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A Limited Form of Dram Shop Liability?

A Limited Form of Dram Shop Liability

Reviving two cases that were dismissed in the absence of a Dram Shop Act, the Court of Appeals handed down a landmark decision which imposes a limited form of "dram shop liability" for the first time in the State's history. 

As a result, adults who host parties with knowledge of underage drinking may be held civilly liable for death or injuries caused by an intoxicated attendee. Considering the strong public policy reflected in a new statute that imposes criminal penalties upon such hosts, the Court of Appeals found that a limited form of social host liability only exists when the adults in question act knowingly and willfully, as required by the statute.

"Although young people 'are close to a lifelong peak of physical health, strength, and mental capacity,'" the Court recognized that "they are still developing in profound ways suggesting that they, in contrast to adults, are not capable of handling the more dangerous elements this world offers.  Prominent among these dangers, and front and center in these cases, is alcohol."  In the Court's view, "underage persons are not solely responsible for drinking alcohol on an adult’s property because they are not competent to handle the effects of this potentially dangerous substance."

For this reason, the Court refused to apply Maryland's very strong defense of contributory negligence to bar claims asserted on behalf of an underage drinker who caused or contributed to his or her own injuries.  In Maryland, even an iota of negligence on the part of a claimant typically precludes recovery.  Yet, even though such claims against the host would be based on negligence, the Court ruled that those who act willfully cannot assert a defense of contributory negligence on the part of the underage drinker:

Contributory negligence, normally a defense to negligence, is not available when a defendant violates an exceptional statute, the effect of which "is to place the entire responsibility for such harm as has occurred upon the defendant." Comment c to Section 483 of the Second Restatement of Torts explains that "[a] statute may be found to have that purpose [of shifting responsibility] particularly where it is enacted in order to protect a certain class of persons against their own inability to protect themselves."  [Maryland's criminal statute] clearly was enacted to protect underage people from the seductive call of alcohol and its effects. The statute was drawn carefully to limit criminal liability to a knowing and willful violation by the defendant, and we have so limited these civil causes of actions. For these reasons we conclude that negligent actions of the underage person in getting intoxicated cannot be the basis of a contributory negligence defense in an action against the person.

This is the first time that Maryland has imposed even a limited version of dram shop liability.  That itself is a significant change in Maryland law.  But the Court's use of public policy derived from a criminal statute to impose civil penalties may have even broader implications if the Court were to apply that same rationale to expand liability in other areas.  Manal Kariakos v. Brandon Phillips, and Nancy Dankos v. Linda Stapf, Nos. 20 and 55, September Term 2015.