Georgia Osteopathic Hospital, Inc. v. Strickland

Hall, Presiding Judge. The hospital appeals from a judgment of the DeKalb Superior Court affirming an award of the State Board of Workmen’s Compensation to one of its employees. The sole issue is whether the Georgia Osteopathic Hospital is an "employer” as contemplated by Code Ann. § 114-101, and thus subject to the Workmen’s Compensation Act. The section defines an employer as "any individual, firm, association or corporation engaged in any business operated for gain or profit, except as hereinafter provided.” This court has held that "nonprofit organizations do not come under, the definition of employer as defined in the Workmen’s Compensation Law.” Flint Electric Membership Corp. v. Posey, 78 Ga. App. 597, 599 (51 SE2d 869). The board found "as a matter of fact” that the hospital was operated for gain "in that each year its net worth has increased and a profit has been shown above its operating expenses.” It further found that the same issue was decided by the Supreme Court of Georgia, (citing Ga. Osteopathic Hospital v. Alford, 217 Ga. 663 (124 SE2d 402)) and that, as a matter of law, the hospital is operated for a gain or profit. The hospital contends the board misinterpreted and misapplied the law of the Alford case. We must agree. The sole issue and the holding in Alford was that the hospital was not a "purely charitable institution” within the meaning of the Constitution and statutes of the state and therefore not exempt from ad valorem taxes. It did wof hold that the hospital was a profit-making organization. "Charitable” and "non-profit” are not synonymous. Non-profit organizations also include those devoted to religious, scientific, educational, literary and other purposes. Further, the test for determining whether an organization is non-profit is not whether it has an excess of income over expenses for several years. If this were the case, no such organization could ever expand beyond its initial stage. The Georgia Corporation Code defines a non-profit corporation as one "no part of the income or profit of which is dis [87] tributable to its members, directors or officers.” Code Ann. § 22-2102 (c). Both the charter and the actual operations of the hospital conform to this test as shown by the evidence adduced at the hearing, including the fact it is recognized as a non-profit organization by the United States Internal Revenue Service and the Georgia Sales Tax Unit. Submitted September 15, 1970 Decided December 4, 1970. Zachary, Hunter, Zachary & Bowden, W. E. Zachary, Sr., for appellant. Essley B. Burdine, for appellee. Finally, the fact that the member-doctors clearly benefit in their private practice from the hospital’s operation does not make • this a business run for gain. The same thing could be said for the members of the Georgia Milk Producers Confederation or the Flint Electric Membership Corp.; yet this court has held both organizations to be non-profit for the purposes of workmen’s compensation. Hall v. Ga. Milk Producers Confederation, 61 Ga. App. 676 (7 SE2d 330); Flint Electric Membership Corp. v. Posey, supra. Judgment reversed. Bell, C. J., Jordan, P. J., Eberhardt, Pannell, Deen, Quillian and Whitman, JJ., concur. Evans, J., dissents.