Transcript of Record — Riker v. Commissioner (No. 261)
Supreme Court brief1957
Ask Donna
What actually matters in this document.
Text
R611
No. 15072
—_——— ———— x ey
Gnited States
Court of Appeals
for the Rinth Circuit x
PEGGY LOU RIKER and FREDA H. GRASS-
MEE, ~
£ vs.
COMMISSIONER OF INTERNAL REVENUE,
Petitioners,
Respondent.
Transcript of Record
Petition to Review a Decision of the Tax Court
of the United States
ri. &
‘ Philtips & Yor Orden Ce., 870 Brennan Street, Sen Prendhee, i"s-
PAUL P. O’BRIEN, CLERK
~-
_No. 15072
Bnited States
Court of Appeals
for the Ninth Circuit
PEGGY LOU RIKER and FREDA H. GRASS-
MEE,
Petitioners, |
Vs.
i aan fae Oe ee Pa
Respondent.
a
Transcript of Record
nee
Petition to Review a Decision of the Tax Court
of the United States
Phillips & Van Orden Co., 870 Brannan Street, San Francisco, Colif.-6-22-56
INDEX
[Clerk’s Note: When deemed likely to be of an important nature,
errors of doubtful matters appearing in the original certified record
are printed literally in italic; and, likewise, cancelled matter appear-
ing in the original certified record is printed and cancelled herein .
accordingly. When possible, an omission from the text is indicated by |
printing in italic the two words between which the omission seems
to occur. }
PAGE
Amended Petition, Na: 40078..........%.....: _ 68
_ Affidavit in Support of.............+---. 74
Ainendent to Answer, No. 46979.....:....... 77
Answer, No. 46979.......... ere as 11
Answer to Amended Petition, No. 46978....... 76
ere ee eee eer Te eee ee eee 1
GS ee eee 159
Decision, No. 46978................. ae 96
Theetebom, No. SORTS. : .. 25.0 fee cee eee YT
Docket Entries, No. 46978........45.....-.-6. 3
Docket Entries, No. 46979...-........... vio. ©
Memorandum Es A nea ered oreo 79
Petition, No. 46978........... Sn ee “13
Ex. A—Letter and Notice of Deficiency... 17
B—Constitution of Christ’s Church of
the Golden Rule................ 20
Petition, No. 46979 ........ ie ee ee
Petition for Review....... Te a (rea een ee ee 98
Ne eee eT eee eee 161.
INDEX PAGE
Transcript of Proceedings.................. 10]
Witnesses: |
Grassmee, Freda H. ;
ANE 0 cided oh oa whence ened 139
| U—@MOSB ......... Torreee. caavhene 142
Huff, Marian T.
—direct ........... err eer
SS oe ee rrr 135
ae ee ee 136
Riker, Peggy Lou
——GTOCE «2 econ Veen , 148
a, Ranney Ee arn eee 153
APPEARANCES
For Petitioner:
HOWARD B. CRITTENDEN, JR., ESQ.
For Respondent:
LEONARD L. MARCUSSEN, ESQ.;
T. M. MATHER, ESQ.;
ROBERT C. WHITLEY, ESQ.
| Commissioner of Internal Revenue - 3
In the Tax Court of the United States
Docket No. 46,978 ae
PEGGY LOU. RIKER, ;
} Petitioner,
| vs. .
COMMISSIONER OF INTERNAL REVENUE,
Respondent.
DOCKET ENTRIES
1953
Feb. 19—Petition received .and filed. Taxpayer
notified. Fee paid.
Feb. 19—Copy of Petition served on General Coun-
sel. 3 atl
Feb. 19—Request for -Circuit hearing in San
Francisco, filed by taxpayer. 3/11/53—
Granted. ie
Apr. 16—Answer filed by General Counsel.
Apr. 20—Copy of answer served on taxpayer—Sca
Francisco, Calif.
1954 :
Feb. 17—Hearing set May 24, 1954—San Fran-
cisco, Calif.
May 25—Hearing had before Judge Van Fossan on
Petitioner’s oraland written motions to
continue, Granted, and on joint motion to
consolidate Dockets 46,977 te 46,979, incl.
—Granted. Order, proceeding continued
generally on San Francisco calendar.
Written motion for continuance, filed at
hearing. Copy served on Respondent.
‘
.
4 | Peggy Lou Riker, et al., vs.
1954. :
June 15—Transcript of Hearing 5/25/54 filed.
July 13—Hearing set Nov. 1, 1954, San Francisco,
Calif. as
Oct. 25—Motion for leave to file amended petition,
amended petition lo@red, filed by tax-
payer.
Oct. 26—Hearing set 11/1/54, San ‘Francisco,
Calif., on petitioner's motion of 10/25/54.
Oct..26—Copy of motion, amended petition and
notice of hearing served on General Coun-
sel
- Nov. 2—Hearing had before Judge Tietjens on the
merits. Order, Motion to amend petition;
Granted. Amended petition filed; served.
Answer to amended petition, filed at hear-
ing; served simultaneous. Original briefs,
60 days. Reply, 30 days thereafter.
Nov. 9—Copy of motion and amended petition
__- served on General Counsel.
- Ney. 23—Transeript of hearing. 11/2/54 filed.
1955 |
Jan. 3—Motion for extension to Feb. 2, 1955, to
file brief, filed by General Counsel. 1/4/95
—Granted. .
Jan. 4 Motion for extension of 30 days to file —
brief filed by taxpayer. 1/6/55—Granted.
Jan. 28—Brief filed by General Counsel.
Feb. 7—Brief filed by taxpayer. Copy served.
Mar. 25—Reply Brief filed by taxpayer. Copy
served.
: . ©
Commissioner of Internal Revenite i)
1955. .
Apr. 14—Order that petitioner on or before May 25,
1955, file a proposed statement of facts in
accordance with Rule 35(e) of the Rule
of Practice, entered.
May 24—Motion for extension of time of 2 weeks
to file statement of facts, filed ‘by tax-
payer. 5/257/55—Granted.
June 7—Statement of Fact filed by taxpayer.
—. 6/8/55—Copy setved. —
Aug. 11—Memorandum findings of fact and opinion
filed, Judge Tietjens. Decision will be
entered under Rule 50. Copy served
8/11/55. |
Nov. 7—Computation for entry of decision filed
by Respondent.
Nov. 10—Hearing set 12/14/55, Washington, D.C.,
on Réspondent’s computation.
Dec. 14—Hearing had. before Judge Arundell, on
settlement. Ordered. Referred to Judge
Tietjens.
Dec. 15—--Decision entered, Judge Tietjens, Div. 1.
1956
Jan. 16—Petition for review by U.S. Court of
Appeals for the Ninth Circuit filed by
petitioner. Proof of service by mail at-
tached. |
Jan. 16—Designation of contents of Record on
Review, with proof of service by mail
thereon, filed by petitioner.
wee
6 Peggy Lou Riker, et al., vs.
Ini the Tax Court of the United States
Docket No. 46,979
FREDA H. GRASSMEE,
Petitioner,
| Vs.
COMMISSIONER OF INTERNAL REVENUE,
Respondent.
DOCKET ENTRIES
1953. | .
Feb. 19—Petition received and filed. Taxpayer
notified. Fee paid.
Feb; 19—Copy of petition served on General Coun-
th,
Feb. 19—Request for Circuit hearing in San Fran-
| cisco, Calif., filed by taxpayer. 3/11/53—
Granted.
Apr. 16—Answer filed by General Counsel.
Apr. 20—Copy of answer serv ed on taxpayer, San
Francisco, Calif. .
1954
Feb, .17—Hearing set May 24, 1954, San Francisco,
Calif. | |
May 25—Hearing had before. Judge Van Fossan
on petitioner’s oral and written motions
for continuance, granted ; and on joint
motion to consolidate Dockets 46,977 to
46,979, incl., granted. Order, proceeding
' continued generally on the San Francisco
ealendar. Written motion for continuance
filed at hearing. Copy served on respond-
ent.
Commissioner of Internal Revenue 7
1954
June 15—Transcript of Hearing 5/25/54 filed.
July 13—Hearing set Nov. 1, 1954, San Francisco,
Calif.
Sept. 8—Motion for leave to file amendment to an-
swer; amendent to answer lodged; filed
by General Counsel. 9/9/54—Granted.
Sept.10—Copy of motion and amendment to answer
_ served on taxpayer. .
Nov. 2—Hearing had before Judge. Tietjens on the
merits. Simultaneous. Original briefs, 60
days; Reply briefs, 30 days thereafter.
‘Nov. 23—Transcript of oe 11/2/55 filed.
1955 .
Jan. 3—Motion for extension to Feb. 2, 1955, to
file brief, filed by General Counsel. 1/4/55
—Granted.
Jan. 4—Motion for extension of 30 days to file
brief by taxpayer. 1/6/55—Granted.
Jan. 28—Brief filed by General Counsel...’
Feb. 7—Brief filed by Taxpayer. Copy served.
Mar.25—Reply Brief filed by Taxpayer. Copy
_ served.
Apr. 14—Order, that petitioner on or before May
25, 1955, file a proposed statement of facts
in accordance with Rule 35(e) of the
Rules of Practicé, entered.
May 24—Motion for extension of time of 2 weeks
to file statement of facts, filed by tax-
payer. 5/25/55—Granted. |
8 Peggy Lou Riker, et al., US
1955
June 7—Statement of Fact filed by taxpayer.
6/8/55—Copy served.
Aue. 11—Memorandum findings of fact and opinion
filed. Judge Tietjens. Decision will be
entered under” Rule 50. Copy served
8/11/5
Nov. Rp caine for entry of decision filed
by Respondent. .
Nov. 10—Hearing set 12/14/55, W ashington, D.C,
on Réspondent’s computation.
Dec: 14-—Hearing had before Judge Arundell, on
settlement. Ordered—Referred to Judge
Tietjens.
Dec, 15—Decision entered, Judge Tietjens, Div. 1
1956:
Jan. 16—Petition for Review by U.S. Court of
Appeals for the Ninth Circuit filed by
petitioner, Proof of Service by Mail at-
tached.
Jan. 16—Designation of Contents of Record on
Review with proof of Service by Mail
thereon, filed by petitioner.
[Title of Tax Court and Cause.)
Docket No. 46,979
PETITION
Now comes your petitioner, Freda H. Grassmee,
and petitions the above-entitled Court for redeter-
mination of tax by. the respondent Coramissioner,
and for grounds shows:
Commissioner of Internal Revenue 9
Bs
That by registered United States mail the Re-
spondent Commissioner of Internal Revenue sent
to your petitioner, Freda H. Grassmee, a letter
dated November 25, 1952, together with a ‘‘state-
ment,”? a Gopy of which is attached hereto marked
“Exhibit A” and made a part hereof by reference,
and incorporated herein as if herein set forth at
length. That said letter by its terms undertakes to
state that said Respondent Commissioner has deter-
mined your petitioner's Income tax Hability to be a
~ . defiereney of $176.53 and to assess the same as tax.
Il.
That said $176.53 cleimed deficieney for tax ts
claimed for personal income tax for the ealendar
vears of 1948 and 1949; that vour petitioner’s re-
turns for each of said years was duly and-recularly
filed with the Collector of Internal Revenue at San
Francisco. That in. said years vour petitioner's
residence was and is San Francisco, California.
That the entire amount of said proposed and
elanned deficiency of $176.53, with interest, is in
dispute and the subject of controversy.
IT1. .
That the Respondent Commissioner erred:
(1) In treating the gifts of Petitioner . to
Christ’ Chureh of the Golden Rule, for religious
purposes exelusively, as not a proper deduction in
either the vears 1948 or 1949, in any sum at all.
|
'
|
10 Peggy Lou Riker, et al., vs.
ee.
That the.statement of facts upon which Peti-
tioner relies are: ;
(1) That at all times herein mentioned, and
during the entire calendar years of 1948 and 1949
Christ's Church of the Golden Rule was and is a.
church and religious society and its principal tem-
poral ageney under its Church Fonstitution and
Canon Laws was the Elected Delegates Committee
of the Ecclesiastical Society of Christ's Church of *
the Golden Rule. That attached hereto marked
Exhibit B and incorporated herein by reference is
said Church Constitution and Caron Laws then and .
now in effect: That said Committee was and is
the temporal agency of said Church and religious
society, and held all property under said Church
Constitution and Canon Laws under a trust there-
for for use exclusively for religious purposes; and
no part of the income inured to the benefit of any
person, individual nor private shareholder (there
heing no shareholders of any kind) and no part of
its funds or property could be used for carrying
on propaganda or otherwise-attempting to influence
legislation. Thaf said Church and its said temporal
agency. Was and is organized solely and exclusively
for said religious purposes and are organizations
within the provisions of Section 10, subdivision 6,
Internal Revenue Code.
(2) That in each of said calendar years, peti
tioner gave all her earnings from her employment
to said Chureh for religious purposes by express
Commissioner of Internal Revenue 11
donations to said temporal agency for religious pur-
poses only.
Wherefore your petitioner, Freda H. Grassmee,
prays that the above-entitled Court set the above
matter for hearing in the City and County of San
Francisco, State of California, that a trial be had
thereon in said City, that a redetermination be had
“upon said proposed deficiency and said assessment,
that said Church and its said temniporal agency be
held to be an organization within See, 101, sub-
division 6, during the calendar years of 1948 and
1949, that 15% of vour petitioner’s personal earn-
ings be allowed as a proper decuction, and gifts te
that extent in each calendar year be allowed as
proper deductions as gifts te religions purposes,
and for such other and farther or other or further
relief, deerees, judgments and or orders as shall he
just and equitable in the premises,
< HOWARD B. CRITTENDEN, TR.
Attorney for Petitioner.
Duly verified.
Reeeived and filed February 19, 1993. TLCLULS.
Served February 19, 1953.
[Tith: of Tax Court and Cause.)
J deoocket No. W).0754
ANSWER
Comes now the Commissioner of Tnternal Rev-
ene, respondent above named. by his atterney,
>
12 Péggy Lou Riker, et al:, vs.
Charles W. Davis, Chief Counsel, Bureau of Tnter-
nal Revenue, and for answer. to the petition filed
by the above-named petitioner, admits and denies
as follows:
| I.
Admits the allegations contained in paragraph I
except denies that the deficiency has been assessed.
: Il. ,
Admits the allegations contained in paragraph II
except denies that petitioner’s returns for each of
‘said years were duly and regularly filed.
WT
Denies the allegations of error contained in para-
graph IIT of the petition.
IV.
(1) and (2.) Denies the allegations contained in
subparagraphs (1) and (2) of paragraph IV of the
f Vv.
Denies generally and specifically each and every
petition.
allegation contained in the petition not hereinbefore
admitted, qualified or denied.
- Wherefore, it is prayed that the Commissioner's
determination be approved and that the petitioner's
appeal be demied.
</ CHARLES W. DAVTS, °
Chief Counsel, Bureau of
Internal Revenue.
‘ Commissioner of Internal Revenue 13
Of Counsel:
B. H. NEBLETT,
District Counsel ;
T. M. MATHER,
LEONARD ALLEN
MARCUSSEN,
Special Attorneys, Bureau
of Internal Revenue. |
.
Filed April 16, 1953, T.C.U.S.
[Title of Tax Court and Cause.]
Docket No. 46978
PETITION
Now comes vour petitioner, Peggy Lou Riker,
and petitions the above-entitled Court to redeter-
mine the alleged assessment and claimed determina-
tion of tax by the Respondent Commissioner against
your petitioner, and for grounds shows: .
S
That the Respondent Commissioner by letter
dated November 25, 1952, sent by United States
registered mail to vour petitioner Peggy Lou Riker .
advising vour petitioner that tax in the sum of 1.
584.03 was being assessed and was determined as a
deficiency against vour petitioner. That a copy of
14 | Peggy Low Riker, et al., vs. —
said letter together with attached ‘‘statement”’ is at-
tached hereto marked “Exhibit A’? and = incor-
porated herein by reference.
II.
That the said $1,584.03 is claimed as deficiency
and assessed for the vear 1948, ending September
30, 1948, for personal income taxes of your peti-
tioner. That said return was duly and regularly filed
with the Collector at San Francisco, Califoriia.
That the amount of tax in controversy is $420.
i) °
That the Commissioner erred:
(1) In refusing vour petitioner any deductions
for gifts made .to Christ’s Church of The Golden
Rule, an exempt organization under See. 101(6) in
any sum or at all.
° . . . s
(2) That rneome ot petitioner from all SsOUrces
during said accounting period was the sum of $s,
595.11 and not *9,713.89.
(3) That the Commissioner disallowed the ex-
pense ef $168.61 for property and sales tax as a
proper deduction.
, i.
That the faets upon which veur petitioner rely
are:
(1). That during the entire period of time in-
volved in the return, and during 1948 and at al!
Commissioner of Internal Revenue 15
F ;
times herein mentioned Christ’s Church of The
Golden Rule was and» is a Church and religious
society and its principal temporal agency was and
is the Elected Delegates Committee of the Ecclesi-
astical Soeiety of Christ's Church The Golde~ Rule,
which committee held all money and property in
trust and was organized to act for the eéclesiastical
organization for religious purposes pursuant to the
Church Constitution and Canon Laws, a copy of
which is attached hereto marked Exhibit B and in-
eorporated herein by. reference. That said Church
is and was an exempt organization and within the
provisions of Section 101(6) and all money and
property were and are held for religious purposes
only and no part inures nor inured to the benefit
of any person, individual or private shareholder,
now Was nor is any part used or usable for propa-
ganda or to otherwise influence legislation.
