2010-Chapter12 outline

Hotel, Restaurant, and Travel Law

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Unformatted text preview: Week Ten - Chapter 12 Liability and the Sale of Alcohol. *The sale and consumption of alcoholic beverages is regulated by state law. is *In most states, much of the power to license and regulate the restaurants and bars that sell alcohol, regulate has been given over to the local (town, city or has county) governments. county) *This regulation includes who can sell alcohol, on what days and at what times, and how it can be what sold. sold. *Some of the power has been retained by the state government, such as the drinking age restrictions government, and dram shop acts. and *Alcoholic Beverages and the Hospitality Industry *Business with liquor licenses are in the business of selling alcoholic beverages, because there is a selling relatively high profit margin on such sales. relatively *On the other hand, there are many ways that the sale of alcohol can give rise to liability for the seller. sale *There are also specific laws that increase that liability risk, and they must be understood. liability *Failure to comply with the law can result in a number of serious consequences: number *Civil damages. *Statutory fines. *Suspension or revocation of a liquor license. *Criminal penalties for serving an underage drinker. *In order to sell alcohol, a business must first be licensed. In the case of restaurants or bars, the licensed. license is usually obtained from the applicable local license government. government. *After a license is granted, it still be revoked or suspended by the same licensing agency or board, suspended often for the violation of the laws governing alcohol often sales. sales. *To qualify for a license, the applicant may have to prove that they: prove *Have not abused liquor in the past, as a consumer, seller, driver, or otherwise; consumer, *Have not been convicted of a felony, or perhaps even charged with one; even *Have not made illegal sales of alcohol in the past; and and *Are otherwise of good character. *In most states, illegal alcohol sales would include those made to: those *Anyone who is under the age of 21. *Anyone who is visibly intoxicated. *Known habitual drunkards, though any case I found for this situation involved a drinker who was found also visibly intoxicated at the time. also *As to the law regarding under age drinkers, the age to drink is generally 21. age *It is the responsibility of the restaurant or bar to ask for acceptable identification. ask *Management must determine what qualifies as acceptable, but may include: acceptable, *State-issued driver’s license. *State-issued non-driver identification card. *Military identification card. *Passport. *If a patron uses a fake ID, that appears to the reasonable trained eye to be legitimate, the reasonable business might not be liable for the sale. business *Conversely, if the age of the drinker should have been questioned, but they were served anyway, the been business violated the law. business *Use of a minor’s book to show that the sller questioned the credentials of the drinker before questioned they were served would generally have no they beneficial effect and may even have the opposite beneficial effect as documented evidence that the seller effect knew, or should have known, that the patron should knew, not be served. not *If alcohol is sold to someone who is of sufficient age, who then provides it to an underage drinker, age, the seller would not be liable, unless the *The seller knew or should have known that the purchaser would provide it to the underage drinker. purchaser *This may occur if the alcohol is sold to a family having dinner and they ask for glasses for their having underage children. underage *If the seller knew of the liquor going to the underage drinker, the seller is liable as if they sold underage directly. directly. *Sales to those who are visibly intoxicated. *A person’s appearance or actions may indicate that they are intoxicated. that *Slurred speech *Bloodshot, glassy, or watery eyes *Flushed face *Poor coordination *Aggressive behavior or changes in behavior. *With the existence of small portable breathalyzers, a blood alcohol level test can also be an indicator, blood though such a test cannot be forced upon a patron. though A BAC—blood alcohol content - of .08 or higher, is BAC—blood generally considered legally intoxicated. generally *Even if there is some question of whether a patron is intoxicated, the seller can refuse them service, as is there is no law that requires all be served, so long there as the seller is not discriminating in violation of as state or federal civil rights law. state *Students in this course will have usually taken some sort of liquor sales certification class, and as some employers, they are held to a higher standard of employers, recognizing intoxication before others might. recognizing *Employees must also be trained in the same manner as the employer shall be liable for illegal manner sales made by an employee. sales *Liability can result from the failure to train employees, the failure to set internal policies as to employees, the manner of serving alcohol, or the failure to the support employees who shut off patrons who the support server believes is visibly intoxicated. server *Under common law, a seller was not generally liable for damages caused when it served alcohol liable illegally and that patron was injured or caused illegally injury to another. injury *The patron was responsible for their own harm and for the harm they caused to others. and *As