Abunda Life Churchv.Asbury Park

Superior Court of New Jersey, Appellate DivisionNov 10, 1999
18 N.J. Tax 483 (N.J. Tax 1999)

Argued October 26, 1999.

Decided November 10, 1999.

Appeal from the Superior Court, Appellate Division.

Before Judges PRESSLER, CIANCIA and ARNOLD.

Keith E. Paterson, for appellant.

Harry Haushalter, for respondent.


Plaintiff Abunda Life Church of Body, Mind Spirit appeals from a Tax Court judgment dismissing its complaint wherein it had sought local property tax exemption for the 1994 tax year pursuant to the provisions of N.J.S.A. 54:4-3.6. The claimed exemption was denied upon the findings that the property was not actually and exclusively used for religious purposes, plaintiff had failed to demonstrate it operated on a nonprofit basis, and its use of the property violated the zoning laws of defendant City of Asbury Park.

We have carefully reviewed the record and are satisfied that plaintiff's claim was properly denied. Without reaching the question of whether plaintiff's use of the property violated any of defendant's zoning ordinances, we affirm the order denying plaintiff's claim for property tax exemption and the subsequent judgment dismissing plaintiff's complaint. We do so substantially for the reasons expressed by Judge Rimm in his extensive and detailed oral opinion.

We add only the following comments. Tax exemption statutes are strictly construed, and the burden of proving entitlement to an exemption is on the party seeking it. N.J. Carpenters v. Borough of Kenilworth, 147 N.J. 171 , 177-78, 685 A.2d 1309 (1996); Princeton Univ. Press v. Borough of Princeton, 35 N.J. 209 , 214, 172 A.2d 420 (1961).

To obtain a property tax exemption under N.J.S.A. 54:4-3.6 the applicant must be: organized exclusively for an exempt purpose; the property must be actually and exclusively used for the exempt purpose; and the applicant must not operate or use its property for profit. Paper Mill Playhouse v. Millburn Tp., 95 N.J. 503 , 506, 472 A.2d 517 (1984).

In the present case, plaintiff's organizational purposes are not challenged. However, the record is replete with examples of plaintiff's commercial activities on the property, none of which can be legitimately construed as religious in nature or incidental to religious activities. There was substantial credible evidence to support Judge Rimm's finding that plaintiff did not operate exclusively for religious purposes. Cesare v. Cesare, 154 N.J. 394 , 411-12, 713 A.2d 390 (1998); Rova Farms Resort v. Investors Ins. Co., 65 N.J. 474 , 483-84, 323 A.2d 495 (1974); R. 2:11-3(e)(1)(A).

So too, plaintiff's proofs designed to demonstrate its nonprofit status were so deficient as to prevent any meaningful analysis of its financial posture, much less allow a conclusion that it operated as a not-for-profit entity. As Judge Rimm correctly found, the financial reports submitted were "essentially meaningless in terms of indicating whether the plaintiff is operating on a nonprofit basis or not." The Certified Public Accountant called on plaintiff's behalf conceded that his work-product was only a compilation of receipts and expenditures, not a true financial statement or audit. The missing proofs included a general ledger for receipts, a daily cash receipts journal, donor records, and inventory data. There was either no proof or insufficient proof as to revenue generated from the church's investments, income from advertising and plaintiff's printing business as well as payments from insurance companies relating to medical procedures performed on the premises. Clearly plaintiff failed in its burden of proof to establish the asserted right to exemption. Dawn Bible Students Ass'n v. Borough of East Rutherford, 3 N.J.Super. 71 , 75, 65 A.2d 532 (App.Div. 1949).

The order denying plaintiff's claim for exemption and the judgment dismissing its complaint are affirmed.