(2)° That: vour petitioner made gifts of her in-
eome during the period covered by her rettrn, to wit
the taxable vear ending September 30, 1948, in the
sum of $8,959.11 to said Chnureh for religious pur-
poses onky under said Chureh Constitution | and
Canon Laws, to said Church's said temporal agency.
the said Eleeted Delegates Committee of the Ee-
clesiastical Society of Chmrist’s Church of The
Golden Rule.
(3) ~That vour petitioner’s total ineome during
said period was $8,959.11 and no more, and. not the
sum of $9,713.89.
~~
16 Peggy Lou Riker, et al., Us.
(4) That your petitioner expended during said
year, the sum of $168.61 as and for property and
sales taxes which are a proper deduction in com-
puting income for tax purposes.
Wherefore yeur petitioner Peggy Lou Riker
prays that the above-entitled Court redetermine the
deticiency assessed and determined against her as
aforesaid: that a trial be had thereon in the City &
County of San Francisco; that the donations to said
Church be properly allowed as deductions for
religous purposes, that said property and sales
taxes be allowed as proper deductions, and that the
Court determine her income not to exceed the said
sum of $8,959.11 as aforesaid; and for stich other
and further or other or further relief. decrees
and/or judgments as shall he just and equitable in
the, premises. ,
v</ HOWARD B. CRITTENDEN, JR.
Attorney for Petitioner.
Duly Veritied.
Commissioner of Internal Revenue 17
EXHIBIT A
Form 1230-A (1951)
Internal Revenue Service
TRA :90-D:HM
U. S. Treasury Department
Office of Internal Revenue Agent in Charge
74 New Montgomery Street
San Francisco 5, California
Nov. 25, 1952.
Mrs. Peggy Lou Riker,
Post Office Box 3652 Rineon Annex,
San Francisco 19, California.
Dear Mrs. Riker: ; ’
You are advised that the determination of your
income tax liability for the taxable vear(s) ended
December 31, 1948, discloses ai deticieney of ¥1.-
584.02 as shown in the statement attached,
In accordance with the provisions of existing in-
ternal revenue laws, notice is hereby given of the
. 2 ie . . . Fe !
deticieney or deficiencies mentioned,
Within 90 days from the date qf the mailing of
this letter von may file a petition with The Tax
Court of the United States, at its principal address,
Washington 4D. C2. for a redetermination of the
deticleney, Tn counting the 90 days vou may not ex-
chide any’ day unless the 90th day is a Saturday.
Sunday. or legal holiday in the Distriet of Colum
hic, in whieh evemt that dav is net eaunted as the
‘wth dav. Otherwise Saturdas s. Sundavs and legal
-18 Peggy Lou Riker, et al., vs.
holidays are to be counted in computing the 90-day
period. . a
Should you not desire to file a petition, you are
requested to execute the enclosed form and for-
ward it to this office for the attention of IRA:90-D.
The signing and filing of this form will expedite the
closing of your return(s) by permitting an early
assessment of the deficiency or deficiencies, and will
prevent the accumulation of interest. since the in-
terest period terminates 30 days after receipt of the
form, or on the date of assessment, or on the date
of payment, whichever is earlier.
‘
Very truly vours,
JOHN 8. GRAHAM,
Acting Commissioner.
By HENRY J. BRU,
Acting Internal Revenue
Agent in Charge.
Enelosures:
Statement,
Form 1276,
Agreement Form.
Statement
San Francisco :
IRA :90-D -HM
Mrs. Peggy Lou Riker
Post Office Box 3652 Rineon Annex
San Franciseo 19, California
Tax Liability for the Taxable Year Ended
December 31, 1948
- Deficiency
Income Tax .... ag Lee
In making this determination of vour ineome tax liability, it
is noted that you did not avail vourself of the privilege of filing
a protest.
°
Commissioner of Internal Revenuc 19
A copy of this letter and statement has been mailed to your
representative, Mr. Howard B. Crittenden, Jr.. Central Tower,
703 Market Street, San Francisco 3, California, in accordance.
with the authority contained in the power of attorney executed
by you and on file in this office.
Adjustments to Net Income
Net income as disclosed by return.........-...- ¢ 586.17
Unallowable deductions and additional in-
come : . 2
(a) Contributions ...................----..$ 8,959.11
i ee 168.61 9,127.72
Adjusted gross income as corrected............ $ 9,713.89
Less :
(ce) Standard deduction —................- 971.39
Net income as adjusted... Seellonae $ 8,742.50
Explanation of Adjustments
(a) It is held that contributions in the amount of $8,959.11
made to Christ's Church of the Golden Rule are not allowable
deductions in computing your taxable‘net income.
(b) Due to the fact that the standard deduction has been
allowed, the deduction claimed for taxes in the amount of
$168.61 has been included in computing your adjusted gross
income.
(c) The standard deduction of $971.39 is allowed represent-
ing 10% of $9,713.89, your adjusted gross income as corrected,
Computation of Income gax
a ictaicnnninaneniecamnslh eae
Less 2 exemptions at $600.00 each. ......... 1,200.00
Normal tax and surtax net income..........% 7,542.50
Tentative tax 0.000... . fee # 1829 76
Less: 17% on $ Fe ARE REE 68.00
12% on $1,422.76.............-00--000-00- OBS 170.73 238.73
Correet income tax liability... ........-. € 1,584.03
Income tax disclosed by return
Original, Aecount No. 7832608 .
First California District ................-..- 0.00.
Deficiency in income tax. CELI) € 1584.03
20 | Peggy Lou Rtker, et al., vs.
EXHIBIT B
Certified Copy
Constitution of
Christ’s Church of The Golden Rule
We, the members of the ecclesiastical society of
Christ’s Church of The Golden Rule, do hereby
ordain and. establish this Constitution for the
* Church. -
Article I.
| Declaration of Faith
We deem it proper to state herein some of the
basic doctrines and principles upon which Christ’s
Church of The Golden Rule is founded, and the
following declaration expresses, substantially, what
we believe:
1, Of The True God:
We believe that there is but one living and true
Father-Mother God; omnipotent, omniscient, and
omnipresent; the Creator and Preserver of all
things both visible and invisible; the Supreme
Ruler of the Universe, wholly worthy of honor, con-
fidence and love—in whom we live, move, and have
our being. |
2. Of Christ Jesus:
We believe that Jesus of Nazareth was inexpress-
iblvy wise, gentle and holy; that he came to earth
to reveal God to all men, and to exemplify by his
e
Commissioner of Internal Revenue 21
actions and teachings all of the virtues and good-
ness of a perfect man; that by his life, crucifixion,
death, resurrection and ascension he became the
Way-shower to all who believe in his teachings;
but that the Christ (Truth) existed even before
Abraham was, and has always been co-existent with
God * * * the man Jesus we believe to have been
the highest exemplification of the Christ (Truth)
to have evolved from the race of men—hence our
acceptance of him as our Way-shower.
3. Of the Holy Seriptures:
“We believe that the original basic teachings of the
Holy Bible wefe written by men moved by the Mind
or Spirit that is God; that it contains all directions
necessary to salvation; that it reveals the principles
by which we shall live and he judged; that it is, and
wi) forever remain the basis of ‘hristian fellowship
and the most perfect standard by which human con-
duct shall be tried.
-4 Of Salvation Through Repentance and Regen-
eration: |
We believe that to be saved from the consequences
of any kind of wrong doing, we must truly repent
thereof and correct our errors; that to be. regen-
erated we must respond freely to the influence and
power of the Mind that is God—the Mind that was
in Christ Jesus; and that the evidence of regenera-
tion shall appear as a more Christ-like life.
22 Peggy Low Riker, et al., vs.
~-
5. Of True Réligion:
We believe that the essence of true religion is to
learn to love God with all of one’s heart and the
art of doing unto others as we would have others
do unto us; that we must serve, rather: than be
served; that the strong must help the so-called weak,
so that none may suffer; and that in all things we
should seek the perfect will of God, and the good
of all men. — :
6. Of the Economy of. the Chureh:
We believe that economic equality is the only en-
during foundation upon which to build industrial,
business, political, national and international rela-
tionships; and that to insure such equality the
property and earnings of the individual members _
of the Chureh should be owned and managed by the
Church for the benefit of all mankind in accordance
with the rules and regulations of the ecclesiastical
society of this Church, that God may be glorified
and all mankind directly or indirectly benefited.
Article IT.
Church Organization
There is hereby ereated an organization for mat-
ters ecclesiastical, which shall have power: to adopt.
anodify and interpret the creeds, activities, doctrines
and teachings of the Church; to establish, amend
and. interpret the canon law of the Church; to
ereate, appoint, discipline and, if necessary, remove
officers of the Chureh and its various affiliates and
avencies: to test. pass upon, select and discipline
.
Commissioner of Internal Revenue 23
members of the various classes, associates, ¢co-
workers and affiliates of the Church, to determine
the various classes of membership, associates, co-
workers and affiliates of the Chureh; to provide for
ordination and select those qualified for ordination:
to provide for the sacraments and determine who
shall give and who shall take the sacraments: to
establish ecclesiastical courts, and define the juris-
‘diction and powers thereof; to appoint the mem-
bers of such courts and provide for their procedure,
and for the review and carrying out of the judg-
ments and sentences thereof; and to do any and all
other things deemed’ necessary and proper for
earrying on the ecclesiastical work of the Church.
Article ITI.
The Senior Elder
There is hereby created the office of Senior Elder
of Christ’s Church of The Golden Rule.
The Senior Elder, during his tenure. of office,
shall be the Ecclesiastical Head of the Church, and,
except as otherwise provided in this constitution,
shall have and exercise all of the powers pertaining
to the ecclesiastical government of the Chureh, not
specifically granted to some’ other agency, officer,
or committee, as provided in Article IT; and the
Senior Elder shall also have power to supervise and
veto the acts of any other ecclesiastical - officer,
agency, or committee of the Church. |
The Senior Elder shall be elected by the duly
chosen representatives of the several student -min-
24 | Peggy Lou Riker, et al., vs.
ister training projects of the Church, at a con
vention of such representatives called for that pur-
pose. He shall hold office until his successor is
elected or appointed by a convention called to select
another Senior Elder. Such convention may be
called by the Senior Elder, or by a majority of the
said Project Managers, or by a majority of dele.
gates selected for that purpose by the members of
the several projects.
Article TV.
The Advisory Board of Elders
1. There is hereby ereated an Advisory Board
of Elders of Christ's Chureh of The Golden Rule. -
2. The Advisory Board shall be composed
five ecclesiastical members of the Church who, in the.
first instance, shall be elected by the Convention:
two of said) members shall be elected for terms of
three vears, two for terms of two vears, and one for
aterm of one vear: and thereaftersat the expiration
‘of a term, a successor shall be elected by the. re-
maining members of the Board for term of three
years, and if a vaeanev oceur for reason other thay
expiration of a term the remaining members of the
Board shall elect a snecessor for the unexpired term,
Any person elected to membership on the Board
shall serve only if contirmed by the Senior Elder,
and of not confirmed by the Senior Elder. th
Board shall elect another ‘person whe is satisfac ‘tory
to the Senior E Ider.
= & Subject’ to the written consent of the Senior
Elder. the Advisorv Board. by a majority. vote of
¥
eK
Commissioner of Internal Revenue 25
its members, may enact, establish, amend, or repeal
the provisions of any of the canon laws, creeds
and doctrines of the Church; and, subject to the
written consent of the Senior Elder, the Advisory
joard, by a majority vote of its members, may
create, appoint, disclipline, or remove officers of the
Church, determine the various classes of member-
ship, associates, co-workers, and affiliates of thecee-
clesiastical organization, provide for and appoint
committees for the examination of applicants for
the several classes of membership, associates, co-
workers, and affiliates, and prescribe . standards
therefor: selevt persons for ordination, and persons
te vive the sacraments. ;
t. Subject to the written consent of the Semer
Elder, the Advisory Board, by a majority vote of |
its members, may establish ecclesiastieal courts
and define the Jurisdiction thereof, appoint the
members of such courts, establish, the procedure
thereof for the trial of matters and persons within
its jurisdiction, snd for the review and éarrving
out of the judemonts and sentences of the courts.
5. The Senior Elder shall hiave and exereise,
when he deems it advisable or necessary, the power
to review, modify, or reverse the Judgement or
sentence of anv ‘ecclesiastical court. and te reprieve
er pardon any person convicted by sueh court,
Article V.
The College of Pastors
’
1. There is hereby created a College of Pastors
of Christ’ Church of The Golden Rule.
26 Peggy Lou Riker, et al., vs.
2. The College of Pastors shall be composed of
the pastors of the various projects, congregations,
and groups of the Church, and shall convene upon
eall of the Senior Elder..The College of Pastors
shall act by a majority vote of a quorum; and half
of the members of the College shall cui.stitute a
quorum, |
3. The College of Pastors shall have such powers
and perform such duties as may be preseribed by
the Senior Elder in writing.
Article VI.
Temporal Agencies
1. The temporal agencies of the Church shall be
under and subject to the control of the ecclesiastical
authorities of Christ’s Church of The Golden Rule.
- 2 The temporal agencies of the Church, while
subject to ultimate control by the ecclesiastical
authorities, shall, insofar as may be practicable, be
kept separate from the ecclesiastical agencies of the
Chureh.
*»
3. The officers, agents and members of the tem-
poral agencies of the Church shall possess such ec-
elesiastical or other qualifieations and be ‘subject. to
such discipline and supervision as may be preseribed
by the ecclesiastical organization of the Chureh, or
by its canon laws.
4. The. Senior Elder, with the adviee of the
Advisory Board, shall grant charters to the various
congregations, projects and other temporal activi-
Commissioner of Internal Revenue 27
ties Upon such terms, conditions and reserva-
tions as shall be determined by him. Any violation
of such terms, conditions, or reservations, or of the
canon laws of the Chureh shall, if clearly shown
in accordance with his sole diseretion—justify the
Senior Elder in the suspension of stich charter: or
such. charter, after hearing, may be declared for-
feited by the judgment of an ecclesiastical court
of the Church,
5. If any charter is suspended, or forfeited, as
herein provided, or if the Advisory Board or the
Senior Elder shall find that any property of a
chartered ageney of the Church is not being handled
or used according to the religious dedication thereof,
then the powers and duties of such chartered ageney,
tovether with the property under its control, shall
he transferred to, and shall be held and) admun-
istered by, another temporal ageney of the Church
asin the eanon laws provided and. if the canon laws
do not se provide, then te such temporal agency of
the Chureh as the Senior Elder may designate in
writing. ;
6. The ownership. right. of possession and in-
terests in property, as referred to in paragraph 5
of this Artiele, shall be determinéd by the ee
elosiastical courts of the Church whose judgment in
respect thereto shall be final.
7. If anv temporal ageney of the Chureh shall
have title to or possession of any property of the
Church, sueh ageneyv shall hold) such property. in
28 Peggy Lou Riker, et al., vs.
trust for the bentit of the ecclessiastical society
of this Church; and the income therefrom shall be-
long to the ecclesiastical society of this Church;
and it shall be used exclusively for carrying on the
ecclesiastical work of the Chureh in accordance with
the rules and regulations of the ecclesiastical society
of the Church and shall be payable to the Church
upon the order of the Senior Elder or Advisory
Board. |
Article VII.
Settlement of Controversies
1. Tt is hereby declared to be the policy of
Christ's Church of The Golden Rule that the mem-
hers, associates, co-workers, affiliates, congregation,
projects and other agencies of the Chureh shall not
engage in controversies, civil litigation, or other un-
seemly conduct in respect to property or other
rights; but that all disputes, disagreements and con-
troversies relating thereto, of every kind whatso-
ever, shall be determined and settled in accordance
with the canon Jaws and by the ecclesiastical courts
of the Church. |
» Christ's Chureh of The Golden Rule recog
nizes the necessity for and gives cheerful adherence
to.civil government, its laws, courts and institutions ;
it holds‘and ordains, however, that its members, as-
socjates, co-workers, affihates, congregations, proj-
ects and other agencies shall not become involved
in civil litigation, but instead shall be governed by
the eanon laws and other Jaws, rules, and regula-.
Commissioner of Internal Revenue — 29
tions of the Church as interpreted, followed and en- |
forced by its ecclesiastical courts. |
3. Tf any controversy, dispute, or disagreement
shall arise between any members, associates, co-
workers, affiliates, congregation, projects, or other
agencies of the Chureh, or any of them, which can.
not be settled by thé parties involved. therein, re-
course shall be had to the authorities of the Church
including, as a last resort. the ecclesiastical courts
thereof, whose judgment shall be final.
1. The willful violation of any of the provisions
of paragraphs 1, 2, and 3 of this Article shall ,sub-
ject the yiolator, if a member, associate, co-worker,
or affiliate of the Church to suspension and. if
pursued, to excommunication ; and if the violator
is a congregation, project, or other agency of the
Chureh, it may he abolished or its rights, privileges.
duties and powers may be transferred by the Senior
Elder to another ageney of the Chureh.
Article VIII.
* Amendments
Amendments of this constitution may be proposed
hy the Advisory Board, or by the Senior Elder,
but shall not be effective until ratified by a two-
thirds vote of the managers of the several student
minister training projects of the Church,
Article IX.
Convention
The Chureh convention shall have full power to
amend this constitution, any eanon law, doctrine or
30 Peggy Lou Riker, et al., vs.
ecclesiastical ruling by a majority vote of a quorum
of the convention proposing such amendment or
change and duly ratified by a majority of the ec.
clesiastical members of the Church society. The
Senior Elder’s office may be declared vacant or
filled, ér any other Church official’s office declared
vacant, with or without cause, or vaeany filled by a.
majority vote of a quorum of the convention rati-
tied by a majority of such ceclesiastical members.
