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Texas Restaurant Law

How To Handle Alcohol Liability Claims

Posted in Alcohol, Liability, Litigation, Recent Law Trends

With the tragic death of Dallas Cowboy’s player Jerry Brown, Jr. still fresh in our minds, it is more important than ever to be wary of potential liability from alcohol distribution. (For the latest on that story, see this link from an article written by Elissa Repko and Selwyn Crawford at the Dallas Morning News).

As most restaurant owners know, restaurants and their employees can be liable to third parties who are damaged from patrons who consume too much alcohol at a restaurant. Because of liability like this, it is important to know how a restaurant becomes liable and what to do to avoid that liability.

The Law Governing Alcohol Liability

The Texas Dram Shop Act is the prime authority for alcohol liability in Texas. Found in the Texas Alcohol & Beverage Code (the “Code”), it imposes liability on a restaurant if the restaurant serves a clearly intoxicated patron and the damages caused by the patron are “proximately caused” by the patron’s intoxication. In other words, a restaurant should not serve a drunk. If a restaurant serves a drunk, then the restaurant is at least partially responsible with the drunk for damages the drunk causes.

The good news is that there is a “safe harbor” that allows a restaurant to defend itself. Under the safe harbor, a restaurant (not the serving employee) may avoid liability for serving a drunk patron, if it meets the following requirements:

  1. The restaurant requires its alcohol serving employees to take a Texas Alcohol & Beverage Commission (the “TABC”) sanctioned training course; and
  2. The employee at issue actually took the course; and
  3. The restaurant has not directly or indirectly encouraged its employees to violate the Dram Shop Act.

Thus, the first two requirements are easy for most restaurants. The third requirement basically shifts the burden of proof to the plaintiff to show that the restaurant was not otherwise negligent. Often, prior violations under the Code will negate this third requirement.

How To Handle Alcohol Liability Claims

Now that we know the basics of the law, how do we handle claims? Follow these steps to give your restaurant the best chance of avoiding alcohol related claims:

  1. Establish a policy about serving alcohol. For instance, some restaurants set their own limits on how many of certain drinks may be sold to individual patrons. (Think Hurricanes at Pat O’s.)
  2. Require all employees who could even possibly touch alcohol to take a TABC sanctioned course;
  3. Refuse to allow employees who have not taken the course to serve alcohol, and enforce such a restriction severely;
  4. Be scrupulous in preserving your restaurant’s reputation for alcohol violations and take any perceived violation very seriously;
  5. Be proactive with the TABC. For example, the bar referenced in the Brown article above issued a statement that it was fully cooperating with TABC representatives. This proactive approach can make all of the difference in these situations.

These simple steps can significantly improve your chances of reducing or even eliminating alcohol liability at your restaurant.

Have you experienced an alcohol claim? How did you deal with it? Please write and share it with us!

About the author: Matthew Sanderson is a restaurant lawyer in Texas. “Good service with a smile” is his motto. Click here to find out more about Matthew Sanderson’s legal practice and how he can help you today. Follow him on Twitter @dealattorney.