Dram shop laws or acts hold business owners liable for selling alcohol to patrons who are clearly and visibly intoxicated. Businesses must be aware of visible signs of intoxication, such as slurred speech and a lack of coordination, and stop selling alcohol to such patrons.
Alcohol-serving establishments are liable for injuries caused to third parties by patrons who have consumed alcohol. The law also prohibits providing alcohol to minors who are intoxicated.
Liquor laws regulate alcoholic beverages. States have their own liquor laws, and even within the same state, liquor laws may vary by region. An example of this would be the highly regulated sale of alcohol in business zones. Additionally, some states prohibit the sale of alcohol on Sundays or during certain times of the day.
Liquor laws generally govern the following:
Liquor licenses authorize businesses to sell and serve alcoholic beverages in the state where they are located. Liquor laws are strictly regulated by federal, state, and local governments, as previously mentioned.
Permissions are granted for the following:
To reduce fraud, the liquor license application process is lengthy and time-consuming. The application itself can also be expensive, depending on where you are opening your business. Furthermore, towns and cities often limit the number of establishments that can use these licenses simultaneously, called quotas.
Obtaining a liquor license begins with submitting a request to your city’s government. The application will generally be discussed in an open town meeting, and citizens who attend this meeting can voice their opinions. The town council will discuss it.
The application is submitted to the state for review after approval by the local government. Your restaurant or business will receive a liquor license if the state government approves your application. However, not all business license applications are approved, especially for liquor licenses, because the laws governing alcohol are strict. An application can be rejected if a jurisdiction meets a quota for businesses that can sell alcohol.
Also, several local and state officials review each application, so if one element is out of place, it could negatively impact the application. The process of obtaining a liquor license may be considerably delayed if a business has outstanding taxes or fees, for example.
Each state has its own liquor laws, so each license is different. Standard “liquor licenses” are accepted in some areas, however. Alcohol sales specific to that state can be included in this category. Typically, a license will distinguish whether a business can sell alcohol for on-premises consumption or for off-premises consumption.
As a reminder, cities can often separate liquor sales from other alcohol sales. As an example, a restaurant that only serves beer and wine may need a specific Beer and Wine License instead of a liquor license.
Depending on the nature of the business, other states require specific liquor licenses. Clubs, hotels, and restaurants may have specialized licenses, as well as companies that deliver alcohol.
Bars and restaurants commonly refer to liquor licenses when discussing their operations. Liquor stores, supermarkets, and convenience stores that sell alcohol are also subject to liquor licenses, specifically, Retail Licenses.
Pennsylvania’s dram shop law is listed under the Pennsylvania Liquor Code at Section 4.493(1). Businesses that serve alcoholic beverages to visibly intoxicated patrons may be held civilly liable under this statute.
It is difficult to determine whether someone is “visibly intoxicated,” but employees are encouraged to exercise good judgment when serving patrons who appear to be impaired.
Eyewitness accounts, blood samples, and other tests may also confirm “visible intoxication.”
Alcohol may also not be sold by businesses to minors, mentally ill persons, or people with a drinking habit under the dram shop law.
Yes, Pennsylvania is one of the few states that allow patrons to recover damages from businesses that sold them drinks. Therefore, not only third parties but also intoxicated people themselves can sue the bar or tavern for compensation.
A person served alcoholic beverages by a business and then injured themselves or another due to their drunkenness can hold the business liable for damages. When the bar or tavern sold the person more drinks, they must have known that the person was visibly intoxicated.
Intoxicated persons may also recover damages under Pennsylvania law, which some have criticized. According to Pennsylvania lawmakers, the dram shop act protects “the general public,” which includes patrons, from injuries.
A liquor license comes with a list of regulations and laws that a business must follow. As an example, once a business acquires a liquor license, it must maintain and renew it regularly. It is possible to lose your business if you serve or sell alcohol without a valid license and face jail time in serious cases.
There may be additional fees associated with renewing a liquor license.
Liquor laws can be violated in the following ways:
A business that violates the terms of its liquor license will receive an accusation informing the business owner of the laws they violated. Additionally, the owner must attend a hearing with the state’s alcohol controlling agent. A judge will then decide whether the license terms were actually violated and whether any disciplinary action should be taken.
A judge may impose consequences on a business that violates the license terms. Revocation of a business’s liquor license is the most common example, which can sometimes be permanent. Restaurants that sell alcohol to anyone under 21 often lose their license permanently.
It is possible, however, for the business to regain its license after meeting certain conditions. In addition, fines and fees may be imposed as part of the disciplinary process, or they may be the only disciplinary action taken by the judge.
A police error can sometimes be used as a defense against a liquor law violation. However, some liquor law violations are strict liability violations, meaning the person might be held liable simply for the action. Regardless of their knowledge or intentions at the time, this would be the case. The sale of alcohol to minors can be punished even when the shop owner does not know that the person is a minor.
Multiple parties can be involved in Dram Shop Law violations, making them complex. Because Pennsylvania allows patrons to recover, several conflicting interests may be at play simultaneously.
It is important to work closely with a competent attorney regardless of which party you are associated with. A Pennsylvania business lawyer can also help you stay informed of current dram shop laws changes.
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