The convention shall convene upon eall of the
Ecclesiastical Head or Acting Keelesiastical Head
or upon written demand of 29% ‘of the ee.
elesiastical members of the Chureh. The — con-
vention shall consist of elected delegates, elected
by a majerity of the ecclesiastical members of
the Church at each group or congregation. There -
shall be one elected delegate for each twenty (20)
adult® persons or major fraction thereof, but there
shall be at least one from. each student minister”
training group and church congregation, even
though it have less than 10 adults. A majority of
elected delegates shall constitute a quorum, The
Convention shall be the sole and exelusive judge of
the qualification and eredemtials of its members.
Canon Laws of
Christ's Church of The Golden Rule
Canon Law No. 1-——Official Tenet.
The King James version of the Holy Bible as it
is construed, taught and interpreted from time to
”
"15 vears.of age and older.
Commissioner of Internal: Revenue 31
time by the duly constituted officials and officers of
the ecclesiastical society of the Church, is hereby
declared to be the law gover ning the ecclesiastic ale
matters and conduct of, the parties under these
canon laws.
Canon Law No. 2—Purposes.
In accordance with the rules of procedure ap-
proved im writing by the duly constituted — ec-
clesiastical government of the Chureh, it shall be
the purpose of the religious society to teach and
promote the spiritual and religious welfare of man-
kind and particularly to promulgate the teachings
of Christ Jesus as found in the King’James version
of the Holy Bible, most particularly the economic
teachings.of Christ Jesus, and to this end to main-
tain and earry on churches; to teach those things
‘that in the opinion of said Church Government will
tend to forever end the causes and evils of war,
poverty, illiteracy, superstition, greed. brutality.
hate, selfishness, man’s inhumanity to man and his
subjection to the blind so-called forces of nature and
materiality : to teach such subjects as will eng
mankind to adopt Christ Jesus’ **Golden Rule” o
absolute **economic”” “equity as the cornerstone of
1 world-wide and universally accepted system of all
individual, industrial, business, political, national
and. international relationships; to teach that men
should worship and glorify “*fiod,” not other men
whom they set up on thrones and literally worship
and glorify as they would an ‘tidol.” until such men
become their masters with the power of life or
32 Peggy. Lou Riker, et al., vs.
,
death in their hands, as though ‘they’. were God
Himself, or as though mankind were slaves who
lived only to do the bidding of these idolatrously
worshipped pigmy gods of wrath, greed and hate;
to teach that there is but ‘tone’? God—ommiscient,
and omnipresent Life, Truth, and ** Love’’-—-who
lovingly cares and provides for all of His ‘children
impartially and ‘tequally”’ from His limitless and
inexhaustible universe; to teach that because of the
infinite afflmence og our Creator — the vastness and
inifinitels abundant substance of His universe—
creed, selfishness, economic competition, poverty,
jealousy, hate and war are but manifestations of
moral idivey —expressions of ignorance, supersti-
tion and stupidity.
In accordance with the rules of procedure: ap-
proved in wrifing by the duly constituted” ce-
-lesiastieal government of the Church, to teach and
promnete the spiritual, moral and finaneial welfare
of all. mankind by the practical application of
Christianity: te teach and give iistrnetion in the
veneral seience of Jaw and nature by means of any
practical edneational methods, and te teach and
exemplify by any practical means, with any or all
suitable means or Aweneles the practical application
of Christianity: te teach and exemplify: the Use of.
monev oor eredit: in-any and all of its ,economic
finetions, and generally to tevely and exemplify
worthy and righteous business methods and. seien-
tifie wavs of procedure based pon Christ -esus’
“Golden Rule’ of absolute and impartial universal!
economic equality.
Commissioner of Internal Revenue 33
Temporal Affairs.
Canon Law No. .3—Seeular and Temporal Admin-
istration.
Insofar as practical, there shall be maintained a
complete separation of all matters ecclesiastical and
all matters secular and temporal. Matters secular
and temporal shall be handled by the various tem-
poral agencies of the ecclesiastical society, or its
various subdivisions, activities or congregations or
projects. The ecclesiastical matters shall be all im-
portant, and the seewlar and temporal matters shall
he wholly subservient to and for the purpose of. aid-
ing, assisting and carrving out the ecclesiastical
matters. All temporal agencies shall hold their prop-
erty Upon au private trust for the ecclesiastical
organization; and the temporal agent shall act as
such only with the consent and direction of the ee-
clesiastical organization. and upon the termination
of any such temporal agent's authority or limita-
tion of its seope by the eeclesiastieal Clureh Gov-
ernment, its seope and authority shall forthwith be
limited accordingly except te convey titles or prop-
erty to its successor as named by the Clifreh Gov-
ernment. -Determination of ecclesiastical matters by
the duly constituted authorities of the Clarch shall
he conelusive and banding upon the temporal
agencies, even though sueh ecclesiastical matter di
rectly or indirectly or Ineidentaily alffeets matters
of property. or property rights oranthority of any
temporal ageney or of any officer, agent or member
of such agenev.
34 Peggy Lou Riker, et al., vs.
Canon Law No. 4—Granting and Revocation of
Charters:
Each project, congregation, temporal agency,
society and group within the religious society shall,
as a condition of its authority and right to be a part.
of the religious society, hold a charter from the
ecclesiastical Church Government. Such charter
shall provide in addition to such ‘other provisions
as the Church Government may designate, a provi-
sion that the charter is held pursuant to the church
constitution and canon laws, and is revocable upon
violation of any of the canon 'aws. Such charter
shall be granted, withheld or revoked upon what-
ever terms and conditions the Church Government
may designate. Departing from the religious pur-
poses as detined, by the duly constituted Church Gov.
ernment or any sehism, shall be grounds for termi-
nation of the charter by either the Eeeclesiastical
‘Head or by the judgment or decision of the Church
Judiciary. , :
Upon revocation or suspension of a charter, all
property of the project, congregation, temporal
agency, society or group shall forthwith be delivered
to the person or persons designated by the Church
Judiciary, and pending action by the Church
Judiciary, to whomever the Church Government.
shall designate.
Canon Law No, 5—Definition of Temporal Agency.
‘‘Temporal Agency’’ as used in these canon laws
means any person, natural or artificial, or group or
e
Commissioner of Internal Revenue 35
eutity who acts in any way in matters temporal or
secular for the ecclesiastical Church Government or
religious society or any part thereof or any project,
congregation or activity of the Church or who holds
any property subject to any religious trust or use or
purpose under the doctrines, teachings or beliefs of
‘the religious society or ecclesiastical Chureh Gov-
ernment. |
Canon Law—No. 6—Powers of Temporal Agency.
Nothing in these canon laws shall prevent, hinder
nor be construed to prevent or hinder any temporal
agency under these canon laws from changing the
form of any property subject to the religious pur-
poses as detined and construed by the ecclesiastics!
Church Government. Such temporal agency shall
have power to sell, lease, hypothecate and/or
alienate such property so long as the proceeds there
from shall be thereafter used for such religious pur-
poses, or remvested for such use for sich religious
plirposes. To avoid Joss of property by the transfer
of such property for substantially less than its
market value, or to otherwise lose property for such
religious purposes, the Eeclesiastical Head of the
Church Government shall be consulted as to any
contemplated sale, lease. liypothecation or aliena-
ton of any substantial asset or property mi excess
of $10,000.00 value, and if he determines that such
sale or transfer, lease, hypotheeation or alienation
is. in his discretion, net calculated to tose or reduce |
the value of the property subject to such religions
- a Peggy Lou Riker, et al., vs.
purposes by such contemplated sale, lease, transfer,
hypothecation or alination, and that such transac-
tion will tend to carry out such religious purposes,
he shall consent thereto. Failure of any official ?
or person connected with such temporal agency
under these canon laws to first consult with said
Ecclesiastical Head of the Church Government be-
fore making such transaction or to abide by the -
decision of said Eeclessiastical Head, or the judg-
ment of the Church Judiciary, if its jurisdiction
has been invoked and such judgment is not in ae-
cord with the decision of said Ecclesiastical Head,
shall be grounds for discipline before the Church
Judiciary. .
Canon Law No. ‘7—Suspension of Temporal Powers.
Should any temporal agency of the Church or-
ganization do or suffer to be done anything which
might materially impair the ability of such temporal
ageney to petform any of its duties or that might
materially impair the use of any substantial part
of the property held by the temporal agency for
- religious purposes as defined and determined by the
ece ‘lesiastical Chureh Government, then it shall he
the duty of the Eeelesiastieal Head of fhe Church
~ Government or of the Advisory Board or of the
Chureh Judiciary upon its own motion, to forthwith
suspend the powers of such temporal ageney. Im-
mediately upon such suspension, the Church Judici-
ary shall, with or without notice, designate a tem-
porary agency or person, under the eanon laws to
{
Commissioner of Internal Revenue 37
take possession of all of the property held by the
temporal’ agency and to use the same for .such
religious purposes under the direction and control
of the Church Judiciary. Possession and all -powers
of such temporal ageney shall forthwith pass to such
agency or person temporarily designated by the
Church Judiciary, pending the final determination
and decision and judgment of the Church Judici-
irv. The Chureh Judiciary shall cause proceedings
‘tou be instituted before it, notice: given to all in-
terested persons, and if the Church Judiciary shall
determine thereafter upon notice and after a hear-
ing or opportunity to be heard, that such temporal
agency has done or suffered to be done or was about
to do or suffer to be done anything which might ma-
terially impair the. ability of the temporal agency
tu perform any .of its duties prescribed by the
Church Government or. materially impair the reli-
gious Use of any substantial part of any of its prop-
erty, it shall be the duty of the Church Judiciary
to terminate all power, right, and authority of the
temporal agency as of the suspension or commence-
ment of the proceedings if there were no-suspension,
and to designate the proper. person or agency for
the performance of such duties of such temporal
¢
agency. and its successor.
Canon Law No. 8—Terms of Conveyance and Ad-
ministration of Assets.
All property acquired by the Church, or any con-
sregation, project, ecclesiastical society or any part
thereof, or any temporal agency shall be used and °
38 Peggy Lou Riker, et al., vs
held exclusively for the religious purposes as de-
tined and interpreted by the ecclesiastical Church
Government. This shall apply to all property how-
soever acquired, of whatever kind and nature, and
wheresoever situated, and whether personal or real
or ‘otherwise, and whether tangible or intangible.
All transfers, convevances and sales shall he pre-
sumed to be bona fide gifts to the Lord's work un-
less there be conditions or understandings or prom-
sex to the contrary in writing duly approved in
writing by the duly constituted ecclesiastical Church
Government. The consent in writing shall not be
viven unless the ecclesiastical official, exercising
such diseretion, determines such conditions or -un-
derstandings or promises will tend to earry out the
said religious purposes of the cece ‘lesiastieal Chureh
Government. and sueh conditions, understandings
and/or promises are necessary fo carry out such
religious purposes. The consent thereto shall be
withheld ‘if the Eeclesiastical Head shall, in’ his
absolute discretion, determine such conditions, Un-
‘derstandings and or promises are likely to unduly
impair thre religions: purposes OF subject other prop-
perty. subject to religious purposes, to undue Yisk
wv hazard,
It shall be the poliew of the ecclesiastical Chureh
Government and of all officials and) persons con:
nected with temporal agence ies to encourage gifts of
real property fo he subject to a condition. or right
of re-entry for condition broken, that should such
don: ated real property be used for other than reli-
Commissioner of Internal Revenue 39
gious purposes, as defined and interpreted by the ec-
elesiastical Church Government, such donated prop-
perty shall revert to the donor thereof.
Canon Law No. 9—Contracts and Agreements (Re-
garding Maintenance and Support).
-No gift or transfer of property shall ever be
‘accepted by any temporal ageney as a condition of
or as consideration for any care, maintenance or
support of the donor or of any particular individual
or group of individuals. No temporal agency shall
make any contract for the support, maintenance, ed-
ucation, housing or rooming of any person for any
period of longer than one calendar month. Nothing
herein contained shall prevent anv temporal agency
from conducting any school, college, dormitory,
hotel or restaurant, and making the usual contracts
customary in the area in which such activity is un-
dertaken by other religious organizations or groups
in the carrving out of religious purposes,
The purpose of this canon law is to prevent any
walled gifts or transfers of. property being made
hy any person under so-called “life care con
tracts, or for any person to make a gift expecting
the gift not to be used for religions purposes, Inuit
to he used for the support, maintenance or care of
the donor or any particular person or persons.
Canon Law No. 10—Regulations Governing Church
Assets.
No part of the income of any property, money or
property right, of whatsoever: kind or nature and
40 Peggy Lou Riker, et al., vs. -_
“wheresoever situated, shall ever inure’ to the per-
sonal profit or benefit of any person or persons,
shareholder or certificnte holders; but all income
of any group, temporal ageney, project, congrega-»
tion, and society or any part thereof shall always
be used for the religious purposes of this Chureh
ax defined and construed by the ecclesiastical
Chureh Government. No amendment to these canon
laws, and no instrument under which any gift, con-
vevance or transfer is made shall ever permit any
person or persons, oF shareholder or shareholders
te ever have any proprietary rights. in the income
of any such group, ageney or society. No temporal
agency shall ever issiie any stoe ‘A or ceftiticate for
the payment of any income to inure to the benetit
of any individaal or stockholder,
Canon Law No. TL—Regulations * rohibiting Use of
Chureh Assets for Propaganda Cor Tnflueneine
Leuwislation ).
No property held or acquired by any tempera!
reeney, or for ans religious purposes of the ee
clestastiea| sorlety or any part thereof, project, com
Sregation, group or society of the Church shall
poeple used for intlnencing legisiation or for prepa
catala: and pe amendment te these canon laws shall
peeve guts such property, tneome oP proceeds ty
be ever used to influence levistation or for propa
canda, No gift, conveyance, acquisition or other in
<tyument unde ‘y which property hay at any time i
the future be jaequired by any temporal ageney, or
Held shally permit such use of any part of sueh
o
Commissioner of Internal Revenue 41
money, property or property right, for such ,pro-
hibited purposes,
Canon Law No. 12——-Regulations Governing Use of
Facilities and Income, and Apostolic Mode of
Living.
It being a doctrine of the ecclesiastical Chureh
Government that no person shall profit from the
Lord’s purse, nor that any person shall profit nor
commercialize nor financially benefit. from the prop:
erty subject to the religious trust nnder these canon
laws nor under the control or direction of any tem-
poral ageney under these canon laws, and it: being
the intention of the ecclesiastical Church Govern-
ment that only those who are cenminely interested
inthe Christian erusade and ministry of the Chnreh
- shall be assisted to earry on this erusade and minis
trv, itis directed :
oe, 1) No salaries, Wages or tother compensation
shall be paid those persons nider these canon laws
in their work, studies or efforts in carrying out the
religous PULP poses of the religdotis soelety except as
in Canon Law Neo. 19 provided, Costs, expenses of
av ine, travel, personal eNpenses and obligations -or
other sams as may be justified in the discretion of
the Chureh Government mav he advanced or re
tnbursed to any person under these canon laws, if
the Chureh official exereising such diseretion deter-
imines such sumer sums to be necessary and it will
eurry ont such religious purposes.
(2) As the material needs of the various persons
42 Peggy Lou Riker, et al., vs.
and their families and dependents must of neces- _
sity be met to permit these persons to dedicate their
work, services, and studies to carry out the religious
purposes of the ecclesiastical society, the religious
apostolic society form of living is selected as the
means to aecomplish these results in accordance
with the doctrines, teachings and principles of the
ecclesiastical Chureh Government.
(3) There shall be a common community treasury
for the conduct of the religious apostolic society
form of living; and the ecclesiastical Church Gov-
ernment shall designate the temporal ageney to act
as such treasury, and the use to which its funds
shall be put in such illustration of its religious
teachings.
(4) The ecclesiastical Church Government shall
determine how much is necessary for the common
community treasury to carry out the religious pur-
poses through the apostolic society form of living.
Thereafter the various temporal agencies under
these canon laws are authorized to make available
such money or property as a religions purpose, up
to the amount of the sum or property or both de-
termined by the eeclesiastical Chureh Government
as necessary for the conduct of the said religions
apostolie society. |
(5) From among the facilities owned, con-
trolled or subject to the use of the various temporal
aveneies under these canon laws, the ecclesiastical
Commissioner of Internal Revenue 43
Chureh Government shall designate those that may
be used as parsonages for those engaged in the
njnistry of the religious society, those that may be
used as seminaries for the religious studies of the
religious society, and those that may be used. as liv-
ing quarters for others engaged in the various reli-
vious activities of the religious society. “Phe tempo-
al ageney, having such property subject to its con-
trol or direction, is authorized to use such prop-
erty so designated for sueh parsonage, seminary
and/or diving accommodations as. a religious use
under these canon laws.
(6) Such money and preverty subject to these
religious uses, as the ecclesiastical Church Govern
ment may designate therefor may be used for he-
nevolences; and thereafter the various temporal
agencies having or controlling such money or prop-
erty are authorized to use it for such benevolences
asa religious: purpose,
(7) The eeclesiastieal Church (iovernment may.
designate such person or persons, or group or class
of persons, from time to time, whether such person
or persons be ecclesiastical members or not, and ir-
respective of such Person OP Persons religious he-
Nefs or membership im any religious society or
chureh, as proper subjects or persons tobe fed,
lodged, and/or supported by any temporal agency
during the pleasure or will of such temporal ageney
as a charitable or helpful aet in illustrating and
teaching the purposes of the Church. Thereupon any
temporal ageneyv is authorized to use money or
¢)
44 Peggy Lou Riker, et al., vs.
property under its control for such purpose as a
religious purpose hereunder. The apostolic forth
of living may be extended hereunder to such person
or persons, if the ecclesigstical Church Government
so designates. |
Canon Law No. 13—Regulations Governing <Ae-
_counting and Membership Lists.
