Dram Shop Rule Definition and Legal Meaning

On this page, you'll find the legal definition and meaning of Dram Shop Rule, written in plain English, along with examples of how it is used.

What is Dram Shop Rule?

n. A statute that holds a business strictly liable to anyone injured by a drunken patron or guest if the business sells an alcoholic drink or a host serves liquor to someone who is obviously intoxicated. California recently banned this strict liability. Since there is always an intervening cause, it is often difficult to prove that the liquor bought or served caused the specific accident.

History and Meaning of Dram Shop Rule

The Dram Shop Rule is a legal principle that holds businesses, such as bars and restaurants, responsible for serving alcohol to individuals who are visibly intoxicated. The law imposes strict liability on the establishment if the alcohol served to a customer is the proximate cause of the injuries or damages sustained by a third party. The rule has its roots in the United Kingdom and was first recognized in the U.S. in the mid-19th century, primarily as a way to curb the negative effects of alcohol consumption and limit civil liability for intoxicated individuals.

In the U.S., Dram Shop laws are enforced at the state level, with the specifics of the law varying widely from one jurisdiction to another. Some states do not have Dram Shop laws, while others have strict liability statutes that impose unlimited liability on businesses that serve alcohol to visibly intoxicated individuals.

Examples of Dram Shop Rule

  1. If a bar serves alcohol to a patron who is visibly intoxicated and that patron subsequently causes a car accident, injuring a third party, the bar may be held liable under the Dram Shop Rule.

  2. The family of a victim killed by a drunk driver may file a lawsuit against both the driver and the establishment that served him, under the Dram Shop Rule.

  3. A restaurant that continues to serve alcohol to a patron who is visibly intoxicated and then proceeds to get into an altercation with another patron may be held liable for any injuries sustained by the victim of the altercation.

Legal Terms Similar to Dram Shop Rule

  1. Social Host Liability - Similar to Dram Shop laws but applies to individuals hosting parties or events where alcohol is served.
  2. Negligent Entrustment - Imposes legal liability on a person who knowingly lends or entrusts a dangerous instrumentality, such as a car or firearm, to someone who is likely to cause harm to others.
  3. Contributory Negligence - Legal doctrine that reduces or eliminates the ability of a plaintiff to recover damages if they were at least partially responsible for their own injury or damages.