Can an establishment be sued for over-serving liquor?

Understanding dram shop laws and your liability are important if you own or work in an establishment that serves alcohol.

Under dram shop laws, an establishment that serves alcohol to someone after he or she is visibly intoxicated can be held liable for the damage the drunk person causes — where, for example, he or she drives drunk and hurts someone.

Introduction to Dram Shop & Social Host Liability

A dram shop (or dramshop) is a bar, tavern or similar commercial establishment where alcoholic beverages are sold.

Dram shop law, also called dram shop liability, is a way to prevent an establishment that makes a profit from selling liquor by putting profit over public’ safety.

Dram shop liability refers to the body of law governing the liability of taverns, liquor stores, and other commercial establishments that serve alcoholic beverages.

In simple terms, dram shop laws hold retail establishments liable for damages caused by serving alcohol to an obviously intoxicated patron – and in some cases – the owner of a bar, restaurant, tavern or other establishment can be sued if an intoxicated patron causes a car accident.

The majority of states allow for recovery when the defendant knew (or should have known) the customer was intoxicated. Some states have attempted to address this problem through more exacting tests. Many states impose liability on social hosts as well as commercial establishments. This related area of the law is known as social host liability.

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Effects of Dram Shop Laws

According to MADD (Mother Against Drunk Driving), the effects are dram shop laws are:

  • Dram shop liability laws reduce alcohol-related crashes.
  • Dram shop laws increase publicity of the impacts of over-serving.
  • Dram shop laws decrease excessive and illegal consumption.
  • Dram shop laws do not decrease personal responsibility.

Intent of Dram Shop Laws

The intent of dram shop laws is to encourage bar owners to train employees to recognize when this point has been reached by a patron, and cut off any further service or sale of alcohol.

When this guideline is ignored, it becomes much more likely that a patron will leave the bar and cause some kind of harm to himself and/or others by causing an auto accident.

It might also be that the patron becomes belligerent with excess alcohol and engages in a fistfight with other customers at the bar. Both types of behavior are clearly unacceptable.

Which states have Dram Shop laws?

Dram shop laws vary from state to state, but 43 states enacted dram shop laws in some form in response to the large number of DUIs that cause catastrophic injuries or wrongful deaths. These laws allow some degree of liability against drinking establishments who allow visibly intoxicated patrons to drive away.

Dram Shop Laws by State – National Conference of State Legislatures

  • States that do not have dram shop laws include: Virginia, South Dakota, Nevada, and Maryland.
  • California has enacted a law specifically prohibiting civil liability of people, bars, and alcohol retailers that serve alcoholic beverages to those that subsequently cause injury or death to others.

State

Vendor Liability
Adults?

Vendor Liability
Minors?

Relevant Statutes/ Case Law

Alabama

Yes

Yes

§ 6-5-71,
§ 6-5-72

Alaska

Limited

Yes

§ 04.16.030;
§ 04.21.020(a); §04.21.080(a)(l).

Arizona

Yes

Yes

§§4-311; 4-301; 4-312(B)

Arkansas

Yes

Yes

§16-126-103; §16-126- 104;

California

No

Limited

BUS §25602; BUS §25602.1

Colorado

Yes

Yes

§§12-46-112.5; 12-47-128.5

Connecticut

Yes

Yes

§ 30-102

DC

Yes

Yes

Case Law

Delaware

No

No

Florida

Limited

Yes

§ 768.125

Georgia

Limited

Yes

§ 51-1-40(b)

Hawaii

No

Yes

Case Law

Idaho

Limited

Yes

§ 23-808

Illinois

Yes

Yes

§ 235 IILCS 5/6-21

Indiana

Yes

Yes

§ IC7.1-5-10-15.5

Iowa

Yes

Yes

§§ 123.92; 123.49(1)

Kansas

No

No

Kentucky

Yes

Yes

§ 413.241

Louisiana

No

Yes

§ 9:2008

Maine

Yes

Yes

28-A MRSA § 2501 et seq.

Maryland

No

No

Massachusetts

Yes

Yes

Case Law

Michigan

Limited

Yes

§ 436.1801(3) & (10)

Minnesota

Yes

Yes

§340A.801

Mississippi

Limited

Yes

§ 67-3-73 (2) & (4)

Missouri

Limited

Yes

§ 537.053

Montana

Limited

Yes

§ 27-1-710

Nebraska

No

No

Nevada

No

No

§ 41.1305

New Hampshire

Yes

Yes

§ 507-F:1 et seq.

New Jersey

Limited

Yes

§2A:22A-1 et seq.

New Mexico

Yes

Yes

§ 41-11-1

New York

Yes

Yes

§§ 11-100 & 11-101

North Carolina

Limited

Yes

§§ 18B-120 et seq.

North Dakota

Yes

Yes

§ 5-01-06.1

Ohio

Yes

Yes

§§ 4399.01, 4399.02, & 4388.18

Oklahoma

No

Yes

Case Law

Oregon

Yes

Yes

471.565(2); §471.567

Pennsylvania

Limited

Limited

47 § 4-497

Rhode Island

Yes

Yes

§3-14-6; §3-14-7.

South Carolina

No

Yes

Case Law

South Dakota

No

No

§§ 35-4-78, 35-11-1, & 35-11-2

Tennessee

Limited

Yes

§57 10 101; §57 10 102; Case Law

Texas

Limited

Limited

§2.01 et seq

Utah

Limited

Limited

§ 32A-14-101

Vermont

Yes

Yes

7 § 501

Virginia

No

No

Washington

No

Yes

§66.44.200; Case Law

West Virginia

Yes

Yes

§ 55-7-9

Wisconsin

No

Yes

§ 125.035, Case Law

Wyoming

Limited

Yes

§ 12-8-301

Safe Harbor & Liability Mitigation

Alcohol Seller-Server training can mitigate liability during a lawsuit involving intoxication by providing evidence of intent on the part of the establishment that serves and sells alcoholic beverages.  This defense is called a “reasonable efforts defense” or “Safe Harbor”.

Although the “Safe Harbor” defense exists to protect employers, it is key that employers are both aware of and involved in the activities taking place in their particular establishment to avail themselves of this protection.  Therefore, in order to attempt to stay within and be able to rely upon the “Safe Harbor” defense, providers of alcohol should, at a minimum:

    • Require employee training with an approved training course.
    • Confirm that employees have attended training and are re-certified as required.
    • Maintain documentation of training of each employee who serves alcohol.
    • Maintain written policies against the over-service of alcohol and develop procedures intended to prevent such over-service from occurring.
    • Ensure compliance with the written policies and procedures that are put in place.
    • Discipline those employees who violate the policies, up to and including termination.

 

Additional Resources:

 

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