Case Title: State of New Jersey, Township of Pennsauken v. James Schad

Citation: 

Docket Number: a-197-97

State: new-jersey

Court: New Jersey Supreme Court

Date: 1999-07-28T00:00:00Z

Document:
(This syllabus is not part of the opinion of the Court. It has been prepared by the Office of the Clerk for the convenience of the reader. It has been neither reviewed nor approved by the Supreme Court. Please note that, in the interests of brevity, portions of any opinion may not have been summarized). HANDLER, J., writing for a unanimous Court. In this appeal, the Court considers whether the restrictive provisions of a Pennsauken Township municipal ordinance apply to signs that are not physically located outside or affixed to the exterior of a commercial property, and, if so, whether the ordinance unconstitutionally restricts commercial speech. James Schad operates two adult entertainment establishments in the Township of Pennsauken -- one on the Admiral Wilson Boulevard and the other on Route 73. Both locations have illuminated, free standing signs and at least one building-mounted sign, all of which either conform to the requirements of the Township's sign ordinance or were permitted as non-conforming uses under the ordinance. In September 1995, without securing a requisite permit, Schad erected eight displays at one of the locations and twelve at the other. Each display consisted of a color transparency measuring 42.75 square feet, depicting a woman dressed in swimwear, and was set in an individual wooden encasement with a backlit panel and glass front. The displays were placed twelve to twenty-four inches behind the windows, but were not attached directly to the windows. The transparencies were visible only from outside the buildings and were illuminated at night. Schad was issued summonses in connection with the transparency displays for various violations of the Township's sign ordinance, including failure to remove signs exceeding the maximum number permitted and the maximum gross square footage allowed at a given location, and failure to obtain permits for the transparency displays. Subsequently, on March 21, 1996, he was found guilty by the Pennsauken Municipal Court and was fined $30,000. The municipal court held that the ordinance applied to Schad's transparencies even though they were located within his stores, and rejected his constitutional defenses. His convictions were affirmed by the Law Division following a trial de novo. On June 28, 1996, summonses were again issued to Schad, charging continuing violations of the same sign ordinance provisions. On September 25, 1996, he was again found guilty by the municipal court and fined $102,000. Although his convictions were subsequently affirmed by the Law Division, the fines were reduced to $65,920. Schad appealed both convictions to the Appellate Division. The Appellate Division reversed all of Schad's convictions and vacated the fines. The court determined that the transparency displays placed inside the windows were not signs within the meaning of the Township's sign ordinance. Given its holding, the court did not reach the constitutional issues raised by Schad. The Supreme Court granted the Township's petition for review and Schad's cross-petition for review of the constitutional issues not addressed by the Appellate Division. HELD: The language of Pennsauken Township's sign ordinance applies to interior illuminated transparency displays in Schad's adult entertainment establishments that are intended to be visible from outside the premises; the ordinance does not unconstitutionally limit Schad's speech. 1. Statutory rules of construction require that an ordinance should be interpreted to effectuate the legislative intent in light of the language used and the objects sought to be achieved. (pp. 8-9) 2. Although zoning ordinances generally are liberally construed in favor of the municipality, because municipal court proceedings to prosecute violations of ordinances are essentially criminal in nature, a rule of strict construction should be followed, interpreting the terms of the ordinance narrowly, and resolving any ambiguities in favor of a defendant charged with a violation thereof. (pp. 9-10) 4. Schad's displays qualify as signs because their message was directed solely outside the buildings. To limit the term outside to signs or displays that are placed or located physically outside a building allows a proprietor to circumvent the ordinance's restrictions and intended effect by placing an otherwise noncomplying sign behind a window inside of the premises, while still communicating to passersby. (pp. 11-15) 5. A regulation that serves purposes unrelated to the content of expression is deemed neutral and is subject to less scrutiny than one that is content-based, even if it has an incidental effect on some speakers or messages but not others. (pp. 16-17) 6. In order for a restriction on commercial speech to survive First Amendment scrutiny, it must concern lawful activity, must directly advance the substantial governmental interest asserted, and must be no more extensive than is necessary to serve that governmental interest. (pp. 17-19) 7. The Township's ordinance clearly involves commercial speech and is content-neutral in its application to commercial communications. (pp. 19-20) 8. Interests in traffic safety and visual appearance constitute substantial governmental interests. (pp. 20-21) 9. The regulatory restrictions of the Township's ordinance, examined under standards of intermediate scrutiny applicable to commercial speech, are not an unconstitutional