The Pitfalls of Reliance on a “Reverse” Dram Shop Act

By Joseph Cartolano, Angela Alvero, Law Offices of Cartolano & Alvero, P.A

Law Offices of Cartolano & Alvero
12955 Biscayne Blvd. Ste. 324
Miami, Florida  33181
Tel:  (305) 899-6842       Fax:  (305) 899-6849

Joseph Cartolano

[email protected]

Angela Alvero

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In March of 2010, a motorcyclist, on his way home to his wife and their grandchild, was struck by a motorist who had been drinking continuously for the previous nine hours at a fraternal order lodge’s bar. After being dragged for 200 feet before being left for dead in the middle of the road, the motorcyclist sustained multiple broken bones and massive permanent brain injury.  He filed suit against the owner of the fraternal lodge and eventually obtained a verdict in the amount of $11.1 million. While a reward of this size may seem justifiable for such a tragedy, it’s one example of the hefty Hospitality Liability cases that establishments such as this face.[i]

In a September, 2005 decision, a jury found a tavern owner 25% liable for injuries sustained by a 62-year-old male veteran who was struck by a vehicle while he was a pedestrian crossing the street.  Earlier in the day, the driver who struck the pedestrian had initially consumed a beer and a rum drink at the tavern. He then left, went to a liquor store and purchased beer and a bottle of Southern Comfort, which he consumed at his home before returning to the tavern, where he was served a Mai Tai and another beer. The driver then left the tavern and moments later, struck the pedestrian. As a result of the accident, the pedestrian was completely paralyzed in both legs and incompletely paralyzed in both arms. At the trial on the pedestrian’s suit against the driver and the tavern owner, the jury awarded $10,496,000 in damages, and assessed 25% of the liability for this amount to the tavern owner.[ii]

A 45-year-old female who sustained permanent injuries when she was struck by a motor vehicle sued the owner of a bar/lounge in 2010.  The accident occurred after she left the lounge, where she had consumed an admittedly excessive amount of alcohol. She alleged that the employees of the lounge knew or should have known that she was a habitual alcoholic and that the quantity of alcohol served to her would render her intoxicated and incapacitated.  The case was settled before trial for a total of $500,000.

The above cited cases reveal that while Florida has what is commonly viewed as an “owner friendly” Dram Shop Act (in fact, so owner friendly that it is often referred to by legal commentators as a “reverse Dram Shop Act”), a tavern owner who relies solely on the statute for protection from liability may leave himself severely unprotected.

The Florida Dram Shop Act is found in Florida Statutes § 768.125, and states as follows:

A person who sells or furnishes alcoholic beverages to a person of lawful drinking age shall not thereby become liable for injury or damage caused by or resulting from the intoxication of such person, except that a person who willfully and unlawfully sells or furnishes alcoholic beverages to a person who is not of lawful drinking age or who knowingly serves a person habitually addicted to the use of any or all alcoholic beverages may become liable for injury or damage caused by or resulting from the intoxication of such minor or person.

Rather than being a statute that establishes liability on tavern owners, with exceptions (as do traditional Dram Shop Acts), the Florida law prevents liability for tavern owners (thus, the “reverse” denomination), except under two specific circumstances:  when the person is injured as a result of the sale or furnishing of alcohol to (1) a minor or (2) a person habitually addicted to the use of alcohol.

Florida case law interpreting the statute has generally been favorable to tavern owners also, holding that “[s]erving an individual multiple drinks on one occasion would be insufficient, in and of itself, to establish that the vendor knowingly served” a person habitually addicted to the use of alcohol”[iii], and that “Florida law imposes no general duty on a business owner to ensure the safety of an intoxicated person who is about to leave the premises.”[iv]  However, there is also support under the case law for trial court judges to allow a jury to determine the issue of whether or not the tavern owner should have known that the person being served was habitually addicted to alcohol, and that is the risk that leads to the unfortunate outcomes noted above.

To illustrate, a Florida appeals court found the following fact situation sufficient to allow a jury to make such a determination, in a case in which a driver struck a bicyclist after consuming alcohol at an establishment known as “Nick’s”:

It is undisputed that [the driver] consumed 8-10, 12-ounce cans of beer and two straight shots of tequila over the period of an hour and a half. After a short absence from Nick’s, during which he drank yet another beer served elsewhere, [the driver] returned to Nick’s walk-up window, where he ordered and was served another beer. The manager of Nick’s Bar admitted that it would be unusual for a person to consume that many beers and two shots of tequila without showing signs of intoxication. Despite [the driver]’s considerable alcohol consumption, he did not stagger and did not slur his speech. The manager twice asked [the driver] to leave the bar only because [the driver] became loud and argumentative. [The driver] pled guilty to the charge of driving while under the influence of alcohol and admitted that he had a drinking problem from the age of sixteen, which he still had at the time of the accident. At that time, [the driver] had never received treatment for his alcohol addiction.[v]

The appellate court found that this evidence created an issue of fact to be properly resolved by a jury.  And as any trial attorney can attest – once given the power to resolve an issue, a jury will, and there is no way to eliminate the risk that it will do so adversely to what the facts and/or the law would seem to warrant.

Therefore, it is singularly imprudent for the owner of a bar or nightclub to believe that the industry supportive Dram Shop Act enacted by the Florida Legislature, and the defense sympathetic interpretations that the statute has received from appellate court, are enough protection for the business that the owner that has built, nourished and developed.  As in all business endeavors, a comprehensive risk management plan is critical, including a strong insurance component.

Don’t wait until a claim is filed in order to insure your biggest asset: your business. Our specialists at RMS Hospitality Group can assist you in tailoring a policy to meet your specific needs. For more information about our offerings, contact us today at (888) 359-8390.

[i] Rodney Wilde et al. vs. Okeechobee Aerie 4137 Fraternal Order Of Eagles, Circuit Court, Nineteenth Judicial Circuit, Okeechobee County, case no. 2010CA457.

[ii] Caduceus Self Insurance Fund Inc. vs. The Doctor’s Company, Circuit Court, Second Judicial Circuit, Leon County.

[iii] Ellis, v. N.G.N. of Tampa, Inc., 586 So.2d 1042 (Fla, 1991).

[iv] Hall v. West, 157 So.3d 329 (Fla. 2d DCA 2015).

[v] Roster v. Moulton, 602 So.2d 975 (Fla. 4th DCA 1992).