What is a Dram Shop?

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A dram shop is a legal term referring to a bar, tavern or the like
where alcoholic beverages are sold. Traditionally, it referred to a shop where spirits were sold by the dram, a small unit of liquid.

A question often asked of me as a Chicago personal injury attorney is whether a tavern or bar is legally liable for the injuries caused to 3rd parties by intoxicated patrons? In Illinois the short answer is yes with many limitations. At common law dram shop liability did not exist. It is a creature of the legislature's enactment of a statute. The public policy behind the law holds that when one balances the economic burden of dram shop owners versus those injured by the actions of the intoxicated, the rights of the injured win out. In effect dram shop insurance becomes a taverns cost of doing business in Illinois.

The Illinois dram shop law holds that when the following is proven by a preponderance of the evidence the injured is entitled to relief.

• 1. The dram shop sold alcohol to the person causing the injury,
• 2. The alcohol sold by the dram shop caused or materially contributed to the person's intoxication,
• 3. The intoxication was the proximate cause of the plaintiff's injuries,

The law is enforced against those who sold or furnished the alcohol to an inticated person and against those that rent or lease the property to the dram shop. There is also a special provision holding any adult that rents a hotel room for minors that he or she knows will be used to drink alcohol may also be held liable for harm caused by the minors.

At first you might assume that the injured are entitled to a full and complete damage award as if they were injured by someone’s negligent conduct. Unfortunately, the downside of the legislatures creation of the law is that it comes with a damage cap.

Causes of action for direct injury from the actions of an intoxicated patron which occur after January 20, 2011 may not exceed $61,151.39.

Actions for “loss of means of support” and or “loss of society”, may not exceed $74,740.59

The Illinois Dram Shop Act is intrastate in nature, in that alcohol served in Illinois which causes injury in Wisconsin does not constitute a violation. A tavern located near a state line can sell large quantities of alcohol to a person, carry them to their car, drive the car to the state line yet they are not liable for the death and destruction that may follow. On the other hand there would be liability if the neighboring state has a similar dram shop law.

Rick Grossman