“Seeing the Invisible” – Recent Challenges for Restaurant, Bar and Tavern Owners In Defending Claims Under the New Jersey Dram Shop Act

By Teagan S. Allen, Esq.*

Thirty states across the country have enacted “dram shop” laws that set forth the parameters by which a licensed alcoholic beverage server—such as a restaurant, bar or tavern owner—can be held liable to individuals who suffer injury or death, or cause injury or death of others, as a result of intoxication. In New Jersey, the Licensed Alcoholic Beverage Server Fair Liability Act, N.J.S.A. 2A:22A-2, most commonly known as the New Jersey Dram Shop Act, provides the exclusive legal remedy against a licensed alcoholic beverage server for damages suffered by a person who sustains injury as the result of the negligent service of alcoholic beverages. Pursuant to the Act, a restaurant, bar or tavern owner is deemed to have been negligent only when the server served a visibly intoxicated person or a minor. “Visibly intoxicated” is defined by the Act as “[a] state of intoxicated accompanied by a perceptible act or series of acts which present clear signs of intoxication.” This seemingly straightforward criteria appears to overwhelmingly favor alcoholic beverage servers and places a heavy burden upon plaintiffs. However, the impact of a 2013 New Jersey appellate decision regarding the threshold of evidence required to prove these claims has recently muddied the waters in favor of plaintiffs and is presenting new challenges for the defense of personal injury, wrongful death and survival claims under the Act.

In Halvorsen v. Villamil, 60 A.3d 827 (App. Div. 2013), the New Jersey Appellate Division held that eyewitness testimony of service of a visibly intoxicated patron was not required to prove that a licensed alcoholic beverage server violated the Act. In Halvorsen, the defendant driver, Villamil, was involved in a motor vehicle accident that occurred approximately 30 minutes after he left the bar at TGI Friday’s, where he had been drinking for several hours. Villamil’s blood alcohol content (BAC), taken one and one-half hours after the accident, was .278. However, there was no eyewitness testimony of Villamil’s condition or alcohol consumption while at TGI Friday’s. During discovery, the plaintiffs submitted an expert report from a well-known plaintiff’s toxicologist, Richard Saferstein, who concluded that, based on the “relation back” of Villamil’s BAC, he must have been served alcoholic beverages while visibly intoxicated at TGI Friday’s. Saferstein opined, inter alia, that Villamil had consumed 17 drinks at the bar and would have shown visible signs of intoxication, such as slurred speech and an unsteady gait.

At the close of discovery, TGI Friday’s filed a successful motion for summary judgment, arguing that the plaintiffs failed to set forth any direct evidence that Villamil was visibly intoxicated when served at TGI Friday’s. On appeal, the plaintiffs argued that eyewitness testimony was not required and that Saferstein’s “relation back” opinion was enough to survive summary judgment. The Appellate Division reversed, noting that the Act’s language did not explicitly require eyewitness testimony. The court reasoned that the plaintiffs could survive summary judgment because they were able to present enough circumstantial evidence that Villamil was served while visibly intoxicated. Specifically, the Appellate Division found that, in the aggregate, the following evidence permitted the plaintiffs’ case to proceed:

Saferstein’s “relation back” opinion that Villamil would have shown signs of visible intoxication at least one hour before leaving TGI Friday’s;

• Villamil’s testimony that he only consumed alcohol at TGI Friday’s on the date of the accident;
• The smell of alcohol on Villamil’s breath as testified to by the arresting officer;
• Villamil’s testimony that he did not eat, and only drank alcoholic beverages while at Friday’s;
• Villamil’s exceptionally high BAC one hour after the accident; and
• The short timeframe of only 20-30 minutes between when Villamil left the bar and the motor vehicle accident.

TGI Friday’s did not appeal. Consequently, at first blush, the Halvorsen decision appears to be a fundamental departure from the standards set forth in seminal dram shop cases, including Mazzacano v. Estate of Kinnerman, 962 A.2d 1103 (N.J. 2009). Yet, the court was careful to note that “relation back” testimony, on its own, remains insufficient to create a genuine issue of material fact. Other facts must be present that would allow a reasonable juror to find that the driver was served alcohol while visibly intoxicated. Nevertheless, the lasting effect of the Halvorsen decision is that a plaintiff may now prove negligence with circumstantial evidence alone.

In the wake of Halvorsen, plaintiffs have successfully applied to defeat summary judgment in DUI-related dram shop cases where the record is devoid of direct evidence demonstrating the negligent service of alcohol. DUIs are the most common types of liability claims faced by restaurant, bar and tavern owners. Thus, questions have been raised regarding how a licensed alcoholic beverage server can realistically defend these claims when plaintiffs are no longer required to prove through eyewitness testimony that someone actually saw the patron exhibit signs of visible intoxication. Has Halvorsen effectively negated the requirement of visible intoxication? Not necessarily. Although Halvorsen is certainly a blow to defendants, particularly in the context of dispositive motions, its broader impact is tempered by the highly fact-specific analysis applied by the Halvorsen court. Knowledgeable and well-prepared advocates can develop and make crucial distinctions, based on the circumstances of their cases, to argue that the Halvorsen decision is inapplicable. Overall, nearly three years post-Halvorsen, the Act remains, at least for the time-being, a significant hurdle for plaintiffs in hospitality-related personal injury actions.

*Teagan, an associate in our Roseland, New Jersey office, can be reached at 973.618.4126 or tsallen@mdwcg.com.

_{Defense Digest, Vol. 22, No. 2, June 2016}

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