SYLLABUS
(This syllabus is not part of the opinion of the Court. It has
been prepared by the Office of the Clerk for the convenience of the
reader. It has been neither reviewed nor approved by the Supreme Court. Please
note that, in the interests of brevity, portions of any opinion may not
have been summarized).
Argued December 3, 2002 -- Decided February 11, 2003
LONG, J., writing for a unanimous Court.
This appeal considers whether an association organized exclusively for educational purposes is required to demonstrate some level of income from charitable donations to qualify for immunity pursuant to the Charitable Immunity Act, N.J.S.A. 2A:53A-7 to -11 (the Act). This appeal considers also whether a church is engaged in "good works" when it opens its premises to a nonprofit community organization for a nominal fee and whether partakers of the works of the community organization thus qualify as beneficiaries of the works of the church.
In November 1995, plaintiff Jamie C. Ryan was injured while attending a meeting
of the Mothers' Center. The Mothers' Center, formed in 1987, is a nonprofit
group of parents and expectant mothers organized to exchange and receive information regarding
childbirth, child rearing, mothering and family relationships. Members pay annual dues as well
as fees to participate in the activities. However, the Mothers' Center is open
to non-members, and anyone who subscribes to its basic policies and purposes and
wishes to take advantage of its multiple programs is welcome. Plaintiff was a
member of the Mothers' Center and had been attending a group that focused
on early childhood development. That group met weekly at Holy Trinity's parish house.
At the November 1995 meeting, participants sat in a circle around the
room on folding chairs. Plaintiff was seated near a supply closet. One of
the two group facilitators for the meeting was defendant Laura Fadem. Fadem had
brought her children with her to Holy Trinity. Forty-five minutes into the meeting,
Fadem's son wandered over to the supply closet and apparently tried to open
it. The door appears not to have been properly hinged, and when it
was pulled, it detached and struck plaintiff on the back of her head,
causing her to fall to the floor. She alleges that, as a result,
she suffered significant injuries. Plaintiff and her husband filed suit in 1997 against
Holy Trinity, the Mothers' Center, Fadem, and a series of John Doe defendants.
At the time of the accident, Holy Trinity had a policy of
opening its doors to social outreach projects with community purposes and allowing them
to use its facilities to conduct meetings. Those groups included the Boy Scouts,
Alcoholics Anonymous, Al-Anon, the Children's Psychiatric Center, and a Monday night social club
for mentally challenged people. Holy Trinity included notices of meetings in the church
bulletin. Permission to use a room could be obtained from the church council
for a fee of $15. Although not entirely clear, that fee appears to
have been based on the church's estimate of its cost of keeping the
building open. Holy Trinity asserted in discovery that no group was refused permission
to use the church facilities if it could not afford the fee. The
Mothers' Center used the church facilities for many different meetings. Payments were made
by check from the Mothers' Center to Holy Trinity. During the period July
through December 1995, the Mothers' Center used the church facilities 31 times and
paid Holy Trinity a total of $465.
The trial court granted summary judgment to all defendants based on charitable immunity.
The Appellate Division affirmed the dismissal of the complaint against Holy Trinity and
Fadem in her individual capacity, and reversed the dismissal against the Mothers' Center
and Fadem as its agent. Because the evidential record is silent regarding the
Mothers' Center's income, the Appellate Division remanded the case for a determination of
whether the Mothers' Center received any part of its operating income from charitable
contributions. The Mothers' Center petitioned for certification, contending that the finding that it
was organized exclusively for educational purposes obviated any further inquiry regarding its finances.
The plaintiffs filed a cross-petition contesting the finding that Holy Trinity was entitled
to charitable immunity. This court granted both petitions.
HELD : Holy Trinity is entitled to charitable immunity, pursuant to N.J.S.A. 2A:53A-7 to
-11, because it is a nonprofit entity, it is organized exclusively for religious
purposes, and at the time of the accident, it was promoting its objectives
in respect of plaintiff, who was a beneficiary thereof. Because the Mothers' Center
is organized exclusively for educational purposes, no further financial analysis is required.
1. The purposes of the Act are to avoid the diversion of charitable
trust funds to non-charitable purposes and to encourage altruistic activity. Distilling the statutory
language of the Act to its essence, an entity qualifies for charitable immunity
when it 1) was formed for nonprofit purposes; 2) is organized exclusively for
religious, charitable or educational purposes; and 3) was promoting such objectives and purposes
at the time of the injury to a plaintiff who was then a
beneficiary of the charitable works. (Pp. 9-11).
2. The terms "educational" and "religious" have plain meanings that are subject to
literal reading, therefore entities that can prove they are organized exclusively for educational
or religious purposes automatically satisfy the second prong of the charitable immunity standard.
In contrast, determining whether an entity is organized exclusively for "charitable" purposes requires
further examination, pursuant to Parker v. St. Stephens' Urban Dev. Corp. Inc.,
243 N.J. Super. 317 (App. Div. 1990), including an examination of the source of
the entity's funds. (Pp. 12 to 18).
3. The Mothers' Center bases its claim that it is entitled to charitable
immunity on its educational purpose. That purpose was declared in its bylaws and
is revealed in its operation, which includes lectures, discussions and the general exchange
of information. Its aim is the conveyance of information to all interested parents
and prospective parents about birth and childrearing. The discussion format of the programs,
like the lecture format, is a valid method of pedagogy. Because the Mothers'
Center passes muster as an entity organized exclusively for educational purposes, no further
financial analysis is required to satisfy the second prong of the Act. Moreover,
plaintiffs having conceded the Mothers' Center's nonprofit status and that plaintiff was a
beneficiary of its works, the Mothers' Center and Fadem, as its agent, are
entitled to summary judgment based on charitable immunity. (Pp. 18 to 23).
