scientific institution engaged in the education of young men and women at Salem, Marion County, Oregon.
"(b) That the said fraternal home constitutes a place where the members of the plaintiff corporation live and carry on their studies in connection with their literary pursuits as students in the said Willamette University.
"(c) That the only persons occupying the said fraternal home are actual members of plaintiff corporation and must be actual students regularly enrolled at said Willamette University.
"(d) That the membership in said plaintiff corporation is limited to students actually enrolled or who have been actually enrolled as students in the said Willamette University. *Page 168
"(e) That admission to and retention of active membership in said plaintiff corporation is limited to students who have attained and maintain a certain standard of scholarship in studies pursued in said Willamette University.
"(f) That the officers of plaintiff corporation constantly investigate the scholastic standings and supervise the studies of the active members of plaintiff corporation as students of Willamette University.
"(g) That the funds necessary for the acquirement and maintenance of said fraternal home and premises above-described have been, are being, and will be voluntarily contributed by the members of plaintiff corporation for the purpose of perpetuating a fraternal home for students attending, or who will hereafter attend said Willamette University who are or who will hereafter become members of plaintiff corporation.
"(h) That officers and members of plaintiff corporation receive no compensation in any form for their services except that the business manager thereof receives the equivalent of approximately the sum of $15.00 per month for services rendered.
"(i) That plaintiff corporation furnishes the active members thereof with room and board and a place to pursue their studies at the actual cost thereof except that each of said members voluntarily contributes, in addition thereto, sums of money used for paying the purchase price of said premises to the end that after such purchase price is paid in full the then active members and students of said University may be able to attend said University, pursue their studies and live in said fraternal home at less expense."
Attached to the complaint and made a part thereof as exhibit "A" are the articles of incorporation of plaintiff. Plaintiff describes its object, business and pursuit in Article II as follows:
"The object, business and pursuit of this corporation is and shall be to organize a fraternal home for *Page 169 students attending Willamette University. To provide, establish and organize a place where the students of the aforesaid fraternal body may congregate, make their homes, eat their meals and in a general way use the property owned by them as a home for the college year or any other time agreed on in the by-laws of their organization.
"The object of this corporation, however, is purely fraternal and not for gain.
"The incorporators and their successors shall have the power to manage their own affairs, i.e., pay bills, pay insurance, taxes, interest, yearly installments, repair buildings, and, in fact, do everything incident to maintaining a fraternal home.
"The incorporators and their successors shall have the power to purchase, hold, possess and dispose of real estate, to make by-laws, to appoint agents and subordinates as the business may require, to have continuous succession under its artificial name, to take and grant property, and contract obligations, within the limits conferred on it by its charter, to receive grants of privileges and immunities and to enjoy them in common."
Defendants filed a general demurrer. There is only one issue joined by the complaint and demurrer and that is whether or not plaintiff is a benevolent, charitable, literary or scientific society within the meaning of the statute exempting such societies from taxation. It is not claimed by defendants that the complaint is defective or deficient. Defendants simply claim that the plaintiff, as described in the complaint and its articles of incorporation, is neither a benevolent, charitable, literary nor scientific society so as to exempt it from the operation of the laws of taxation within the state. The demurrer was sustained and from the consequent judgment plaintiff appeals. AFFIRMED. *Page 170 The Constitution of the state prescribes:
"The legislative assembly shall, and the people through the initiative may, provide by law uniform rules of assessment and taxation. All taxes shall be levied and collected under general laws operating uniformly throughout the state." Const. Or., Art. IX, § 1.
"All real property within this state, and all personal property situated or owned within this state, except such as may be specifically exempted by law, shall be subject to assessment and taxation in equal and ratable proportion." Or. L., § 4232.
"The right of a state government, through its legislature, when not restricted by constitutional provisions, to limit its power of taxation, is a doctrine too firmly established to admit of discussion. The legislature has power to exempt from taxation any person, corporation, or class of property according to its views of public policy or expediency, provided always that no constitutional provisions are violated." 2 Cooley on Taxation (4 ed.), p. 1378, § 659.
In this state the only constitutional limitation is that taxes should be levied and collected under general laws operating uniformly throughout the state. Assessment of property for taxation is the rule and exemption of property from taxation is the exception.
"An intention on the part of the legislature to grant an exemption from the taxing power of the state will never be implied from language which will admit of any other reasonable construction. Such *Page 171 an intention must be expressed in clear and unmistakable terms, or must appear by necessary implication from the language used, for it is a well-settled principle that, when a special privilege or exemption is claimed under a statute, charter or act of incorporation, it is to be construed strictly against the property owner and in favor of the public. This principle applies with peculiar force to a claim of exemption from taxation." 2 Cooley on Taxation, pp. 1403, 1404, § 672.