It shall be the duty of any temporal agency to
account to the ecclesiastical Church Government for
all financial and property matters. Unless other:
wise specified by resolution of the Advisory Board
of Elders. such accounting shall be done annually
by each temporal agency to the ecclesiastical Church
Giovernment. ,
It is hereby declared that it is a Constitutional
Right of every person under these canon laws to
Freedom of Religion, and no official or temporal
geney shall make any disclosure without the con-
sent of each person, to any other person, of any
religious heliefs, of any such person, or that any
particnlar person under these canon laws holds any
particular religions beliefs. Determination by the
Keclesiastical Mead of any membership classitica-
tion or by the Church Judieiary of any such matter,
Shall be final and conelusive. Any trial or proceed-
ines. before the Church Judiciary involving any
religious beliefs shall be confidential unless re-
quested to be open by the party involved, or the
aceused and the ecclesiastical church officials. No
person having aecess to any list or names giving
Commissioner of Internal Revenue 45
membership or disclosing beliefs in religious mat-
ters, shall distlose or make publie such list of names
without the. consent of each such person except to
the Church Judiciary, who shall keep sueh list or
names confidential, or to the duly constituted Chureh
official having lawful use or access to sneh list of
names, Unlawful disclosure. or publication shall be
erounds for discipline.
Membership
Canon Law No. 14-—Prerequisite to Membership
(Including Agreement of Members).
No person shall be a member of the religious
socdety, or any part thereof, of the Church until:
(1) He or she has met the religions examina-
tlons and tests preseribed by the vecclesiastical
Church Government.
(2) He or she has been certitied on the records
of the ecclesiastical Church Government by the e-
clestastical Head as having met the necessary reli-
gious prerequisites for such class of membership.
(3) He or she has duly made appleation for
membership Uhpreond the form preseribed hy the ee.
clesiastieal Church Government, lias agreed to he
hound by the Chureh constitution and Chureh laws
known as Canon ‘laws, and agrees to Submit. te
arbitration, valuation and/or determination all the
matters provided iu the canon laws,
Upon the adoption of theseséanon laws. the ee-
clesiastical Church Government shall notify those
46 Peggy Louw Riker, et al., vs.
who are members of the ecclesiastical organiza-
tion of their membership and classification, and
failure to forthwith notify in writing the Secretary
of the Church Government of rejection of member-
ship shall constitute an acceptance of these canon
laws and of said agreement to arbitrate in these
“canon laws, and to abide by the Church Judiciary ‘s
decision or judgment. |
The agreement of all members of any and. all
classifications shall be:
I agree to abide by the Church constitution and
the Chureh Jaws known as canon laws, and by all
lawful decisions and orders of the Chureh Govern-
ment or any official thereof within the scope of his
or her authority.
[ agree to submit all questions, disputes and eon-
troversies of ecclesiastical and organizational mat->
ters to the Chureh Judiciary. as under the canon -
laws provided (and as they may be amended from
time to time), and agree not to resort to legal or
other remedies until all remedies thereunder have
been fully exhausted. T further agree to submit te
arbitration as m the eanon laws provided (and a-
they may be amended from time to time) all ques.
tions. disputes and controversies whether now in
existence or hereafter arising between myself and
the ecelesiastieal organization, and part thereof, any
temporal ageney, officer, official, member and /or
any person or persons under said eanon laws:
(1) controversies which micht be the sub-
ject of a civil action and are within the provi
Commissioner of Internal Revewae 47
_ sions of Califorfiia Code of Crml Proeedure,
Sections 1280 to 1293;
(2) all matters of the amount of damages.
and
(3) all matters of value of property, real,
personal or otherwise.
An award of arbitration, valuation, or determina-
tion, shall be binding, final and conclusive upon the
parties thereto, and judgment may be entered
thereon as in Civil Code of Procedure ef California,
Section 1287 provided. 1 agree not te bring any
action, suit or proceeding until T have exhausted my
remedy by this agreement to arbitrate, to deter-
mine damages, and/or for valuation.
(Name in Full.)
Canon Law No. 15—Classitieation of Members.
Of the various ecclesiastical members of the reli-
gious society, there shall be the following classi-
featlons:
(1) Co-Workers—those. actively engaged in the
Church ministry vot otherwise classified.
(2) © Affiliates—those who adhere to the religious
_ beliefs of the religious society, and are ecclesiastical
members. This shall inelude co-workers and all
other classifications within this canon law.
48 Peqaqy Lou Riker, et al., vs.
(3) Student Ministers—those who are studying
' for the ministry of the church, upon admission te
such status by duly constituted authority of the
Church, but not vet admitted to lay or ordained
membership. This is a probationary status.
(4) Junior Members between 15 and 21 years
of age.
(5) Lay Members—those members of the reli-
viens society designated by the Eeelesiastieal Head
of the Church Government whe have, by: examina:
tion and condiet. evidenced religious training and
have evidenced a desire to- and who have—ded
icated their lives to the ministry of the Church
and renounced their worldly woods by oath of
poverty and become children of the Chiureh.
(6) Ordained Members those who have anal
fied as lav members ead been duly ordained by
the diity constituted Cliaireh Government. Pastors
shall be ordained members having a duty as such
pastor by gesteniment of oluly comstituted Cline!
officials.
7 Managing Menibers those affiliates desrg
voted cas managing members by. daly constituted
aiitherity: te istrict others an religious matters,
oS) Members Entitled to Be Rntrosted With Posi
tions of Trust and Confidenes Those affttiates whe.
hy reason of thei r religious beliefs, are designated by
the-Eeelesiastieal Head of the Church to be eapable
of holding office or positions of trust and confidence
in the socretv, or in any of its congregations, or
any temporal agency. This position is always pro-
Commissioner of Internal Revenue 49
bationary, and may be suspended by the Eeclesi-
astical Head and terminated by the Advisory Board
of Elders or by a judgment of the ecclesiastical
eourt. The Ecelesiastical Head of the religions
society shall designate those affiliates who, in his
opinion by reason of their religious beliefs, : are
qualified for this classification. Termination of -ueh
‘classification or suspension shall be by reason of
religions beliefs. only, and shall not be for dis-
ciplinary reasons or by way of punishment. In the
event of suspension from: this classification. the af-
tiliate shall be disqualified to aet as an ofeer or
official in the religions society, or any part thereof,
or for any temporal ageney or te vet in aay position
of trust or contidence under these canon laws. or
any ecclesiastical or temporal gtice in the Churel.
Upon suspension, the Eecesastical Head of the
Chureh or such examining committee as may be
designated by such Head. shall forthwith examine
Stel suspended: person on mutters of religions be-
hefs and immediatels report the result. thereof te
the Advisory Board of Elders or to the ceclestasticad
emt having jurisdietion: and sueh report shall he
comelisive us te ecelesiastiens beliefs.
Coanen Law No. 16 Obligations of Membership.
It shall be the obligation of all. members to
fathfully and without mental reservations abide by
the constitution, canon laws, and the rules and reygu-
lations ef the ecclesiastical Church Govertinent and
the interpretation and decisions of the officials of
said Chureh Government. ATL lawful orders) and
50 Peggy Lou Riker, et al., vs.
directions of any duly constituted official within the
seope of his or her ecclesiastical authority shall
he obeved at once and without question: however.
nothing herein contained shall requjre or suggest
violation of any law, statute or ordinance, nor shal!
it require or suggest anything to be done contrary to
the doctrines and teachings of the Chureh, Any per-
son aggrfeved by obedience to any such order or di-
rection shall have a right to be heard by the duly
constituted. official of the ecclesiastical hody with
power to correct any abuse of authority, or a fair
and impartial hearing before the Church Judiciary,
at the option of the aggrieved person, or both as in
the canon laws provided. |
Canon Law No. 17—No Legal Obligations to Mem-
bers for Gifts.
There shall never be any legal obligation for giv-
ing or payment of money or transfer of property
as.a condition for obtaining or retaining any office,
status or membership; and any official who directly
or indirectly seeks either for himself or any orgami- —
zation or temporal ageney of the Church to estab-
lish such ai legal consideration shall forfeit his
office and any member who directly or indireetly
secks either for himself or for any organization or
temporal agency of the Church to establish such a
legal consideration shall be excommunicated.
Canon Law No. 18—Regulations Governing Mem-
bership (Financial Liability).
No financial or property rights and no financial
liability shall acerue by reason of any kind of mem-
Commissioner of I nternal Revenue Ol
bership nor shall any person incur personal financial
or property rights nor liability by: reason of any
office or membership held in this Church; and all
contracts, understakings and other ayreements made
-whether as a temporal agency or otherwise—for
and on behalf of the Chureh shall contain. as a
provision thereof this provision. .
Canon Law’ No. 19-—Regulations Governing Com-
pensation to Members.
All services performed for, given to, or expended
“by any person subject to these canon laws for the
Church, or any congregation, project, ecclesiastical
society or any part thereof, or of the temporal
agency, shall be gifts, absolute and complete, for
whieh there shall never be any compensation or
other remuneration unless there is an express con-
tract in writing between such person subject) te
these canon laws and the person, group or organiza
tion sought to be eharged .detining the method of
compensation, rate and the services or work or
property to be compensated, and such written con.
tract has been duly approved in writing by com-
petent officials of the ecclesiastical Church Govern-
ment.
Tt is the intention*of these canon laws that all
such services and work shall be outright gifts to the
Lord’s work; and no individual or person shall
protit from: money or propery given or obtained for
religious purposes. The ecclesiastieal Church Goy-
ernment shall not approve in writing of anv such
52 Peggy Lou Riker, et al., vs.
written contract for services or work or property to
be compensated unless and until the official ex-
ercising such discretion determines that such com-
pensated services are within the said religious pur-
poses and such compensated services are necessary
to carry out such religious purposes.
Canon Law No. 20—Property Rights of Individuals.
No person shall ever have any personal, proprie-
tary or other right, title or interest in or to any
property of the Church, congregation, projecty ec-
clesiastical society or any part thereof, or temporal
ageney, by reason of meinbership in_ the society,
‘Chureh, congregation, project, ecclesiastical society —
or any part thereof, or temporal agency, or of any i
office therein. All property shall be used exclusively
for religious purposes according to the beliefs and
teachings as interpreted and construed by the duly
constituted Chureh Government.
Canon. Law No. 21—Political Affiliations.
No person shall use his office or connection or
membership in the Chureh, nor any: property of
the Church or any of its temporal agencies, for
political purposes, or to promulgate or spread
propaganda nor to influence legislation.
All persons in or connected with the religions
society shall have absolute freedom of political af-
filiation, choice and/or action in any political matter
and no pressure or direction, directly or indirectly,
shall be used or aiverted through the religious
Commissioner of Internal Revenue 53
society or any part thereof to affect or influence any
political affiliation, choice, action or vote.
No person under these canon laws shall ever di-
rectly or indirectly attempt to change or advocate
the change of government by other than, lawful
means. Any person assisting, or joining, or advo-
eating the principles of, any organization advocat-
ing the change of government by other than lawful
means shall be excommunicated.
No person under these canon laws shall ever di-
rectly or indirectly belong to the Communist Party,
or any of its affiliated or front organizations. No
person under these canon laws shall ever directly
or indirectly belong to any fascist or nazi organiza-
tion or faseist oF nazi political party.
Canon Law No, 22—Definition of ‘Project’? and
_** Project Managers.”’
A “project manager”’ shall be any person having
any classification of ecclesiastical membership who
ix duly authorized and empowered hy the duly con-
stituted ecclesiastical Church Government to assist
those on the: project in applying Christianity as
taught, construed and defined by the duly consti-
tuted Church Government to every-day life. Such
project manager is an ecclesiastical official of the
Church Government, and shall be selected from
among those designated by the Ecclesiastical Head
of the Church Government to be entrusted with a
position of trust and confidence.
54 ; Peggy Lou Riker, et al., vs.
A ‘project’ is any group, undertaking or activ-
ity in which one or more persons under these canon
laws undertakes to apply and illustrate Christianity
as taught, construed and defined by the duly con-
stituted Church Government to every-day life. “A
project may or may not be owned in whole or in
part by some temporal agency of the Church, or
it may be owned by some individual and tempo-
rarily dedicated to such use withont affecting, im-
pairing or lessening the ownership of the individual
therein. No property, other than money gifts and
vifts of services shall be accepted by any temporal
‘agency without the consent of the ecclesiastical
Church Government. Such assent may be condi-
tional or absolute. .
Canon Law No. 23—Publications.
No publication shall be made in the name of the
Church except that which is duly authorized by
the Chureh Government. Projects, congregations,
LrOUps, socleties and temporal agencies of the
Church may make and distribute publications so_
long as they are in accordance with the religious
purposes of” the Church religious society and_ its
doctrines, beliefs and teachings, but it shall appear
thereon that such publication is only that of the
particular project, group, congregation, society. or
temporal agency. Any such publication that de-
parts from the religious purposes, shall be = sus:
pended by the Church Government; but nothing
herein contained shall be used as censorship, and
Commissioner of Internal Revenue 55
such suspension shall be subject to review by the
Church Judiciary. :
Canon Law No. 24—Duties of Affiliates.
It shall he the duty of all affiliates, including stu-
dent ministers and members of every classification,
to constantly remember that Christ Jesus’ Golden
Rule applies specifically to their treatment. of
others, regardless of how others: may treat them,
and to continually seek to use that principle in
their everyday lives and in their dealings with al!
with whom they come in contact * * * whether affili-
ated with the Church or any of its agencies or not:
It shall further be the duty of all affiliates, includ-
ing student ministers and members of every ¢lasst-
fication, to earnestly endeavor to so live that their
actions as well as their words wili constitute an
exemplification of Christ Jesus’ teachings and so
continue to perfect the ‘illustration”’ of the prac-
tiability of such teachings which is being estab-
lished by Christ’: Church of The Golden Rule and
all of its agencies.
Canon Law No. 25—Grounds for Diseipline.
As an intent to violate a canon law is the essence
of an ecclesiastical offense, no proof of an overt’
act is necessary in any disciplinary proceedings or
action before the Church Judiciary, :
Vilifying any ecclesiastical official or slanderous
remarks against any membe¥r shall be grounds fer
dise*pline under these canon laws.
6 Peggy Lou Riker, et al., vs.
Any attempt to divert property-of any temporal
aeeney from its religious piurposes or to misuse the
same contrary to the doctrines of the ecclesiastical
organization as defined by the ecclesiastical Church
Government shall be grounds for discipline under
these-canon laws.
Any blasphemous statements oer utterances shall
he erounds for discipline under these canon laws.
Aiding, encouraging or advistne any person to
depart from the Christian ideals, as taught by the
ecclesiastical Church organization, shall be grounds
for diseipline under these canon laws,
Aiding. abetting, advising or encouraging, di-
rectly or indirectly, in any schism or division or *
separation from the Church organization, except
by democratic meaiis in conformity with the Church
constitution or its amendment, shall be grounds for
discipline under these canoa laws,
Duties of Officers
Crnon Law No, 26- Duties of Keclesiastical Head.
The Keelesiastical Head of the Chareh Govern-
tneut Shall desienate the various examining com.
mitters, and speeriy their duties,
ft Shall be the duty of the Eeelesiastical Tead
of the Chureh Government beth personally and
through @xamining committees to determine the
teachings, doetrimves. religious observances, and. re-
ligtens practices in the various projects, groups,
eonorecntions and seeteties of the Chureh and that
>
-
Commissioner of Internal Revenue 57
they are maintained according to the religious doc-
trines, teachings, practices and observances of the
ecclesiastical organization, and in conformity there-
with.
Canon Law No, 27—Dnuties of Secretary.
There shail be designated a Secretary, who shall
keep the records of the ecclesiastical matters of the
Church Government, and perform such duties as
the Ecclesiastical Head shall designate in the mat-
ter of correspondence,
Canon Law No. 28—Privileges of Officers.
It shall always be the privilege of any officer of
the eeclesiastical Chureh Government to attend any
meeting of any committee or areney, to inspect
their meeords, to require a repert of any financial
or property matter, to require an accomit of any
temporal ageney or officer or member handling
roney for or on account of any Chureh activity or
trust or religious purpose, and: to make any maquiry
whieh any such Chuich Government officer shall
deem Necessary, proper oF convenient,
Conon Law No. 20—Eeclesiastical Head. Is) Pas
tor to All Members.
it shall be the privilege of the Feelesiastical Head
of the Chureh Government to be the pastor to all
of the various members: of the society, regardless
of where they may be loeated, live or be, and re-
vardless to what) project, congregation, eroup ar
¢
58 Peggy Lou Riker, et al., vs.
society they may belong; to minister to them, and —
to give or perform the sacraments. The ordained
members and pastors shall perform the duties of
their ministry in whatever area they may be as-
signed by the Church Government.
Judicial
Canon Law No. 30—Establishment of Ecclesiastical
Courts (Church Judiciary ).
There are hereby created ecclesiastical courts of
the Church Government to be known and designated
as the “Church Judiciary.” The Church official or
officials acting as and exercising the ecclesiastical
court powers or as arbitrator, evaluator or in de-
termining damawes, shall be designated as “judge”
of the Church Judiciary.
Canon Law No. 31—Appointment eof Judges and.
Duties and Powers of Church Judiciary.
The Advisory Board, with the written approval
of the Eeclesiastical Hegd of. the Church Govern-
ment, shal appoint one or more members of the
ecclesiastical organization as judge of the Church
Judiciary, to hold office until his successor is ap-
pointed. The Advisory Board, at the time of
appointment, shall designate the area in which such
judge shall act. Any such judge: of the Church
Judiciary who shall, for any reason, determine he
is disqualified to act in any matter, shall report
such disqualification to the Advisory Board, and
the Advisory Board, with the written approval of
Commissioner of Internal Revenie 59
the Ecclesiastical Head of the Church Government,
shall destgnate and appoint another person to act
as sueh judge of the Church Judiciary. In such
hatter Wherein such disqualification bas been re-
ported, but not in any other matter.