4. Plaintiffs do not challenge the nonprofit status of Holy Trinity and further
concede that Holy Trinity is organized exclusively for religious purposes. At issue is
whether Holy Trinity satisfies the third prong of the test: at the time
of the accident, was it engaged in charitable works and was plaintiff a
beneficiary of those works? The test for determining whether a party is a
beneficiary has two prongs. The first is that the institution, at the time
in question, was engaged in the performance of the charitable objectives it was
organized to advance. The second is that the injured party must have been
a direct recipient of those good works. (P. 23)
5. The term "works" is defined liberally. Exercises that are designed to aid
in the advancement of the spiritual, moral, ethical and cultural life of the
community in general are deemed within the purview of the religious society. Here,
in furtherance of the tenants and principles of the Lutheran Church, Holy Trinity
provided space for community organizations to conduct meetings. By supporting social outreach groups
that enriched the life of the community at large, Holy Trinity fell well
within the modern view, now sixty years old, that the good works of
churches are not limited to parochial concerns. (Pp. 24 to 27).
6. In assessing who is a beneficiary of the works of a charity,
that notion is to be interpreted broadly, as evidenced by the use of
the words "to whatever degree" modifying the word "beneficiary" in the statute. Those
who are not beneficiaries must be unconcerned in and unrelated to the benefactions
of such an organization. Here, plaintiff was a beneficiary of the works of
Holy Trinity at the time of the accident both as a member of
the Mothers' Center, and as an attendee at a Mothers' Center function on
Holy Trinity's premises. (Pp. 27 to 30).
The judgment of the Appellate Division is AFFIRMED to the extent that
it approved the grant of summary judgment to Holy Trinity and Fadem, individually,
and held that the Mothers' Center was organized exclusively for educational purposes; and
it is REVERSED to the extent that it remanded the case for a
showing that the operating capital of the Mothers' Center is derived from charitable
contributions or trust income. Summary judgment in favor of the Mothers' Center and
Fadem, as its agent, is REINSTATED.
CHIEF JUSTICE PORITZ and JUSTICES COLEMAN, VERNIERO, LaVECCHIA, ZAZZALI and ALBIN join in
JUSTICE LONG's opinion.
SUPREME COURT OF NEW JERSEY
A-116/
117 September Term 2001
JAMIE C. RYAN and ROBERT J. RYAN, her husband,
Plaintiffs-Respondents and Cross-Appellants,
v.
HOLY TRINITY EVANGELICAL LUTHERAN CHURCH,
Defendant and
Cross-Respondent,
and
MOTHERS’ CENTER OF MONMOUTH COUNTY,
Defendant-Appellant,
and
LAURA FADEM, JOHN DOE (1-5), a fictitious name, party intended being unknown and
ABC CORPORATION (1-5), a fictitious name, party intended being unknown,
Defendants.
Argued December 3, 2002 – Decided February 11, 2003
On certification to the Superior Court, Appellate Division.
Mauro C. Casci argued the cause for appellant.
Harry V. Osborne, II, argued the cause for respondents and cross-appellants (Evans, Osborne
and Kreizman, attorneys).
David M. Molnar argued the cause for cross-respondent (Anthony W. Guidice, attorney).
The opinion of the Court was delivered by
LONG, J.
Once again we consider the Charitable Immunity Act, N.J.S.A. 2A:53A –7 to –11
(the Act). More particularly, we are called on to determine whether an association
organized exclusively for educational purposes is nevertheless required to demonstrate some level of
income from charitable donations to qualify for immunity. We have concluded that it
need not. We also have determined that a church can be engaged in
its “good works” when it opens its premises to a nonprofit community organization
for a nominal fee, and that partakers of the works of the community
organization can thus qualify as beneficiaries of the works of the church.
In 1997, plaintiffs Jaime C. Ryan and Robert J. Ryan, husband and wife, filed a complaint in the Superior Court, Law Division, Monmouth County against defendants Holy Trinity Evangelical Lutheran Church, the Mothers’ Center of Monmouth County, Laura Fadem, and a series of John Doe defendants. The complaint alleged that due to defendants’ tortious conduct, Mrs. Ryan suffered injuries while attending a meeting of the Mothers’ Center that was held in Holy Trinity.
All defendants answered, denying the allegations of the complaint and cross claiming against each other for contribution and indemnification. Eventually defendants moved for summary judgment. Charitable immunity was the pivotal issue.
The facts established by the pleadings, discovery, and other documents on file basically are uncontroverted. Mrs. Ryan was injured on the morning of November 17, 1995, while attending a meeting of the Mothers’ Center, held in Holy Trinity’s parish house. At the time, she was seven months pregnant.
The Mothers’ Center, formed in 1987, is a nonprofit See footnote 1 group of parents and expectant mothers organized to exchange experiences and receive information regarding childbirth, child rearing, mothering, and family relationships. A council of volunteers runs the Center. The organization is non-hierarchical, and decision-making is by consensus. In 1995, there were approximately 80 to 100 members. According to the bylaws of the Mothers’ Center, its purpose is
to promote the welfare and meet the needs of mothers; to help mothers to maintain and improve their self-esteem in their roles as mothers; to facilitate the free and confidential exchange of ideas and current information on birthing, childrearing and maintaining a family; to offer a non-judgmental forum for the discussion of the challenges and crises of motherhood; and to provide child care programs that enable mothers to separate from their children if they so choose, and allow mothers relaxed time to participate in Center activities.
