Responsibilities and Risks
An important change facing the industry is an increasing number of successful liability suits against licensed establishments.
In this section you will review:
- Legal Responsibilities
- Duty of Care
- Case Studies
- Implications of the Case Studies
- Reducing Your Liability
- The Importance of Documentation
- Sample Incident Forms
An important change facing the industry is an increasing number of successful liability suits against licensed establishments. These cases arise from an individual being served alcohol then injuring or killing someone (or themselves) while under the influence. Courts are deciding that the people serving the alcohol may share some of the blame in these incidents. Some court cases have led to settlements for large sums of money. Even when no blame is found, servers and owners must endure a court hearing and related costs.
Many factors make this a frustrating problem; however, while arguments rage over the fairness of the whole issue smart operators and servers are acting to reduce the risk of a court case. This is the goal. You may not be able to eliminate the risk any more than you can eliminate the risk of a fire in your kitchen. You can, however, take effective steps to manage and reduce the chances of a lawsuit. Fortunately, this action will also reduce the risk of your patrons being involved in mishaps and accidents, and allow them to continue visiting your establishment.
Those who serve or provide liquor (bartenders and servers) may be held civilly responsible for negligent liquor service.
Those who are in control of licensed premises may be held civilly responsible for problems arising from improper or illegal service, or dangerous patron behaviour(owners, managers).
Any questions you have regarding your potential civil liability should be referred to a lawyer.
The marketing and selling of alcohol is governed by laws and regulations set by each province or territory. Here in Newfoundland and Labrador, the governing body is the Newfoundland & Labrador Liquor Corporation.
Duty of Care
Duty of care is the responsibility you have for your customers’ safety. Ask yourself:
- Did I know or should I have known that a person was intoxicated or becoming intoxicated?
- What steps did I take to prevent a person from increasing or maintaining his/her level of intoxication?
- What steps did I take to protect a person once he/she was or apparently was intoxicated?
Prevention – Your First Duty of Care
To exercise reasonable care to ensure that persons are not served alcohol, such that they become a danger to themselves or others.
Preventing Intoxication Means:
- Monitoring a customer’s actions and behaviours.
- Being aware of factors that affect intoxication.
- Being prepared to refuse service to a customer who is at risk of becoming impaired.
- Eliminating inducement (attempt to persuade people to purchase and consume more liquor than they normally would).
Protection – Your Second Duty of Care
To take reasonable steps to protect persons who have become intoxicated: to ensure that they do not harm themselves or others.
This may include:
- Arranging for an impaired customer(s) to be placed in the care of a responsible (and sober) person.
- Arranging rides.
If a customer leaves your establishment and is in an accident or injured, you and your establishment can be held responsible.
Chain of Responsibility
Was the intoxicated person placed in the care of someone else? An intoxicated driver may have been ‘picked up’ by the police or placed in a taxi or put into the care of a designated driver.
Any actions the intoxicated person takes after this type of intervention could be judged to be so remote from your care and control that you will not be held liable. However, the fact that he/she managed to drive a car for two hours or 100 miles before an accident may not remove you from subsequent liability or damages. Nor does the mere fact that “they drank somewhere else after leaving us” remove you from the ‘chain of responsibility’.
“He/she was negligent so I can’t be held responsible!” It doesn’t work that way. In fact, because he/she was negligent, you may be held responsible: if you did not demonstrate your duty of care. For example: An intoxicated driver loses control of his car resulting in an accident involving injury.
- Was the driver negligent? Yes. Failure to control the car.
- Was alcohol served by you a factor? Yes. Contributed to his negligence in failure to control his car.
- Were you negligent in the service of alcohol? If you had a duty of care and breached that duty, you could be found negligent.
- Could you end up paying damages? Yes.
- How much? More than you may realize.
Joint and Several Liability
Courts will determine different amounts of liability. What percentage of blame is given to each party is for the courts to determine, based upon the facts of the case, and the chain of responsibility.
The cases below contain discussion of an alcohol provider’s liability under common law.
1. Jordon House Hotel Ltd. v. Menow and Hosberger (1973)
The Supreme Court of Canada recognized that a tavern owner had a duty to protect intoxicated persons from injuries that they might suffer on or off the premises.
Menow (the defendant) drank to visible intoxication and was ejected from the Jordon House Hotel. As he walked along the highway, he was hit by a car. Menow successfully sued the driver and the hotel. Menow, the driver and the hotel were each held one-third at fault.
Cases following this landmark decision have placed a duty of care on establishments. Establishments must be sure people are not harmed when they leave an establishment in an intoxicated state.
2. Hague et al v. Billings et al (1989)
The issue was whether either of the defendant taverns would be liable to the plaintiff for damages that happened as a result of an accident caused by an intoxicated driver.
Billings (the defendant) killed J. Hague and seriously injured her daughter. Billings had been served at two taverns before the accident. The staff at the Oasis Tavern refused service after one drink when they agreed that he was intoxicated. The staff at the Ship and Shore Hotel served several drinks to the Billings party.