The Judge ‘of the Chureh Judiciary shall pro-
mulgate and adopt rules of procedure, in con-
formity with the Anglo-Saxon concepts of justice.
Pleadings may be oral or written, and cif oral the
Judge shall cause them to be reduced to writing in
the Church Judiciary reeords,
Violation of any canon law shall be grounds for
diserpline and. the Church Judiefary shall punish
only after notiee and an opportunity: for a fair
trinho and: punishment shall be sueh as the Chureh
Judiciary may determine, up te excommunication,
and may be condithonal: and may be staved upon
Sich terms and conditions as the Chureh Jndienry
or the Reviewnne Nutherity) may Cetertmine. pend-
Misr My Review,
Amv person dn and: dtsenplinary proceedimes. whe
tus be dissatisfied with ans tinal pudement or de-
cistomy may either oralls orn Writing within ten
I) dass of such judement or decision state to the
Chiureh Judietary that lie or she qe dissatistied wath
such judetment and deetsionr: ated ask for a review
thereof. Wherenpen the judge of the Chureh dn
dietary shall certify his records in the case together
witha Sumimnars of afl testimony and proceedings
to the Eeeclesiastical Head of the Church Govern-
tment. and satd Reelestastieal Pbesad) <hiall enue sore
60 Peggy Lou Riker, et al., vs.
impartial person licensed to practice law to examine
said records, together with any statement such ae-
eused may wish to incorporate or submit and if
such. impartial person certifies or states in writing
that substantial justice Jhas: been afforded the ae-
cused, and there is nothing, in his opinion, that was
a miscarriage of justice, either in the procedural
or substantive matters ino such proceedings, the
judgment shall be affirmed, otherwise the Eeclesias-
tical Head shalb set aside the Judgment or decision
amd return the record, together with the opinion
of such impartial third person, to the Church
Judiciary for further proceedings in’ conformity
with such Opinion.
The Eeclosiastieal, Head of the Church Govern-
ment shall have power and authority at any time
to pardon, commute or reduce any punishment, of
any Judgment or decision of the Church Judiciary,
In disciplinary matters,
anon Law Ne. 32 -- Church. Judiciary Powers
(Contin ied).
The Chureh Judiciary shall have jurisdiction te
deterniine all disputes and «controversies involving
all right to offiee, all authority off all officials and
persons Within the Church Government or any part
thereof, or any temporal ageney, all membership
weording to its various classifications, and the
scope and aithority of any and all temporal ayen-
eles ond the rights te property as between them
Commissioner of Internal Revenue - 61
and any person or group of the Church, matters
of doctrine and belief as therein involved and afl
other eeclesiastien} and organizational matters. De-
termination of membership, according to the various
classes, ‘qualifications, office, and all other ecclesias-
tical and organizational matters shall be determined
by the various officials of the Church Government,
and such determination shall be final and conclusive
upon all persens under these laws unless ao pre-
ceeding is submitted te.the Church Judiciary and a
final decision or determination thereon ix obtained.
Canon Law No. 33-- Church Judiciary Powers
(Continued ).
Irrespective of any dispute, question or contre
versy, the Chureh Judiciary shall have jurisdietion
to determine membership, authority, qualification
and powers of any person or official or temporal
aveney under these canon laws. In such proceed-
ings. all interested persons shall have notice and an
opportunity to be heard in accordance with these
canon laws.
Any person who believes himself to be aggrieved
by any action or omission of any other person
under these canon laws shall be entitled to a fair
and impartial hearing before the Church Judiciary,
ahd in such proceedings, the aggrieved person may
at his option ask for no more ov other rehef than
viudieation on the records of the court.
AIL persons subject to these canon laws shall he.
hound by the deeision of the Church Judiciary,
62 Peggy Lou Riker, et al., vs.
whether interlocutory or final, and shall promptly
obey all orders vand directions thereof including
orders to appear, or to give testimony.
Any interested person under these earion laws
who believes himself aggrieved by any order, judg-
ment or decision of the Church Judiciary in ecclesi-
astieal or organizational matters may, within ten
(10) eh thereafter either orally or in writing, se
state to the Ecclesiastical Head of the Church Gov-
ernment or the judge of the Church Judiciary,
whereupon the order, judgment or decision shall be
reviewed as in these canon laws provided.
Cano Law No. 34--—-Notice of Proceedings.
The Chureh Judiciary shall, by its rules, provide
for notice to be given In ant proceedings. If the
whereabouts or location ef ang person under these
eanon laws are unknown te the judge of the Churet
Judiciary, notice of at least ten (10) days may he
eiven te any person under these canon laws by
sending the notice by United States registered mail,
retuma receipt demanded, to the last known address
of suelo person as shown by the records of thi
ecclestustient Chivvel Government,
Canon Law New 5a -Seleetion of Arbitrator ¢(Reou
lations (ioverning Arbitration).
As om the early Christian Church before the time
Wf Constantine, all eivil and temporal matters in
dispute between Christians were submited to the
Church authorities tor deetsion rather than te seb
Commissioner of Internal Revenue 63
mit such matters to the Roman courts, so also shall
all disputes be submitted in all ecclesiastical matters
to the Church: Judiciary and in civil and temporal
matters to arbitration as in these canon laws pro-
vided.
The ecclesiastical Judiciary competent te aet, in
the area involved is hereby designated as the arbi-
trator, evaluator and /or umpire of all matters that
may be the subject of dispute. [In the event it is
impossible to obtain a fair and impartial arbitrator.
evaluator and/or umpire from among the Church
Judiciary, then the Advisory Board of Elders shall
designate an impartial person to act as such arbi-
trator, evaluator and/om umpire. En any arbitration
no person Who is interested shall take part in such
arbitration as an arbitrator, it being the intention
of these canon laws that such arbitrator shall be
absolutely fair and impartial and in all respects
capable of rendering a fair and impartial decision
and award. In the event it is impossible te obtain
a fair and impartial arbitrator from among the ”
Church) Judiciary, then such arbitrater or arbi-
\trators shall be designated and. seleeted by the
pee Board of Elders, and such arbitration
shall be conducted ino accordance with California
Code of Civil Procedure, Sections 1280 to 1293; and
the decision of the arbitrator shall be final and con-
clusive upon the parties. No person who is inter-
ested in such dispute shall act in such selection of
an arbitrator: but the Advisory Board shall act,
without such interested person ‘oe persons, and its
4
64 Peggy Lou Riker, ‘et al., vs.
quorum for the purpose of such selection and ap-
-pointment of an arbitrator or arbitrators shall be
determined by deducting the number of such -dis-
qualified members of said Board from the number
otherwise required to constitute a quorum. Should
it be impossible to obtain an arbitrator from. the
Church Judiciary, and should the Advisory Board
of Elders for any reason fail and neglect to appoint
arbitrators or should all of the Advisory Board of
Elders be disqualified te act. then it: shall be the
duty of the College of Pastors to select and appoint
the arbitrator or arbitrators; sueh arbitrator or
arbitrators: shall conduet the arbitration according
to Califonia Code of Civil Procedure, Sections 1280
to 1293 and the award and decision of arbitration
shall be final and conclusive upon the parties. Tt is
the intention of these canon laws to select the arbi-
trator or arbitrators from among the membership
of the ecclesiastical society of the Church: that all
disputes invelving civil and temporal “matters he
settled by aftbitration conducted. in accordance with
the Civil Code of Procedure of California, and the
award and or decision of ar®itration shall be fina!
and conclusive upon the parties. [t is the intention
that detesuination of. values and all questions of
the amount of damages shall be determined hy
evaluators and or umpires; and all previsions of
these canon laws as to arbitration shall extend te
<uch matters of determination of values, and all
questions of the amounts or damages.
Commissioner of Internal Revenue 65
Canon Law No. 36—Qualification of Arbitrator.
The judge of the Church Judiciary shall act as
arbitrator, evaluator or umpire under all disputes,
questions and controversies, unless” disqualified to
act. No such judge of the Chureh Judiciary shall
act in any such matter until he has determined he
has no interest in the controversy, question or dis-
pute that he can render a fair and impartial de-
cision, award or finding therein, and that he knows
of nothing that would prevent him from acting as
such arbitrator, evaluator or umpire. It shall be
the duty of any party to such arbitration, evalua-
tionor determination to file a written detailed state-
cment of facts with anv such judge of the Church
Judiciary or other person acting as arbitrator,
evaluator oF umpire, stating all matters which the
party believes will prevent such person from ren-
dering a fair and impartial decision or award or
finding or that would affect the qualifications of
such person to act as an arbitrator, evaluator or,
umpire, immediately Upon the commencement of
any sigh proceedings; or Hf not discovered until
later, immediately upon discovery.
All proceedings for arbitration, valpation or’
determination Involving any question, dispute or
controversy under any agreement to arbitrate, de-
termine damages or value shall be held striethy in
accordance with the provisions of Sections [280 to
1293 of the California Code of Civil Procedure.
Any award, determination or valuation thereunder
2
66 Peggy Lou Riker, et al., vs.
shall be. final and conelusive upon the parties
thereto. |
Canon Law No. 37—Request for Review (Regula-
tions Governing Reviews).
* A
Tn all matters involving organizational or ecclesi-
.
astical controversies or jurisdiction exercised by
the Church Judiciary, any interested person or
party to such, proceedings may, within ten (19)
days after the act of such Church Judiciary, state
orally or in writing to the Church Judiciary or to
‘the Eeclesiastical Head of the Church Government
that he or she is dissatisfied with the decision; judg-
ment or findings of the Church Judiciary, and ask
for a review thereof. Whereupen the Church Ju-
diciary shall make an entry in its records of such
request for a review, giving the date thereof, and
certify a copy of. the Church Judiciary records in.
the case of proceedings together with a summary
of all testimony and proceedings to the Ecelesiasti-
cal Head of the: Church Government. The = said
Eeelesiastical Head, upon receipt of such record,
shall cause some impartial person licensed to prac-
tice law to examine said record together with any
statements or briefs of the aggrieved person or any
other interested persons. Such impartial person so
examining said-record shall either certify that there
is nothing in his opinion that was a miscarriage of
justice, either in the procedure or the substantive
matters, so as to substantially affect the rights of
any. parties thereo, or specify wherein there was a
iniscarriage of justice so as to substantially affect
Commissioner of Internal Revenue 67
the rights of any of the parties thereof. In the
former cases, the acts of the Church Judiciary shall
be affirmed. In the latter case, the Eeclesiastical
Head shall return the record together with the
opinion .of the impartial person examining the
record for further proceedings in conformity with
such opinion.
Nothing herein contained shall provide for any
review of any matter or proceedings Involving arbi
tration, Valuation or determination of damaves.
a ad Certificate ;
I, ALE. Knapp, Secretary of the Ecclesiastical
Society of Christ's Chureh of The Golden Rule. de
hereby certify this and the foregoing 26 paces’
(being a total of 27 pages) to be true and correet
copies of the “Constitution of Christ's Chureh of
The Golden Rule and **Canon Laws of Christ’
Church of The Golden Rule’ which were adopted
in convention at the San Franéisco Theological
Seminary on February 1th, 1948. and approved
and accepted by more than ninety-five per cent
(95%) of the Loyal) Ecclesiastical Affiliates of
Christ's Church of T © Golden Rule.
Ih Witness Whereof, I have hereunto set my
hand this 13th dav of Mareh, 194s.
[Seal] . /sf A. E. KNAPP.
Received and filed February 19, 1993, P.CLULS.
Served February 19, 1953.
6 . Peggy Lou Riker, et al., vs.
[Title of Tax Court and Cause.] .
; | Docket No, 46,978.
AMENDED.PETITION
Now comes your petitioner, Peggy Lou Riker,
and.amends her petition on file in the abov e-entitled 7
matter. to show:
i
‘That eens aph II is amended by changing the |
last sentence thereof to read:
“That the amount of tax ‘in controversy if?
$1,984.03.”’
IT.
That — IIT of the petition is amended
to read:
That the Commissionér erred:
(1) In refusing your petitioner any deductions
for gifts made to Christ's Church of The Golden
~ Rule, an exempt organization under Sec. 101(6) in
any. sum or at all. . | !
(2) That income of your petitioner from all
sources during said accounting period was the sum
of $277.39 per person, herself, and her minor. child
residing with her, being an undivided 1/575 inter-
est in the net income of the Apostolic Society; that
said income from the two persons is shown ahd
‘reported in the return as $754.78. That said income
is a proportionate share of the gross receipts, in-
cluding gifts, to the Common Community Treasury
ad
Commissioner of. 1 nternal Revenue - 69
‘of the Apostolic Society of Christ’s Church ,of The.
Golden Rule.
>
**(3) That the Commissioner disallowé@ the ex-
pense of $168.61 for, property and sales taX@s as a
proper deduction.”
ITI.
That Paragraph IV of the — petition is
i mended to read:
; >-
“That the facts upon which your petitioner rely
are:
(1) That during the entire period of time in- .
volved in the return, and during 1948 and at: all
times herein mentioned Christ’s Church of The
Golden Rule was and is a Church and religious
society and. its principal temporal agency was and
is the Elected Detegates Committee of the Eeclesi-
astical Society of Christ’s Church of The Golden
"Rule, which committee held all money and property
in trust and was organized to act for the ecclesiasti-
eal organization for religious purposes Pursuant to
the Church Constitution and Canon Laws, a eopy of
which is attached hereto marked Exhibit B and
incorporated herein by reference, That 'said Church
is and was an exempt organization and- within the
' provisions of Section 101(6) and all money and —
property were and are held for religious purposes
-only and: no part inures nor inured to the benefit
of any person, individual or private shareholder,
now is nor was any part used or usable for propa-
ganda or to. otherwise influence legislation.
79 Peggy Lou Riker, et al., vs.
(2) That your petitioner, during the calendar
year, ran and operated a certain project of Christ's
Church of The Golden Rule known as ‘Your Food
Fountain’ at 901 E. Base Line Blvd., San Bernar-
dino, California; that said project was established
from funds provided by the temporal agency of the |
said Church; and was conducted under licenses in
the name of vour petitioner. That the said temporal
agency passed under the control of the Bankruptey
Court in Los Angel@@and an agreement was made
hetween the Trustees in Bankruptey and the Elected
Delegates Committee’ of the Ecclesiastical Society
of Christ’s Church of The Golden Rule, whe reby
the said committee acquired the interest of said
trustees in Bankruptcy. That the said -taxpayer,
together with affiliates of the said Chireh, ran and
operated sdid Food Fountain, up to January 20,
1948, and all gross receipts therefrom. were de-
posited directly in the bank account of said Elected
Delegates: Commyttee, and the affiliate making the
deposit executed Church Form known as No. 399
and transmitted the original thereof to the com-
mittee. That all expenses attendant with the oper-
ation of Your Food Fountain up to January 20,
1948, from October 1, 1947, and prior thereto, were
paid from a commercial banking account designated
as Your Food Fountain Project Account. That dur-
ing said period of time up to January 20, 1948,
listed items of expenses of operation of the Food-
Fountain were submitted with an agreed budget to
the said committee, and the said committée would
from time to time draw its check for the said proj-
Commissioner of Internal Revenue 71
ect account to permit payments of said expenses
of operation. That there was no commingling of the
said-Elected Delegates’ bank aecount and the said
Project Acgeunt. Thé gross reteipts shown in the
taxpayers’ return from the start. of the fisea? vear
on October 1, 1947, to January 20, 1948, were. the
sums directly deposited to the said committee’s ac-
count, and said gross receipts appear in the tax
return of the said committee as an Apostolic Society
under the item of ‘Application of Student Min-
isters’ Training Program’ for the vear 1948. That
the expenditures from the said Project Account,
supported by paid or receipted vouchers, were car-
ried on the said committee’s books under its respec-
tive item of expense or disbursement, and the
expenses of the conduct of the Fountain to Janu-
ary 20, 1948, appear in the said Apostolie Society's
return as a portion of the ‘Items of Expenses and
Equipment, Materials and Supplies of Student
Minister Training Projects.”. That from January
20, 1948, to June 30, 1948, a consistent effort was
made by the said committee to sell the said Foun-
tain as a going business and to clear up the cloud
of the claim of the trustees in Bankruptey. That
during said period, the taxpayer was the sole
Church affiliate in the business, and she ‘used three
separate partners, mostly relatives, to conduct the
business. That the taxpayer transmitted her share
of the earnings, as received from each partnership,
to the Church, together with a Form No. 399. That
these funds given from January?20, 1948, to June
; 30, 1948, were transmitted to the said Elected -Dele-
72 Peggy Lou Riker, et al., vs.
gates Committee and are reported by the said com-
mittee as part of the Apostolic Society’s income in
‘said Society’s tax return, as part of the item ‘Gifts
from Individnals.”- That on July 22, 1948, the said
Elected Delegates Committee purchased such 4inter-
estas the trustees in Bankruptey claimed in said
Fountain, and the said sale was duly confirmed by
the said Bankruptey Court. That the purchase
price note of $1,500 was duly exeeuted by the said
committee and delivered by the said committee to
the said trustees in Bankruptcy and paid by the
said committee to the said trustees in Bankruptey
according to the terms of said purchase note. That
after July 22, 1948, the said project Your Food
Fountain was operated and all the profits therefrom
paid to the committee, after. the deduction of ex-
penses connected therewith, and the said business
was sold by the said committee and the entire net
proceeds received by the committee were deposited
in its bank account. That during the entire fiseal
period from and after October 1, 1947, and until
the sale of Your Food Fountain by said committee,
your taxpayer resided with a group of the Apostolic
Religious Societv’s members of said Church living
in San Bernardino. That the said group paid for
Its living expenses from the Project Aecount, and ”
all living eXpenses were required to be made and
were according to an approved budget duly sup- -
ported by paid vouchers, and such. vouchers were
submitted monthly to the said committee: and the
said committee would and did provide funds from
its bank account for such Project Account, inelud-
Commissioner of Internal Revenue 73
-ing the cost of operation and the actual expenses
of living of said Apestolic Society group. That the
amounts and sums in said approved budget for liv-
ing expenses were determined by the duly consti-
tuted government of ‘said Church government. That
the personal living expenses of said group are in-
cluded in the said committee's tax return designated
as ‘Student Minister Maintenance.’ That during
all of said time the taxpayer’s minor daughter, then
seven ‘and eight years old, lived with taxpayer at
the said San Bernardino Apostolic Society group
of said Church, and all. the adults’ of Said group
were affiliates of said Church and part of the
Apostolie Society of said’ Church. That said corn-
mittee’s tax return was made as an Apostolic
Society, and the Common Community Treasury
thereof, upon a Form 1065, and all the income
therefrom was reported by each of the persons in
said Apostolic group as income, whether received
or not, pursuant to the said requirements of Sub-
division 18 of Section 101, Revenue Code. That said
proportionate share was reported as the sole income
of the taxpayer, for herself and her minor child as
two proportional units thereof as aforesaid. |
(3) That your petitioner expended during said
vear the sum of $168.61 as and for property’ and
sales taxes, which were proper deductions for com-
puting income for tax purposes,”’
- IV. a
That the said prayer be amended by appending
thereto the following:
74. ‘Peggy Lou Riker, et al., vs.