The promotion of those purposes, according to the bylaws of the Center, is
to be effectuated through “an education program directed toward parents ....” The Mothers’
Center runs a number of programs, including a post-partum project, along with discussions
and informational groups on parenting techniques and discipline. At general membership meetings, speakers
are often scheduled to talk on topics relating to parenting and motherhood, including
medical issues.
The Mothers’ Center also provides childcare during meetings, which enables its members to
participate in group discussions and other activities. Childcare services are provided, along with
playgroups for children and activities for mothers and children together.
The Mothers’ Center is open to non-members. Anyone who subscribes to its basic
policies and purposes and wishes to take advantage of its programs is welcome.
Members pay annual dues as well as fees to participate in the organization’s
activities. The dues in 1995 were $25 for the year. Membership is not
required for programs but is necessary for participation in the governance of the
participants.
Generally, the discussion groups meet weekly. Each subject is covered in depth over
approximately an eight-week period. Trained facilitators focus the discussions, present topics, and resolve
any disagreements between participants.
Mrs. Ryan was a member of the Mothers’ Center and had been attending
a group that focused on early childhood development. Ten to twelve mothers typically
participated in that group. Although the meetings for some discussion groups were held
in members’ homes, the group Mrs. Ryan was attending held its weekly meetings
at the parish house of Holy Trinity. At the November 17, 1995, meeting,
the participants sat in a circle around the room on folding chairs. Mrs.
Ryan was seated near a supply closet.
One of the two group facilitators for that meeting was defendant Laura Fadem.See footnote 2
On November 17, 1995, Fadem brought her children with her to Holy Trinity.
She sent her daughter to the childcare room on the second floor, and
took her son with her to the meeting. Forty-five minutes into the meeting,
the boy wandered over to a supply closet door and apparently tried to
open it. The door appears not to have been properly hinged, and when
it was pulled, it detached and struck Mrs. Ryan on the back of
her head, causing her to fall to the floor. She alleges that, as
a result, she suffered significant injuries and required long-term treatment, including surgery.
At the time of the accident, Holy Trinity had a policy of opening
its doors to social outreach projects with community purposes and allowing them to
use its facilities to conduct meetings. Those groups included the Boy Scouts, Alcoholics
Anonymous, Al-Anon, the Children’s Psychiatric Center, and a Monday night social club for
mentally challenged people. Holy Trinity included notices of meetings in the church bulletin.
Permission to use a room could be obtained from the church council for
a fee of $15. Although not entirely clear, that fee appears to have
been based on the church’s estimation of how much was needed to cover
the costs of electricity, heat, and air conditioning, in other words, the cost
of keeping the building open. Each group that used the church’s facilities paid
the same fee. Holy Trinity asserted in discovery that no group was refused
permission to use the church facilities if it could not afford the fee.
The Mothers’ Center used the church facilities for many different meetings. Payments were
made by check from the Mothers’ Center to Holy Trinity. During the period
July through December 1995, the Mothers’ Center used the church facilities a total
of 31 times. At $15 per use, the Mothers’ Center paid Holy Trinity
a total of $465 for that period.
On those facts, the trial court granted summary judgment to all defendants based
on charitable immunity. The Ryans appealed. The Appellate Division affirmed the dismissal of
the Ryans’ complaint against Holy Trinity and Laura Fadem, individually, and reversed the
dismissal against the Mothers’ Center and Laura Fadem as its agent. Because the
evidential record is silent regarding the Mothers’ Center’s income (other than dues and
fees) the Appellate Division, citing
Bieker v. Community House of Moorstown,
169 N.J. 167, 178 (2001), and Parker v. St. Stephens’ Urban Dev. Corp., Inc.,
243 N.J. Super. 317, 326 (App. Div. 1990), remanded the case for a determination
of whether the Mothers’ Center received any part of its operating income from
charitable contributions.
The Mothers’ Center petitioned for certification and the Ryans filed a Cross-Petition. On
May 13, 2002, we granted both petitions.
172 N.J. 355 (2002). We now
affirm in part and reverse in part.
The heart of the Mothers’ Center’s argument is that under this Court’s recent decision in O’Connell v. State, 171 N.J. 484, 491 (2002), the finding that it was organized exclusively for educational purposes obviated any further inquiry regarding its finances. The Ryans counter that under Bieker, supra, 169 N.J. at 178, and Parker, supra, 243 N.J. Super. at 326, a further financial inquiry is compelled.
The Ryans’ cross-petition is focused on Holy Trinity. Although they acknowledge that Holy Trinity is organized exclusively for religious purposes, they maintain that the Mothers’ Center was a purely secular operation that had no connection to the religious works of Holy Trinity and was solely a tenant of the church. As such, although Mrs. Ryan was a beneficiary of the works of the Mothers’ Center, she was not so positioned relative to Holy Trinity.