limitation of Schad's speech. (p. 22) 10. An ordinance that imposes a permit requirement in order to engage in communicative conduct is permissible if it includes narrow, objective and definite standards to guide the licensing authority, and if the granting of the permit is not based on the uncontrolled will of an official. (pp. 22-23) 11. Permit fees must operate to meet the expenses incident to the administration of the act and to the maintenance of the public order in the matter licensed. The permit fee charged by the Township is not facially excessive or unreasonable, and will not deter a commercial enterprise from erecting a sign. (pp. 24-25) 12. The Township's ordinance does not violate procedural due process inasmuch as the time limitation followed by the Township accords one seeking the permit ample opportunity for prompt judicial review in the event the permit is erroneously denied. (pp. 25-26) 13. The Township's ordinance is not facially vague and further is not void for vagueness as applied to Schad. (pp. 26-27) 14. Schad failed to present sufficient evidence of disparate treatment in application of the ordinance to him. (pp. 28-29) 15. The substantial amount of fines imposed, though large, is not unconstitutionally excessive and is rationally related to the need to deter future violations by Schad and others. (pp. 29-31) Judgment of the Appellate Division is REVERSED. CHIEF JUSTICE PORITZ and JUSTICES POLLOCK, O'HERN, GARIBALDI, STEIN, and COLEMAN join in JUSTICE HANDLER's opinion. STATE OF NEW JERSEY, TOWNSHIP OF PENNSAUKEN, Plaintiff-Appellant and Cross-Respondent, v. JAMES SCHAD, Defendant-Respondent and Cross Appellant. Argued March 1, 1999 -- Decided July 28, 1999 On certification to the Superior Court, Appellate Division, whose opinion is reported at 307 N.J. Super. 493 (1998). Michael E. Joyce argued the cause for appellant and cross-respondent (Kelley, Wardell & Craig, attorneys). Bradley J. Shafer, a member of the Michigan and Arizona bars, and John A. Underwood argued the cause for respondent and cross-appellant (Underwood & Micklin, attorneys; Robert E. Levy, on the brief). The opinion of the Court was delivered by HANDLER, J. In this case, a municipality applied the restrictive provisions of its sign ordinance against interior store displays that were visible from the exterior of the premises. The owner of the building premises contended that the ordinance did not apply to interior displays and that the enforcement of the ordinance was unconstitutional primarily because it violated rights of free speech protected by the First Amendment. The appeal thus raises the initial issue of the interpretation of the municipal ordinance and whether its provisions apply to signs that are not physically located outside or affixed to the exterior of a commercial property. If the ordinance embraces such displays, that issue in turn gives rise to constitutional defenses involving essentially the reasonableness of restrictions on commercial speech. (7) Illuminated Sign. Any sign which is designed to be seen at night by virtue of artificial light from within, behind or upon such sign, but not including reflector-type signs unless the source of light is made a part of, or is related to, such sign. (9) Wall sign. A sign attached to or painted on a wall and subject to all sign regulations herein. The ordinance requires a permit for certain types of signs, including non-residential signs exceeding twelve square feet and any illuminated sign, regardless of size. Id. at 126-711(G)(1). Applicants must submit, as part of the permit application, "a sketch showing the size, location, text and owner [of the sign] . . . indicated in writing, together with a fee." Id. at 126 711(G)(2). The required fee differs based on the square footage of the sign for which a permit is sought. Ibid. A sign measuring 8 to 25 square feet requires a $40 fee; a sign containing 25 to 100 square feet requires a $100 fee; and a sign covering more than 100 square feet requires a $150 fee. Code 120-12(G) (amending 126 711(G)(2)). In order to receive a permit, an applicant must conform to the ordinance's various restrictions on the sign size, number, location and type. The relevant regulations in this case govern business signs in commercial districts: C. Signs in commercial districts. The following signs may be erected and maintained in commercial districts, subject to the conditions specified: . . . . (2) Business signs or signs for any permitted commercial activity. A sign may be erected and maintained on the same building or premises as the use to which it refers, provided that: (a) The number of such signs shall not exceed two (2) in C-1 Commercial Districts and four (4) in C-2 Commercial Districts. (b) The maximum total area of all permitted signs shall not exceed an area equal to two (2) square feet for every one (1) lineal foot of building frontage; and signs shall be permitted on a building wall or roof; provided, however, that no sign shall extend higher above the building height, as defined herein, than four (4) feet. (c) Temporary window signs shall not be considered in computing the allowable sign area, provided that such interior window signs do not cover more than ten percent(10") of any single window and are not permanently affixed to the window. CHIEF JUSTICE PORITZ and JUSTICES POLLOCK, O'HERN, GARIBALDI, STEIN and COLEMAN join in JUSTICE HANDLER'S opinion. NO. a-197/198 STATE OF NEW JERSEY, TOWNSHIP OF PENNSAUKEN, Plaintiff-Appellant and Cross-Respondent, v. JAMES SCHAD, Defendant-Respondent and Cross-Appellant. DECIDED