
    The Cleveland Library Association v. Frederick W. Pelton, Treasurer, et al.
    1. A library association, incorporated under the laws of this state, whose objects and purposes are, “The diffusion of useful knowledge, and the acquirement of the arts and sciences, by the establishment of a library of scientific and miscellaneous books for general circulation, and a reading-room, lectures and cabinets;” open to all persons, without distinction, upon equal terms, and the income and revenues of which are devoted exclusively to such objects and purposes, is “an institution of purely public charity,” within the meaning of the 6th clause of the act of March 21, 1864 S. & S. 761.
    2. Where such association owns a lot of ground, with a block of buildings thereon, constructed as an entirety, and the buildings having a basement and three stories over the same, each divided into rooms adapted to its use, and for renting, some of which, on each floor, are used by it for its purposes; some are rented out, and the rents received are applied exclusively to keeping the property in good repair, and to the purposes of the association, and some are vacant, Held, that such . parts of said building and appurtenances as are rented, or otherwise used with a view to profit, are not exempt from taxation.
    3. The fact that the building is so constructed, that the parts leased or otherwise used with a view to profit cannot be separated from the residue by definite lines, is no obstacle to a valuation of such parts for purposes of taxation, having due reference to the taxable value of the entire property.
    Appeal. Reserved in the District Court of Cuyahoga County.
    The action below was brought by plaintiff, to enjoin the auditor and treasurer of Cuyahoga county, from collecting the taxes and assessing penalties thereon, for the year 1877, on its property, known as Case Block, in the city of Cleveland.
    . It was reserved for decision here, on the following finding of facts :
    “ This cause came on to be heard upon the pleadings and ■evidence, and the court finds that the plaintiff is a corporation, duly organized under section 66 of the corporation ,act of May 1st, 1853, as amended May 14th, 1859, and that the objects and purposes of said corporation aip set forth in the ■constitution and by-laws, which are made part of this finding ■and hereto annexed, marked 1 Exhibit A that said plaintiff is possessed of a large collection of scientific and miscellaneous books, about 14,000 volumes; that besides its library proper, it has a large collection of natural history, also a large historical collection, and keeps up and maintains a reading-room in connection with its library ; that any person, without distinction of color, sex or faith, can become a member, and that at the commencement of this action the annual fee is, and ■ever since has been, one dollar, and there are about one thousand members; that if a member withdraws more than one book at a time a further charge of ten cents per week is added ; that its library and reading-room are open to the members daily, •and its natural history and historical collections are open free ■during two' days a week to the public; the association has no stockholders, and no member or officer of the plaintiff has any pecuniary benefit from the plaintiff, or is entitled to ■any ; that it employs and pays a librarian and a few necessary ■assistants to' take charge of the books and their distribution, ■and to attend to the exhibition of its collections aforesaid; that ■on the first day of July, 1876, Leonard Case, by his deed duly executed and delivered, conveyed to the plaintiff the premises situate in the city of Cleveland and described in his said deed, ■a copy of which is hereunto annexed and made part of this finding, and marked ■ Exhibit Bsaid Case died in January, 1880, without exercising his right of revocation mentioned in said deed; that said plaintiff has been in occupation of said ■promises ever since the execution of said deed; that the whole land is covered by a building, and a diagram of 'the rooms of said building is hereto annexed, marked ‘ Exhibit 0,’ and made part of this finding; that the rooms marked ‘ R,’ in the basement, are used for storage by the tenants of the rooms above ; that on the principal floor the rooms are all stores and are all rented, and the rooms on the floors above marked ‘ R,’ are rented, and the hall is rented for musical concerts, lectures, ■and art and scientific exhibitions; the rooms marked ‘ L,’ are ■actually occupied by the library for its books, collections, reading-rooms and storage, and the other rooms are not rented ; the entire net income derived from the rents is devoted as fast as it is collected to the purchase of books and enlarging the facilities of the library, and no member or officer of the plaintiff derives or receives any pecuniary benefit from said income ; during 1879 the gross income from renting rooms and hall ■amounted to $10,000, of which amount $3,000 was used in purchasing books for the library, and after retaining sufficient to pay taxes on premises, the remainder thereof was used for necessary repairs of the building and for enlarging the library rooms.
    