Holy Trinity argues that the Ryans’ vision of its mission is too narrow and that it is entitled to immunity because its provision of a forum for the Mothers’ Center to hold its meetings was “in furtherance of the tenets and principles of the Lutheran faith to enhance, enrich and promote the cultural, moral, ethical and spiritual life of the community at large.” As such, Holy Trinity urges that in accordance with its religious principles, it made available its facilities to nonprofit organizations engaged in “social outreach type endeavors,” that the Mothers’ Center was one of those organizations, and that Mrs. Ryan was therefore a beneficiary of Holy Trinity’s works.
The Charitable Immunity Act provides:
No nonprofit corporation, society or association organized exclusively for religious, charitable or educational purposes or its trustees, directors, officers, employees, agents, servants or volunteers shall, except as hereinafter set forth, be liable to respond in damages to any person who shall suffer damage from the negligence of any agent or servant of such corporation, society or association, where such person is a beneficiary, to whatever degree, of the works of such nonprofit corporation, society or association; provided, however, that such immunity from liability shall not extend to any person who shall suffer damage from the negligence of such corporation, society or association or of its agents or servants where such person is one unconcerned in and unrelated to and outside the benefactions of such corporation, society or association.
[N.J.S.A. 2A:53A-7.]
The history of the Act has been recounted repeatedly, Bieker, supra, 169 N.J.
at 174-75; Schultz v. Roman Catholic Archdiocese of Newark,
95 N.J. 530, 537
(1984); Hamel v. State,
321 N.J. Super. 67, 73-74 (App. Div. 1999), and
need not be repeated here, except to note that its original purpose was
to avoid the diversion of charitable trust funds “to non-charitable purposes in order
to live up to the reasonable expectations of the benefactors.” Parker, supra, 243
N.J. Super. at 321.
Over time, however, our case law has recognized that the purposes underlying charitable
immunity are broader than simply preserving charitable trust funds and include the encouragement
of altruistic activity. See O’Connell, supra, 171 N.J. at 496 (“[T]he statute’s legislative
history suggests that preservation of a charity’s assets was only one of a
number of purposes propelling the [Act’s] enactment.”); Schultz, supra, 95 N.J. at 537
(“The focus of the legislative process was not on the question of what
exceptions were consistent with the historical development of the doctrine of common law
charitable immunity. The focus was on the economic effect of abolition of the
doctrine upon the charities.”) (citing Hearings on S. 204 re Exemption of Religious,
Charitable and Hospital Organizations from Negligence Liability, Before the Assembly Judiciary Committee (July
17, 1958)); Abdallah v. Occupational Ctr. of Hudson County,
351 N.J. Super. 280,
284 (App. Div. 2002) (“[T]here is agreement that [the Act’s] underlying purpose and
rationale have always been the protection and encouragement of private philanthropy both to
assure the continued provision of beneficent services and to relieve government of the
burden of providing them.”) (citing Restatement (Second) of Torts § 895E cmt. c (1979);
2 Harper & James on Torts, § 29.16 (1956)); see also Note, The Quality
of Mercy: “Charitable Torts” and Their Continuing Immunity,
100 Harv. L. Rev. 1382,
1384 (1987) (“[S]ome courts, pointing to public policy considerations in favor of charitable
good works, feared that damage awards might drive charities to bankruptcy or cost
them prospective donors.”) (citing Vermillion v. Woman's College of Due West,
104 S.C. 197 (1916)).
Distilling the statutory language to its essence, this Court has held that “an
entity qualifies for charitable immunity when it ‘(1) was formed for nonprofit purposes;
(2) is organized exclusively for religious, charitable or educational purposes; and (3) was
promoting such objectives and purposes at the time of the injury to plaintiff
who was then a beneficiary of the charitable works.’” O’Connell, supra, 171 N.J.
at 489 (quoting Hamel v. State,
321 N.J. Super. 67, 72 (App. Div.
1999)).
As an interpretive rationale, N.J.S.A. 2A:53A-10 instructs that the Act
shall be deemed to be remedial and shall be liberally construed so as
to afford immunity to the said corporations, societies and associations from liability as
provided herein in furtherance of the public policy for the protection of nonprofit
corporations, societies and associations organized for religious, charitable, educational or hospital purposes.
[Ibid.]
That is the backdrop for our inquiry.
We turn initially to the petition of the Mothers’ Center. The Ryans have conceded the nonprofit status of the Mothers’ Center and that, at the time of the accident, Mrs. Ryan was a beneficiary of its works. Several matters remain to be resolved.
The first issue is the propriety of the Appellate Division’s conclusion that, although the Mothers’ Center was organized exclusively for educational purposes, it was nevertheless required to make a showing that its operating capital was derived from charitable contributions or trust fund income to satisfy the second prong of the charitable immunity standard. Quoting Parker, supra, 243 N.J. Super. at 326, the court held that such a showing is necessary because the public policy foundation for the Act is “the preservation of private charitable contributions for their designated purposes.”
We turn again to the Act, which provides in relevant part that an entity seeking charitable status must be “organized exclusively for religious, charitable or educational purposes.” N.J.S.A. 2A:53A-7. Although the overarching character of all three categories is eleemosynary, they are actually quite distinct. Two are specific as to subject matter (educational and religious), and one is a generic catchall term (charitable). Both “educational” and “religious” have a limited and commonly understood meaning. On the contrary, “charitable” is a more complex notion that defies precise definition. See Presbyterian Homes v. Division of Tax Appeals, 55 N.J. 275, 285 (1970) (“It is evident ... that the term ‘charity’ in a legal sense is a matter of description rather than a precise definition.”).
