the standard set forth in Feniello, supra, that Elwyn has operations within the state and thus comes within the purview of N.J.S.A. 2A:53A-7.
Plaintiffs argue next that summary judgment on the charitable immunity issue must be denied because there exists a genuine issue of material fact with respect to whether AIMS and Elwyn are "nonprofit corporation[s] . . . organized exclusively for religious, charitable, educational or hospital purposes," as required by N.J.S.A. 2A:53A-7. We disagree.
In support of their motion, defendants have submitted the affidavits of Donaphon and David R. Carson, the Director of Insurance and Business Services for Elwyn and AIMS. Both men state, based on their research and personal knowledge, that AIMS and Elwyn are nonprofit corporations. This contention is born out by the Certificates of Incorporation submitted in connection with the affidavits. It appears from AIMS' Certificate of Incorporation that AIMS was incorporated pursuant to N.J.S.A. 15A:1-1, (Exhibit A-76 to Donaphon's affidavit), which provides for the creation of nonprofit corporations. Similarly, it appears that Elwyn is treated as a nonprofit corporation pursuant to 15 Pa. C.S. § 7901 et seq. (Exhibit C-13 to Carson's affidavit.) In addition, defendants point to recent correspondence from the United States Internal Revenue Service to the effect that both corporations enjoy tax-exempt status, pursuant to 26 U.S.C. § 501(c)(3), as nonprofit corporations. In short, we find that the record supports the defendants' contention that they are nonprofit corporations. As plaintiffs have failed to produce any evidence, even after extensive discovery on this issue, that would cast doubt on defendants' asserted nonprofit status, we find that there exists no genuine issue of material fact with respect to this question.
We also find that both AIMS and Elwyn were organized exclusively for a combination of charitable, educational and hospital purposes. AIMS' Certificate of Incorporation provides that "the purposes for which this Association is formed are the study, care, training, maintenance and education of those whose minds have not developed normally." (E.g., Exhibit A59 to Donaphon affidavit.) According to Donaphon, AIMS "operates and maintains a long-term care facility for mentally handicapped, mentally retarded and developmentally disabled children and adults. It provides an educational program and training for its residents." (Donaphon affidavit, para. 3.) Similarly, the Act providing for Elwyn's incorporation states that the purpose of the corporation "shall be the mental, moral and physical education of idiotic and feeble-minded children . . ." (Exhibit B1 to Donaphon affidavit), and Donaphon states in his affidavit that Elwyn also operates long-term care facilities for mentally disabled people. (Donaphon affidavit, para. 4.) We believe, and plaintiffs do not appear to dispute, that these purposes as expressed in the defendants' corporate charters and evidenced by their activities, are manifestly charitable, educational and hospital as required by the charitable immunity statute.
Plaintiffs contend, nevertheless, that there exists a genuine issue of material fact with respect to whether Elwyn is organized exclusively for eleemosynary purposes. They point out that it appears from Donaphon's deposition testimony that Elwyn has two wholly-owned profit-making subsidiaries. Plaintiffs do not explain, however, how Elwyn's ownership of these subsidiaries affects its corporate purpose or its entitlement to immunity under the statute. It is clear that a nonprofit corporation organized exclusively for charitable, educational or hospital purposes may come within the purview of N.J.S.A. 2A:53A-7 even though it has profit-making operations. See Kasten v. YMCA, 173 N.J. Super. 1, 412 A.2d 1346 (App. Div. 1980). The question in such a situation is "'whether the institution pleading the immunity, at the time in question, was engaged in the performance of the charitable objectives it was organized to advance,' and whether plaintiff then was truly a beneficiary thereof." Sommers v. Union Beach First Aid Squad, 139 N.J. Super. 425, 431, 354 A.2d 347 (App. Div. 1976), quoting Anasiewicz v. Sacred Heart Church, 74 N. J. Super. 532, 536, 181 A.2d 787 (App. Div. 1962). In the present case, plaintiffs do not dispute that Fred Seiderman was injured by Elwyn's activities, and not those of its profit-making subsidiary. Accordingly, the fact that Elwyn owns profit-making subsidiaries is not material, inasmuch as there is no dispute that Elwyn was engaged in the performance of its charitable objectives, and that plaintiff was a beneficiary thereof at the time of his injury.
Plaintiffs offer no other arguments, nor produce other evidence, to refute defendants' contentions, which are supported by affidavits and other documentation, that they are nonprofit corporations organized exclusively for purposes covered under N.J.S.A. 2A:53A-7. We note that defendants' motion for summary judgment had been adjourned to allow plaintiffs to conduct discovery on this issue, and that the discovery is now complete. Based on the record before us, for the reasons set forth above, we find that defendants have carried their burden of establishing that they are covered by N.J.S.A. 2A:53A-7, and that plaintiffs have failed to produce any evidence to create a genuine issue of material fact with respect to this issue.
Having determined that AIMS and Elwyn are entitled to immunity under N.J.S.A. 2A:53A-7, we must determine the scope of that immunity and whether it applies to all of the claims alleged in the complaint. Plaintiffs point out that the statute by its terms refers only to "negligence" and argue, therefore, that AIMS and Elwyn are not immune from liability for their allegedly grossly negligent, wanton and willful misconduct. In response, defendants point to the legislative admonition, contained in N.J.S.A. 2A:53A-10, that the statute "shall be deemed to be remedial and shall be liberally construed so as to afford immunity to the said corporations . . . 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." Defendants contend that the remedial purposes of the statute will best be achieved by according immunity to all forms of negligent conduct.
This court's research has revealed no New Jersey cases precisely on point. In fact, the New Jersey Supreme Court recently declined to rule on the issue in Schultz v. Roman Catholic Archdiocese of Newark, 95 N.J. 530, 538-539, 472 A.2d 531 (1984). It explained:
We agree that a statute should be construed in light of probable legislative intent in the context of an evolving common law . . . . We see no evolution of common law doctrine that conflicts with the original legislative policy insofar as ordinary negligence of a charity's employees is involved. Courts have questioned whether the statute applies in cases of strict liability . . . . Whether immunity should cloak those with a reckless or gross disregard for the safety of others in a question that may have to be addressed . . . . Perhaps the time has come for the Legislature to consider again the scope of the law and its intended application to new theories of liability . . . .