In Fort Mitchell Country Club v. LaMarre, 2011-SC-000665-DG, the Kentucky Supreme Court held a country club that violated its liquor license was still protected by Kentucky’s Dram Shop Act. This decision will affect restaurants, bar owners, country clubs and other establishments that sell and serve alcohol.
Under Kentucky’s Dram Shop Act, KRS § 413.241, an establishment selling liquor for consumption on its premises is vulnerable to liability if a person is injured off of the premises by an intoxicated patron served when a reasonable person should have known that the patron was already intoxicated.
Two couples residing in the same neighborhood rode together in a golf cart to their local country club for dinner and drinks. Both couples were members at the country club. The first couple, Mr. and Mrs. Plummer, rented a private locker there to store alcohol which could be consumed at the club. It is unclear if the alcohol stored in this locker was purchased at the club. Over the course of an hour dinner, the four of them consumed almost two
bottles of red wine and one bottle of champagne. Following dinner, the staff provided Mr. Plummer with one of his unopened bottles of champagne stored at the club. Mr. Plummer took this bottle with him off of the premises. No employee of the country club believed any party to have been intoxicated. On the way home, the driver of the golf cart, Mr. Plummer, accelerated suddenly, causing his passenger and dinner party guest, Mr. LaMarre, to fall off and sustain serious injuries. Mr. LaMarre and his family subsequently sued the country club for serving Mr. Plummer alcohol in violation of Kentucky’s Dram Shop Act.
Mr. LaMarre argued that the Dram Shop Act did not protect the country club because Mr. Plummer was intoxicated and nonetheless served alcohol by staff. The Kentucky Supreme Court stated that whether Mr. Plummer was actually intoxicated or not was irrelevant. The only relevant issue was whether a reasonable person serving alcohol should recognize intoxication. Because Mr. LaMarre could not provide evidence that the country club staff had reason to believe Mr. Plummer was intoxicated, the Dram Shop Act protected the country club from liability.
In the alternative, Mr. LaMarre argued that the Dram Shop Act did not protect the country club because it violated the terms of its liquor license when the staff allowed Mr. Plummer to take alcohol from his locker off of the premises. The Court held that a liquor license violation, in and of itself, will not remove an establishment from protection afforded by the Dram Shop Act. However, if a violation results in the license’s revocation, the result may differ.
The implications of LaMarre are significant. First, evidence of actual intoxication is not sufficient to establish that a person serving alcohol should know one is intoxicated. Second, a liquor license violation alone will not remove an establishment from protection provided under Kentucky’s Dram Shop Act.
If you would like a full copy of this case, or have any other questions about liability under Kentucky’s Dram Shop Act, please feel free to contact one of our Retail and Hospitality Liability Practice Group Members.