The cornerstone of our analysis is O’Connell, supra, 171 N.J. at 484. There, the issue was whether Montclair State University was entitled to charitable immunity in connection with a student’s injury on its premises. The Appellate Division reversed the trial court’s grant of summary judgment in favor of Montclair on the ground that a public entity is not entitled to assert the defense of charitable immunity. Id. at 487. We granted certification. Obviously the public entity aspect of that case was unique. However, in ruling, we had occasion to address generally the language of the charitable immunity statute. In so doing, we clarified that an entity satisfying the elements plainly set forth in the Act would be entitled, without further analysis, to immunity. Id. at 491. More particularly, we held that an entity organized exclusively for educational purposes automatically meets the second prong of the charitable immunity standard. Because Montclair was a nonprofit entity, organized exclusively for educational purposes, and because O’Connell, as a student, was plainly a beneficiary of its works, our ultimate conclusion was that nothing more had to be proved to justify the application of charitable immunity. Ibid.
The Ryans maintain that there is a disconnection between O’Connell, on the one hand, and Bieker and Parker, on the other. In Parker, the Appellate Division considered whether a nonprofit community development corporation that sponsored low- and moderate-income housing and funneled federal money into the projects could qualify for charitable immunity. Parker, supra, 243 N.J. Super. at 321-22, 324. Recognizing the fact-sensitive nature of such an inquiry, the court in Parker properly concluded that nonprofit status alone meets only the first prong of the Act and that performance of a useful service does not per se compel the corollary that an organization is engaged in charitable activity. Id. at 324-25. In other words, Parker requires courts to look beyond the nonprofit status of an entity and even beyond its benevolent acts to determine whether it is organized exclusively for “charitable” purposes:
What is required is an examination of the entity seeking to clothe itself in the veil of charitable immunity to discover its aims, its origins, and its method of operation in order to determine whether its dominant motive is charity or some other form of enterprise.
[Id. at 325.]
Applying those principles, the court in Parker ruled that the community housing corporation
before it was not entitled to immunity because it did not seek to
provide housing through its own efforts, either by the dedication of church funds
or through a program of charitable solicitation; because its board members were unpaid,
not because of any benevolent instinct, but as a quid pro quo for
federal funding; and because it was created, not to lessen the burden on
government, but to obtain as much money from the government as possible, and
to run its program with that money. The court concluded that, as a
conduit for federal money, the housing corporation was not an entity organized exclusively
for charitable purposes but was the “quasi-public sponsor of a federally funded housing
project.” Id. at 327.
That fact-sensitive approach is in line with our prior treatment of the notion
of “charitable purposes.” Such a determination “depends on the facts or circumstances of
each case.” Presbyterian Homes, supra, 55 N.J. at 285. In Presbyterian Homes, a
nonprofit organization that provided housing for the aged sought a property tax exemption
because its property was being operated for a “charitable purpose.” Although we recognized
care of the elderly as laudable and the aim of the sponsor as
altruistic, we held that the question of whether it was charitable depended on
the manner in which the property was used to achieve that end. Id.
at 288. We found that manner wanting. The by-laws of Presbyterian Homes did
not obligate it to continue providing a home to seniors who were not
financially equipped to pay its fees or who became ill. Seniors who had
expended all of their assets could be turned out and potentially could become
public charges. Moreover, although rental fees in themselves would not necessarily eliminate charitable
status, there was a direct relationship between the size of the rental payment
and the desirability of the unit. Id. at 286-87. In rejecting the charitable
characterization, we invoked the reasoning of the Illinois Supreme Court in Methodist Old
Peoples Home v. Korzen,
39 Ill.2d 149, 158 (1968), concluding that such circumstances
lack “the warmth and spontaneity indicative of charitable impulse.” Presbyterian Homes, supra, 55
N.J. at 287.
We recently cited Presbyterian Homes and Parker approvingly in Bieker, supra, 169 N.J.
at 178-79. There, the Moorestown Community House, a nonprofit corporation that operated and
rented meeting rooms and athletic facilities both to charitable and for-profit entities contended
that it was organized exclusively for “charitable” purposes. Id. at 172-73. We held
that a determination was needed regarding whether the dominant motive of the Community
House was, in fact, charitable or some other form of enterprise. Although recognizing
that receiving income from some limited non-charitable activity would not prevent an otherwise
eligible entity from obtaining immunity, we held that the question of how much
of the rental operation was devoted to for-profit entities had to be resolved
in order to determine whether the entity was exclusively charitable. Id. at 178-79.
O’Connell did not distinguish Parker or Bieker because they were not relevant to
its analysis. O’Connell was concerned only with an entity “organized exclusively for educational
purposes.” O’Connell, supra, 171 N.J. at 491. In that case, we interpreted the
Charitable Immunity Act literally and held that the second prong of the Act
was satisfied based solely on the fact that education was Montclair’s exclusive purpose.
Ibid. The same analysis would apply to an entity “organized solely for religious
purposes.” The reason is that “the terms ‘educational’ and ‘religious’ have plain meanings
that are subject to literal reading.” Abdallah, supra, 351 N.J. Super. at 284.
In contrast, as the court in Abdallah observed in assessing the “charitable” characterization
in connection with an entity that served as a combination employment agency and
shelter workshop:
[W]here a non-profit, non-religious, non-educational organization relies on the immunity based on its
asserted charitable status, a traditional analysis as exemplified by Parker, which looks beyond
the organization's non-profit structure and social service activities, continues to be mandated. And,
we are convinced, that traditional analysis must take into account the organization's source
of funds as a critical element of charitable status.
