Dram shop laws are laws that hold an establishment liable when a customer was served alcohol and has an alcohol related incident that results in injury or death. Under this statute, a restaurant, bar, or liquor shop cannot serve alcohol to an individual who is obviously intoxicated. 30 states have dram shop liability, and 22 of these states limit these liability cases to instances where alcohol was served to an individual who was under the legal drinking age
It was found that, in states with higher levels of dram shop liability, establishments have less low-price drink promotions, such as “happy hours,” which encourage fast, excessive drinking. Studies found that these promotions increase the number of drinks consumed by an average of 1.6 percent. Dram shop laws also encourage more strict regulation of underage drinkers, which is important because U.S. surveys found that 40 to 90 percent of outlets sell to underage customers.
In California, dram shop laws are limited. Legislation has removed liability for establishments who serve alcohol to patrons. The statute states, “No person who sells, furnishes, gives, or causes to be sold, furnished, or given away, any alcoholic beverage…shall be civilly liable to any injured person or the estate of such person for injuries inflicted on that person as a result of intoxication by the consumer of such alcoholic beverage.”
Under this statute, an establishment which serves alcohol, including liquor stores and bars, may not be held responsible for serving alcohol to an individual who is obviously intoxicated. However, there is an exception to this rule, under the California Business and Professions Code section 25602, which holds that a civil case can be brought to court if an establishment serves alcohol to a visibly intoxicated minor. This law applies only to licensed vendors in California, and not to social hosts who provide alcohol at a party or other event.
Additionally, though an establishment may not be held civilly liable for serving alcohol to an intoxicated individual, they still could be subject to criminal misdemeanor charges. In such cases, it is still a misdemeanor to sell, furnish, or give alcohol to someone who is a “habitual or common drunkard” or an “obviously intoxicated person,” and California does not distinguish between licensed vendors and social hosts.
If another individual is injured by an intoxicated person, they can seek damages such as medical bills, the value of lost wages, and damages for pain and suffering. If the intoxicated person was a minor, the injured party could seek damages from the alcohol vendor. If the intoxicated person was not a minor, the injured party can only seek damages directly from the intoxicated person.
California’s change in dram shop legislation is because it is often difficult to prove the specific cause to an intoxicated person’s accident or injury. With strict dram shop liability, it is assumed the establishment must have caused the accident by serving the alcohol. In addition, California case law has shown that, in cases where an intoxicated person gets injured or into an accident, it is the consumption of alcohol that causes it, not the serving of alcohol. Therefore, the sale of alcohol in California, including by bars and liquor stores, is not considered the proximate cause of a car accident.