Dram Shop Law Does Not Require Establishment to Monitor Level of Intoxication of Patron Not Being Served with Alcohol

On May 7, 2009, the New Jersey Supreme Court held in Bauer v. Nesbitt, that an establishment serving alcoholic beverages to patrons does not have a duty, under the Dram Shop Act, to monitor the level of intoxication of a patron to whom the establishment is not serving alcohol.  Although the Dram Shop Act generally imposes upon tavern-keepers a duty to monitor the level of intoxication of their patrons and imposes liability on tavern-keepers for accidents caused by intoxicated patrons, where the tavern did not serve any alcohol to a patron that later causes an accident, the tavern cannot be held liable for any subsequent accidents.  If you have been injured in an accident in New Jersey, immediately contact a New Jersey personal injury lawyer or New Jersey auto accident lawyer for an analysis of your case.

In this case, plaintiff’s twenty-one year old son, James Hamby, was killed in an accident while a passenger in a car operated by Frederick Nesbitt.  In addition to suing Nesbitt directly, plaintiff also sued the C View Inn for wrongful death and survivorship asserting causes of action under both the Dram Shop Act and common law negligence.  However, discovery revealed that the Inn had never served any alcohol to Nesbitt.  Nesbitt and four other friends came to the Inn on “wing night” in order to socialize and drink.  Nesbitt was the only member of the group who was not old enough to legally purchase alcoholic beverages.  Both the waitress and the bartender knew that Nesbitt was underage, and did not serve him any alcoholic beverages or permit him to drink alcoholic beverages brought to the table.  

Nesbitt did drink alcoholic beverages before coming to the Inn.  That night, Hamby purchased a 12-pack of beer and a bottle of rum from another establishment.  Hamby and Nesbitt drank some of the beers and also took swigs from the rum bottle.  Hamby then snuck the rum bottle into the C View Inn in his pants.  While at the Inn, Nesbitt was served only coca-cola.  However, Hamby poured rum into Nesbitt’s coca-cola from the bottle he brought into the Inn without the Inn staff noticing.  The rest of the group consumed several pitchers of beer and glasses of vodka with orange juice.  When the group left the Inn, Nesbitt drove with Hamby in his car.  While driving, Nesbitt hit a guardrail on the Garden State Parkway and the car rolled over.  Hamby died as a result of injuries he suffered in the crash.

The trial court ruled in favor of the Inn on summary judgment; however, the Appellate Division reversed.  The Appellate Division held that the Inn can be held liable because it served alcohol to Hamby, who was visibly intoxicated, and because of his impaired status, he got into the car with another intoxicated driver.  In other words, had the Inn not permitted Hamby to become so intoxicated, he may have decided not to get into the car with Nesbitt, who Hamby would have known to be intoxicated.  The Supreme Court reversed the Appellate Division and dismissed the Complaint.

Initially, the Court noted that plaintiff did not assert a Dram Shop cause of action against the Inn under the theory that it served alcohol to a visibly intoxicated Hamby.  Since the plaintiff did not assert this cause of action in its Complaint, the Inn was not fairly apprised of this theory until the Appellate Division raised it sua sponte.  If a cause of action is not pled in a Complaint, it cannot “spring to life” on appellate review.  Therefore, this cause of action could not be sustained as a matter of fundamental fairness.  While the Court did leave open a remote possibility that such a cause of action could be sustained if it was properly pled, it would be unlikely to sustain a negligent-supervision cause of action against a tavern under any circumstances similar to those in this case.

The Court then noted that by its very terms, the Dram Shop Act provides the exclusive civil remedy for personal injury or property damage resulting from the negligent service of alcoholic beverages.  Under the Dram Shop Act, a server of alcoholic beverages can be held liable for an accident proximately caused by the negligent service of alcoholic beverages only when the server serves a visibly intoxicated person, or a minor, under circumstances where the server knew or should have known that the person being served was intoxicated or a minor.  The Court also noted that the Dram Shop Act was passed because taverns faced a liability insurance crisis, and so the legislature wanted to limit the circumstances under which taverns could be held liable for negligent service of alcohol.  Given the wording of the statute and the purpose for which it was passed, the Supreme Court held that a tavern cannot be held liable for an accident caused by a patron to whom the tavern did not serve any alcohol, even if that person was intoxicated.

This case illustrates the importance of proper pleadings in a personal injury action after an accident.  Anyone injured in an accident should contact a New Jersey personal injury lawyer or a New Jersey auto accident lawyer for a consultation.

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