[Id. at 284.]
We fully subscribe to that view. Entities that can prove they are organized
exclusively for educational or religious purposes automatically satisfy the second prong of the
charitable immunity standard. Entities seeking the shelter of the Act by proving that
they are “organized exclusively for charitable purposes” must engage in the traditional factual
analysis of Parker, including a source of funds assessment.
In the present case, the Mothers’ Center’s claim of entitlement to charitable immunity
is grounded in the assertion that it is organized exclusively for educational purposes.
If that is correct, O’Connell governs and no further financial analysis is required
to satisfy the second prong of the Act.
Although few cases have addressed the phrase “organized exclusively for educational purposes,” those that have had occasion to do so have interpreted it broadly. In Pomeroy v. Little League Baseball of Collingswood, 142 N.J. Super. 471, 473 (App. Div. 1976), the court was required to determine whether the defendant, Little League Baseball of Collingswood, was organized exclusively for educational purposes. In attempting to define “educational purposes,” Pomeroy quoted from earlier case law: “Education is defined as ‘discipline of mind or character through study or instruction.’” Id. at 474 (quoting Stoolman v. Camden County Council Boy Scouts, 77 N.J. Super. 129, 135 (Law Div. 1962) (quoting Webster’s New Collegiate Dictionary)).
The proof presented in Pomeroy was that the defendant’s exclusive purpose was “the education of young people in the ideals of good sportsmanship, honesty, loyalty, courage and reverence” so that they would become happy and productive citizens. Pomeroy, supra, 142 N.J. Super. at 474. That the objective was accomplished through the teaching and supervision of athletic skills did not vitiate the exclusively educational nature of that purpose. Ibid. The same result was reached in Stoolman, supra, 77 N.J. Super. at 135, concerning the Boy Scouts. Pomeroy’s broad interpretation of the education clause has been cited with approval by the Appellate Division in Morales v. New Jersey Academy of Aquatic Sc., 302 N.J. Super. 50, 54 (App. Div. 1997) (citing Pomeroy for broad definition of educational purpose under Act), and most recently by us in Bieker, supra, 169 N.J. at 177.
We think the Mothers’ Center fits the profile of an entity organized exclusively to provide educational opportunities. That purpose was declared in its bylaws and is revealed in its operation, which includes lectures, discussions, and the general exchange of information. Indeed, on a continuum, the Mothers’ Center is more like a traditional education program than the Little League or the Boy Scouts, organizations that were previously acknowledged as within the “organized exclusively for educational purposes” clause. Pomeroy, supra, 142 N.J. Super. at 474; Stoolman, supra, 77 N.J. Super. at 135.
The Ryans argue that Mrs. Ryan’s participation in a “discussion” does not qualify as “educational.” Obviously, the Socratic method belies that statement. Moreover, our case law indicates that the form that the education takes is not a touchstone for qualifying for immunity. In any event, the discussions fostered by the Mothers’ Center are not random conversations but are focused and directed by facilitators who are trained to oversee the process. Through the discussion methodology, new and inexperienced parents learn from those who have been through the same experience, as well as from their peers who are also learning by doing. Although the subject may not be academic, it is serious and important. Further, it is clear that the discussion format is only one of the educational methodologies of the Mothers’ Center. Lecturers also are provided at many meetings.
To avoid the conclusion that the Mothers’ Center is organized exclusively for educational purposes, the Ryans characterize it as a fraternal organization. Kirby v. Columbian Institute, 101 N.J. Super. 205, 209 (Law Div. 1968), set out a bright-line rule that fraternal organizations are barred from charitable immunity because charitable immunity requires that an entity be organized solely for charitable, religious, or educational purposes. As Kirby suggests, a fraternal organization is organized, at least partially, to benefit its own members and thus cannot be exclusively charitable. Ibid.; see also Beicht v. American Polish Veterans, Inc., 259 N.J. Super. 79, 81 (Law Div. 1992) (refusing to apply charitable immunity to fraternal veterans’ association partly because status as fraternal organization precluded finding that it was organized “exclusively” for charitable, religious, or educational purposes); 15 Am. Jur 2d Charities § 203 (2002) (stating fraternal organizations are generally precluded from claiming charitable immunity); 1A Fletcher Cyclopedia of Private Corp. § 77 (2002) (same). Cf. Alpha Rho Alumni Ass’n v. City of New Brunswick, 126 N.J.L. 233, 235 (1922) (defining “fraternal organization” for tax purposes to be group “organized to assist its members and to promote moral, intellectual and social benefits,” in case involving sorority alumnae group) (emphasis added); see also Conrad v. Maricopa County, 12 P.2d 613, 615 (Ariz. 1932) (surveying states and finding bulk of authority to be in favor of rule that fraternal organizations may not be considered “charitable” for tax exemption purposes where state statute or constitution required that they be “strictly” or “exclusively” charitable).
The Mothers’ Center does not fit Kirby’s definition of a fraternal organization. Unlike the sorority in Alpha Rho, or the recreation center in Kirby, the Mothers’ Center is organized exclusively to educate all interested parents and does not focus its educational activities on advancing the interests of its members. Although it is true that the Mothers’ Center maintains a membership roster, the only benefit it affords members is participation in the Center’s management. Membership in no way determines access to the lectures, discussions, and educational programs hosted by the Center.
