A Complete Guide to Texas Dram Shop Law
At its core, Texas dram shop law is simple: a bar who serves alcohol to a customer that is already dangerously drunk can be sued if someone is hurt or killed. Yet, there are many nuances to dram shop law that make it hard for non-lawyers and lawyers alike to understand.
But don't worry. In this article, our Texas dram shop attorneys will explain liquor liability law in a way anyone can understand. We'll walk you through what the law empowers you to do, the history of the law, the reason the law exists, who can sue, case strategy, and how these cases typically play out.
To make it easier to explain such a complex subject, we'll take a building block approach. We'll start by first outlining the basic components of dram shop law, and then we'll layer on more-nuanced explanations.
But before we get started, here are a few things you should know:
These cases are about more than just money. We make bars pay dearly, but we also make them change how they operate.
Michael Grossman, our firm's founder, has been recognized by Mothers Against Drunk Driving for his focus on drunk driving litigation.
If you ask most lawyers, they'll tell you dram shop cases can't be won. They're wrong. It just takes an effective strategy and the right evidence.
Dram shop cases are time sensitive. If you'd like to discuss your potential case please call us at (855) 326-0000 for a free consultation.
How Texas Dram Shop Cases Work
Although we talk about Texas Dram Shop law as if it's a single "thing," it's actually a collection of statutes and court decisions that make up a body of law. Together, these statutes and court cases spell out who can and cannot be sued for the improper service of alcohol.
Texas dram shop law can be broken down into two broad categories:
- Lawsuits against licensed providers of alcohol (e.g. bars, restaurants, caterers, etc.)
- Lawsuits against social hosts (e.g. homeowners who furnish alcohol to guests)
Businesses can't sell alcohol on a whim. They must first obtain a license to sell alcohol by the Texas Alcoholic Beverage Commission (TABC). In dram shop law parlance, businesses who obtain a liquor license from the TABC are called "licensed providers."
Licensed providers can be sued for an alcohol-related injury or death when they:
- Serve alcohol to an obviously intoxicated adult, or
- Serve alcohol at all to a minor.
One thing that should jump out at you is that bars are held to a different standard when they sell alcohol to adults vs. when they sell alcohol to kids.
The key to winning a case against a bar who sold alcohol to an adult (who then hurts themselves or others) is to show that the bar knew the customer was drunk, yet the bar served them anyway. On the contrary, the key to winning a case against a bar who sold alcohol to a minor (who then hurts themselves or others) is simply to show that the bar served the minor at all.
Is that all that must be proved? No, there are few other necessary ingredients for a Texas dram shop case to be successful, but we'll come back to that later. For now, just know that the foundation of suing licensed providers rests on either serving an obviously intoxicated adult or serving a minor.
If "licensed providers" are businesses who are licensed to sell alcohol by the TABC, then social hosts are basically everyone else. The most common type of social host is someone who throws a party at their house where alcohol is made available.
Social hosts can be sued for an alcohol-related injury or death when they:
- Serve alcohol to a minor who is not the social host's own child.
One thing that should jump out at you is that there was nothing on the above list about liability for providing alcohol to adults. Under Texas dram shop law, social hosts are never liable for providing alcohol to adults. Additionally, social hosts are not liable for accidents caused by providing alcohol to their own children. Social hosts can only be sued on the basis that they served alcohol to someone else's kids.
What We're Going to Cover
In this article, we will explain:
- The history of dram shop laws
- The goal of dram shop laws
- Whether dram shop laws are fair to bars
- When you're allowed to sue bars & when you are not
- What the law requires of alcohol providers, including:
- Liquor stores
- Grocery stores
- Alcohol-makers (distillers & brewers)
- Homeowners who provide alcohol in a social setting (parties, barbecues, gatherings)
- Difference between adult and minors, legally speaking
- How first-party dram shop cases work
- How third-party dram shop cases work
- Investigating your case
- Researching the bar's past misconduct
- Proving that the bar violated the law
- Proving the victim's injuries & losses
- Type of compensation you can sue for
- Filing suit, mediation, and trial
- What to expect from the bar
- Defense arguments
- Safe harbor
- Insurance coverage (or lack thereof)
- Comparative fault arguments
- Settling your case
Why This Is Important To Us
Before we get started, let us explain a little bit about why handling drunk driving accidents is such a huge part of our law practice. You read about drunk driving accidents all the time in the news and, perhaps, you or your family have been affected by one. This is a pain we know all too well. One of our attorneys, Keith Purdue, lost his father when a drunk driver crashed into his motorcycle in 2010 as he was on his way to a shift at the county hospital in Dallas. Though we had been litigating these cases for many years prior to Dr. Purdue's passing, you can only imagine how personal these cases have become since then, and we have dramatically changed the focus of our firm accordingly. You can click the link below to read the story about Dr. Gary Purdue in full.
