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Convenience Stores Subject To Liability Under Georgia's Dram Shop Act - Flores V. Exprezit! Stores 98-Georgia, LLC,

January 03, 2012 BY Matthew Nanninga

    We have all been to a gas station at eight o’clock at night, standing ten deep in line, with one cashier working two registers ringing up cigarettes, candy, and soda while working the gas pumps, often times without greeting you, looking at you, or taking the time to issue you a receipt. Assume one of those ten customers in line was intoxicated, purchased a case of beer from the convenience store, and later caused an accident injuring or killing someone. Under that scenario, the gas station could be held liable under the recent Georgia Supreme Court ruling in Flores v. Exprezit! Stores 98-Georgia, LLC., 289 Ga. 466 (2011).

          In July 2011, the Georgia Supreme Court held that Georgia’s dram shop act applies to convenience stores that sell closed or packaged containers of alcohol, not intended for consumption on the premises, to a noticeably intoxicated adult. Exprezit! argued in the lower courts that sellers of closed or packaged containers of alcohol are not subject to dram shop liability. The trial court agreed, as did the Court of Appeals. However, the Georgia Supreme Court overturned those decisions, holding that Georgia’s dram shop act did apply to convenience stores.

          Generally, Georgia’s dram shop act, O.C.G.A. § 51-1-40, subjects a person to liability for injuries if he furnishes or serves alcoholic beverages either to a person who is underage, knowing he will soon be driving; or to a noticeably intoxicated adult, knowing he will soon be driving. The consumer of the alcohol cannot recover damages for his or her own injuries.

          Georgia’s dram shop act has been applied primarily to bars and restaurants. In 2005, an attempt was made to extend the reach of the dram shop act to airlines. In Delta Airlines v. Townsend, 279 Ga. 511 (2005), the Georgia Supreme Court held that the dram shop act does not apply to sales of alcoholic beverages on airplanes. The Court reasoned that, unlike the clientele of land-based establishments, airline passengers generally do not have direct and immediate access to their vehicles after they deplane. Furthermore, the airline has no way of knowing whether any of its passengers will "soon" be operating a vehicle. The intoxicated passenger may be getting picked-up, making a connecting flight, or taking public transportation.

          The Court in Flores v. Exprezit!, however, rejected Exprezit!’s argument that a convenience store was like an airline in that it would have no way of knowing whether its customers would be driving soon. Exprezit! also argued that, unlike bars and restaurants, where the patrons are served, and drink the alcohol on the premises, convenience stores are limited in their ability to discern whether their customers are noticeably intoxicated. The Court was not persuaded by Exprezit!’s arguments, stating that the convenience store does have an opportunity to observe how its customers arrive, and the manner in which the customer will depart. (Of course, by the time the customer is departing, little can be done by the convenience store).

          It is difficult to deny the fact that there is a significant distinction between a convenience store and a bar or restaurant in the context of dram shop liability. A server of alcohol at a bar has significantly more time to observe the patrons, and will obviously know the number of drinks ordered in the establishment. On the other hand, a convenience store clerk may have as little as five or ten seconds to observe a patron. Often times a convenience store clerk does not even interact with the purchaser of alcohol. The purchaser can simply show identification, swipe his credit or debit card, and be on his way. The Supreme Court’s response to this argument was that those facts are all relevant to a motion for summary judgment or to the jury, but the Court was not willing to place a complete ban on liability against closed container sellers.

          The Court also reminds us that the facts of each case are different, and that if a plaintiff cannot demonstrate that the convenience store knowingly sold alcoholic beverages to an intoxicated person who would soon be driving, the convenience store would be entitled to summary judgment. Flores v. Exprezit! simply overturned the Court of Appeals and lower court’s opinions that totally exempted convenience stores from dram shop liability.

          The Court’s opinion was based as much on statutory interpretation as it was public policy. In its analysis, the Court stated that, in construing the intent and purpose of a statute, when a statute is plain and susceptible of only one reasonable construction, the court has no authority to place a different meaning or construction upon it. In other words, the legislature, presumed to have full knowledge of the law, could have exempted convenience stores or sales of closed containers of alcohol from liability if it wanted to do so. After all, the dram shop act expressly denies a cause of action by the consumer of the alcohol. Therefore, if the legislature did not intend for sellers of closed containers of alcohol to be subject to dram shop liability, it should have stated as much in the statute.

          Flores v. Exprezit! was hotly contested. The Georgia Trial Lawyers Association (GTLA) and Mothers Against Drunk Driving (MADD) filed amicus curiae briefs with the Court on behalf of Flores, the appellant. MADD, through their attorney, cited statistics and studies in support of its policy argument that sellers of closed containers of alcohol should be included in dram shop liability. One of the studies cited by MADD was done by the National Highway Traffic Safety Administration, involving actors simulating intoxication and attempting to buy alcohol. The study showed that establishments where patrons consume alcohol "on premises" served noticeably intoxicated patrons 76% of the time, and establishments where patrons consume alcohol "off-premises" served the same pseudo-intoxicated customers 83% of the time.

          The theme of the arguments from the appellant and MADD was that sellers of closed containers of alcohol should be treated no differently than a bar or restaurant, and that the dram shop act did not specifically exempt them from liability. The Supreme Court agreed, stating that a convenience store would still be armed with defenses to a dram shop claim, and that a plaintiff would still have to prove its case.

          The Flores v. Exprezit! decision has significant implications for the convenience store and gas station industry, including the owners, managers, and employees of these stores. Dram shop claims filed against convenience stores will present challenges to evidentiary fact gathering. Considering the fact that a number of convenience store employees work in the industry only a short time, or are transferred around to various stores, it will obviously be difficult to procure testimony from the clerk who sold the alcohol. Furthermore, the clerk’s memory of the sale will likely be nonexistent. Therefore, video footage would be some of the best evidence available in the defense of these types of claims. However, the problem with video footage is that when it is available, the majority of storage programs only save the footage for a month or two before it is deleted. Rarely, if ever, will a lawsuit be filed within this short amount of time.

          The Flores v. Exprezit! decision should also encourage convenience stores, gas stations, grocery stores, and big box retailers to reiterate to its employees the prohibition of selling alcohol to anyone who may appear to be intoxicated. Furthermore, it would be worth re-visiting company policy and procedure manuals to assure alcohol sales are covered and explained, and incorporating some level of training to staff to assist them in recognizing signs of intoxication.

The Journal is a publication for the clients of Drew Eckl & Farnham, LLP. It is written in a general format and is not intended to be legal advice to any specific circumstance. Legal Opinions may vary when based upon subtle factual differences. All rights reserved. 

Editorial Board:

H. Michael Bagley
(Editor-in-chief)