In sum, the Mothers’ Center passes muster as an entity “organized exclusively for educational purposes.” Its aim is the conveyance of information to all interested parents and prospective parents about birth and childrearing. The discussion format, like the lecture format, is a valid method of pedagogy. Ancillary services that are provided advance the educational mission of the Center. Thus, no further inquiry is required concerning the second prong of the Act.
That said, and the Ryans having conceded the Mothers’ Center’s nonprofit status and that Mrs. Ryan was a beneficiary of its works, the Mothers’ Center and Laura Fadem, as its agent, are entitled to summary judgment based on charitable immunity.
Next, we turn to the Ryans’ cross-petition relative to Holy Trinity. No issue regarding the nonprofit status of Holy Trinity has been advanced by the Ryans. Indeed, the first prong of the charitable immunity test is conceded. The Ryans also concede that Holy Trinity is organized exclusively for religious purposes. What is at issue is whether Holy Trinity satisfies the third prong of the test: at the time of the accident, was it engaged in its charitable works, and was Mrs. Ryan a beneficiary of those works?
The established test for determining whether a party is a beneficiary of the works of a charity has two prongs. The first is that the institution pleading the immunity, at the time in question, “was engaged in the performance of the charitable objectives it was organized to advance.” Anasiewicz v. Sacred Heart Church, 74 N.J. Super. 532, 536 (App. Div.), certif. denied, 38 N.J. 305 (1962). The second is that the injured party must have been a direct recipient of those good works. DeVries v. Habitat for Humanity, 290 N.J. Super. 479, 487-88 (App. Div. 1996), aff’d o.b., 147 N.J. 619 (1997).
In assessing whether a claimant is a beneficiary of the works of a religious institution, our courts have defined liberally the term “works”:
The church function is not . . . narrowly confined. It is not limited to sectarian teaching and worship. In [the] modern view, exercises designed to aid in the advancement of the spiritual, moral, ethical and cultural life of the community in general are deemed within the purview of the religious society. A social center is now commonly regarded as a proper adjunct of the local church – conducive to the public good as well as advantageous to the congregation.
[Bianchi v. South Park Presbyterian Church,
123 N.J.L. 325, 332-33 (E. & A.
1939).]
That principle was cited recently with approval by this Court in Bieker, supra,
169 N.J. at 176 (quoting Loder v. Saint Thomas Greek Church,
295 N.J.
Super. 297, 302 (App. Div. 1996) (quoting Bianchi, supra, 123 N.J.L. at 332-33)).
Bianchi is on all fours with this case. There, the defendant religious society
operated a building next to its church that housed, among other things, the
administration offices, choir practice, a gymnasium and meeting rooms. The church house, as
it was called, was used as a social center as well as for
administration of church affairs. Its social and recreational uses were not confined to
the members of the religious society. Id. at 328. A Girl Scout troop,
of which the plaintiff was a member, held weekly meetings at the church
house. The troop made a voluntary donation to the church at the beginning
of each year that was not sufficient to defray the costs of keeping
the building open for its meetings. Other than to use the church house
and make the annual donation, the troop was not affiliated with the church
body. Ibid.
The plaintiff, who suffered injury when she fell down an unlit staircase in
the church house, filed suit against the church. The trial court directed a
verdict for the church, in part, on the ground that the plaintiff was
a beneficiary of its good works. Id. at 329-30. In affirming, the Court
of Errors and Appeals concluded that permitting the troop to use the church
house for its meetings was “plainly classifiable as a secondary church function in
aid of its primary purpose,” which served to exemplify the religious doctrine. Id.
at 333.
Our cases have followed that expansive view. For example, in Anasiewicz, the plaintiffs
attended a wedding ceremony as invited guests at the defendant Sacred Heart Church
where Mrs. Anasiewicz fell and suffered injuries. Anasiewicz, supra, 74 N.J. Super. at
533-34. She brought suit against Sacred Heart. Ibid. In determining whether Mrs. Anasiewicz
was a beneficiary of the works of the church, the Appellate Division found
that, although not members of Sacred Heart, the plaintiffs were within the benefactions
of the church. “Whether they actually benefited spiritually by their attendance [was] of
no moment.” Id. at 537-38. The court went on to identify as the
work of the church “the preservation of moral or sociological concepts held by
the community generally.” Id. at 538.
Even when a religious organization is not advancing its own religious tenets, or
promoting religion at all, it can still be engaged in its “works.” In
Bixenman v. Christ Episcopal Church Parish House,
166 N.J. Super. 148, 150 (App.
Div. 1979), the defendant Christ Episcopal church loaned its premises to a Greek
Orthodox church for a nominal fee until such time as the Greek Orthodox
church could move into its own facilities. The plaintiff, a member of the
Greek Orthodox church, was injured while leaving the parish house of Christ Episcopal
after having attended services of the Greek Orthodox church held on the premises.
Id. at 150-51. Applying the rule of Bianchi, the Appellate Division concluded that
the defendant was engaging in its “works” when it loaned its facilities to
the Greek Orthodox church. Facilitating worship, whether by its own parishioners, or those
of a different faith, is one of the foremost reasons for which churches
exist. Id. at 151.