But, it's not just the personal motivation that drives us. Did you know that there were 1,296 fatal alcohol-related accidents in Texas in 2012? In 2011, there were 1,039 alcohol-related deaths in Texas. This is a major problem and it only seems to be getting worse. As we'll explain later, we believe that one of the ways to curb alcohol-related accidents is to hold the appropriate parties responsible. Here are some more statistics about alcohol-related accidents in Texas:
The best place to start is with the Texas Dram Shop Act, which gives us rules and guidelines for filing lawsuits against bars and other licensed providers of alcohol.
Overview Of The Texas Dram Shop Act
The way that new types of cases come into existence is either by:
- someone filing suit and alleging a novel theory of liability that the court allows (thereby setting precedent)
- the legislature (elected lawmakers) passed a law that specifically grants the right to file the new type of suit.
Dram shop liability was first "loosely" created in the courts and was then specifically spelled out and modified by the legislature. Here is how that happened.
In the late 80s, a man named Larry Poole was killed when his vehicle was struck by a drunk driver. It was later determined that the driver was "black-out" drunk after having been at El Chico restaurant. He claimed to remember nothing from the wreck and his BAC was revealed to be more than 2X the legal limit of 0.08%. Mr. Poole's family sued El Chico, claiming that serving someone to a point of black-out intoxication was an act of negligence.
Now, even though Texas law allows injured parties to sue for any conduct considered to be negligent, prior this case no court in Texas had ever established that alcohol service (even serving a drunk customer) could constitute negligence. After some disputes in the lower courts regarding whether or not improper service of alcohol could form the basis of a negligence lawsuit, the case eventually wound its way to the Supreme Court of Texas. The Supreme Court heard the case and ultimately determined that bars do indeed owe a duty to the general public to serve alcohol to customers in a manner that is reasonable and safe. They explained that once a patron becomes intoxicated to the point that they are dangerous to themselves or others, the bar has essentially created a monster and is responsible for whatever harm is to follow.
This ruling effectively created the precedent by which bars could be sued in the future. However, the ruling created just as many questions as it did answers. What exactly is the difference between negligent service and non-negligent service of alcohol? Is a bar always liable, or just under extreme circumstances? What specifically should a bar do to avoid liability?
Eventually, the questions would have been answered on a long enough timeline by the court, as cases representing various scenarios were tried, but the Texas legislature decided that it was better to replace the court's decision with written, codified law that was precise, unambiguous, and which made bars liable only under very specific circumstances, as opposed to them being liable anytime they were "negligent," which is a term that can mean many different things. The law they created came to be titled the Texas Dram Shop Act. The basis of the law is this: if a bar served alcohol to someone when they knew or should have known that their customer was obviously intoxicated and presented a clear danger to themselves and others, or if they serve alcohol to minors, then they're liable for any injuries caused by the intoxication. But that's literally the only time they're liable. By replacing the obscure standard of "don't be negligent or you can get sued" with the more precise "if you do exactly this you can get sued," bars and those injured by alcohol suddenly knew exactly how the law worked in specific terms.
The Texas Dram Shop Act really accomplished two things:
- It put into code what had previously been established in case law (court precedent).
- It very narrowly constricted what kind of conduct a bar could be held liable for. Instead of suing for some type of "negligence," you now only sue the bar when they serve alcohol to someone who's already drunk or serve minors, period.
Now, this doesn't just affect people trying to file lawsuits against bars, it affects the bars themselves (remember, there are other providers of alcohol like social hosts, caterers, etc, not just bars). On one hand, things have been made easier for bars because instead of being vulnerable to many different types of negligence-based lawsuits, they only have to worry about one type of lawsuit. But it also sent a message: Texas lawmakers agreed with the courts and understood that bars play a role in alcohol-related injuries, and they made sure the bars knew, in unambiguous terms, that they have a legal responsibility to sell alcohol safely.
