The Basic of Alcohol Liability — Part II

April 10, 2011

Shelley Timms, B.A., LL.B., LL.M.
Timshel Services Inc.
Alcohol Risk Management

Part I of the The Basics of Alcohol Liability covered two fundamentals of alcohol liability — special relationship and foreseeability. Part II will review security obligations, innocent third parties, the youth factor and “beyond commercial hosts”.

Security Obligations
Every licencee is obliged to insure that patrons or guests of the establishment are in a safe environment. Occupiers’ liability, which is found in every province either in legislation form or in common law, provides that the occupier must provide premises that are safe – regarding the actual premises, the condition of the guests and the nature of the activity being conducted on the premises.

Most examples of security focus on avoiding assaults and violence in general. A number of legal cases have narrowed in on security staff — liability was found when unreasonable force was used to eject an intoxicated patron. The unreasonable force often resulted in serious, even catastrophic injuries, – ranging from a broken arm while being forced through a doorway to permanent brain injury due to being kicked by the “bouncer” while down on the ground.

A licencee could argue that it does not permit excessive force and that the security staff have gone beyond the job description. However, due diligence in hiring and training the security staff is necessary. One case found liability against the bar for failing to do a proper background check on the “bouncer” who started his job a few hours after being hired (it was discovered that he had a criminal record with a number of assaults).

Security goes beyond preventing violence. It includes training staff to deal with emergency situations such as a fire. It also includes dealing with the unexpected occurring such as in the Jacobsen v. Nanaimo Kinsmen Club case described in the last issue. Ultimately, the case was about

Innocent Third Parties
Initially, the licencee was held liable only if its patron was injured as result of overservice and subsequent injury that could be related to the overservice (impaired driving, falling, assault, etc). However, a 1989 Ontario case upheld by the Court of Appeal in 1992, extended the reach of a host’s liability. In Hague v. Billings et al., three young men drank all day and continued drinking at two bars in the evening. The first bar recognized that they were intoxicated and refused to serve them beyond the first drink. The second bar served them many drinks despite their obvious intoxication. The driver crashed into the Hague vehicle after leaving the second bar, killing the driver and rendering her teenaged daughter a paraplegic.

The courts found that it was reasonably foreseeable that if a patron was overserved and/or visibly intoxicated and drove a vehicle, that a collision with an innocent third party could occur resulting in injury and death. Therefore a licencee has a duty of care, not just to its patron, but to anyone the patron may come into contact with while intoxicated.

The Youth Factor
Canadian courts have stated both explicitly and implicitly that the age of the intoxicated person is a factor in considering liability of the server. All provincial liquor acts state that an establishment may not serve a person who is not “of age”. The age of majority is 19 in all provinces with the exception of Alberta, Manitoba and Quebec, in which the age is 18. All U.S. states have an age of majority of 21.

Thus it is understandable that a licencee may have liability if a person is served to the state of intoxication, is underage, and is injured or killed while in that condition. The provinces also state that parents or guardians may provide alcohol to their children in their place of residence only. Therefore it is important that a licencee not allow a parent or guardian to provide alcohol in a licenced establishment (that includes weddings, banquets, family reunions, etc.) It must also be clear that a parent or guardian can provide alcohol to their child, but not someone else’s child.

In Ontario, a court awarded 5% liability against a 24 year old who bought a couple of bottles of rum for an 18 year old friend. While the degree of liability may seem to be small, it must be considered against a judgement of $8.7 million.

The courts have also stated that the fact that an “of age” person is an inexperienced drinker will be a factor in deciding the degree of liability. In Jacobsen v. Nike, a 19 year old employee of Nike was involved in setting up a trade show exhibit. A supervisor bought a couple of cases of beer for the workers (there were 4 as well as the supervisor) and for clients who came to the booth. A drinking contest between 3 of the workers resulted, including the plaintiff. He had a least 6 to 8 beers and it was known that he had a 45 minute drive home. He fell asleep at the wheel, was ejected from the car and rendered a paraplegic. In awarding 75% liability against the defendant, the judge specifically stated that the age and the inexperience of drinking were factors in his decision.

Beyond Commercial Hosts — Social Hosts
The Jacobsen v. Nike case is also an example of a “beyond commercial hosts” as Nike was the employer of Jacobsen. There have been a few employer host cases as well as the case of the “of age” friend buying alcohol for the underage friend. However, there have been no successful social host cases. Essentially, a social host is anyone who provides alcohol without any kind of charge/profit. This area of hosting ranges from having friends to dinner and serving beer and wine, to having a large party which could include uninvited friends.

The leading case is Childs v. Desormeaux which was decided by the Supreme Court of Canada in 2006. Desormeaux went to a New Year’s Eve party with his girlfriend and another friend. All three were intoxicated when they arrived, although the friend and girlfriend were badly intoxicated. The hosts had anticipated friends drinking too much and had extra blankets and pillows. It was a BYOB party, so there were no controls on how much was consumed nor was there supervision. The hosts knew that Desormeaux had a history of overconsuming at parties, had two impaired driving convictions and one conviction for driving while his licence was suspended.

When Desormeaux and friends were leaving, one host walked with him to his car, and asked if he was OK, to which he replied yes. Within minutes of leaving the party, he crashed into a vehicle, killing one person and causing the plaintiff, Childs to become a paraplegic.

The court did not hear any direct evidence that the host knew Desormeaux was intoxicated although it was implied. At the trial level, the judge found negligence against the host but no liability as the judge did feel he could create a new tort (new head of negligence) in social host liability. In other words the judge was reluctant to create and expand liability, preferring the provincial government to establish standards for social hosts just as it did for commercial hosts.

The Ontario Court of Appeal stated that it could find negligence as it was not convinced the host knew that Desormeaux was impaired. The Supreme Court of Canada basically found that it was unreasonable to establish the same, though weaker, standards as for a commercial host. However, it is important to note that the Supreme Court did state that perhaps with a different set of facts, there may yet be a successful case for social host liability.

With respect to universities and their obligations regarding alcohol liability, they are often commercial hosts in that most have liquor licences and sell alcohol for events. Their Student Unions may be separately licenced, but there are relationships that may track some liability back to the university. They are responsible for young people, some of whom are underage. They can be employer hosts both with faculty, staff and student staff. Finally, they could be social hosts, but with the youth factor, universities are definitely vulnerable to a different standard because they may be hosting underage or inexperienced drinkers.

This is a brief overview of the basics of alcohol liability — each topic can be discussed in further detail with more legal examples. At the end of the day, the issue is a failure to understand the nature of the substance involved and the potential consequences of turning a blind eye.

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