Fischer v. Cooper

• Decision Date: 13 June 1989
• Docket Number: No. 17065,17065
• Citation: 116 Idaho 374,775 P.2d 1216
• Parties: Wilma FISCHER, As Personal Representative of the Estate of Cori Lloyd and on Behalf of the Minor Children of Cori Lloyd: Alan Lloyd and Alicia Lloyd, Plaintiffs-Appellants, v. Marilyn J. COOPER, Individually and the Marital Community Consisting of Marilyn J. Cooper and John Doe Cooper; Christine Watson, Individually, and Michael Watson, Individually, and the Marital Community Composed of Christine Watson and Michael Watson, Defendants-Respondents. and Perry W. Bisher, Individually, Defendant.
• Court: Idaho Supreme Court

Page 1216

775 P.2d 1216

116 Idaho 374

Wilma FISCHER, As Personal Representative of the Estate of Cori Lloyd and on Behalf of the Minor Children of Cori Lloyd: Alan Lloyd and Alicia Lloyd, Plaintiffs-Appellants, v. Marilyn J. COOPER, Individually and the Marital Community Consisting of Marilyn J. Cooper and John Doe Cooper; Christine Watson, Individually, and Michael Watson, Individually, and the Marital Community Composed of Christine Watson and Michael Watson, Defendants-Respondents and Perry W. Bisher, Individually, Defendant.

No. 17065.

Supreme Court of Idaho.

June 13, 1989.

Jerry T. Dyreson, Spokane, Wash., argued and Pat W. Arney, Coeur d'Alene, for plaintiffs-appellants.

Paine, Hamblen, Coffin, Brooke & Miller, Coeur d'Alene, for defendants-respondents, Marilyn J. and John Doe Cooper. Ausey H. Robnett, III, argued.

Lukins & Annis, Coeur d'Alene, for defendants-respondents, Christine and Michael Watson. Charles W. Hosack, argued.

BISTLINE, Justice.

This is a wrongful death action brought by the personal representative of Cori Lloyd on behalf of her estate and two surviving minor children, Alan Lloyd and Alicia Lloyd. Cori Lloyd died from injuries sustained in an automobile/motorcycle collision that occurred in Kootenai County on May 13, 1984.

Robert and Marilyn Cooper owned and operated the Rainbow Inn prior to February 21, 1984. Marilyn Cooper had obtained a renewal of her retail alcoholic beverage license authorizing her to sell alcoholic beverages at the Rainbow Inn. On February 21, 1984, the Coopers, having earlier filed a petition in bankruptcy, entered into a lease/option to purchase agreement with Michael and Christine Watson under the terms of which the Watsons took possession of the real estate, fixtures, and inventory of the Rainbow Inn. The Watsons hired their own employees and operated the business as a tavern under the lease provisions of the agreement from that date through May 17, 1984. The Coopers were not involved in the operation of the business after the Watsons took possession. It is apparent, however, that the only liquor license for the premises, and under which it was operated, was in the name of Marilyn J. Cooper.

On May 13, 1984, after patronizing the Rainbow Inn, Perry Bisher left the tavern and drove his motor vehicle on state highway 53. Bisher's headlights were not working at the time, approximately 9 p.m., but Bisher believed there was sufficient remaining daylight in which to drive home. The motorcycle on which Cori Lloyd was a passenger pulled out to pass a third vehicle and collided with the oncoming light-less Bisher vehicle.

The respondents Coopers and Watsons filed respective motions for summary judgment with Judge Magnuson. Judge Magnuson granted the Coopers' motion for summary judgment on the basis that they did not retain any power to control the Watsons' activities, and therefore had no opportunity to prevent the harm alleged in the appellant's complaint. Judge Magnuson determined that liability could not be imposed on the Coopers solely on the basis that the license to sell alcohol at the Rainbow Inn was in the name of Marilyn Cooper.

The trial court also granted the Watsons' motion for summary judgment on the basis that Idaho did not, at that time, recognize an action at common law for bar owner or operator liability to third persons injured by intoxicated patrons of a bar. The Court recognized that our legislature had since passed a Dram Shop Act, ¹ but ruled that the statute had no retroactive effect.

This appeal requires us to address the following issues:

1. Whether the trial court erred in granting summary judgment to the Watsons on the basis that Idaho did not recognize a common law action against a vendor of alcohol for injuries to a third party on May 13, 1984.

2. Whether the trial court erred in granting summary judgment to the Coopers on the basis that the Coopers exercised no control over the operation of the Rainbow Inn, even though Marilyn Cooper was the record holder of the Rainbow Inn's liquor license.