Corporation of the Sisters of Mercy v. Lane Co., 123 Or. 144 (261 P. 694); Willamette University v. Knight, 35 Or. 33 (56 P. 124); Hibernian Benevolent Society v. Kelly,28 Or. 173 (42 P. 3, 52 Am. St. Rep. 769, 30 L.R.A. 167).
"When it is said that exemptions must be strictly construed in favor of the taxing power, this does not mean that if there is a possibility of a doubt it is to be at once resolved against the exemption. It simply means that if, after the application of all rules of interpretation for the purpose of ascertaining the intention of the legislature, a well founded doubt exists, then an ambiguity occurs which may be settled by the rule of strict construction. The rule of strict construction does not relieve the court of the duty of interpreting the exemption by the ordinary rules of construction in order to carry out the intention of the legislature and does not apply where there is no language in the act justifying or requiring construction." 2 Cooley on Taxation (4 ed.), pp. 1415, 1416, § 674.
The case presented is one of first impression in this court. Plaintiff has very ably argued for the exemption of its property, has very thoroughly analyzed the case and collected authorities claimed to support its contention. It is recognized by both plaintiff and defendants that authorities from other jurisdictions must be examined with great care because they are helpful only and to the degree that the statutes under *Page 172 construction are similar to the statute of this state on the subject of exemption from taxation. Plaintiff has presented three cases wherein the property owned and occupied by Greek letter societies of institutions of learning have been held exempt. These cases are State v. Allen, 189 Ind. 369 (127 N.E. 145);Kappa Kappa Gamma House Assn. v. Pearcy, 92 Kan. 1070 (142 P. 294, 295, 52 L.R.A. (N.S.) 995); Beta Theta Pi v. Boardof Commrs., 108 Okla. 78 (234 P. 354). An examination of all of these cases clearly discloses that they are construing a law expressly exempting Greek letter societies of the same kind as plaintiff. In State v. Allen, above, the court's decision was based upon the Constitution of the State of Indiana, Article X, Section 1, reading as follows:
"`That any part, parcel or tract of land not exceeding one (1) acre, and the improvements thereon, and all personal property, owned by any Greek letter fraternity, which is connected with any college, university, or other institution of learning, and under the supervision thereof, and which is used exclusively by such Greek letter fraternity to carry out the purposes of such organizations, shall be exempt from taxation.'"
In Kappa Kappa Gamma House Assn. v. Pearcy, above, the decision is based on a statute reading in part as follows:
"`All real estate not exceeding one-half acre in extent and the buildings thereon situate, and used exclusively by any college or university society as a literary hall or as a dormitory, if not leased or otherwise used with a view of profit, and all books, furniture, apparatus and instruments belonging to such society, shall be exempt from taxation.' Gen. Stats. 1909, § 9218.
"The validity of the statute is not challenged, and there can be no question as to the character of the *Page 173 society, the use to which the property is devoted nor any contention that it falls within any of the constitutional or statutory restrictions on exemption. According to the agreed facts, the building is exclusively used by a society of the university as a literary hall and as a dormitory, and the purpose of the society is that such exclusive use shall continue for an indefinite period, and that it is not leased or otherwise used for profit." Kappa Kappa Gamma House Assn. v. Pearcy, supra.
In the case of Beta Theta Pi v. Board of Commrs., above, the court's decision is based upon a territorial statute reading as follows:
"Fifth. `The grounds and buildings of library, scientific, educational, benevolent and religious institutions, colleges or societies, devoted solely to the appropriate objects of these institutions, not exceeding ten acres in extent, and not leased or otherwise used with a view to pecuniary profit.'
"Sixth. `The books, papers, furniture, scientific or other apparatus pertaining to the above institution and used solely for the purpose above contemplated, and the like property of students in any such institutions used for the purpose of their education.'"
This territorial statute was continued in force by the Constitution of the State of Oklahoma. No case has been cited to us, nor have we been able to find any, exempting Greek letter societies' property from taxation where either the Constitution or the statute of the state does not expressly mention the property of such society.