      “ That the land included in said deed stands on the county duplicate at a valuation of $24,552.50, and the building at a valuation of $74,657.50, on which total valuation of $99,210, ■the general state, county and city taxes were assessed for the year 1877, and in the hands of the treasurer for collection. And difficult and important questions of law arising on these facts, on motion of the plaintiff, this cause is reserved to the supreme court for final determination.”
    The following is the diagram referred to :
    
      “Exhibit 0.”
    
      Copy of the original Plan of the Case Puil&ing.
    
    
      
    
    
      
    
    
      
    
    
      
    
    
      
    
    
      
      Grannis <& Griswold, for plaintiff.
    Heisley, Weh c& Wallace, for defendants :
    This institution is not an institution of purely public charity, and as such exempt from taxation. Gerke v. Purcell, 25 Ohio St. 229 ; Chegaray v. Mayor, 13 N. Y. 220; Indianapolis v. McLean,, 8 Ind. 328 ; State v. Ross, 24 N. J. Law, 497; 23 Ohio St. 144; 19 Ohio, 110 ; 17 Mo. 335 ; 29 Ohio St. 201. At all events only so much of the premises in controversy as is actually occupied by the association for the purposes of its organization should be exempt. 1 Met. 541; 3 Mich. 172 ; 19 Ohio, 110; Burroughs on Taxation, 134; 8 Ohio, 189; 29 Ohio St. 201; 120 Mass. 212; 1 Met. 538; 2 Cush. 611; 25 Ind. 518; 4 Ind. (Porter) 86; 85 Penn. St. 288; 15 La. Ann. 389 ; 28 La. Ann. 512 ; 10 Kansas, 442; 8 Kansas, 344.
   Johnson, J.

The plaintiff is a corporation organized under the act of 1852, as amended March 14, 1859. 1 S. & O. 305. “ Section 73 of said act provides that: The trustees or directors who may be appointed under the provisions of this act, and their successors in office, shall have perpetual succession of such name as may be designated, and by such name shall be legally capable of contracting, and of prosecuting and defending suits, and shall have capacity to acquire, hold, enjoy, dispose of, and convey all property, real or personal, they may acquire by purchase, donation, or otherwise, for the purpose of carrying out the intention of such society or association, but they shall not acquire or hold property for any other purpose.”

The purposes of this association, and for which it may acquire, hold and use property, are, as found by the district court, and set forth in “ Exhibit A,” “ The diffusion of useful knowledge and the acquirement of the arts and sciences by the establishment of a library of scientific and miscellaneous books for general circulation, and a reading room, lectures and cabinets.”

It is open to all without distinction, and all its income is devoted exclusively to said purposes.

That this association, in its objects and purposes, is, “ an in.stitution of purely public charity,” within the meaning of the statute of 1864, is, we think settled by the cases of Gerke v. Purcell, 25 Ohio St. 229 ; Cincinnati College v. State, 19 Ohio, 111; and Humphries v. Little Sisters of the Poor, 29 Ohio St. 201.

As it appears, by the findings of the court, that some of the rooms in the basement and in the different stories are used by the association for its objects, some are vacant and some are rented, the only remaining question is, whether the part of the property that is rented should be assessed for taxation %

This requires a construction of the sixth clause of section 1 of the act of March 21, 1864, providing for exemptions, which reads as follows:

All buildings belonging to institutions of purely public charity, together with the land actually occupied by such institution, not leased or otherwise used with a view to profit, and all moneys and credits appropriated solely to sustaining, and belonging exclusively to such institutions.”

In considering this question, we may premise:

1st. That all exemptions by statute, from the equal burdens of taxation, should be strictly construed,

2d. That the fact that the income derived from rents of 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 irt use, and not to what is done with its accumulations. Cincinnati College v. State, 19 Ohio, 110; Humphries v. Little Sisters, 29 Ohio St. 201; Gerke v. Purcell, 25 Ohio St. 229.

