Murphy Bartol & O'Brien, LLP, for defendants.
Joseph Ra, Town Attorney (
Mario Bove of counsel), for plaintiff.
OPINION OF THE COURT
JOEL K. ASARCH, J. This case involves a question of concern to municipalities: may a restrictive covenant running with the land bar the sale of alcoholic beverages at the location even though such sale is licensed by the New York State Liquor Authority? The defendants, Amerada Hess Corporation and Hess Mart Inc., have been charged with two counts of violating article XXXIII, § 336 of the Building Zone Ordinance of the Town of Hempstead. The defendants are alleged to have permitted the sale of alcoholic beverages on January 23, 2001 and on February 13, 2001 at 880 Old Country Road in Westbury, Nassau County, New York. It is contended by the People that such retail sale was specifically prohibited by the covenants and restrictions affecting the gasoline service station (GSS) district property. By order dated April 15, 2002 (Moser, J.), the court denied the defendant's motion to dismiss the accusatory instruments based on the pleadings. It is noted that based on the evidence adduced at trial, the court finds that the prior decision of this court is not law of the case. (Del Castillo v Bayley Seton Hosp., 232 AD2d 602 [2d Dept 1996].) Further, docket numbers 2001NA153S and 2001NA230S were dismissed at trial upon application of the People as duplicative (CPL 170.30); docket numbers 2001NA227S and 2001NA151S had previously been dismissed. A trial without jury was held before the undersigned on December 12, 2002. Memoranda of law were submitted on February 28, 2003. At trial, Code Enforcement Officer John Rocco, James Noonan (a professional engineer) and George Benavides (defendant's real estate representative) testified.
The Trial Testimony
The parties stipulated to the following two facts:
"1. The premises at issue (to wit: 880 Old Country Road, Westbury) is a Gasoline Service Station (`GSS') zoned property under Article XXXIII of the Town of Hempstead Building Zone Ordinance. Within this district, a gasoline service station may sell retail products other than gasoline, oil, grease and other petroleum products only `when specifically permitted by the Town Board,' § 336(A)(7)."
"b. Town of Hempstead Building Zone Ordinance § 337 provides that an application for inclusion of new premises within a GSS district shall include covenants and restrictions."
On March 13, 1995, C & B East Meadow Co., the owner of the premises at that time, executed a declaration of restrictive covenants which was duly filed with the Nassau County Clerk on April 3, 1995. Amoco Oil Company (a previous tenant) had made an application to the Town Board for inclusion of the premises in the GSS district. The declarant "for the best interests of itself and the Town of Hempstead" declared, among other items concerning hours, air pump, propane storage, curb cuts, storage, etc., that "14. [w]ith respect to the convenience
denied this motion in that the presence of beer in display cases, signs and prices provided the inferences that there was a retail sale of alcoholic beverages. The court reserved decision on preemption and constitutional grounds of the defendant's motion to dismiss. The defense produced two witnesses to testify: James Noonan, a professional engineer, and George Benavides, a real estate representative for Hess. Mr. Noonan testified that he was a professional engineer who worked on gas station applications submitted to the Town of Hempstead. Mr. Noonan testified that any application for GSS district inclusion requires a public hearing and that he was involved in the GSS district application by Amoco in the late 80's or early 90's for the premises herein. The gas station at issue was rebuilt and a new building was erected to include a convenience store. Mr. Noonan stated that the Town's normal practice was to impose restrictive covenants to detail how landscaping, lighting, appearance and what is sold. At the hearing, Mr. Noonan testified that pursuant to board member requests, the restrictive covenant against the sale of alcohol at the convenience store had been entered into. The Town accepted the declaration containing restrictive covenants as part of the GSS application. Notwithstanding the Town's acceptance of the restrictive covenants in approving the GSS status, a New York State Liquor Authority grocery chain wine product license was issued to the defendant Hess Mart Inc. for the premises and for the period covering August 22, 2000 through May 31, 2003.
Discussion of Law
Both parties agree that the Town Board may not directly regulate the sale of alcoholic beverages in gasoline station convenience stores. "In People v De Jesus (54 NY2d 465, 468-470 [1981]), we found the elaborate and detailed regulatory scheme laid out in the Alcoholic Beverage Control Law, in conjunction with the declared goal of the statute (§ 2) to `regulate and control the manufacture, sale and distribution within the state of alcoholic beverages', determinative in our conclusion that the State had preempted the regulation of establishments selling alcoholic beverages" (Vatore v Commissioner of Consumer Affairs of City of N.Y., 83 NY2d 645, 649-650 [1994]). It is well established that a municipality may not regulate the sale of alcoholic beverages. (1980 Ops Atty Gen No. I 186.) That being said, may the municipality regulate indirectly that which it cannot do directly? This is the crux of this matter. Law. The ordinance envisions restrictive covenants running with the land, covering primarily the removal of buildings and appurtenances. While the court believes that such a covenant, whether voluntary or not, cannot prohibit the sale of alcohol by a duly licensed establishment, the court credits the testimony of Mr. Noonan that the condition was required by the Town prior to the passing of the zoning change. Mr. Noonan recalled a board member asking, "you will, of course, include a provision for the elimination of beer at this location" (transcript at 87) and that conditions were requested by board members (transcript at 90). The court rejects that this particular prohibition was entered into "voluntarily." The court takes notice that the sale of alcoholic beverages at convenience stores located at gasoline stations has many deleterious effects. Young people who drive but who are not over the age of 21 attempt to purchase beer at these convenience stores, as well as drivers who sometimes purchase beer with the intent of drinking while driving. People buy beer at these gasoline stations and then consume the alcoholic beverage in public, in neighborhoods surrounding the gasoline station. Each situation appears with too much frequency in this court. Notwithstanding the foregoing, it is the opinion of the court that the covenant against selling alcoholic beverages is preempted by New York State law. The restriction which is authorized by the Building Zone Ordinance is an attempt to regulate the operation of the defendant's business and is unenforceable. (Matter of Old Country Burgers Co. v Town Bd. of Town of Oyster Bay, 160 AD2d 805 [2d Dept 1990].) The State Liquor Authority's power cannot be limited in this way. (Tad's Franchises v Incorporated Vil. of Pelham Manor, 42 AD2d 616 [2d Dept 1973], affd 35 NY2d 672 [1974].) The court finds that the Town is preempted, whether legislating directly or through the acceptance of the restrictive covenant, from prohibiting the sale of alcoholic beverages at the GSS convenience store. This covenant cannot be used as a basis for criminal prosecution. Accordingly, the defendant is found not guilty.