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Southland Corp. v. Township of Edison

Decided: July 1, 1986.

THE SOUTHLAND CORPORATION, PLAINTIFF,
v.
THE TOWNSHIP OF EDISON, DEFENDANT. ROSEANNE AMENDOLA, T/A MENLO PARK AMOCO, AMOCO OIL COMPANY & AMOCO CORPORATION, PLAINTIFFS, V. MUNICIPAL COUNCIL OF THE TOWNSHIP OF EDISON (MIDDLESEX COUNTY) AND THE TOWNSHIP OF EDISON, DEFENDANTS



Keefe, J.s.c.

Keefe

The plaintiffs in the two consolidated actions now before the court challenge on various grounds the constitutionality of an Edison Township ordinance that requires plaintiffs' retail businesses to close between the hours of 12 a.m. and 6 a.m. The plaintiffs in one suit are an individual retail gasoline dealer (Amendola), Amoco Oil Company and Amoco Corporation. The plaintiff in the second suit is the Southland Corporation which, through its 7-Eleven Division, operates convenience food stores throughout the country. The court heard extensive testimony over eight days and now makes findings of fact and conclusions of law as required by R.1:7-4.

The ordinance in question provides as follows:

sec. 57-1. Purpose.

It shall be the purpose of this Ordinance to discourage and prevent the present trend of robberies and violent capital crime which occur at retail establishments; and to protect the safety and welfare of the residents of the Township of Edison who patronize and are employed by these retail establishments.

sec. 57-2. Definitions.

The following terms, when used in this Article, shall be construed as follows:

RETAIL ESTABLISHMENT -- An establishment, enterprise, or business that sells to the general public goods, merchandise, food or material; and/or automotive fuel, motor oil, goods and services which are generic to gasoline filling and service stations.

Specifically excepted are hotels and motels, supermarkets, diners, restaurants, bars and taverns, truck terminals.

sec. 57-3. Closing hours.

No retail establishment as herein defined, to which the general public is invited, shall be open for business between the hours of 12:00 a.m. and 6:00 a.m. Prevailing time (2400 to 0600 hours).

sec. 57-4. Violations and penalties.

Any person who shall violate a provisions of this Chapter shall, upon conviction thereof, be punished by a fine not exceeding five hundred dollars ($500.00) or by imprisonment for a term not exceeding ninety (90) days, or both. A separate offense shall be deemed committed on each day during or on which a violation occurs or continues.

sec. 57-5. Severability.

If any Article, section, subsection, sentence, clause or phrase of this Chapter is for any reason held to be unconstitutional or invalid, such decision shall not affect the remaining portions of this Chapter, and they shall remain in full force and effect.

The subject ordinance was first considered by the Edison Council in January 1986, although the topic of closing retail establishments had been broached and rejected by the council in 1980 after a young man had been killed at 12:50 a.m. while working in a convenience store located in Woodbridge. The renewed interest in such an ordinance was sparked by the homicide of another young man at a gasoline station in Sayreville on December 25, 1985. The victim of that killing was also working alone after midnight. The crime received a great deal of public attention and an expression of concern by various local legislative bodies. Hearings on the subject have also been conducted by a State Legislative Committee. While the ordinance was under consideration by Edison Council there was

another homicide of a young man at a gasoline station in Edison on March 21, 1986. The victim in the most recent homicide was also working alone and was killed between the hours of 11:00 p.m. and 7:00 a.m. There is no question but that the March homicide convinced the Council that the ordinance should be passed.

The Edison Council intended, from the beginning of their consideration of the ordinance, to close gas stations and convenience stores, allowing all other retail operations to stay open. As evidence of their fixed intent they asked the Edison police chief to research crime statistics only as to gas stations and convenience stores and advise the council how many such establishments were open 24 hours per day. It is conceded by defendant that, although the ordinance is not worded as directly as the council intended it has the same effect. It is intended that gas stations and convenience stores close between 12:00 a.m. and 6:00 a.m. while all other retail establishments may remain open. The retail establishments exempted from regulation are identified by enumerated exceptions.

The testimony of Edison Council members contains a common thread of assumptions that were at the heart of their desire to regulate the plaintiffs' operations. The first assumption was that gasoline stations and convenience stores had higher incidences of robberies during the regulated hours than other retail businesses. The second assumption was that the incidence of robberies was due to the way in which these businesses operate as opposed to other retail businesses, that is, easy access to cash, ease of ingress and egress (escape), volume of business being conducted, a minimal number of people employed, youthful employees, and a large turnover of employees (poorly trained). The third assumption was that the exempted businesses did not have the risk factors of robbery present in their operation equal to that of gas stations and convenience stores. The two most important considerations that resulted in the exemption of all other retail businesses were the number of

employees on the premises after 12:00 a.m. and the volume of business conducted at those establishments.