Plaintiff very forcibly argues that plaintiff's society is to all intents and purposes in the same class as dormitories belonging to a college or university; that such dormitories are very generally, if not universally, exempt from taxation; that, therefore, plaintiff's property should be exempt from taxation:Matter *Page 174 of Syracuse University, 124 Misc. Rep. 788 (209 N.Y. Supp. 329); affirmed, 214 A.D. 375 (212 N.Y. Supp. 253); State v. Carleton College, 154 Minn. 280 (191 N.W. 400); YaleUniversity v. New Haven, 71 Conn. 316 (42 A. 87, 43 L.R.A. 490); Harvard College v. Cambridge, 175 Mass. 145 (55 N.E. 844, 48 L.R.A. 547); Chicago v. University of Chicago,228 Ill. 605 (81 N.E. 1138, 10 Ann. Cas. 669). In all the cases relied upon by plaintiff as showing that dormitories are exempt from taxation the dormitories are owned, managed and controlled by the college or university or leased to a club of students without charge. The case of Yale University v. New Haven, above, is a very instructive case. The opinion goes into the history of colleges and universities and most satisfactorily expounds the reason for including dormitories in property exempt from taxation. None of the cases under this heading supports the contention of plaintiff that a Greek letter society, such as plaintiff is, can lawfully claim its property to be exempt.
It is very persuasively argued by plaintiff that plaintiff is a benevolent, literary and scientific society. We cannot adopt this view, as those terms are used in the statute designating the property exempt from taxation in this state: Or. L., § 4235. The object of the plaintiff corporation, as stated in its articles, is:
"To provide, establish and organize a place where the students of the aforesaid fraternal body may congregate, make their home, eat their meals and in a general way use the property owned by them as a home for the college year or any other time agreed on in the by-laws of their organization."
There is nothing in this statement of the business, object or pursuit of plaintiff that constitutes either *Page 175 benevolence, charity, literature or science. The statement of the business of plaintiff indicates clearly that it is a corporation for the benefit and convenience of its own members. It has no legal connection with Willamette University. Its members are attending that institution. They are attending as students, not as philanthropic men of letters or scientists. Its articles of incorporation also clearly indicate that it expected to pay taxes on the property that it owned. This, together with other inferences, legitimately drawn from the complaint all warrant us in concluding that other similar fraternities in the state are paying taxes on the property owned and occupied by them. All of the cases, as well as the text-books, called to our attention and which we have been able to find involving a similar situation to the instant case denied a right of exemption from taxation. A very instructive case is Phi Beta Epsilon v. Boston,182 Mass. 457 (65 N.E. 824). This case is especially instructive because the same court in Harvard College v. Cambridge, above, sustained the claim of that college for exemption from taxation of property used as a Commons on its campus. The statute of Massachusetts is very similar to the statute of Oregon. To the same effect is the case of Orono v. Kappa Sigma, 108 Me. 320 (80 A. 831); Orono v. Sigma Alpha Epsilon, 105 Me. 214 (74 A. 19, 21); People v. Alpha Pi, 326 Ill. 573 (158 N.E. 213, 54 A.L.R. 1376). Ordinarily a dwelling-house, even when belonging to a college or university, but rented to teachers and occupied by them for their own convenience, is not exempt from taxation. A college fraternity house in which the members of the society live and have their meals is not exempt if some literary and educational work is done therein: 26 R.C.L. 322, *Page 176 par. 282. We do not doubt that Greek letter societies are valuable and helpful to their members. They are beneficial rather than benevolent.
"The chapter-houses of college fraternities being independent as regards their ownership, occupation, and control from the colleges at which they are located and used chiefly as homes or club houses for their members are not exempt from taxation." 37 Cyc. 938.
Such work as is done by plaintiff and its members is not ordinarily considered either benevolent, literary or scientific. The students there are pursuing the same studies as other students in the university. The purpose of the organization as expressed in its articles and as expressed by the able attorney who argued the case orally, indicates that it is organized and maintained for the convenience of its members and not as a benevolent society. The literary work is that of a student while attending college. The scientific phase of plaintiff's activities is that of a student while preparing himself for his life's vocation. Such pursuits are not generally classed as literary or scientific. Benevolent societies, as the term is used in the statute, are societies organized with the dominant purpose of doing good to others rather than for the convenience of their members. Literary societies are organizations for the propagation and spread of good literature rather than for one's own individual education. Scientific societies are usually and ordinarily understood to embrace organizations for the promotion of science or the pursuit of scientific studies for the purpose of developing science, rather than as a student in a college or university for his own edification. *Page 177
Plaintiff was incorporated in 1922. We infer from the complaint and argument that taxes were assessed and collected from similar fraternities in this state then and theretofore. That fact is persuasive that the public policy of the state required such societies to pay taxes on the house occupied and owned by them. The court should not so construe the statute as to change that policy. If a change is to be made the legislature or the people through the initiative should make the change.
Applying, as we must, a strict rule of construction to the statute exempting certain properties from taxation, we are constrained to hold that plaintiff is not entitled to have its property exempted from taxation. The decree is affirmed.
AFFIRMED.
BROWN, J., absent.