Dram Shop Liability

Dram Shop Liability Peggy Kelley Thu, 10/25/2018 - 03:47 PM EDT


Dram shop liability laws are statutory (i.e., written) provisions that allow licensed drinking establishments (e.g., restaurants, bars, liquor stores) to be held financially liable for serving alcohol to an underage or intoxicated person who later causes injury to a third party.


To limit commercial availability of alcohol to underage youth and intoxicated patrons

Typical Elements

  • Dram shop liability laws established by statute or through common law (i.e., a body of unwritten state laws based on precedents established by the courts). In this case, precedents would include any rulings that allow an injured party to sue the person or entity that negligently or intentionally caused injury.
    • Note: Statutes take precedence over common law court decisions (SAMHSA, 2012).
  • If law or policy experts intend to proceed through common law, they may want to review the following liability rules for lawsuits (The Community Guide, 2013):
    • A negligence standard applies. That is, plaintiffs (e.g., injured parties) do not need to demonstrate that the defendant acted intentionally, willfully, or knowingly (e.g., that the defendant knew the person he or she was serving was underage or intoxicated).
    • If negligence is established, the plaintiff can receive compensatory and punitive damages.
    • Underage plaintiffs need to establish that they were provided with alcohol and that this provision contributed to injury.
      • Note: Intoxication at the time of sale only needs to be established for adult plaintiffs, not underage plaintiffs. For adults, plaintiffs must establish that the intoxicated adult was furnished alcohol and that the furnishing contributed to the injury.
    • Plaintiffs must meet the “preponderance of evidence” standard of proof, which is lower than the standard of proof (e.g., beyond a reasonable doubt) for criminal cases.
  • There are two variables that can affect the ability of the injured party to prevail in a lawsuit and recover damages (SAMHSA, 2012):
    • Limits on damages: Statutory caps on the total dollar amount that can be recovered through lawsuits.
    • Limits on elements or standards of proof: Legislative requirements that plaintiffs prove additional facts or meet a more rigorous standard of proof than would normally apply in common law. These requirements can include establishing clear and convincing proof or proof beyond a reasonable doubt that the retailer knew the minor was underage, the retailer intentionally or willfully served the minor, or the retailer knew the minor or adult patron was intoxicated at the time of sale or service.


  • Some states have enacted responsible beverage service (RBS) affirmative defenses where retailers can avoid liability if they demonstrate they implemented RBS programs and that the staff were following RBS procedures at the time of the incident (SAMHSA, 2012).
  • The use of dram shop liability has declined in many states during the past two decades, largely because of increased evidentiary requirements, limitations on damage awards, restrictions on who can be sued, or some combination of these limitations (Mosher, Cohen, & Jernigan, 2013).


  • Youth under age 21
  • Adult alcohol consumers
  • Alcohol outlet owners, managers, and servers 


Dram shop liability laws have been linked to reductions in:

  • Alcohol-related motor vehicle fatalities of adults and minors (Chaloupka, Saffer, & Grossman, 1993; Rammohan et al., 2011; Whetten-Goldstein, Sloan, Stout, & Liang, 2000)
  • Self-reported incidents of heavy episodic drinking and drunk driving among all drinkers (Stout, Sloan, Liang, & Davies, 2000)
  • Drinking levels by college students (Powell, Williams, & Wechsler, 2004)


13. Dram Shop Liability

Alcohol - Excessive Consumption: Dram Shop Liability


Alcohol - Excessive Consumption: Dram Shop Liability


Chaloupka, F. J., Saffer, H., & Grossman, M. (1993). Alcohol-control policies and motor-vehicle fatalities. The Journal of Legal Studies, 22(1), 161–186.

The Community Guide. (2013, September 24). Preventing excessive alcohol consumption: Dram shop liability. Retrieved from  https://www.thecommunityguide.org/findings/alcohol-excessive-consumption-dram-shop-liability

Mosher, J. F., Cohen, E. N., & Jernigan, D. H. (2013). Commercial host (dram shop) liability: Current status and trends. American Journal of Preventive Medicine, 45(3), 347–353.

Powell, L. M., Williams, J., & Wechsler, H. (2004). Study habits and the level of alcohol use among college students. Education Economics, 12(2), 135–149.

Rammohan, V., Hahn, R. A., Elder, R., Brewer, R., Fielding, J., Naimi, T. S., . . . & Zometa, C. (2011). Effects of dram shop liability and enhanced overservice law enforcement initiatives on excessive alcohol consumption and related harms: Two Community Guide systematic reviews. American Journal of Preventive Medicine, 41(3), 334–343. doi:10.1016/j.amepre.2011.06.027

Stout, E. M., Sloan, F. A., Liang, L., & Davies, H. H. (2000). Reducing harmful alcohol-related behaviors: Effective regulatory methods. Journal of Studies on Alcohol and Drugs, 61(3), 402.

Substance Abuse and Mental Health Services Administration (SAMHSA). (2012, November). 13. Dram shop liability. In Report to congress on the prevention and reduction of underage drinking (4.3.13).  Retrieved from https://alcoholpolicy.niaaa.nih.gov/sites/default/files/imce/users/u1743/stop_act_rtc_2017.pdf

Whetten-Goldstein, K., Sloan, F. A., Stout, E., & Liang, L. (2000). Civil liability, criminal law, and other policies and alcohol-related motor vehicle fatalities in the United States: 1984–1995. Accident Analysis and Prevention, 32(6), 723–733.