3d. The circumstance, that the rooms in the building, actually used by the association, are on the different floors, from the basement to the third story, and are not severable by any vertical or horizontal lines through the building, presents no obstacle to a separation in valuation for purposes of taxation. This was settled in Cincinnati College v. Yeatman, 30 Ohio St. 276.

The case of Cincinnati College v. State (supra), would seem to be decisive of the one at bar, and is so, unless, as is claimed, the exemption clause under consideration requires a different construction from the corresponding clause in the former statutes under which that case arose.

The words of the act of 1864 are: “ All buildings belonging to institutions of purely public charity, together with the land -actually occupied by such institution, not leased or otherwise used with a view to profit,” &c., while those of the act of 1846 -are : All buildings belonging to scientific, Utera/ry, or benevolent societies, used exclusively for scientific, literary or benevolent societies, together with the land actually occupied by -such institutions, not leased or otherwise used with a view to profit,” &c.

The argument is, that as the word exclusively is omitted from the act of 1864, it was intended to change the law as construed in Cincinnati College v. State, and that now, if part only of the building is so used, and the residue is rented, .the whole is exempt. This construction would defeat the limitation found in the words not leased or otherwise used with a view to profit.”

The words “ institutions of purely public charity,” are substituted in the act of 1864, for the societies specifically named in the act of 1846, and embrace all societies without enumeration, where the object is apurely public charity. If such an institution embraces other objects, and uses its buildings for •other purposes, as for instance, renting with a view to profit, it is not an institution of purely public charity. In short, its buildings must, under the act of 1864, as well as under that ,-of 1846, be used exclusively for that object, in order to be •exempt.

Any other construction would defeat the manifest intention •of the tax laws, and allow such institutions to become landlords of all species of property, provided the income derived therefrom is used to promote their objects.

Again, in view of the principle that exemptions from taxation should be strictly construed, it has been held, in many well-considered cases, that an exemption in general terms of all the property of a college or other institution extends only '.to the projDerty actually used for its legitimate purposes, as fully as if the exemption was expressly limited to such property.

Thus, when a library association was incorporated, to establish a library, and by its charter its property, in general terms, was exempt from taxation, it was held that the use must be direct and exclusive, and that where the building of the association consisted of a large number of rooms, a small portion of which only were used, and the others were rented out for business purposes, the part so used was not exempt from taxation. State v. Elizabeth, 4 Dutcher, 103. To the same effect is the case of State v. Flavell (4 Zab. 382), where 'the lands of a corporation were, by its charter, in general terms, exempted from taxation; it was held, that this exemption only extended to such real estate as was held for the purposes of the corporation, and did not include other lands or property. See also, State v. Mansfield, 3 Zab. 512; Burrows on Taxation, 130-136 ; Trustees of Good Shepherd v. Boston, 120 Mass. 212; Detroit v. Mayor, 3 Mich. 112. Indeed, such must necessarily be the case.

The statute under which the plaintiff holds its charter, as already cited, gives it capacity “ to acquire, hold, enjoy, dispose of and convey all property, real or personal, they may acquire by purchase, donation or otherwise, for the purpose of carrying out the intention of such society or association, but they shall not acquire or hold property for amp other purpose”

While we do not intend to suggest a doubt of the right of this corporation to accept this munificent donation of Mr. Case, the property being an entirety and suitable for its purposes, yet we think it clear, that as to so much of this building and grounds, not necessary for its use, which is rented out, should not be exempted from its equal share of taxation.

It may be said, that the entire building may become necessary for the objects of the association. When this shall become the case, and the entire building or any additional parts are so trsed, the parts thus withdrawn from renting, cease to be leased or otherwise used with a view to profit, and fall within the exemptipn.

The fact that the building is so constructed that the parts leased or otherwise used with a view to profit cannot be ¡separated from the residue by definite lines, is no obstacle to a valuation of such parts for purposes of taxation, having due reference to the taxable value of the entire property. ■

Remcunded, for further proceedings in accordcmoe with this decision.  