“That the Court determine that the funds of
Your Food Fountain are properly income of the
said committee of said Chureh,-and that your tux-
payer is taxable under the provision of Subdivision
18, Section 101 of: the Revenue Code, only for her |
proportionate share, whether received or not, for
herself and her minor child, after deduction of
personal exemptions of the taxpayer and her minor —
child therefrom.” |
/s/ HOWARD BL
CRITTENDEN, JR.,
Attorney for Petitioner.
.
Duly verified.
AFFIDAVIT IN SUPPORT OF
PETITION TO AMEND
State of California,
City and County of San, Francisco—ss.
Howard B. Crittenden, Jr., being first duly
sworn, deposes and says: That he is attorney for
the petitioner in the above-entitled matter.
That the above-entitled action together with the
(irasmee and the Grossheim cases are three test *
eases selected from the group pending. before the
Agent’s office in San Francisco involving members
of Christ’s Church of The Golden Rule. That there
is an understanding that the determination on these
cases will be conelusive upon the parties and the
Commissioner of Internal Revenue 75
Commissioner in the determination of the matters
pending for said years. That the said (irasmee case
and the said Riker case were selected to present
the question of Subdivision 6, Section 101, Exemp-
“tion: and the Grossheim case presented the report-
ing and exemption under Subdivision 18.of Seetion
101. That in conferences with the technical staff
and General Counsel’s office, affiant, on behalf of
said taxpayers, learned that the Commissioner con-
tended that there was an error in the Grossheim
matter resulting in a negligible tax of approxi-
mately $1.00, and that the said Grosshéeim matter
would be conceded by the Commissioner before the
Tax Court, and no adjudication would therein - be
involved.
That in the course of the conferences with Mr.
Mareussen of the General Counsel's office. affiant
stated that the Riker case conld be amended to in-
elude facts sufficient to raise the matters otherwise
involved under Section 101, Subdivision 18, instead
of and in place of the Grossheim matter; and in
the Spring of 1954 affiant tendered to the said Mar-
eussen as such counsel a snegested stipulation ovt-
lining the facts: set forth in the attached amend-
ment. That by reason thereof the Commissioner
will not be prejudicedby any delay in the tendering
of the amendment. That it was stated to affiant by
the successor to Mr. Marcussen, as attorney for the
Commissioner, that said attorney could not join in
the stipulation as to the facts recited in the pro-
posed written offer, but only as to the formal docu-
76 Peggy Lou Riker, et al., vs.
ments attached thereto and the authentication and :
due execution thereof.
* —./s/ HOWARD B.
; CRITTENDEN, JR.
Subscribed and sworn to before me this 19th day
of October, 1954:
[Seal] /s/ AGNES M. COLE,
Notary Public in and for the City and County of
San Francisco, ‘State of California.
‘My commission expires August 28, 1955.
_ Affidavit of Service by Mail attached.
Lodged October 25, 1954.
_ Filed at hearing November 1, 1954.
[Title of Tax Court and Cause.]
Docket No. 46,978.
ANSWER TO AMENDED PETITION
Comes now the Commissioner of Internal Rev-
enue, respondent above named, by his attorney,
Daniel A. Taylor, Chief Counsel, Internal Revenue
Service, and for answer to the amended petition
filed by the above-named petitioner admits and
denies as follows: :
Admits the allegations contained in paragraph I
of the amended petition.
Commissioner of Internal Revenue 17
II.
Denies that the Commissioner erred in the deter-
mination of the deficiency as alleged in paragraph
II of the amended petition.
TTT.
Denies the allegations contained in paragraph IIT
“of the amended (petition and all subparagraphs
thereunder.
. IV.
Denies the allegations contained in paragraph TV
of the amended petition.
Wherefore, it is prayed that the Commissioner’s
determination be approved and the petitioner's ap-
peal denied.
/s/ DANIEL A. TAYLOR,
Chief Counsel, Internal
Revenue Service.
Filed at hearing November 2, 1954.
Served November 2, 1954.
[Title of Tax Court and Cause.]
Docket Nw. 46,979.
AMENDMENT TO ANSWER
Leave of the Court having first been obtained,
Comes now the Commissioner of Internal Rev-
enue, respondent above named, by his attorney,
78 Peggy Lou Riker, et al., vs.
Daniel A. Taylor, Chief Counsel, Internal Revenue
Servicasand amends his answer to the petition filed
by the ‘above-named petitioner by striking the
. prayer therefrom and adding the following:
ve
Further answering the petition herein, respond-
ent alleges as follows:
(a) On each of her returns for the taxable years
1948 and 1949 petitioner claimed two exemptions,
one for herself and one for her. mother.
(b) Petitioner’s mother did not receive from
petitioner over one-half of her support for the tax-
able vears 1948 and. 1949. Petitioner is therefore
not entitled to an exemption for her mother in
either of said years.
(¢) There is accordingly due from petitioner
such increased deficiency in income tax for each of
the years 1948 and 1949 as will result from the dis-
allowance of the exemption claimed with respect to
petitioner's mother.
Wherefore, respondent prays that the Tax Court
redetermine the deficiencies in income tax for the
taxable vears, 1948 and 1949 to be the amounts de-
termined by the Commissioner in his notice of
deficiency, viz., $86.53 and $90.00, respectively, plus
such increased deficiency as may be indicated on a
Rule 50 computation resulting from the further
adjustment described herein, claim for which is
Commissioner of Internal Revenue — . 79
hereby made pursuant to the provisions of Section
272(e) of the Internal Revenue Code.
/s/ DANIEL A. TAYLOR,
Chief Counsel, Internal
Revenue Service.
Nd
Received and lodged September 8, 1954. _
Filed September 9, 1954, T.C.U.S. |
Served September 10, 1954.
[Title of Tax Court and Cause.]
MEMORANDUM DECISION
1. Held: Income derived from the operation of
a restaurant by petitioner was her income and not
that of the Church organization to which she con-
tributed it. |
29. Held: Part of ‘amounts contributed to a
Church organization by petitioners was not de-
ductible as contributions to a religious organization,
since the Church was not organized and operated
exclusively for religious purposes within the mean-
ing of Section 23(0), Internal Revenue Code of
1939. |
3. Held: Dependency exemption for petitioner’s
mother disallowed, since her support was received
from the Church. |
80 Peggy Lou Riker, et al., vs.
HOWARD B. CRITTENDEN, JR., ESQ, x
For the Petitioners.
T. M. MATHER, EgQ.,
For the Respondent.
MEMORANDUM FINDINGS OF FACT
AND OPINION
Respondent determined a deficiency in income
tax against petitioner -Peggy Lou Riker in the
amount of $1,584.03 for 1948, and deficiencies of
$86.53 and $90 for 1948 and 1949, respectively,
. against petitioner Freda H. Grassmee. By amend-
ment to respondent’s answer in the case of Freda .
Grassmee, an increased deficiency was claimed he-
eause of respondent's disallowance of an exemption
claimed with respect to her mother.
The cases were consolidated for hearing and de
cision. . .
The questions we have to determine .are (a)
whether income derived from the operation of a
restaurant by petitioner Peggy Lou Riker. was in-
come taxable to her or to a religious organization,
‘of which she was a member; and if taxable to her
(b) whether.she. is entitled to a deduction for the
vear 1948 for contributions to a religious organi-
zation under Section 23(0), Internal Rev enue Cod:
of 1939. In the case of Freda H. Grassmee the
questions are whether the contributions to the same
religious organization for the years 1948 and 1949
are deductible, and whether she is. entitled to a
*
.
Commissioner of Internal Revenue 81
4
dependency exemption for her mother for .those
vears.
Findings of Fact
The petitioners are individuals. During her fisca!
year 1949 Peggy Lou Riker lived in San Bernar-
dino, Califernia. During 1948 and a part of 1949
Freda Grassmee lived in Los Angeles; in August,
1949, she moved to San Francisco. Both petition-
ers’ returns for the years in question. were filed
with the collector of internal revenue for the first
district of California at San Francisco.
Christ's Chureh of The Golden Rule is a religious
nonprofit California corporation (hereafter called
the Church). The Church was organized in 1944.
1n 1945 the Chureh was adjudicated a bankrupt and
during 1948 and 1949 was in bankruptcy.
The Chureh adopted a constitution anc canon
laws in 1948. The religious beliefs of the Church
are set forth in the constitution which declares a
helief in a true God, in Jesus Christ, the scriptures
and in salvation through repentance.
The economy of the Church is declared to be
based on economic equality and the property and
earnings of its members in the words of the con-
stitution |
should be owried and managed by the Churel
for the benefit of all mankind if accordance
with the rules and regulations of the ecclesi-
astical society of this Church, that God may
82 Peggy Lou Riker, et al., vs.
be glorified and all a directly or indi-
“rectly benefited.
The ecclesiastical affairs of the Church are in the
-hands of an organization consisting: of a senior
elder, an advisory board of elders, and a college of °
* pastors. |
The temporal affairs of the Church are in the
hands of ‘‘temporal ageneies”’ subject to the con-
trol of the ecclesiastical authorities. Such affairs
are carried on through charters granted by the
senior elder with the advice of the advisory hoard,
to the ‘‘various congregations, iene and other
temporal activities * * *.’’-
According to- the canon laws of the Church, a
‘charter could be granted, withheld or revoked upon
whatever térms and conditions the Church Govern-
ment designated. The canon laws of the Church
provide, inter, alia, that all temporal agencies are
to hold ‘‘their property upon a -private trust for
the ecclesiastical organization,’’ and
All transfers, conveyances and sales. shall be
presumed to be bona fide gifts to the Lord's
work unless there be conditions or understand- .
ings or promises. to the contrary if writing,
duly approved in writing by the duly consti-
tuted ecclesiastical Church Government.
In operation, activities of Church members are
of two types. Some members devote all of their:
time to working in Church. projects and studying
to be ministers of the Church’s teachings. These
Commissioner of Internal Revenue 88
are called student ministers, and they live in apos-
tolie societies called ‘“‘Student Minister Training
Projects.’’ One purpose of these projects, most of
which were engaged in commercial cetivities, is to
spread the teachings of the Chureh by having the
publie witness the application of these teachings
in everyday life. Some projects were not engaged
in commercial activities but simply operated resi-
dential facilities for Church members. Members
living in both types’ of projects contributed their
earnings to the Church. Other Church menihers
lived at home and participated in Church activities.
The Church operated a theological seminary.
The principal temporal agency ‘of the Church is |
the Elected Delegates Committee (hereafter called
the Committee) which was formed in 1946.
During 1948 and 1949 thé Committee eperated
various student minister training projects. It also
operated the Church treasury and carried on vari-
ous commercial activities in competition with pri-
vately owned enteiprises, Including, among others,
a restaurant, a laundry, a lumber yard, bulb gar-
dens, farming, stock raising and a warehouse. These
enterprises were operated for profit. Gross receipts
from the operation of these projects were sent. to.
the Committee covered by a. form stating that the
transfer was an outright gift from the * project
manager and was to be used only for Church pur-
poses, .
_ For 1948 and 1949 the Saad filed amended
returns of income on Treasury Department form
-
84 Peggy Lou Riker, et al., vs.
990 as an organization exempt under section 101
of the Internal Revenue Code of 1939, and also
amended returns as an apostolic society on the
partnership form 1065, The returns showed the
Committee’s gross income for 1948 as $484,981.44,
of which $347,489.99 was reported as received from
the operation of student minister training projects,
and $137,491.45 from contributions and gifts. “In
1949 gross income of $409,590.05 was reported, of
which $352,528.70 was from the operation of student
minister training projects and $56,033.27 was from
vifts and contributions. On the Committee's re-
turns. as an apostolic society, the undistributed pro_
rata share of each member of the apostolic society
Was reported as $342.27 for 1948 and $316.17 for
1949.
During the taxable years Peggy Lou Riker was
a member of the Chureh. Prior to joining the
Church Peggy Lou and her husband had operated
a drug store in partnership with his parents. The
partnership was dissolved and Peggy Lou and her
husband took the fixtures of the business and made
a cash settlement with his parents. The fixtures
were then used to set up a student minister train-
ing project to operate a restaurant under the name
of **Your Food Fountain” (hereafter sometimes
called the Fountain). Peggy Lou was manager of
the project and the business license was in her
name. Her'duties included giving religious instrue-
tion to ‘members’ of the project, who varied in
number from 12 to 17. All of the receipts from the
Commissioner of Internal Revenue 85
operation of the Fountain were turned over to the
Committee on a form such as that described above,
signed by Peggy. Lou as project manager. Funds
were in turn allocated by the Committee from the
Church treasury for the operation of the Fountain
and the living expenses of the members of the
group. -
While the bankruptcy proceedings of the Chureh
_ were pending, Peggy Lou sued the trustees in bank-
ruptey to establish her ownership of the equipment
of the Fountain. An agreement was made in May,
1947, between Peggy Lou and the trustees relating to
the Fountain while the litigation was pending, which
provided that Peggy Lou was to operate the estab-
lishment until the lawsuit involving ownership was
settled. The income during this’ period was to be-
long to Peggy Lou and she was to pay the trustees
certain amounts to be deposited by the trustees in
a trust fund account. All operating expenses were
to be paid by Peggy Lou.
From May, 1947, until July, 1948, the restaurant
was operated under this agreement. Of this. period,
from.May, 1947, until Fanuary. 1948, the restaurant
was run as a “Chureh project,” and the earnings
“were turned over to the Committee by Pégey Lon.
From January, 1948, until June, 1948, Peggy Lou
ran the business in private partnership with-other
persons who were not members of the Church, and
from June until September, 1948, she operated the
business on a percentage basis with a prospective
purchaser of the business. Her partnership share
86 _ Peggy Lou Riker, et al., vs.
of the restaurant’s earnings was contributed to the
Committee. For five months of her fiseal year 1948,
January 20 to June 30, Peggy Lou filed partner-
ship returns for three different partnerships that
operated the restaurant in thiy, period. In July,
1948, the assets of the restaurant were sold to the
Committee for $1,500. Peggy Lou consented to the
sale.
Peggy Lou filed an income tax return for her
fisenl vear 1948 (October 1, 1947, until September
30,°1948), which disclosed a net profit of $7,568.25
from the operation of a restaurant business under
the name of ‘‘Your Food Fountain.’’ A memo-
randum attached to the return read as follows:
Item 2. Wages, ete.
Taxpayer was employed by Own Business’ for a
gross Income of $8959.11 during the taxable vear.
However, under the rules of the apostolic society
fof which taxpayer is an associate) that all in the
society share their income, $8959.11 was contributed
to and became vi part of the income of the apostolic
society, and is reported as part thereof, Taxfiaver
would therefore be taxed twice on the same income
by reporting at as wages and also’ as a dividend.
For this reason, this latter sum is reported only
as part of the dividend or taxpayer's pro rata share |
of the net income of said apostolic religious society.
(See Item No. 3 Dividends.)
Item 3. Dividends.
1/575 interest in $217,001.54 net income of the
Elected Delegates” Committee of the Eeclesiastieal
Commissioner of Internal Revenue 87
Society of Christ’s Church of The Golden Rule,
and Apostolic Religious Association for its account-
ing period of Oct. 1, 1947, to Oct. 1. 1948, This was
‘not received as a dividend, but is reported under
See, 101(18)—Per person in Association $377.39.
Number of persons in taxpayer's family who
were. in association and obtained support from
Society during period:
Me Ries WITT. 6c css cee cbse esse $754.78
In her return for 1948 Peggy Lou claimed the
sum of $8,959.11 as gifts to the Church. This claim
was disallowed by the Commissioner and this action
was alleged as error in the original petition, In an
amended petition it was prayed that the income of
the Fountain bé found to be the income of the
Church,
Facts With Relation to Petitioner Freda H. Grass-
mee.
Freda H. Grassmee was employed in a law office
in Los Angeles during 1948 and 1949. She was a
member of the Church. She contributed practically
all of her salary for those years to the Committee.
She and her mother lived in a Church residential
project and participated in religious activities of
the Church. Both ‘received. their support from the
Church. Freda’s income tax returns for 1948 and
1949 contained memoranda as to the disposition
of her income similar to that attached to Peevey
Lou’s return. On her returns for both years she
claimed a dependency exemption for her mother.