Although certain legislative assumptions were made, no research was done by the council as to the number of employees or number of customers present during the late night hours in those establishments closed by the ordinance, or in those establishments permitted to remain open as exceptions to the ordinance. Although some council members on rare occasion patronized late night establishments, no township council members acknowledged patronizing any of the exempted or regulated establishments during the very late night hours.

It was conceded by the defendant that the Council relied heavily upon the views of its Chief of Police. Chief Kermes at one time expressed the view that all retail establishments should be closed after midnight. However, after the March 21, 1986 homicide his letter to the mayor requesting action recommended only that all night gas stations be closed. In January of 1986 Chief Kermes provided the Edison Council with a memorandum reflecting the robbery experience of convenience stores and gas stations in Edison during 1985. This memorandum indicated that while there were seven robberies of gas stations in 1985, there were no such robberies in convenience stores. Chief Kermes was not asked to produce crime statistics on the exempted businesses, nor was he consulted with regard to the exceptions in the Ordinance, except to be asked by the Township attorney whether he would object to closing convenience stores, as well as gas stations.

The Chief believes that crime is essentially unpreventable and unpredictable as to where and when it will occur, especially as to when a robbery will result in a homicide. While he attempted to define those characteristics of gas stations and convenience stores that he believes make them special robbery targets, he delineated no specific characteristics which made a convenience store different from any of the establishments the Ordinance permits to remain open. While Chief Kermes testified

that a convenience store characteristically only has one attendant on duty during the midnight hours, is accessible to highways and is staffed by youthful clerks who are constantly changing employment, he also testified that the age of a clerk is really not important, the number of employees on duty may be irrelevant to the occurrence of a crime, and all business establishments in Edison are easily accessible to major state or interstate highways. The Chief conceded that, despite the express legislative finding in the Ordinance, he could not state there existed either a trend of robberies or of violent capital crimes occurring in convenience stores.

Edison police records show that the most recent armed robbery of a convenience store occurred on April 27, 1984, in a Krauzers. This robbery, however, occurred prior to midnight. The most recent robbery that occurred in a convenience store between midnight and 6:00 a.m. occurred on December 28, 1981, at 1:25 a.m., also in a Krauzers. In the last six and one-half years there have been only seven robberies in approximately ten Edison convenience stores, regardless of the hours. No robberies have occurred in over two years. Chief Kermes also acknowledged that the effect of an ordinance such as this would be to displace robberies either in time (to the hours of opening and closing, which are the periods of greatest vulnerability to robbery), or by place (to those business establishments that the ordinance permits to remain open).

Southland now operates a total of 211 franchised 7-Eleven stores throughout New Jersey. Three of these stores are located in Edison Township. The three 7-Eleven stores are located on Vineyard Road, Lafayette Road, and Woodbridge Avenue. Prior to the enactment of the disputed ordinance, the Vineyard Road and Lafayette Road stores operated on a 24-hour basis. The Woodbridge Avenue store closed between midnight and 5:00 a.m.

A 7-Eleven store offers virtually the same product lines as that offered in a supermarket. The vast majority of 7-Eleven

stores nationally are open 24 hours a day. Late night sales represent a significant proportion of a 7-Eleven store's business. Based upon national market data, 16% of a 7-Eleven store's sales are made between midnight and 6:00 a.m. During the same period of time, 13% of 7-Eleven's customer traffic enters their stores. During the late night shift (11:00 p.m.-7 a.m.), the same study reveals 21% of customer traffic and 23% of sales. Applying national statistics to Edison's two 24 hour stores, these stores average approximately 315 customers per night (11 p.m.-7:00 a.m.). Based upon national marketing statistics, the hours between 12:00 midnight-1:00 a.m. and 1:00 a.m.-2:00 a.m. each represent 4% of a 7-Eleven store's sales. Comparable percentages are yielded during the 7:00 a.m.-8:00 a.m.; 8:00 a.m.-9:00 a.m.; 9:00 a.m.-10:00 a.m.; and 10:00 a.m.-11:00 a.m. hours. Although customer traffic slacks off after 2:00 a.m., this time is profitably used to accept deliveries, stock shelves and clean the store.

The adoption of the ordinance adversely affects Southland and its franchisees in several ways: (a) significant gross sales will be lost. (During the course of a year, Southland projects that the two former Edison 24-hour stores will lose approximately $180,000-$200,000 in gross sales. The third store will lose approximately $60,000 in gross sales as a result of the ordinance.); (b) over a period of time, customer loyalty will be jeopardized; (c) established patterns of customer buying habits will be broken; and (d) 7-Eleven stores will experience a competitive disadvantage against competitors allowed to remain open.

This competitive disadvantage will not only affect 7-Eleven stores during the hours in which they are forced to close, but also during other hours of operation. Sales figures for the first three full weeks following the effective date of the ordinance show that sales losses have been approximately 15%-17% in the two former 24-hour stores, and 3.5% in the non-24-hour store. This takes into account ...


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