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Dram Shop Liability For Serving Underage
In 1983, the North Carolina legislature passed the Dram Shop Act, which, among other things, created a claim for relief for damages against permittees who sell alcohol to underage people. G.S. 18B-121 states that
An aggrieved party has a claim for relief for damages against a permittee or local Alcoholic Beverage Control Board if:
(1) The permittee or his agent or employee or the local board or its agent or employee negligently sold or furnished an alcoholic beverage to an underage person; and
(2) The consumption of the alcoholic beverage that was sold or furnished to an underage person caused or contributed to, in whole or in part, an underage driver's being subject to an impairing substance within the meaning of G.S. 20-138.1 at the time of the injury; and
(3) The injury that resulted was proximately caused by the underage driver's negligent operation of a vehicle while so impaired.
Other notable provisions of the Dram Shop Act include
- G.S. 18B-120(1) which defines an “aggrieved party” as “a person who sustains an injury as a consequence of the actions of the underage person, but does not include the underage person or a person who aided or abetted in the sale or furnishing to the underage person.”
- G.S. 18B-120(2) which defines an “injury” as including, but not being limited to, “personal injury, property loss, loss of means of support, or death. Damages for death shall be determined under the provisions of G.S. 28A-18-2(b). Nothing in G.S. 28A-18-2(a) or subdivision (1) of this section shall be interpreted to preclude recovery under this Article for loss of support or death on account of injury to or death of the underage person or a person who aided or abetted in the sale or furnishing to the underage person.”
- G.S. 18B-123 which limits “[t]he total amount of damages that may be awarded to all aggrieved parties” to $500,000 per occurrence.
- G.S. 18B-126 which sets the statute of limitations at one year.
North Carolina Courts have added further interpretation of the Dram Shop Act. In 1989, the North Carolina Supreme Court looked at the issue of “whether the personal representative of the estate of a nineteen-year-old who consumes alcoholic beverages and dies from injuries sustained in a single-car accident may recover damages under N.C.G.S. § 18B-121 from the seller of the beverages” in the case Clark v. Inn West. In Clark, the 19-year-old decedent bought and consumed four shots of tequila and four beers at the defendant bar. He became visibly intoxicated. He drove his car towards his home, after he left the bar, but instead of making it there, crashed his car and died.
The Court reasoned that because G.S. 18B-120(1) excepts the “underage person” from the definition of aggrieved party, “had decedent lived, he could not have recovered for his injuries.” “The wrongful death statute provides for survivorship only of claims that could have been brought by the decedent had he lived.” The Court held that “[t]herefore, no claim survives his death, and his personal representative may not maintain an action under the Dram Shop Act.”
In 2002, the court of appeals held that the parents of an underage decedent could be included in the definition of an “aggrieved party.” In Storch v. Winn-Dixie Charlotte, Inc., the 18-year-old decedent purchased alcohol at the defendant’s store, which he consumed and became intoxicated. He then drove and died in a single car accident. The plaintiffs were the parents of the decedent. The issue was whether the parents of the underage person are included in the definition of an “aggrieved party.”
The court looked at Clark and noted that in that case, “[t]he Court went on to examine the definition of ‘injury’ contained in G.S. § 18B-120(2) and concluded that the statute ‘does not preclude recovery for loss of support by their underage child, if the underage child in fact supported the parents.’” However, the court also noted that this was dictum in the opinion.
The court of appeals reasoned that the definition for “injury” in G.S. 18B-120(2) specifically states that “[d]amages for death shall be determined under the provisions of G.S 28A-18-2(b).” “As applicable to the parent of the underage person, "injury" would include funeral expenses of the underage person, G.S. § 28A-18-2(b)(3), as well as damages for loss of services, G.S. § 28A-18-2(b)(4)b, society, companionship, etc., G.S. § 28A-18-2(b)(4)c, and loss of support.” The court noted that this claim by the parents of an underaged decedent under the Dram Shop Act is distinct from the claim of a personal representative under the wrongful death statute.
The court of appeals looked at another case involving the definition of an “aggrieved party” in 1997. In Estate of Darby by Darby v. Monroe Oil Co., the decedent drove the underage driver to the store to purchase alcohol. The decedent did not contribute money but the other two passengers did. Later, all four occupants of the car died when the car ran off the road and crashed into a tree. The court held that the decedent who drove the underage driver to the store to purchase alcohol was not an “aggrieved party” because he “aided and abetted” the underage driver in the purchase of alcohol.
More recently, in 2001, the court of appeals looked at another provision of the Dram Shop Act. In Green v. Fishing Piers, Inc., three friends were at a bar late one evening into early the next morning. One of them was only 20-years-old but was served alcohol at the bar. When they left the bar, the 20-year-old was visibly intoxicated but got into her car with the two other friends. She then lost control of her car and as a result of the accident, all three occupants of the car died.
When the estate of one of the passengers filed a complaint against the bar under the Dram Shop Act, the bar filed a third-party complaint against the estate of the driver for joint and several liability. The estate of the driver argued that it could not be held liable for damages to the passengers because of the passenger’s contributory negligence.
The defendant bar argued that G.S. 18B-124 created a claim against the underage driver. It states that
The liability of the negligent driver or owner of the vehicle that caused the injury and the permittee or ABC board which sold or furnished the alcoholic beverage shall be joint and several, with right of contribution but not indemnification.
The court stated that:
Because N.C.G.S. § 18B–121 creates a cause of action against the permittee or a local ABC Board only, the theory by which the liability of the negligent driver is determined must arise from some other context, be it common law negligence, the Wrongful Death Act, or otherwise. As we have discussed, the pleadings in the present case do not allege such an alternate theory of liability. Because we have held that Defendants erroneously contended that N.C.G.S. § 18B–124 creates liability on the part of Ms. Lutz's Estate, the trial court did not err in granting summary judgment in favor of Ms. Lutz's Estate.
Another provision of Chapter 18B involves the sale or provision of alcohol to underage people. G.S. 18B-302(a) and (a1) state
(a) Sale. - It shall be unlawful for any person to:
(1) Sell malt beverages or unfortified wine to anyone less than 21 years old; or
(2) Sell fortified wine, spirituous liquor, or mixed beverages to anyone less than 21 years old.
(a1) Give. - It shall be unlawful for any person to:
(1) Give malt beverages or unfortified wine to anyone less than 21 years old; or
(2) Give fortified wine, spirituous liquor, or mixed beverages to anyone less than 21 years old.
In 1992, the North Carolina Supreme Court held in Hart v. Ivey that a violation of this provision was not negligence per se. However, the social hosts in that case were liable under common law negligence for serving alcohol to an underage person who was later involved in an impaired driving accident and caused injuries to an innocent third party. The Court reasoned that defendants were not negligent per se under G.S. 18B-302 because that statute was not “a public safety statute which was intended to protect the plaintiffs” but “to stop persons under the statutory age from drinking alcoholic beverages.”
The Court stated that
If we were to hold, without any qualification, that a violation of N.C.G.S. § 18B-302 is negligence per se, it would require a trial court to charge that giving a person under twenty-one years of age a small amount of some alcoholic beverage, which does not affect his or her ability to drive, is negligence per se. We do not believe the General Assembly intended this result.
The Court held that the plaintiffs could maintain a common law negligence claim because “[t]he defendants were under a duty to the people who travel on the public highways not to serve alcohol to an intoxicated individual who was known to be driving” and “a man of ordinary prudence would have known that such or some similar injurious result was reasonably foreseeable from [the] negligent conduct” of serving alcohol to an intoxicated person who would be driving.
If you have been injured in a car accident with an impaired driver, visit www.rflaw.net for legal help.
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