Case Brief: The Roman Catholic Bishop of Nueva Segovia v The Provincial Board of Ilocos Norte

G.R. No. L-27588 December 31, 1927
THE ROMAN CATHOLIC BISHOP OF NUEVA SEGOVIA, as representative of the Roman Catholic Apostolic Church, plaintiff-appellant,

The plaintiff, the Roman Catholic Apostolic Church, represented by the Bishop of Nueva Segovia, possesses and is the owner of a parcel of land in the municipality of San Nicolas, Ilocos Norte, all four sides of which face on public streets. On the south side is a part of the churchyard, the convent and an adjacent lot used for a vegetable garden, containing an area off 1,624 square meters, in which there is a stable and a well for the use of the convent. In the center is the remainder of the churchyard and the church. On the north is an old cemetery with two of its walls still standing, and a portion where formerly stood a tower, the base of which still be seen, containing a total area of 8,955 square meters.
On July 3, 1925, the defendants required the plaintiff to pay the land tax on the lot adjoining the convent and the lot which formerly was the cemetery and on the portion where the tower stood. The plaintiff filed an action to recover the sum of land tax that was paid to the defendants, alleging that it is illegal.
The lower court declared that defendants were correct in collecting land tax for the lot adjoining the convent, and that they erred in collecting land tax for the lot which was formerly the cemetery and on the portion were the tower stood.
Both parties appealed for this judgment.

1. Whether the lot on the southern side adjoining the convent is subject to land tax exemption.
2. Whether the lot on the northern side which formerly was the cemetery and the portion where the tower stood is subject to land tax exemption.

The Supreme Court held that both the lots must be subject to land tax exemption.

1. Yes. The land adjoining the convent is subject to land tax exemption.
The exemption in favor of the convent in the payment of the land tax (sec. 344 [c] Administrative Code) refers to the home of the parties who presides over the church and who has to take care of himself in order to discharge his duties. It therefore must, in the sense, include not only the land actually occupied by the church, but also the adjacent ground destined to the ordinary incidental uses of man. Except in large cities where the density of the population and the development of commerce require the use of larger tracts of land for buildings, a vegetable garden belongs to a house and, in the case of a convent, it use is limited to the necessities of the priest, which comes under the exemption.

2. Yes. The lot on the northern side which formerly was the cemetery and the portion where the tower stood is subject to land tax exemption.
Even if it is no longer used as a cemetery, neither is it used for commercial purposes and, according to the evidence, is now being used as a lodging house by the people who participate in religious festivities, which constitutes an incidental use in religious functions, which also comes within the exemption.

The judgment appealed from is reversed in all it parts and it is held that both lots are exempt from land tax and the defendants are ordered to refund to plaintiff whatever was paid as such tax, without any special pronouncement as to costs. 

Dissenting opinion of Justice Malcolm:
The Assessment Law exempts from taxation “Cemeteries or burial grounds . . . and all lands, buildings, and improvements use exclusively for religious . . . purposes, but this exemption shall not extend to property held for investment, or which produces income, even though the income be devoted to some one or more of the purposes above specified.” (Administrative Code, sec. 344; Act No. 2749, sec. 1.) That is the applicable law. The facts may be taken as found by the judge of First Instance, who made his findings more certain by an ocular inspection of the property under consideration. The testimony and the inspection disclosed that the lot Known as “huerta” was not devoted to religious purposes, and that the old cemetery had long since leased to be used as such and had been planted to corn. Those are the facts. The test to be applied to the combined law and facts must be the actual use of the property. The property legally exempt from the payment of taxes must be devoted to some purpose specified in the law. A “huerta” not needed or used exclusively for religious purposes is not thus exempt. A cemetery or burial ground no longer a cemetery or a burial ground is not thus exempt. Accordingly, I prefer to vote for the affirmance of Judge Mariano’s decision.