88 Peggy Lou Riker, et al., vs.
The Commissioner disallowed the deductions
claimed as contributions to the Church in 1948 and
1949. In an amended answer he claimed increased
deficiencies based on disallowance of the depend-
eney credits claimed for Freda’s mother. .
Opinion
Tietjens, Judge: —
In the petition originally filed petitioner Peggy
Lou claimed that all of the income derived from
the operation of the restaurant ‘‘Your Food Foun: —
tain’? was donated by her to the Elected Delegates’
Committee. By amendment to her petition she
claimed that the income was nof hers but was the
Committee’s; that her only income was her propor-
tionate share of the Committee's net income for the
year, which, though not actually received, was ap-
portioned te her as a member-of an ‘apostolic asso-
ciation.”
Peggy Lou made her return for 1948, the year
in question here, on a fiseal year basis, October 1,
1947, until September 30, 1948. Our findings show
that she entered into an agreement in May, 1947, -
with the trustees ino bankruptey under which she
was to operate the Fountain until her claim to
ownership of the restaurant equipment was judi-
cially determined. This agreement expressly ‘pro-
_ vided that all funds derived from the operation of
the restaurant were to belong to her, and she was
to make certain payments to the trustees. It ap-
pears that she, continued to operate the restaurant
+
Commissioner of Internal Revenue 89
under this agreement until July, 1948, when the
yestaurant equipment was, sold to the Committee.
According to her testimony, during that part of her
fiscal year from October, 1947, to January, 1948,
she ran the restaurant as a Church project, she
heing project manager; and from January to June,
1948, the restaurant was run as private -business
by a partnership of which she was a member. Dur-
ing the latter period the operation of the resteurant
was not a Church project. Although the restaurant
equipment was sold to the Committee in July, 1948,
Pegey Lou continued to operate the business until
September, 1948, on what she termed a ‘‘percentage
basis”? with another person who was interested in
buying the property. Late in 1948 or early in 1949
the Fountain was sold, the Committee receiving the
purchase price. In the October-January’ period the
vross receipts of the business were turned over to
the Committee by Peggy Lou as a gift..and in the
came manner she turned over her share of the
proceeds of the business in the January-June and
dune-September periods.
On the basis of the foregoing evidence we think
it is clear that at least during the October to July —
period Peggy Lou operated the restaurant under
the agreement with the trustees in bankruptcy and
the income she received from its operation was bers
and not the Committee's. Income is taxable to the
one who eninis it or otherwise creates the right to
receive it and to enjoy the benefit of it when paid.
Helvering v. Horst, 311 U.S. 112 (1940). The in-
90 Peggy Lou Riker, et al., vs.
come was earned principally as a result of Peggy
Lou’s efforts in operating the restaurant. Accord-
ing to the agreement with the trustees she had an
unqualified right to receive the funds from the
operation of the restaurant and her testimony was
that she actually received them. That her enjoy-
ment of the income‘ consisted of donating it to the
Committee cannot relieve her of the liability for
tax on its receipt. Helvering v. Horst, supra.
The status of the income from the operation of
the restaurant in the period from July to the end
of Peggy Lou’s fiseal year, September, 1948,.is less
certain. There is no breakdown as to what amount —
"of restaurant income was earned in this period.
Petitioner has the burden of overcoming the cor-
rectness of respondent’s determination that the in-
come was hers. To meet this burden the evidence
is that the restaurant equipment was owned by the
Committee in this period, and upon the sale of the
restaurant late in 1948 or early in 1949, the pur-
chase price went to the Committee. On the other
hand, Peggy Lou testified that she operated the
restaurant in this period on a percentage basis with
a prospective purchaser, and that she received a
share of the receipts of the business, which she
donated to the Committee. On this- state of the
‘record we can hold only that petitioner has failed
to meet her burden of proof, and that respondent’s
determination should stand.
Having determined that the income from the
operation of the restaurant was taxable to Peggy
Commissioner of Internal Revenue 91
a]
‘Lou, the next question is whether a part (15 per
cent of her adjusted gross:income) of the amount
she turned over to the Committee may be deducted
as a charitable contribution under section 23(0),
Internal Revenue Code of 1939. The refusal of the
respondent to permit any amount as a contribution
to a religious organization was one of the assign-
ments of error in Peggy Lou’s amended petition.
The same question is presented in the case of Freda
(irassmee, who was privately employed and turned
over almost all of her income to the Committee.
That part of section 23(0) which is pertinent
here provides:
In computing net ‘income there shall be allowed
as deductions:
(o) Charitable and Other Contributions. — In
case of ‘an individual, contributions or gifts pay-
ment of which is made within the taxable vear to
or for the use of:
{2) a corporation, trust, or community
chest, fund, or foundation, * * * organized and
operated exclusively for religious, charitable,
scientific, literary, or educational purposes,
* * * no part of the net earnings of which
inures to the benefit of any private shareholder
or individual * * * |
te an amount which in all the above cases combined
does not exceed: 15 per centum of the taxpayer's .
adjusted gross ineome. -
92 Peggy Lou Riker, et al., vs.
The respondent claims (a) that the Committee
was not organized and operated exclusively for the
purposes required by the statute, because one of
its principal activities was the operation of various ”
business ventures; and (b) that since the senior
elder of the Church has exclusive control of the
Church and its property, the earnings of the Church
may inure to his benefit or to the benefit of other .
Church officials who are empowered to request an
election as senior elder.
Our findings of fact show that according to the
constitution and canon laws of the Church the
Committee was set up to handle the temporal affairs —
of the Church, as distinguished from its spiritual or
ecclesiastical affairs. In carrying out this purpose it
operated a restaurant, a laundry, a lumber mill, and
various other commercial enterprises, which were
its principal sources of, income during the years
in question. In determining whether an entity is
‘organized and operated exclusively for- religious,
charitable, * * * or educational purposes’” within
the meaning of section 101(6), Internal Revenue
Code of 1939, in order to determine its qualification
as a tax exempt organization, this Court has denied
exemptions to those organizations set up to engage
in business activities, despite the fact that the in-
come earned is to go to an exempt organization. So.
‘even if we assume so far as this phase of the case
is concerned, that the ecclesiastical society of the
Church, the beneficiary of the Committee's earn-
ings under the Church constitution, is a religious
Commissioner of Internal Revenue 93
.organization qualified under section 23 (0) this does
not help petitioners. We are cognizant that some of
the circuit courts have differed with us on this ques-
tien, and hold that where the organization in ques-
tion is operated to produce income for a tax exempt
body, the producing entity is also exempt from tax-
ation under section 101: Roche’s Beach, Ine.. v.
Commissioner, 96 F. 2nd 776 (C.A.2, 1938), reversing
35 B.T.A. 1087; C. F. Mueller Co. v. Commissione;,-
190 F. 2d 120 (C.A.3, 1951), reversing 14 T. C. 922;
contra, United States v. Community Service, 189 F.
2d 421 (C.A.4, 1951), certiorari denied, 342 U. S.
932 (1952). The language of section 101 (6), ‘‘or-
ganized and operated exelnsively for religious * * *
purposes,’ is identical with that ‘of section 23 (0), —
which describes the types of organizations to which
contributions are deductible. We think our decisions
under section 101 (6) should have equal applica-
bility where the qualification of an organization
under section 23 (0) is in question. Following our
prior decisions, we hold that the Committee. was
not organized and operated exclusively for religious
purposes, because the reason for its organization.
as shown by the constitution and laws of the
‘Church, was to conduct the temporal affairs of the
Church and these in fact consisted principally of
various commercial enterprises.
Our holding that the Committee does not qualify
as a religious organizatien to which contributions
- are deductible under section 23 (0) does not com-
pletely dispose of the question of the deductibility
94 —C Peggy Lou Riker, et al., vs.
of petitioners’ contributions, since such contribu-
tions are deductible if ‘‘made * * * to or for the
use of’’ a qualified organization. In John Danz, 18
T.C. 454 (1952), (aeq. C.B. 1952-2, 1), we held that
contributions to a trust set up to benefit exempt
charitable’ organizations were deductible, even
though the trust itself did not qualify as organized
and operated exclusively for the purposes enumer-
ated in section 101 (6), since such contributions
were “for the use of’? the exempt charitable organi-
zations. To the same effect is United States v.
Weed, U.S.D.C. Mo., May 11, 1954 (C.C.H. 54-1
U.S.T.C. 9414; 1954, P.H. @72,631). Our hold-
ing in John Danz cannot be aptly applied here,
since we do not think that the ecclesiastical society
of the Church can qualify as organized and op-
erated exclusively for religious purposes. In that
case there was no question that the beneficiary
organizations qualified under section 23 (0), and
the entity engaged in business was not carrying on
the work of the beneficiary organizations. Here the
laws of the’ Church provide specifically that a
temporal agency is to act for the ecclesiastical
Church; A temporal agency is required to be char-
tered by the ecclesiastical Church Government, and
the charter may be revoked upon whatever terms
the Church Government may designate. All prop-
erty or income received by a temporal agency is
to be held in trust for the benefit of the ecclesi-
astical society of the Church. Thus it is apparent _
that the Committee is an agency of the ecclesiastical
sodety of the Church for carrying out the latter's
Commissioner of Internal Revenue 95 .
temporal functions; this being so, its commercial
activities should properly be ascribed to the ec-
clesiastical society itself in determining the latter’s
qualification under section 23 (0). In fact, we have
before us little evidence of activities of a purely
. spiritual nature, as commonly understood, being
carried on by the Church. ‘Although the ecclesias-
tical society was established to administer the spirit-
ual functions of the Church, the Church’s principal
function seems to have been the various projects
supervised by the Committee, which were engaged
in different business activities. Cf. Trinidad v. Sa-
grada Orden, 263 U.S. 578 (1924). This is under-
standable in light of the fundamental beliefs of the
Church, which are-not typical in that the emphasis
is not on formal religious worship. The Chureh has
no chureh buildings. Its principal reliance is on
having its members live in a manner exemplifying
Christ's teachings, particularly by living in a self-
less manner. Its student minister training projects,
while engaging in commercial activities, were de-
signed to permit the public to witness the applica-
tion of Christ’s teachings to evervday life. Thus the
very means chosen by the Church to attain its
spiritual purpose involve engaging in commercial
activities through its principal temporal agency,
the Committee, and we eannot say that the eeclesi-
astical society was éperated exclusively for religious
purposes as. required by section 23° (0). Conse-
quently the petitioners are not entitled to deduc-
tions for contributions for the use of a religious or-
ganization.
96 Peggy Low Riker, et al., vs.
The respondent has also disallowed the depend-
-ency exemptions claimed by Freda Grassmee for
her mother for, 1948 and 1949. During these years
the mother lived with Freda in a Chureh project
and received her support directly from the Church.
Freda’s theory, we take it, is that part of the
earnings she, turned over to the Committee was
for the support of her mother. There is no evidence
that the support received by the mother was con-.
ditioned on the making of a contribution or the pay-
ment of money by Freda. We think the record
supports the claim made in the Commissioner’s an-
swer that Freda did not contribute over half of the
support of her mother and the Commissioner's
elaims for increased deficiencies are approved.
Decisions will be entered under Rule 50.
Reeeived August 1, 1955.
Served August 11; 1955,
~The Tax Court of the United States
Washington
Docket No. 46978
PEGGY LOU RIKER,
Petitioner,
vs. :
. COMMISSTONER OF INTERNAT REVENUE,
| Respondent.
DECISION
Pursuant to the determination of the Court as
set forth in its Memorandum Findings of Fact and
Commissioner of Internal Revenue — 97
Opinion filed August 11, 1955, the respondent hav- —
ing duly filed a proposed computation in accord-
ance therewith and the petitioner having failed,
after dué notice, to file a counter proposed compu-
tation or to object at the hearing on December 14,
1955, to the computation as made by the respondent,
it is hereby
Ordered and Decided: That there is a deficiency
in income tax in the amount of $1,404.68 for the
‘taxable year 1948.
/s/ NORMAN O. TIETJENS,
Judge.
Entered: December 15, 1955.
Served: December 16, 1955.
The Tax Court of the United States
Washington
‘Docket No. 46979
FREDA H. GRASSMEE,
Petitioner,
’ Ys.
COMMISSIONER OF INTERNAL REVENUE,
| Respondent.
DECISION
Pursuant to the determination of the Court as set
forth in its Memorandum Findings of Fact and
98 Peggy Lou Riker, et al., vs.
Opinion filed August 11, 1955, the respondent hav-
ing duly filed a proposed computation in accord-
ance therewith and the petitioner having failed,
after due notice, to file a counter proposed compu-
tation or to object at the hearing on December 14,
1955, to the computation as made by the respond-
ent, it-is hereby
Ordered and Decided: That there are deficien-
cies in income tax.in the amounts of $84.80 and
$25.50 for the.taxable years 1948 and 1949, respec-
tively. rs
/s/ NORMAN O. TIETJENS,
Judge.
Entered:. December 15, 1955. -
‘ Served December 16, 1955.
[Title of District Court and Cause. ]
Docket No. 46978 and 46979
PETITION FOR REVIEW
The above named petitioners, Peggy Lou Riker
and Freda H. Grassmee, herewith petition for re-
view of the decisions dated December 15, 1955, in
the above-entitled matter (consolidated at the time
of trial) which said decisions determined a defi-
ciency of $1404.68 against the petitioner Peggy Lou
Riker for the taxable year 1948, and determined a
deficiency of $84.80 against the petitioner Freda °
Commissioner of Internal Revenue 99
?
‘H. Grassmee for the year 1948 and the sum of
$25.50 for the taxable year 1949 against said pe-
titioner Grassmee, and from the whole of said de-
cisions. Petitioners and each of them declare that
they seek said review in the Cireuit Court of Ap-
peals of the United States, in and for the Ninth
Cireuit; state that up to and including 1953 and at
all times herein mentioned prior thereto, each of the
petitioners was a resident of the City and County
of San Franciseo, and since 1953 each states that
she .was and now is a resident of the County of
Marin, State of California, and at all times both
said petitioners were and now’ are residents of the
Northern District of California, Southern Division,
and each filed her personal income tax returns in-
cluding the returns involved in the above-entitled
matter, with the Collector of Internal Revenue, San
Francisco, California. The nature of the controversy
in the ahove-entitled matter is the amount of income
and deductions subjeet to personal income tax for the
petitioners Riker during the calendar vear 1948,
and Grassmee during the calendar vears 1948 and
1949; that both of the petitions involve the deduecti-
hility of gifts by each of the said) petitioners te
their religious society, Christ's Church of the
Golden Rule, up to 15% of. their income, said gifts
and each of them being exclusively for religions
purposes and were paid to the principal temporal
agency of said church, to wit, the Elected Delegates
‘Committee of the Ecclesiastical Society of Christ's
Church of the Golden Rule; that the matter involv-
100 Peggy Lou Riker, et al., vs.
ing the petitioner Riker involves in addition
thereto, whether said petitioner is taxable for only
a proportional share reported for the taxable year
1948, of an activity of the said religious society in
the conduct of its religious practices, in the aposto-
lie form covered by Section 101, Subdivision 18, or
whether the said petitioner Riker is taxable for the
related income, the fruits of the efforts of a group
‘of which she was an official, in the conduct of their
ministry and religious practices in said church.
Dated this 13th day of January, 1956.
/s/ HOWARD B. CRITTENDEN, JR. -
Attorney .for Petitioners Peggy Lou Riker and
Freda H. Grassmee.
HOWARD B. CRITTENDEN, JR.,
Attorney at Law.
Affidavit of service by mail attached. ©
Filed January 16, 1956, T.C.U.S.
Commissioner of Internal Revenue 101
In the T ax Court of the United States
Docket Nos. 46977, 46978, 46979
WOLF H. GROSSHEIM and ORPHA GROSS-
HEIM; PEGGY LOU RIKER, FREDA H.
GRASSMEE, “
Petitioners,
VS.
7 * .
COMMISSIONER OF INTERNAL REVENUE,
Respondent.
PROCEEDINGS
Courtroom 421, Appraisers Building,
630 Sansome Street,
San Francisco, California:
Tuesday, November 2, 1954.
The above-entitled matter came on for hearing,
pursuant to notice to the parties, at 2:00 o'clock
p.in.
Before: Honorable Norman O. Tietjens, Jr,
Presiding.
Appearances :
HOWARD B. CRITTE NDEN, JR., ES
For the Petitioners.
T. M. MATHER, ESQ.,
Kor-the Respondent.
. * *
102 - Peggy Lou Riker, et al., vs.
a. ee MARIAN T. HUFF
was ealled as a witness by and on behalf of the pe-
titioners, and, having first duly affirmed, was ex-
amined and testified as follows:
The Clerk: Will you_state your name, please?
The Witness: Marian T. Huff. |
The Court: If you will pay attention to the
questions that your counse! asks you and try to an-
“swer the question as it is asked and-in as loud and
clear a voice as voy ean, so we can all understand
vou, please.
The Witness: All right.
Direct Examination
By Mr. Crittenden:
Q. Mrs. Huff, what is: your connection with
Christ Church of the Golden Rule?
A. Tam Student Minister of Christ Chureh of
the Golden Rule, Mr. Crittenden. [11] 3
Q. Do you hold any position ?
AL Yes, Lam Secretary to the Elected Delegates
Committee. ;
Q. Are you a member of that Committee /
A. Yea; Tam. |
Q. . And does that Chureh operate under the-
any particular Constitution ar laws?
A. Yes. Our Chureh is organized under a Con-
stitution and Canon laws. ~
Q. I see. .
Commissioner of Internal Revenue 103
(Testimony of Marian T. Huff.)
Q. (By Mr. Crittenden): I show you here a
certified copy of. the. Church’s Constitution and
Canon Laws, and ask. you if that is. the Organic
Law.of the organization ?
A. Yes, that-seems to be a complete copy, Mr.
Crittenden.