Simply put, the goal of the Dram Shop Act was and is to discourage bars from over-serving customers while also protecting bars from being sued for merely serving alcohol in the first place. You can visit the pages below to learn more about the Texas Dram Shop Act and its history.
Again, because of this law, anyone who is hurt or who loses a loved one in an alcohol-related accident can file suit against a bar, wherein they're provided an opportunity to prove that the bar is responsible. Click the link below to read more about who can file a lawsuit.
But, Are Dram Shop Laws Really Fair to Bars?
How can a bar be responsible for someone else's conduct? That's the big question most people ask when they hear that someone filed a lawsuit against a bar in a drunk driving accident case.
The short answer is that they're not. The bar is liable for the bar's conduct and the drinker is liable for the drinker's conduct. It's up to the jury to decide whose conduct was the bigger factor in the accident, and that means that it's subject to interpretation.
For instance, imagine that someone goes into a bar and tries to get drunk on purpose, hoping to get into an accident later and hurt someone, simply because they're sadistic. Surely all reasonable people can agree that even if the bar over-serves that driver and that customer later drives away and gets into an accident, killing someone, that the customer was exclusively at fault. After all, that person was literally trying to get drunk enough to kill someone, and a willful act is the most pure and well-understood example in determining fault; of course it's your fault if you do something on purpose.
However, on the opposite end of the spectrum, let's imagine another scenario. A 21-year-old girl goes into a bar for her first taste of alcohol ever, and an over zealous bar staff serves her until she is sick and can't even sit up straight. Surely any reasonable person would agree that whatever her intentions were when she walked through the door, she is now in a state that keeps her from being able to make decisions at all. So, it doesn't really make sense to say that the bar is free and clear from responsibility for whatever harm can come to this 21-year old girl leaving the bar in that state. If we're saying that the 21-year old girl is completely responsible for her own actions, that fails basic logic since it defies everything we know about how alcohol affects the body. She was just served copious amounts of a drug whose principal side effect is its impact on a person's decision-making ability, and therein lies the rub. If alcohol had its normal effect on people (makes them feel good, loopy, euphoric, etc), but it didn't affect their decision-making abilities, then bars would not be regulated in this fashion and there would be no such thing as liquor liability. But since it does, bars are regulated in this fashion since they are literally providing a drug that eradicates a person's ability to make sound choices. If the young woman was sober and someone said, "Here, drink enough alcohol to get sick and die," she would not do so if she were a normal person of sound mind. But surely she would be willing to have a few drinks; that's perfectly reasonable. The problem is that there is a huge difference between asking a sober person if they want to drink enough to get hurt and asking an intoxicated person the same question. By the time they're drunk, they will not make decisions the same way they did when they were sober. Period. Because of this phenomenon, the drunker a person becomes, the more a jury is inclined to blame the bar rather than the drunk. By the time someone is two or more times the legal limit, that person is usually incapable of making remotely sound decisions. Bars know this, yet they are happy to keep selling alcohol so long as the patron's money is still green, and our elected officials have decided that such reckless service of alcohol is not reasonable behavior.
But Does All This Indicate A World Gone Wrong?
No. Unlike what many people would have you believe, the fact that alcohol providers can be held liable under Texas law does not somehow create a trend toward blaming other people for a drunk driver's mistakes. Nor does the rationale behind dram shop law bleed into other areas of life. When a person is of sound mind, they are responsible for their own actions. But when someone makes profit from selling them a substance that is known to destroy their ability to be of sound mind, then that's clearly a more complicated situation and special circumstances need to be considered. Alcohol service, dram shop laws, and liquor liability in general are special circumstances, we can all agree on that. It's certainly more special than, say, selling soda or water. So, the fact that dram shop laws exist and are enforced doesn't really say anything at all about how ordinary circumstances are evaluated in any other area of the law. Keep in mind that a bar is only held liable if they break certain rules and the plaintiff (victim) can prove it using evidence. By no means is this a free-for-all situation where anybody can walk into a bar, have a drink, get into an accident, and then arbitrarily claim the bar was responsible and get compensation. The bar's liability must be "earned" by the bar's conduct, and juries usually won't punish a bar unless the bar's conduct is rather unsafe.