Driven from drink; …employees and liquor

Nation's Business, Dec, 1984 by Tony Mauro

ROBERT MATHESON was a problem drinker who brought his problem to work with him. When he showed up drunk at Otis Engineering Company in Carrollton, Tex., one day in 1978, his supervisor did what he thought was prudent: He walked Matheson to his car and told him to go home.

Thirty minutes later, Matheson caused a car accident in which he and three other people died. Six years later, the Texas Supreme Court ruled that Otis Engineering could be held liable for letting Matheson drive. In an out-of-court settlement, the company paid the three victims' survivors a total of $600,000.

As national concern about drunk driving increases, companies and individuals that aid, tolerate or ignore excessive drinking by their employes or guests are being held liable for resulting accidents.

For decades, tavern, restaurant and liquor store owners in many states have been potentially liable for alcohol-related accidents under little-used "dram shop" laws, which have British precedents. (Bars were once called dram shops.) Now those laws are being dusted off and used forcefully by drunk driving victims, and not just against liquor establishments but against corporations and individuals as well.

"There are tons of areas where businesses interface with booze, and each one is a danger point," says Don Nichols, a Minneapolis lawyer and editor of Liquor Liability Journal. "It's natural outgrowth of the anti-drunk-driving movement that more and more people are being held responsible."

Consider the following examples:

* The New Jersey Supreme Court ruled last June that social hosts could be held liable for subsequent accidents if they knowingly served guests at their homes too much alcohol.

* Swiftly applying that doctrine to corporate hosts, a New Jersey appeals court said a lawsuit could proceed against Sam Goody, Inc., owner of a chain of music record stores. The suit was brought by survivors of the victim of an accident caused by a Sam Goody worker who left an employe Christmas party drunk. The company's involvement in the worker-funded party was limited to lending a stereo system and paying $75 to rent the hall.

* The Pennsylvania Supreme Court said last January that the Portersville Valve Company, of Butler County, could be held liable for permanent injuries suffered by 18-year-old employe Mark Congini, who was in a car accident after getting drunk at a 1978 company Christmas party. The key to the company's liability: Congini was under the legal drinking age when he was served at the party.

* A tavern that gave away beer, as well as the radio station that carried commercials for the offer, paid a total of $92,500 to the parents of a Parkville, Mo., boy killed by a drunk driver. the driver had patronized the bar after hearing the commercials and had over-imbibed.

* A Denver bar agreed to pay up to $9.5 million to a permanently injured woman for serving liquor to the driver of a car that hit her.

* police in parts of Maryland are asking motorists arrested for drunk driving where they were served their last drink. The name of the establishment is then referred to the local licensing board for investigation.

The trend is snowballing, say experts. Falmouth, Mass., lawyer Ron Beitman notes a 300 to 400 percent increase in the number of host and corporate liability cases filed or settled over the last year.

possible next targets, says Beitman, are companies whose salesmen wine and dine potential buyers who then get involved in accidents.

Beitman, who represents many plaintiffs suing liquor servers and publishes a newsletter on trends in the field, says: "Five to seven years ago, juries weren't responsive at all to the idea of servers being liable. You would never take a case like that before them. Now they will listen."

FROM THE VICTIMS' point of view, the trend is a welcome one, as they search for more and deeper pockets to compensate them for often devastating losses. "If you're a person with a catastrophic injury," asks Nichols, "who are you going to want to pay for that--yourself or an employer who in some small way contributed to the accident?"

Adds Dr. Morris Chafetz, who was a member of the presidential Commission on Drunk Driving, "I'm not in favor of simply creating more work for lawyers, but on the other hand, you can't just walk away from responsibility any more. The public's attitude about responsibility has shifted."

The commission, in a report issued late last year, recommended passage of dram shop laws in the 27 states that do not have them but was silent on the issue of host liability.

To many companies, the effort to hold them liable seems misguided. "If you think you can solve the drunk driving problem by punishing bar owners and corporate hosts, you're wrong," says Duncan Cameron, director of communications for the Distilled Spirits Council of America. "The problem isn't oversupplying, it's overdemanding. If I want to get drunk, I'll find a way. The individual driver is the one who must be controlled, the one who has to bear the responsibility."