Mr. Crittenden: May I offer this in evidence as
the Petitioner’s Exhibit next in order?
The Clerk: WwW ell, pardon me. Did I unde retand
there is [12] a stipulation of facts in | this case
.Mr. Crittenden: No.
~The Clerk: Therc is not? Well, this is Petition-
er’s Exhibit No. 1. |
Mr. Mather: No objection.
The Court: It will be admitted.
(Petitioner’s Exhibit Number 1) was re-
ceived in evidence. )
Q. (By Mr. Crittenden): Now, under that
Constitution and the Canon Laws was there any
appointment made as to the Elected Delegates Com-
mittee as to what the position of the Elected Dele-
gates Committee was undér those Laws and Consti-
tution ?
A: The Elected Dele antes Committee ts a tem-
poral agency of this Church and it functions under
a charter from the Ecclesiastical Church Govern-
ment and as the temperance—the main one for the
Churehi—it handled the Apostolic Community's
common treasury. “
ean il
104 Peggy Lou Riker, et al., vs.
(Testimony of Marian T. Huff.)
Q. Now, in 1948 did you file an amended return
for the organization under the 990 form?
A. Yes, we did.
Q. 1 will show you a copy. Is that'a copy that
eame from your files? A. That is riglit.
Q. Now, there was a list—this is complete with
these [13] inserts, is it? You may examine them.
A. I believe so, Mr. Crittenden, ves. |
Mr. Crittendef: Counsel; we ask if we may have
a stipulation to use the copy instead of the Gov-
ernment’s original.
Mr. Mather: IT have no objection.
Mr. Crittenden: All right. I will offer in evi-
denee as the Petitioner’s Exhibit next in order-—
The Clerk: This is the amended return ?
Mr. Crittenden: That is the amended return for
the vear ending September 30, 1948, for the Elected
Delegates Committee. on form 9990, |
The Witness: Was’ that for the vear 1948 or
49, Mr. Crittenden ? ,
Mr. Crittenden: That is the “48. T will have the
“49 in time.
The Court: It will be admitted.
(Petitioner's Exhibit) Number 20 was re-
ceived in evidence. ) | '
Q. (By Mr. Crittenden): Now, at the san
time was 1065 return filed for the same period /
A. Yas. ¢
(). And this is an amended réturn that I am
showmng you: there. Is that a copy From) Your
Commissioner of Internal Revenue 105
(Testimony of Marian T. Huff.)
‘files? [14] A. That is correct.
Q. Now, was there a list of names in there in
addition to the—— A. Yes. —
Q. And how many names appeared on it?
A. . Well, in 1948 there were 575, I. believe. Let
me check just a second.. It shows in here. 575 in
1948. |
Mr. Crittenden: Now, may we have the sfpula-
tion to use this copy instead of the original in the.
possession of the Government ?.
Mr. Mather: No objection.
Mr. Crittenden: We will offer this in evidence
as Petitioner’s Exhibit next in order. ;
The Clerk: Exhibit No.3. amended return.
The Court: It will be admitted.
(Petitioner’s Exhibit Number 39 (was) re-
ceived in eidence. )
QY. (By Mr. Crittenden): Now, there is an
amended return by the same Committee for the
vear ending September 30; 1949, on Form @90, and
loask you if this is a copy from your tiles?
A. That is correct. Mr. Crittenden. [15] -
aa * *
Mr. Crittenden: * * * We will offer this in eVvi-
dence as the Petitioner’s Exhibit next in number,
Mr. Mather: No objection.
The Clerk: Petitioner’s Exhibit No. 4.
The Court: [It will be admitted.
(Petitioner's Exhibit Number 4 was re-
ceived im evidente. )
Sinaia)
ns
106 Peggy Lou Riker, et al., vs.
(Testimony of Marian T. Huff.)
Q. (By Mr. Crittenden): At this time did you
file a form on behalf of the Committee on the
‘Form 65? A. Yes, that was done each year.
Q. And was there a list of names of the mem-
bers of the group that were attached on the original
that was filed? = A. Yes. |
Q. That is not included in that copy?
A. No, that is not inciuded in that.
Q. How many names were included?
A. 602 in 1949. [16]
* * *
The Court: It will be received.
(Petitioner’s Exhibit Number 5 was re-
ceived in evidence. ) .
Q. (By Mr. Crittenden): Now, Mrs. Huff, dur-
ing each of these years did all of the individuals
named in these returns file individual returns?
A. Yes, there were individual returns made.
Q.. Now, for the year 1948 I show you a photo-
static copy of Peggy Lou Riker’s return, and I will
show you a mimeographed sheet. Was that type of
a sheet attached to each one of the returns?
A. Yes, that is the form upon which we re-
ported it. . « :
Q. Now, when I say ‘teach one of the individ-
uals,’” was that by family groups or by each indi-
vidual who was named in the complete return?
A. Each individual that is named in the com-
plete return. |
Commissioner of Internal Revenue 107
(Testimony of Marian T. Huff.)
Q.. Well, now, for instance, Peggy Lou Riker
had a daughter? - A. Yes.
Q. How was that handled?
A. I would have to examine the records to see
for certain how that was reported.
Q. There are two returns shown here, two per-
tions? [17] .
A. That is right. What I was hesitating about:
is- whether it was by name or by count. Yes, there
are two portions there.
Q. So that these were filed by family groups?
A. That is right. at
Mr. Crittenden: Now, to keep the record
straight, the witness was shown and testified from
thix photostatic copy of the Riker return, Mav |
put all of these in as.one composite return by stip-
ulation ? , .
“My. Mather: Well, I have no objection to—I
- think the partnership return should go im as one
and the individual returns as another for identifi-
cation purposes, |
Mr. Crittenden: All right, We are going to offer
in evidence this photostatie copy which is, as T un-
derstand ‘it, the Government's copy in lieu of the
original.
Mr. Mather: That is correct. |
Mr. Crittenden: Of the return of Peggy Lou
Riker, which included in it this mimeographed
sheet showing two—one fractional interest reported
at $377.39 each, a total of $754.78, and on Page 1
under ‘‘Item 3° the sum of *‘‘knter here total
108 Peggy Lou Riker, et al., vs.
_ (Testimony of Marian T. Huff.) :
amount of your different dependencies on attached
memorandum ’’—$754.78, which is shown on the face
of the return. - :
We are offering that in evidence as the Petition-
ers’ Exhibit next in order. [18]
’ The Clerk: Petitioner’s Exhibit No. 6.
Mr. Mather: No objection.
The Court: It will be admitted.
_(Petitioner’s Exhibit No. 6 was received in
— €@videnee.)
- Q. (By Mr. Crittenden): Now, during
these——
* . & *
Mr. Crittenden: I am offeripg these with the
same stipulation from counsel, these photostats may
be accepted in lieu of the originals of the three part-
nership returns of Mrs. Riker, ** Your Foods Foun-
tain.”
There are various periods of time from January
20, 1948, to and including June 30, 1948, and these
are offered as a composite exhibit next in order.
The Clerk: Petitioner’s Exhibit No. 7.
Mr. Mather: No objection. [19]
The Court: .They will be admitted.
(Petitioner's Exhibjt No. 7 was received in
evidence. ) |
Q. (By Mr. Crittenden): Now, during the
vears 1948 and ‘49 did the Elected Delegates Com-.
mittee have any sources of income ?
Commissioner of Internal Revenue 109 .
(Testimony of Marian T. Huff.)
A. Yes, we had sources of income from the ap-
plication of our training and also from donations
and contributions that were made by the individ-
gals, members of the church.
Q. Now, when a donation or contribution or any
form of money came in from any project, how was
that transmitted ? . |
A. Well, all funds that were accepted by the
Elected Delegates Committee had to be released to
them on a regular gift form. No. 399 was the num-
ber of the form that we used during those two
years. | oa
Q. Just as an example I have one here that is
signed by Peggy Lou Riker. [I will ask you if you
ean identify that for me.
A. Yes, that is the type of release that the Com-
mittee requires on all funds that were turned over
for their use.
Q. Did you accept any money without a 399
form ? A. No, sir.
Q. Did you accept. any money outside_of the
organization membership itself? ,
A. Not for use in our ecclesiastical work,
no. [20] |
Mr. Crittenden: We will offer in evidence as
Petitioner’s Exhibit next in order, which is a Gov-
ernment Form No. 399, signed by Peggy Lou Riker.
Mr. Mather: No objection.
Mr. Crittenden: Dated January 1, 1945, and,
counsel, | gave you a photostat of that.
110 Peggy Lou Riker, et al., vs.
(Testimony of Marian T. Huff.)
Mr. Mather: Well, I have a copy of it. I don't
have a photostat of it, but I have a copy.
Mr. Crittenden: Well, here you‘are.
The Clerk: Petitioner’s Exhibit No. 8.
The Court: Admitted.
( Petitioner’s Exhibit No. 8 was received in
evidence. )
Q. (By Mr. Crittenden): Now, Mrs.. Huff, in
thix religious organization will you deseribe the var-
ious groups of people as to whether they are in the
Apostolie Sociéty or outside so the Court may un-
derstand the type of organization it is?
A. Well, in order for the Court to understand
the radieal way in which this Chureh functions, |
would have to brieflvy—if I may, your Honor—ex-
plain somewhat of the reasons why this church was
formed.
There are some aspects of this church that are
very like any other church. We have congregations
and we have precepts and interrogations of Christ
Jesus’ teachings, and that is [21] about as far as we
ean go along the line of what most people consider
to be a ehurch.
-
The reason for forming this church is based upon
this: ne
We believe that one of the reasons the world has
failed to find its Heaven here and now as Christ
Jesus its way shower said could be done is beeause
for 2000 vears all that people have done is to study
and talk about the way of. lif: that Christ Jesus -
Commissioner of Internal Revenue ——‘'111
(‘Testimony of Marian T. Huff.)
came to teach us, that it has never seriously been.
lived by men of the world in the way that Christ
Jesus expected His Disciples and those whom His
Disciples taught to follow His teachings.
There would have been no point in founding
another church to have steeples and spires and con-
gregations gathering one day a week to have the
teachings of The Master explained to them. Heaven
knows there are churches enough in the United
States and the world that have been trying to do
that for centuries, so when this church was formed
it was with the idea that its members would. make
a life of this church, that they would live these
teachings in whatever walks of life in which they
were asked to serve, and that maybe by actually
applying these teachings we would be able to prove
all of the premises that the Master Christian made
to the world 2000 years ago.
Now, if we can bear that in mind, it will help
us to understand how this church functions, One
of the laws that [22] Christ Jesus came to give us
was this: ‘‘That giving does not impoverish, ner
does withholding enrich.’’ That is, most of the ills
of the world are suffered because man’s selfishness
and his greed and his desire to get something for
himself rather than to give all that he has to glorify
his Creator. ,
If giving does not impoverish, then we call into
play a very basic universal law that when one gives
with no thought of return there is a multiplication
112 Peggy Lou Riker, et al., vs.
(Testimony of Marian T. Huff.)
of universal law which takes place that brings back
to that person all that he needs.
The Master Christian expressed it this way:
‘‘Why take ye thought for what ye shall eat or
drink or wherewithall ye shall be clothed, for Your
Father knoweth that ye has need for all these
things, but seek ye first The Kingdom of God and
His enpeoneeeme and all these things shall be
added unto you.’
Therefore, anyone becoming a methber of the
Church does so with the full understanding that it
is a way of life, that he goes to Church 24 hours a
day, that everything he does, every bit of effort .he
gives, every bit of material possession he may give
will never in return endure to him personally in any
form of benefit. :
He takes up his studies and begins to learn the
very radical interpretation that this Chureh places
upon Christ [23] Jesus’ teachings, and his life
from then on is dedicated to the Lord’s work, and
he has just one thing to learn, and that is that he
must learn how to give selflessly if he is to aceom-
plish what he came into this (hurech to be a Min-
ister for.
Prédicated upon that, we decided that if we, were |
going to live these teachings, then we would be able
to produce a working éxample of how you take
Christ Jesus’ teachings and apply them to your
everyday life. and produce the results that he said
could be brought to pass.
He didn’t say that you would be taken care of
Commissioner of Internal Revenue 113
(Testimony of Marian T. Huff.)
if you did just carpentry work like He did. He said
that the law was ever operative, and that it applied
to all walks of life, and He chose His Disciples
from all walks of life, and he took them through
the land to the people in all walks of. life.
So He proved it to us that if we were going to live
His teachings, it didn’t matter what we did with
our hands, that Christianity was something to be
lived 24 hours a day in everything you do.
So in order to bring our Ministry to the world
in a way that they would be able to see how it actu-
ally worked, we had to have a cross section of proj-
ects, what we call Student Minister Training Proj-
ects in which we would permit the public to come
in and see us daily us we applied these . teach-
ings [24] to whatever we happened to he doing.
. That is the principal way in whielf we promul-
gate and spread the teachings of our chureh, Con-
sequently, we have no chureh buildings, so-called.
Q. Now, Mrs. Huff—— A. Yes. |
Q. ——-vou have given us the outline of those
who were working in the ministry, Are there any
members of the Church who aré net aetually en-
gaged in the Ministry ? pen
A. That is the one point, Mr. Crittenden, at the
beginning of my remarks I said we were like
churches in several respects that we do have congre-
gations. Those congregations are different classifi-
cations of membership.
Some of them live in their own homes, some » of
them have not come in and taken up the study of
ey
114 Peggy Lou Riker, et al., vs.
(Téstimony of Marian T. Huff.)
the Ministry but they contribute their efforts and
they study, and they are definitely members of this
Church. ©
But student ministers in this Church who take
up this work as a life’s work must live in the Apos-
tolie Society, they must dedicate their entire lives
to learning how to live this way of life in order that
they may be teachers and way showers as ‘was
Christ Jesus. —
Q. Now, Mrs. Huff, were these people who were
not living on the projects holding meetings, or do
they hold meetings of any kind? [25}
A. They have meetings in their homes, yes, Mr.
Crittenden, and from time to time some of the stu-
dent ministers in the church visit them and conduct
services with them. 7
They are in close touch ‘with the ecclesiastical
part of our work, but they are not required to live
under the conditions that student ministers do, and
. they are not a part of the Apostolic Society, , so-
called.
Q. Now, among the Apostolic Society, what do
you call the groups when they live together?
A. Those are called Student Minister Training
Projects. :
Q. And where are these located in general terms,
throughout the United States or just-——
A. At one time we had student minister train-
ing projects located throughout California and part. ~
of Oregon. 04
Q. In 1948 sini "49?
Commissioner of Internal Revenue 115
(Testimony of Marian T. Huff.)
A. In 1948 we still had some student minister
training projects in Oregon as well as California.
Q. Were they a-part of the Apostolic Society
group? A. Oh, yes, yes. .
Q. And at this time in 1948 was there a group
in San Bernardino? A. Yes. |
Q. Where was that located?”
A. It was located out on Base Line, East Base
Line, San Bernardino. [26]
Q. With Mrs. Riker?
A. With Mrs. Riker, ves. It was known as
“Your Foods Fountain.”’ |
— Q. And was there a group in Hollywood?
‘A. Yes. We had several in Los Angeles, there
was a group in Hollywood.
Q. Was Mrs. Riker—correction—Mrs. Grassmee
and her mother a member of any one of those?
A. They lived with the group at Holly wood,
(). Now. what was the ébjective of these par-
ticular groups that vou have deseribed ?
1 don’t mean to go into a bread picture, but what
were they attempting te do. in, each particular
group?
A. Well, these student minister training proj-
ects were set up, as [said a moment ago, for the
purpose of making it possible for the student minis-
ters to express and live in their daily activity the
teachings of their. church.
Q. Did they come in contact with the public
in these places?
A. Many of them did. At that time we had a
/
116 Peggy Lou Riker, et al., vs.
(Testimoriy of Marian T. Huff.)
number of projects where that condition existed,
and we established them primarily for the purpose
of being able to more widely disperse and promul-
‘gate our teachings by having the public come in di-
reci contact with our student ministers in training.
Q. Now, were there places like, for instance,
San [27] Bernardino, where any particular appli-
eations were undertaken to the publie of these
teachings ? A. Oh, very definitely.
Q. Well, where was that done in San Bernar- .
dino? ;
A. That was at ‘Your Foods Fountain’? on
Base Line just outside of San Bernardino.
(. How was that formed originally ?
A. Well, as I reeall, Mr. and. Mrs. Riker were
in business in San Bernardino, and they disposed
of that business and took the fixtures from it and
purchased this property out on East Base Line and
built up the student minister training activity.
there. | 7
Q. AppPoximately how many people were there
in 1948, or, say, from September, 1947?
A. Conservatively, I would imagine at least
twelve, maybe more: but I am sure there was at
least a dozen student ministers there.
Q. Now, was there any income to the Committee
from that activity ?
A. All of the proceeds from that activity, ves,
eame to the Elected Delegates Committee of ¢ Christ
Church of thé Golden Rule.
Commissioner of Internal Revenue 117
(Testimony of Marian T. Huff.)
» Q. And how was it received in this particular
. form?
A. It was released by Mrs. Riker, as the oper-
ator of that activity, to the Elected Delegates Com-
mittee on form [28] 399.
Q. Was that all the gross rec eipts up to Januar Vv
of 1948?
A. Oh, yes, ves. There was an account. Our
_ banking arr uni is this:
The returns from any student miniator *< veen-
pation went into an Elected Delegates Comunittee
hank account as a deposit, and no funds were ever
withdrawn from that locality; and then what we
call the “revolving funds’? which were established
hy the Ecclesiastical Church Government, to meet
the expenses of the Apostolic Soc iety came to the
local groups under a project account from whieh
they could withd
This text is long and has been trimmed here. Open the source document for the complete record.
This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.