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Commercial Liability Under the Dram Shop Act

When an intoxicated person causes damage to a third party, obviously the intoxicated person often can be held liable for their actions. Under the Dram Shop Act, or the Illinois Liquor Control Act, bars, clubs, or other establishments where alcohol is sold, collectively known as dram shops in legal terms, can also be held liable for the actions of the intoxicated party if they sold the alcohol.

In order to hold a dram shop liable for the damage, the victim must prove in court that:

  • The vendor sold alcohol to the patron,
  • Any injuries or damages in question were in fact caused by the same patron,
  • The vendor was a proximate cause of the patron’s intoxication (that is, that the intoxication of the patron was a foreseeable result of the sale of alcohol by the dram shop), and
  • Intoxication was at least one major cause of the conduct causing the third-party’s injury.

For example, a common case of commercial liability under the Liquor Control Act would be related to drunk driving accidents. The bar (or bars) where the driver bought drinks can be held liable for the damages incurred during the accident.

Limits on Liability

There are legal limits to a dram shop’s liability under the Liquor Control Act. They are as follows as of January 20, 2014:

  • For causes of action involving people who are injured or killed or who incur property damage, the amount recoverable is limited to $65,017.86 per person.
  • For causes of action related to a loss of means of support or loss of society resulting from the death or injury of any person, the amount recoverable is limited to $79,466.27.
  • Both of these limits are an overall total per incident, not per dram shop. That means that if the defendant drinks at five different restaurants, the five businesses will be jointly responsible for paying the limit. They will not each be responsible for paying separate damages.
  • These limits are indexed to consumer inflation and are subject to change each January.

For underage customers, liability is even more severe. An amendment to the Liquor Control Act makes serving a minor a criminal offense, whether the alcohol was served in a business or a public location or inside a private home. If the underage patron merely becomes intoxicated, the crime is a misdemeanor. But if the underage drinker goes on to injure himself or herself or a third party, the crime becomes a felony.

The vendor also does not have to physically hand the underage patron the drink to be held responsible. If the court determines that the adult should have reasonably known underage drinking would occur on the property and he or she did nothing to prevent it, the property owner can be held accountable under the law. This is not simply commercial liability for the damage, but also a criminal offense punishable with both a fine and incarceration. For these reasons, businesses serving alcohol must be particularly careful that the patrons are of legal age.

In general, it is prudent in Illinois to be careful when serving alcohol to patrons, because it can be much easier to prove third-party liability than in surrounding states.

How a Lawyer Can Help

If you’ve been injured in an accident involving an intoxicated person, there may be complicated questions about liability. An experienced Chicago personal injury attorney can guide you through the process of identifying all of the parties who might be liable for your injuries — including the establishments that sold alcohol to the person who caused your accident — and through the process of negotiating a fair settlement that compensates you for your physical injuries, lost wages, and other damages.