to the seller of the alcohol, the harm to others was too remote and therefore not generally was foreseeable for negligence liability. foreseeable *Many states felt that the law did not do enough to encourage a server to prevent patrons from encourage abusing alcohol. abusing *Another problem was that many intoxicated persons who cause injury have little money with persons which to compensate those they injure, but the which owner of a restaurant or bar is more likely to have owner insurance and assets to compensate injured insurance parties. parties. *Most states created new laws called “Dram Shop Acts.” Acts.” *Dram shop acts impose liability on restaurants and bars for certain injuries resulting from illegal sales. bars *In a majority of states, selling to a visibly intoxicated person who then harms themselves and intoxicated an innocent third party, will result in the seller’s an liability for the damages sustained by the third liability party, but not to the drinker. party, *A minority of states make the seller liable also to the wrongfully served drinker. the *A very small minority of states have no Dram Shop Act, and the only potential liability would be under Act, the common-law negligence, which would be a the much tougher case to prove. much *Dram shop act liability does not require a car accident, and can result from a fight or other accident, conduct involving the illegally served patron. conduct *The damages that result from dram shop liability can be substantial and can put the seller out of can business. business. *Even defending the lawsuit can cost more than many businesses can afford. many *Under the dram shop majority rule, if a passenger purchased alcohol or encouraged driver to drink, purchased that passenger could not recover for their injuries. that *If the passenger did not contribute to driver’s intoxication, the bar or restaurant may be liable for intoxication, passenger’s injuries, as they are considered an passenger’s innocent third party. innocent *If more than one seller serves a visibly intoxicated patron, any seller proven to have serve them patron, illegally can be liable for the harm caused. illegally *Even though more than one seller can be liable for the harm caused, a damages party cannot get the multiple recoveries. If the total damage is $10,000, multiple that is all the plaintiff can get. They cannot recover that $10,000 each from every defendant found to be $10,000 liable. liable. *If the drinker was not visibly intoxicated until he arrived at the second bar, the first bar will not be arrived liable. liable. *In some states, comparative negligence applies and a seller can reduce its liability by the and percentage of liability attributed to the driver. percentage *Similarly, if the third party injured contributed to the cause of the accident, the injured person’s recovery cause may be reduced accordingly. may *A dram shop act can also include civil damage liability for harm caused by any illegally served liability patron, including under-age drinkers and habitual patron, drunkards. drunkards. *Depending upon the state, a promoter or company may be liable under dram shop, for harm caused by may an illegal sale by a venue or licensed liquor seller an that the promoter contracted with to provide alcohol that to attendees at the promoter’s, or company’s, to event. event. *Miscellaneous Liquor Regulations *Age of alcohol servers – generally a minimum age of 18 or 19, though bartenders may have to be 21. of *State or local restrictions on alcohol sales on certain days or at certain time must be followed. certain *Gambling, fighting, prostitution or other illegal conduct on premises is prohibited and can result in conduct loss of license, even if the premises was not loss participating in the conduct. participating *Maintenance of prescribed records is necessary for income tax, sales tax and other compliance for reasons. reasons. *Restrictions on the type of alcohol sold – the seller must comply with their license, whether it is a full must license, beer/wine or whatever. license, *Proximity to school or church – if the business is located near a school or church, the obtaining of a located liquor license may be complicated. liquor *Limitations on sales promotions *Happy hour is usually the selling of cheap drinks for a short period of time. for *In many states, happy hours are now illegal as they encourage heavy drinking for a short time, they after which the patrons drive home when the prices after go up and cause car accidents. go *Depending upon the state, other alcohol sales promotions may also be illegal under these laws. promotions *Some bars provide nude or sexually explicit entertainment in the form of dancers or strippers. entertainment *This is a form of speech which is entitled some constitutional protection, though the protection is constitutional relatively low, when compared to other forms of relatively protected speech. protected *Because of this protection, government restrictions must further an important government interest must unrelated to suppression of free speech. unrelated *For this reason, a government can restrict this form of entertainment, but cannot prohibit it form outright. outright. *A typical form of government restriction would be requiring a venue, using this form of entertainment, requiring to be located in one confined area where similar to businesses are located, often an industrial zone. businesses *The restrictions must not be broader than is necessary to achieve the stated government necessary interest interest ...
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