Recently, the court in Loder, continued the broad definition of “works” that had
been set forth in our case law. Loder, supra, 295 N.J. Super. at
297. There, a patron at a church-sponsored cultural festival was injured on church
property. The festival apparently included service of food as well as demonstrations of
dancing. The patron, Loder, was not a member of the church and had
gone to the festival to enjoy the food. Id. at 299-300. The Appellate
Division found that there was no doubt that St. Thomas was engaged in
the performance of its objectives. Through the festival, it was attempting to demonstrate
to the community the rich traditions of the Greek Orthodox Church and the
importance of the Hellenic culture in the Orthodox religion, as expressed through food
and dance. Id. at 302. According to the court, those activities bore a
direct and substantial relationship to the church’s function. Id. at 303. We cited
Loder with approval in Bieker, supra, 169 N.J. at 176.
In this case, in furtherance of the tenets and principles of the Lutheran
Church, Holy Trinity provided space for community organizations to conduct meetings. By supporting
social outreach groups that enriched the life of the community at large, Holy
Trinity fell well within the modern view, now sixty years old, that the
good works of churches are not limited to parochial concerns. Thus, Holy Trinity
was engaged in its good works at the time of Mrs. Ryan’s accident.
In assessing who is a beneficiary of the works of a charity, that notion is to be interpreted broadly, as evidenced by the use of the words “to whatever degree” modifying the word “beneficiary” in the statute. Those who are not beneficiaries must be “unconcerned in and unrelated to” the benefactions of such an organization. Gray v. St. Cecilia's School,
217 N.J. Super. 492, 495 (App. Div. 1987). Plainly, Mrs. Ryan was a beneficiary of the works of Holy Trinity at the time of the accident both as a member of the Mothers’ Center, and as an attendee at a Mothers’ Center function on Holy Trinity’s premises.
That status was underscored in Bixenman, a case in which Christ Episcopal allowed the Greek Orthodox church to use its premises. Bixenman, supra, 166 N.J. Super. at 150. The plaintiff argued that she was not the beneficiary of Christ Episcopal’s good works; rather, it was the Greek Orthodox church that obtained the benefit. Id. at 151. The Appellate Division properly rejected that contention, holding that because the Greek Orthodox church received benefits only as its members received benefits, the plaintiff, who was physically present on the premises of Christ Episcopal, benefited from Christ Episcopal’s works. Id. at 152.
The same analysis applies in the present case. The Mothers’ Center receives benefits through its members. Mrs. Ryan was a member of the Mothers’ Center and was physically present on the premises of Holy Trinity for the purpose of receiving the benefits conferred by that church on the Mothers’ Center and the partakers of its programs.
The Ryans’ reliance on Meyer v. Fairlawn Jewish Center, 71 N.J. Super. 313 (App. Div. 1961), aff’d, in part, rev’d on other grounds, 38 N.J. 549 (1962), is misplaced. In that case, the director of a corporation selling Israeli bonds at defendant Jewish Center was injured. Id. at 315-16. The Appellate Division concluded that the plaintiff was not a beneficiary of the Center’s works because he was not a member of the Center and had no concern or relation to its benefactions. His presence at the Center was in the course of his employment, and not as a recipient of the Center’s philanthropy or beneficence. Id. at 321. In affirming the Appellate Division in Meyer, we emphasized that even if Meyer’s employer was a recipient of the Center’s benefactions, his status on the premises could not be measured by that standard. His rights depended on his individual relation with the Center. He was present on the premises of the Jewish Center at the direction of his employer and in fulfillment of his function as an employee, not for the purpose of receiving personally the philanthropy of the Center. Meyer, supra, 38 N.J. at 553-54. Meyer is obviously irrelevant here because Mrs. Ryan was not an employee of the Mothers’ Center, but a member attending a function.
In sum, the Appellate Division correctly concluded that Holy Trinity is entitled to charitable immunity because it is a nonprofit entity, it is organized exclusively for religious purposes, and at the time of the accident, it was promoting its objectives in respect of Mrs. Ryan, who was a beneficiary thereof.
The judgment of the Appellate Division is affirmed in part and reversed in part. To the extent that it approved the grant of summary judgment to Holy Trinity and Laura Fadem, individually, and held that the Mothers’ Center was organized exclusively for educational purposes, it is affirmed. To the extent that it remanded the case for a showing that the operating capital of the Mothers’ Center is derived from charitable contributions or trust income, it is reversed. Summary judgment in favor of the Mothers’ Center and Laura Fadem, as its agent, is reinstated.
CHIEF JUSTICE PORITZ and JUSTICES COLEMAN, VERNIERO, LaVECCHIA, ZAZZALI, and ALBIN join in JUSTICE LONG’s opinion.
SUPREME COURT OF NEW JERSEY
NO. A-116/117 SEPTEMBER TERM 2001
ON CERTIFICATION TO Appellate Division, Superior Court
JAMIE C. RYAN and ROBERT J.
RYAN, her husband,
Plaintiffs-Respondents
And Cross-Appellants,
v.
HOLY TRINITY EVANGELICAL
LUTHERAN CHURCH,
Defendant and
Cross-Respondent,
And
MOTHERS’ CENTER OF MONMOUTH
COUNTY,
Defendant-Appellant.
DECIDED February 11, 2003
Chief Justice Poritz PRESIDING
OPINION BY Justice Long
CONCURRING OPINION BY
DISSENTING OPINION BY
CHECKLIST
Footnote: 1
On October 14, 1988 the Internal Revenue Service determined that the Mothers’
Center was organized exclusively for educational purposes and that no part of any
earnings would inure to the benefit of any private shareholder or individual, thus
warranting nonprofit status.
Footnote: 2
The other facilitator is not a party to the litigation.