Dram Shop Liability Extended to Retail Sales of Alcohol to an Adult Over the Age of 21 for Off-Premises Consumption

Dram Shop Liability Exten…

The Oklahoma Supreme Court in a 5-4 decision extended dram shop liability to commercial vendors for the sale of alcohol, including low-point beer, sold for off-premises consumption to an adult over the age of 21. The decision comes just as State Question 792 was passed by Oklahomans allowing stronger beer and wine to be sold at more retail locations.

Dram shop liability allows a vendor of alcohol to be liable for selling intoxicating beverages to a noticeably intoxicated individual when a third party is subsequently injured as a proximate result of the sale. Prior to this decision dram shop liability in Oklahoma was only recognized for the sale of alcohol by vendors for on-premises consumption or for the sale of alcohol to a minor. However, as a result of of Boyle v. ASAP Energy, Inc., 2017 OK 82, __ P.3d. __, the Oklahoma Supreme Court now allows claims to proceed against convenience stores and other retail vendors who sale intoxicating beverages, including low-point beer, for off-premises consumption to adults over the age of 21.

In the case of Boyle, a convenience store sold low-point beer to an adult over the age of 21 who was involved in a vehicle collision five to six hours after the sale. The intoxicated adult was ultimately convicted of vehicular homicide of one individual. Two additional people were permanently injured in the collision. In the subsequent civil action against the convenience store, the Court found that the plaintiff had presented sufficient evidence to allow a jury to decide whether the intoxicated individual appeared noticeably intoxicated at the time he purchased the low-point beer from the convenience store based solely on expert testimony about the blood alcohol content of the intoxicated individual at the time of the accident.

The Court allowed this new cause of action to be applied retroactively, finding that prior decisions of the Court allowing liability for the sale of alcohol for off-premises consumption to a minor, along with criminal statutory prohibitions for selling alcohol to a knowingly intoxicated adult, served as guides to commercial vendors and was sufficient notice to vendors of the extension of liability recognized in the Court’s ruling in Boyle.

The dissenting Justices took issue with the retroactive application of a new cause of action never before recognized by Oklahoma law, citing concerns about notice to the public and protection from legal action that retrospectively carries a penalty. Indeed, prior dram shop opinions from Oklahoma appellate courts expressly rejected the ability to further extend the reach of dram shop liability without a clear trend in the case law of other states. While no clear trend exists, the majority opinion in Boyle points to a case from the Georgia Supreme Court recognizing similar liability for the sale of alcohol to an adult for off-premises consumption. See Flores v. Exprezit! Stores 98-Georgia, LLC, 289 Ga. 446 (2011). However, in Georgia the tort liability against the vender of alcohol for off-premises was established by the legislative statute, not first recognized by the Georgia Supreme Court as a matter of common law.

The dissenting Justices noted that the majority’s holding is a significant departure from the common law rule which held that no liability extended to vendors selling alcohol, as it was the voluntary consumption of alcohol by the culpable party which caused the injury not the sale of the intoxicant. This common law rule was modified in Brigance v. Velvet Dove Restaurant, 1986 OK 41, 725 P.2d 300, to create vendor liability for the sale of alcohol for on-premises consumption. One of the dissents in Boyle recognizes an inherent problem in attaching liability to a convenience store for the sale of alcohol to an intoxicated individual for off-premises consumption, noting that the store clerk’s interaction with the customer is exceptionally brief, the clerk has not observed the customer’s consumption of alcohol, and the clerk does not know the type, amount, or speed of the consumption. Thus, the clerk is poorly situated to make determinations about the customer’s state and level of intoxication, as opposed to a bartender serving alcohol for on-premises consumption who is uniquely positioned to observe the customer and know what, how much, and when the customer has consumed the alcohol.

Additional commentary from one of the dissents focused on the proximate cause standard requiring that the injury result from the vendor’s violation of the duty. The newly recognized cause of action by the majority opinion in Boyle causes ambiguity as to whether the proximate cause standard still requires a plaintiff to present evidence that the alcohol sold by the vendor for consumption off-premises contributed to the customer’s intoxication and subsequent drunken accident. Indeed, when alcohol is consumed and served on-premises the alcohol sold by the vender necessarily exacerbates the customer’s intoxicated state and ultimately leads to the injurious conduct. However, with off-premises consumption, the law prohibits the customer from drinking the recently purchased alcohol at the store or anywhere else in public, or in a vehicle. Thus, as the dissenting opinion points out, the store has the reasonable expectation that the alcohol sold will not be consumed until the customer has made it to a location where alcohol is lawfully and safely consumed. Therefore, a sale for off-premises consumption is a poor marker for the seller’s actual culpability for subsequent harm to third-parties.

The impact of the Boyle opinion on Oklahomans and the vendors of alcohol in Oklahoma is uncertain. Vendors of alcohol (including low-point beer) sold for off-premises consumption, such as convenience stores, grocery stores, and liquor stores, will likely face a heightened risk of litigation brought by individuals injured as a result of a drunk driver who purchased alcohol at their store. The limitation on a vendor’s liability is now unclear, given the Oklahoma Supreme Court’s ruling. Certain, vendors will want to examine their alcohol sales practices as well as the training provided to their employees to limit their risks as much as possible. If you are a vendor of alcohol or other business that would like guidance or more information on tort liability, premises liability, or training for employees regarding the sale of alcohol, please contact us.

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