‘Tis The Season – Dram Shop And Social Host Liability

holiday party
Posted at 4:28 PM, Dec 12, 2012

'Tis the season to eat, drink and be merry. That means offices, restaurants, and homes will be throwing holiday parties that serve lots of merriment. Of course, all that merriment leads to a rise in the number of drunken driving accidents and arrests.

It's obviously bad news for the driver, but it could be even worse news for the person who poured the alcoholic beverages or the establishment where the driver was served. That's because most states have dram shop liability laws, making the host responsible for any damage, injury or even death caused. It also provides legal recourse for the victims of a drunken driving crash.

Such was the case in North Carolina, where a couple was awarded $1.7 million earlier this year after a drunken driving crash that claimed the lives of their unborn child and the driver who struck them.

All but eight states (Delaware, Kansas, Louisiana, Maryland, Nebraska, Nevada, South Dakota and Virginia) have some sort of dram law on the books, as does Washington, D.C.

“In most states, the standard is one of reasonableness. Was it reasonable for the bartender or other server to give this person another drink? States can vary, but overall common sense mostly rules. Don’t give a drunk person another drink," says attorney Martin Sweet of legal website THELAW.TV.

Intended mainly for bars and restaurants, dram shop liability has been extended even further in some states to include company and private parties who over-serve their guests.

If you plan on having a party this holiday season in your home, you'll probably want to make yourself aware of Social Host Liability Laws that hold the host of a party responsible for the injuries or damages sustained as a result of a visibly intoxicated guest. Snagging the car keys from guests limits the chances of someone getting a DUI on the way home, but there's still the possibility for injury. If someone is injured at a party and the location is deemed unsafe, the risk for liability is there.

The same liquor liability exposure applies to company office parties.

In California, an appellate court applied the Business and Professions Code section for alcohol servers to the sponsors of a company where alcohol was served to an underage employee. Because liquor was free to all employees attending the party, the sponsors were found liable.

While these arrests may be rare, they enter into the public consciousness more during the holidays because of the number of parties that take place throughout the season.

The goals of Social Host and Dram Shop laws are to prevent drunk driving and minimize fatalities.

“The legal idea is that ‘but for’ this bartender or server, the accident would not have happened. It is not the case that at any time a person who has some alcohol in his or her system will trigger liability for the server, but rather if the server was a significant reason why the accident occurred – then the law steps in," Sweet says.

The Insurance Information Institute offers the following tips to promote safe alcohol consumption and reduce your liquor liability exposure:

  • Understand your state dram law and also your state's social host liability laws (if they apply).
  • Be a responsible host by limiting your own alcohol intake so you can better judge your guests' sobriety.
  • Hire a professional bartender that is TIPS (Training For Intervention Procedures) certified.
  • Limit cocktail time to an hour or less.
  • Encourage guests to pick a designated driver or provide cab service.
  • Don't serve alcohol; Offer non-alcoholic beverages and always serve food.
  • Encourage all guests to abide by state seatbelt laws as they drive home.