Action against the Oasis Tavern was dismissed. Billings and the Ship and Shore were found equally responsible. The Hague family was awarded damages of $1,890,000.
3. Whitlow v. The Cross Eyed Bear Tavern (1995)
Mr. Whitlow consumed alcohol at a Legion. He left and shortly after entered the tavern where he consumed more alcohol. While there, he went to use the restroom located down a stairwell. Shortly thereafter, he was found unconscious at the bottom of the stairs. No one saw him descend the stairs. No one saw him fall. He died shortly thereafter. The staircase had a protruding bulkhead. There was a sign on the bulkhead “(Watch your Step/Head!!!)”.
The court found that the bulkhead was one of the causes of Mr. Whitlow’s fall. Mr. Whitlow was found to be extremely intoxicated (18-21 drinks) from the drinks served in either the tavern or the Legion. The warning sign had a reduced effect due to his intoxication. The tavern failed to adequately monitor his consumption of alcohol.
The court found: Mr. Whitlow 80% at fault for his own “damages”. The Tavern 15% liable. The Legion 5% liable.
Condition of the premises is unsafe for use of customers when it is foreseeable that customers may be intoxicated. It is interesting to note that the Legion’s liability was based on “foreseeable danger” to an intoxicated person and a duty to take some active steps to protect them.
4. Jacobson v. Kinsmen Club of Nanaimo (1976)
At a “Beer Garden” held in a curling rink by the Kinsmen Club attended by approximately 2000 people, a patron decided to “entertain” the crowd. He climbed to an I-beam supporting the roof and dropped his pants while hanging from the beam. A little while later he and a friend repeated the performance. Nothing untoward happened and the crowd seemed to enjoy the “show”.
Another guest then attempted the same act, unfortunately not as successfully. He fell 30 feet and landed on another guest who was injured. The court made some interesting comments. It stated that, had the first guest fallen, the court would not have held the Kinsmen Club liable. “Who could foresee that someone would attempt this activity, and how could they have effectively intervened.” However, after the first event it was foreseeable, and what did the Club do to prevent a reoccurrence? Nothing.
After the second occurrence, the event was not only foreseeable, it was an ongoing activity. By this time, the Kinsmen should have intervened, warned the patrons that this activity would not be tolerated, and even posted members by the I-beam pillars to prevent anyone climbing. The Kinsmen did none of these things and by failing to take more effective measures to prevent a recurrence, the Club breached its duty and was found to be liable.
Implications of These Cases
- It is illegal to serve alcohol to anyone who is intoxicated.
- The licensee has an obligation to ensure that the physical condition of the premises does not pose an undue risk of harm to those who enter.
You are responsible for your customers, regardless of their level of intoxication.
The following suggestions help reduce the risk of breaking the law and being found liable.
You need to:
- Ensure you do not serve alcohol to intoxicated patrons.
- Ask for ID from anyone who looks under 25 and do not serve minors (under 19 in Newfoundland and Labrador).
- Watch for and be able to recognize intoxication.
- Make sure customers do not hurt themselves or others.
- Take reasonable steps to reduce and contain your risk (duty of care).
- Act quickly to control disturbances such as fights or groups talking too loudly and annoying other customers.
- Refuse service and remove customers who are involved in illegal activities (such as drug dealing) or who are creating disturbances.
- Make sure everyone on staff works together to stop aggressive or illegal behaviour before it causes a problem.
- Use only reasonable amounts of force to control disturbances.
- Consider that it may be preferable, in many cases, to have police attend to the removal of persons.
It may be tempting to think that the odds are in your favour, that lawsuits will only be made against other people. In these changing times, however, all servers, bartenders, managers and owners are at higher risk.
You can reduce liability by:
- Having clear policies and procedures that are understood, followed and are consistent with what is permitted by rules, regulations and laws
- Documenting your actions and communicating effectively with other staff.
- Maintaining a safe environment.
Proper documentation and communication helps everyone understand what is going on and allows them to support each other’s actions. These steps make it easier to prove what actions were taken if a problem does arise. A logbook provides a physical record, in which any staff should be able to verify actions taken. Good documentation can also discourage people from bringing a lawsuit against you and your establishment. Discuss this with your manager or supervisor.
You should fill out an incident logbook entry whenever someone is:
- Refused entry
- Refused service
- Cut off
- Asked to leave the premises
- Hurt on the premises
These are examples only. There will be other incidents you and your manager may feel should be documented.
- It is important to record incidents with customers in a notebook or logbook. Record the events while they are fresh in your mind; as soon as possible after the incident has taken place.
- Include details such as: time, place, date, nature of incident, description of parties involved, action taken, witnesses, whether police were called, and any other pertinent information.
- Retain all sales slips pertaining to the incident.
Filling out log entries is one way of protecting yourself. Make a note whenever you think and issue could arise regarding your actions, or those of your patrons.
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