Liability Exposure for Liquor Establishments

Liability Exposure for Liquor Establishments

Key Statutes & Regulations

Minnesota liquor liability is governed by the “Dram Shop” act, titled the “Civil Damages Act,” which specifically creates liability for alcohol-related claims.  The Act provides that any person who is injured by an intoxicated person who was illegally served by an establishment has a direct action against the establishment, so long as the injured person played no role in the intoxication.  Minn. Stat. § 340.801.

An “illegal alcohol sale” is:

  • Sales to obviously intoxicated persons (Minn. Stat. § 340A.502);
  • Sales to minors (Minn. Stat. § 340A.503);
  • Others: sales after hours, off sale sales on prohibited days, sales at prohibited locations, sales to nonmembers at a private club, sales by vendor of “on sale” liquor license to patron vendor who knows or should know will consume alcoholic beverage off premises (Minn. Stat. § 340A).

To establish a claim under Minnesota’s Civil Damages Act, a plaintiff must prove the following five elements:

  1. An illegal sale of alcohol;
  2. The illegal sale caused or contributed to the alleged intoxicated person’s condition;
  3. Plaintiff’s injuries were caused by the alleged intoxicated person’s intoxication;
  4. Plaintiff sustained damages recoverable under the Act;
  5. Defendant received written notice of plaintiff’s intent to make a claim for damages within 240 days of the date of entering into an attorney-client relationship in regards to the claim. In claims for contribution or indemnity, notice must be served within 120 days after the injury occurs or within 60 days after receiving written notice of a claim for contribution and indemnity.  Stat. § 340A.802, subd. 2, see also Hartwig v. Loyal Order of Moose, Brainerd Lodge No. 1246, 91 N.W.2d 794 (Minn. 1958).

In on-sale liquor establishments, one of the most common exposure to liability involves sales to obviously intoxicated persons.

Minn. Stat. § 340A.502 states “[N]o person may sell, give, furnish, or in any way procure for another alcoholic beverages for the use of an obviously intoxicated person.”  This statutory prohibition applies only if intoxication is observable in appearance or in the behavior of the person to whom the intoxicating liquor is furnished.  Mjos v. Village of Howard Lake, 178 N.W.2d 862, 867 (Minn. 1970) (emphasis added).  Minnesota Jury Instruction 45.15 defines “obviously intoxicated” as:

A person is ‘obviously intoxicated,’ if the intoxication is or should be reasonably evident to another person using usual powers of observation.

CIVJIB 45.15.  Minnesota Jury Instruction 45.25 defines “intoxicated” as the following:

A person is ‘intoxicated’ when, as a result of drinking alcohol, he or she has lost control to any extent of his or her mental or physical faculties.

CIVJIG 45.25; see also Strand v. Village of Watson, 72 N.W.2d 609, 615 (Minn. 1955).

In other words, a finding of obvious intoxication does not require proof of any specified amount of drinking or any degree of intoxication, but proof of AIP has lost control, to any extent, of his mental or physical faculties, and such condition is, or should be, observable to the seller.  Murphy v. Hennen, 119 N.W.2d 489, 493 (Minn. 1963).  Common signs of obvious intoxication include:

  • slurred speech
  • unsteady gait or balance
  • unusually loud or boisterous speech
  • blood-shot eyes

Please contact us with any questions regarding claims arising from incidents where it is alleged that an illegal sale of alcohol contributed to the accident.