Conford, Kilkenny and Leonard. The opinion of the court was delivered by Kilkenny, J.A.D.
The Fairview Cemetery Company, a nonprofit New Jersey corporation, appeals from the determination of the New Jersey Inheritance Tax Bureau, Division of Taxation, that a devise to the cemetery company, under the will of Katherine Kuebler, of some five unimproved lots in Dover Township, Ocean County, was taxable as an inheritance under N.J.S.A. 54:34-2(d). The testatrix died on October 4, 1966.
The Bureau appraised these lands at $500 and assessed a tax of $75 plus interest, for a total of $82.50, which the cemetery paid under protest on May 22, 1968. The devise was absolute and unconditional, without any limitation upon it or the use of the funds which the cemetery company expects
to receive upon the sale of the lots. Fairview Cemetery is located in Fairview, Bergen County, at or near the boundary of that community with the boundary line of North Bergen, in Hudson County.
The cemetery company claimed and still claims before us that the devise to it was exempt from inheritance tax under N.J.S.A. 54:34-4(d), which exempts from inheritance tax transfers to, or for the use of or in trust for
"any educational institution, church, hospital, orphan asylum, public library or Bible and tract society or to, for the use of or in trust for any institution or organization organized and operated exclusively for religious, charitable, benevolent, scientific, literary or educational purposes, * * * no part of the net earnings of which inures to the benefit of any private stockholder or other individual or corporation; * * *." (Italics ours)
Fairview Cemetery Company maintains that it qualifies under this exemption as a "charitable" and as a "benevolent" organization. Obviously, it does not qualify under any of the other specified categories.
Fairview Cemetery Company has operated the cemetery in Fairview for about 67 years. It is nonsectarian and has served people of all races, religions and national origins, primarily of North Hudson and East Bergen County. It has sold and continues to sell cemetery plots to all people wishing to purchase and use the same. It alleges in its brief, without reference to any proof thereof in the record, that it makes provision for the burial of people who are unable to pay for the plot or for burial charges, by either reducing the fees charged or not charging any fees.
On April 20, 1936 it was adjudged insolvent by the former Court of Chancery. Receivers were appointed and they were authorized "to carry on the business [of the cemetery] as a charitable trust." Docket No. 113/495. Litigation concerning this receivership is reported in Burke v. Gunther, 128 N.J. Eq. 565 (Ch. 1941), affirmed 133 N.J. Eq. 609 (E. & A. 1943), and Moore v. Fairview Mausoleum Co., 39 N.J. Super. 309 (App. Div. 1956). On September 28, 1962 the
cemetery company was discharged from receivership by order of the Chancery Division and trustees were appointed by the court pursuant to N.J.S.A. 8:1-20.1.
The cemetery company advises us that there is presently outstanding and due to holders of receivers' certificates the aggregate sum of $104,150.61. There are no stockholders or holders of any other legal or beneficial interest in the cemetery association, other than the well over 10,000 plotholders. The Superior Court will retain control and select the trustees of the cemetery, audit their accounts and determine their compensation until the receivers' certificates have been paid in full. None of the present trustees has any pecuniary interest in the cemetery.
Fairview Cemetery Company has not had an operating profit since at least 1936. But there is pending in the Chancery Division an action for an accounting, for appointment of a successor trustee and for ...