Appeals from orders of Court of Common Pleas of Allegheny County, Oct. T., 1967, Nos. 33, 34 and 35, in re appeals of Title Services, Inc. and Allegheny Center Associates from tax assessment.
Francis A. Barry, First Assistant County Solicitor, with him James Victor Voss, Assistant County Solicitor, and Maurice Louik, County Solicitor, for appellant.
Frank L. Seamans, with him William H. Pentz, and Eckert, Seamans & Cherin, for appellees.
Bell, C. J., Jones, Cohen, Eagen, O'Brien, Roberts and Pomeroy, JJ. Opinion by Mr. Justice Jones. Dissenting Opinion by Mr. Justice Roberts. Mr. Justice Cohen and Mr. Justice O'Brien join in this dissenting opinion.
These three appeals all involve the same question: when real estate is sold by a tax-exempt authority to a nonexempt corporation after the annual assessment date for real estate taxes, does the nonexempt corporation have to pay a pro-rata share of taxes for the year of sale, or does the exempt status continue throughout the taxable year?
In each of these three cases the Urban Redevelopment Authority of Allegheny County sold parcels of
land in the City of Pittsburgh to private corporations after the annual tax assessment date in Allegheny County (January 1) for the years in question. The Board of Property Assessment, Appeals and Review (Board) assessed the respective properties for that portion of the taxable year in which the corporations owned the properties. On appeal to the Court of Common Pleas of Allegheny County, Judge McKenna held that, if property is tax-exempt on January 1, it remains exempt for the entire year. The Board has appealed to our Court.
Both parties are agreed upon one principle which is well established both in our case law and in the case law of other jurisdictions: if property is taxable on the date of assessment, the tax for the entire year must be paid even if the property becomes tax-exempt during the year. W. G. Halkett Co. v. Philadelphia, 115 Pa. Superior Ct. 209, 210, 175 A. 299 (1934). The case presently before us involves the converse situation. The taxpayers argue that, if property taxable on the date of assessment remains taxable for the entire year, then logically it must follow that property which is exempt on the date of assessment must remain exempt for the entire year. The Board argues that this does not necessarily follow since tax exemptions must be strictly construed.
The Board relies on three cases which it claims have held that, if tax-exempt property becomes nonexempt during the taxable year, then a pro rata share of the assessed taxes must be paid from the date of conveyance. The case which first established this principle is Moore v. Taylor, 147 Pa. 481, 23 A. 768 (1892). We are not persuaded by this opinion. First, not only is this statement dictum in the Moore opinion, it is double dictum. The Court in Moore held first that the question whether the property could be taxed after the sale
from a tax-exempt church to a private citizen was not justiciable since the original taxpayer had not appealed the action of the board assessing the property and, therefore, since this action had not been attacked, the board's action became final. Furthermore, the plaintiff-taxpayer had no standing since the property had been assessed for taxation before he purchased it. Second, we are unmoved by the Moore opinion because the vast weight of authority holds to the contrary.*fn1 The other two cases cited by the Board merely rely on the Moore opinion. Again, however, this recitation of the rule set forth in Moore is dictum in both cases. Philadelphia v. Pennsylvania Co. for the Instruction of the Blind, 214 Pa. 138, 63 A. 420 (1906), involved the converse situation where a charity was seeking tax-exemption for the second half of the fiscal year on a parcel of land which was taxable on the assessment date. In Appeal of Anthony M. Forsthoffer Post 389, 12 Pa. D. & C. 211 (Phila. ...