Nonprofit Organizations Law and Policy Third Edition - Libraries ...

6 OVERVIEW OF THE NONPROFIT SECTOR CH. 1
Dictatorial systems, both past and current, have viewed a freedom of
association as being "dangerous." The 1791 Law of Chapelier in France is an
example along with the Italian code adopted by Italy's fascist dictatorship in
1942. Article 18 of the present Italian Constitution now guarantees a freedom
of association for its citizens so long as they are not organized for a purpose
that is prohibited by penal laws or have not created a secret association or a
military organization that pursues a political end.
QUESTIONS
1. Should individuals have a protected "right of association" through a
vehicle in the form of a nonprofit corporation? Does the "right of association"
necessarily implicate a "right to discriminate" that too can be "dangerous?"
The "right of association" is discussed in Chapter 13.
2. Should a nonprofit organization be denied tax exempt status on the
basis of public policy? See Church of Scientology of California v. Commissioner,
823 F.2d 1310 (9th Cir.1987), cert. den., 486 U.S. 1015, 108 S.Ct. 1752, 100
L.Ed.2d 214 (1988), discussed in chapter 5, and Bob Jones University v.
Simon, 416 U.S. 725, 94 S.Ct. 2038, 40 L.Ed.2d 496 (1974), discussed in
Chapters 5 and 11.
3. Is the involvement of a "charitable" organization in political activities
antithetical to an organization's charitable purpose? Consider the following
case.
L. HAND, CIRCUIT JUDGE.
SLEE v. COMMISSIONER
United States Court of Appeals, Second Circuit, 1930
42 F.2d 184
During each of the years in question Slee, the petitioner, made gifts to
the American Birth Control League, which he deducted from his income.
The Commissioner, and later the Board, disallowed these, and the only
question is whether section 214(a)(1l)(B) of the Internal Revenue Act of
1921 (42 Stat. 227), and section 214(a)(10) of the Revenue Acts of 1924
and 1926 (26 USCA § 955(a)(10)), include the League. Those sections
allow the deduction of gifts made to 'any corporation * * * organized and
operated exclusively for religious, charitable, scientific, literary or educational
purposes, including posts of the American Legion or * * * for the
prevention of cruelty to children or animals.' The question is whether the
League is organized for charitable, scientific or educational purposes and,
if so, whether those are its exclusive purposes.
It at first was an unincorporated association, but secured incorporation
in New York in September, 1922, and its declared objects were as
follows: 'To collect, correlate, distribute and disseminate lawful information
regarding the political, social and economic facts of uncontrolled
procreation. To enlist the support and co-operation of legal advisors,
statesmen and legislators in effecting the lawful repeal and amendment of