Gas dealers lose The Dallas-based owner of some 25 gasoline stations on Oahu has succeeded in evicting two Arco dealers from 10 of the stations, easing the pending sale of the properties.
battle for stations
The owner ousts 2 after they
fail to raise a $1.2 million bondBy Tim Ruel
truel@starbulletin.comOn Saturday, dealers Amgad Wahba and Riyad Khoury turned in the keys to the stations' owner, U.S. Restaurant Properties Inc., after the dealers failed to raise a $1.2 million bond that would have allowed them to continue operating pending appeal of a state District Court ruling. The stations are currently closed.
District Judge Rhonda Nishimura ruled on March 1 that U.S. Restaurant is within its rights to evict the dealers, but the judge later gave Wahba and Khoury three days to raise the bond, with a deadline of noon on Friday last week.
Despite the setback, the dealers are preparing to appeal the decision to the Hawaii Supreme Court, said a representative of their attorney, Mark Kawata. Even if the dealers can't get the stations back, they should be compensated under state law, according to Kawata.
An attorney representing U.S. Restaurant could not be reached for comment yesterday.
The ruling leaves Oahu's three remaining Arco dealers wondering if they will be evicted next. U.S. Restaurant has recently returned some of their rent checks, and the group is suing U.S. Restaurant to block any potential eviction proceedings.
According to the lawsuit, U.S. Restaurant is attempting to sell most of its Oahu stations to local independent dealer Lex Brodie's, and the deal hinges on U.S. Restaurant being able to deliver the stations free and clear of dealer subleases.
U.S. Restaurant also owns an Arco station in Waikiki, formerly run by Khoury, which the Dallas firm is trying to sell in a separate deal to an unidentified buyer.
The three remaining Arco dealers fear U.S. Restaurant will attempt to dismantle their pump equipment, much the same way U.S. Restaurant disabled the pumps at eight of Wahba and Khoury's stations on a Friday night in January. During the escapade, U.S. Restaurant was accompanied by off-duty police officers, paid for by Lex Brodie's, prompting the dealers to complain to police Internal Affairs afterward.
"There was an investigation into the allegations made by the gas station dealers ... and it was found that the officers did not act improperly," police spokeswoman Michele Yu said.
One week after the incident, the 1st Circuit Court ordered U.S. Restaurant to put the eight Arco stations back into working order, because the court found the company violated a late-night emergency restraining order.
U.S. Restaurant, a real estate investment trust, bought the stations in March 1999 after Texaco was forced to divest its Hawaii assets to get regulatory approval for its joint venture with Shell Oil Co.