What is the Alabama Dram Shop Act

Alabama’s Dram Shop Act makes business owners who knowingly serve alcohol to a visibly intoxicated person legally responsible for injuries they cause due to their intoxication. Liable parties can include owners of bars, restaurants, grocery stores, convenience stores, liquor stores, and clubs. The legislature recently reformed this law to make liability insurance more accessible. But it still holds these establishments accountable for the harmful conduct they enable.

Why Did Alabama Enact the Dram Shop Act?

Alabama passed the original Dram Shop Act in 1909 in response to growing public concerns about intoxication, resulting in Prohibition from 1920 to 1933. Writing about the original act, the Alabama Supreme Court described its objective as “to correct the evils resulting from intemperate indulgence in intoxicating liquors.”

A subsequent court case in 1991 interpreted the law to apply a very high liability standard to businesses serving alcohol. The law could deter such dangerous practices by holding drinking establishments financially accountable for negligently serving an intoxicated person who subsequently harmed others.

The legislature recently passed reforms to the Alabama Dram Shop Act to lessen the liability standard, making it easier for restaurants and bars to afford liability insurance. Before these reforms, only three insurers were willing to provide liability insurance to establishments serving alcohol in Alabama – with one threatening to pull out of college towns like Auburn and Tuscaloosa. Liability policies meeting the state-required $100,000 minimum could cost as much as $35,000 annually, which many businesses found cost-prohibitive.

Under the new law, plaintiffs must prove with evidence that the business owner knowingly served alcohol to an individual who was visibly intoxicated at the time of service. They must also prove that the business’s service was the proximate cause of injury or death.

Are Drunk Driving Accidents the Only Accidents a Business or Person Can Be Held Liable For?

Under the Dram Shop Act, someone injured by a drunk person’s harmful conduct in incidents other than motor vehicle accidents may also seek compensation from the establishment that knowingly sold or served the alcohol. This includes incidents such as the following:

• Assault and battery
• Slip and fall accidents
• Alcohol poisoning
• Sexual assault and harassment

Who Can Bring a Claim Under the Dram Shop Act in Alabama?

Alabama allows for two types of victims to file a lawsuit under the Dram Shop Act:

• The injured victim
• The victim’s spouse, child, parent, or other dependent

The law states explicitly that intoxicated people cannot file a lawsuit against the business that served them to seek compensation for their injuries.

What Are the Requirements of the Dram Shop Act That Must Be Proven in a Lawsuit?

For a successful lawsuit under the Dram Shop Act, a plaintiff must prove the following:

• The business owner sold or served alcohol to the drunk individual. The victim must provide sufficient evidence of the individual’s visible intoxication at the time of sale or service of alcohol.
• The business owner knew or should have reasonably known that the individual was visibly intoxicated at the time but served them anyway.
• The individual’s intoxication directly caused the victim’s injuries.
• The victim suffered economic and non-economic losses as a result of their injuries.

What Compensation Can Be Recovered in a Dram Shop Act Lawsuit?

A successful Dram Shop Act lawsuit against a business could provide compensation for financial and personal losses resulting from the injury or harm caused by the intoxicated person. Compensation might include:

• Current and future medical expenses, including hospital stays, surgeries, doctor’s visits, medications, diagnostic tests, and mobility equipment
• Lost wages and benefits if you cannot work while healing from your injuries
• Loss of future earning capacity if your injuries result in a disability or impairment that prevents you from returning to your job or being gainfully employed
• Pain and suffering due to your injuries
• Mental anguish
• Emotional distress
• Loss of quality of life if your injuries prevent you from participating in hobbies or daily activities that you enjoyed before the injury

In rare cases, the court could award punitive damages, which are meant to punish the at-fault party for purposeful and deliberate oppression, fraud, wantonness, or malice. Alabama law caps punitive damages in cases involving physical injury at three times the amount of compensatory damages or $1.5 million, whichever is greater. However, this cap is lower if the defendant is a small business with a net worth of $2 million or less, as is often the case with restaurants and bars. The law caps damages for small businesses at $50,000 or 10 percent of the business’s net worth, whichever is greater.

How Long Do I Have to File a Dram Shop Act Lawsuit in Alabama?

Alabama’s statute of limitations establishes a two-year deadline for filing a Dram Shop Act lawsuit. While two years may seem like plenty of time, waiting too long could jeopardize the strength of the evidence in your case. For example, many businesses periodically delete their security camera footage. If you try to recover the footage weeks or months after the incident, it may be gone. Memories can also fade over time, so eyewitnesses may not remember the specific actions and behaviors of the at-fault parties.

To build a solid case, you should immediately consult an attorney. They will investigate the case and gather critical evidence before it disappears or diminishes.

Contact an Alabama Personal Injury Lawyer

Because Alabama’s Dram Shop Act can be complex, hiring a knowledgeable and experienced lawyer is crucial to building a solid case. The personal injury lawyers at Gartlan Injury Law have helped many Alabama injury victims seek justice from negligent business owners who contributed to the harmful conduct of intoxicated individuals. Contact Gartlan Injury Law today for a free, confidential consultation with an Alabama personal injury lawyer.

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