I.

In ruling that Idaho did not recognize a common law action against a vendor of liquor for injuries to a third party on May 13, 1984, the trial court incorrectly relied upon Meade v. Freeman, 93 Idaho 389, 462 P.2d 54 (1969). The court reasoned that Alegria v. Payonk, 101 Idaho 617, 619 P.2d 135 (1980), merely created an exception to the prior rule of no liability established in Meade.

However, we agree with Justice Johnson's special concurrence in the Court's more recent opinion, Bergman v. Henry, 115 Idaho 259, 766 P.2d 729 (1988), wherein it is stated that Bergman effectively overruled Meade. 115 Idaho at 262-63, 766 P.2d at 732-33. The central holding of Bergman is that "[A] cause of action does lie against a licensed vendor of spirits for negligently continuing to serve alcoholic beverages to an obviously intoxicated adult." 115 Idaho at 262, 766 P.2d at 732. Since Alegria imposed liability for serving a minor, and Bergman imposes liability for service to an obviously intoxicated adult, no part of the rule of Meade remains. Bergman overruled Meade.

We see no reason why an unlicensed seller, here the Watsons operating a tavern, should escape the liability imposed upon, and the duty of care required of, a licensed seller. The hazard to be guarded against is the same, that of unleashing an obviously intoxicated adult or minor upon the highways. Bolstering this view are Idaho Code §§ 23-603, -605, two very broadly worded statutes both of which provide for punishment as a misdemeanor for service to a minor or an obviously intoxicated adult by any person:

Idaho Code § 23-603. Disposal to minor. Any person who shall sell, give, or furnish, or cause to be sold, given, or furnished alcoholic or intoxicating liquor to a person under the age of 21 years, except for medicinal purposes, shall be guilty of a misdemeanor. A second or subsequent violation of this section by the same defendant shall constitute a felony. (Supp.1988). (Emphasis added.)

Idaho Code § 23-605. Disposing to drunk.--Any person who sells, gives or dispenses any alcoholic or intoxicating liquor to another person who is intoxicated or apparently intoxicated shall be guilty of a misdemeanor. (1977). (Emphasis added.)

Thus, as to the Watsons, this case must be remanded to the district court for application of the rule of Bergman v. Henry noted above.

II.

The trial court also erred in granting summary judgment to the Coopers on the basis that they exercised no control over the operation of the tavern, even though Marilyn Cooper was the record holder of the Rainbow Inn tavern's liquor license. This Court has recently and forcefully reaffirmed that the right to operate a tavern pursuant to a liquor license is personal to the record holder of the license. In Uptick Corp. v. Ahlin, 103 Idaho 364, 647 P.2d 1236 (1982), Justice Bakes, speaking for a four-judge majority wrote:

The purpose of the Retail Sale of Liquor-by-the-Drink Act, I.C. §§ 23-901 et seq., is to protect the health, welfare and safety of the people of the State of Idaho and promote and encourage temperance in the use of alcoholic beverages. (citations omitted). A person wishing to obtain a liquor license must submit an application to the Department of Law Enforcement, setting forth the applicant's qualifications and statements and information relative to the premises where the liquor is to be sold. I.C. § 23-905. Only after investigation of the applicant and a determination that the contents of the application are true, that the applicant is qualified and that the premises are suitable, may the director, in his discretion, issue a license. I.C. § 23-907. This application procedure and the procedure to be followed in transferring liquor licenses, see I.C. § 23-908, makes it clear that the legislature painstakingly attempted to ensure that the department have complete control over who may own a liquor license, and that only persons who could be depended upon to advance the policies of the act were entitled to a license.

In Nampa Lodge No. 1389 B.P.O.E. v. Smylie, 71 Idaho 212, 229 P.2d 991 (1951), this Court recognized the personal nature of liquor licenses and stated that a license is a privilege personal to the licensee. See also McBride v. Hopper, 84 Idaho 350, 372 P.2d 401 (1962). The right to sell spirits by retail is conferred upon the director's judgment of the ability and qualifications of the applicant to faithfully discharge the duties imposed on him or her. (citations omitted). Finally, the personal nature of the privilege to sell liquor by the drink can most clearly be seen upon reading I.C. § 23-908, which states in pertinent part that, "[e]very license issued under the provisions of this act is separate and distinct and no person except the licensee therein named except as herein otherwise provided shall exercise any of the privileges granted thereunder." The right to renew is included among the privileges appurtenant to a liquor license and is a privilege which is to be exercised exclusively by the named licensee. To hold otherwise would enable persons who have not subjected themselves to the scrutiny and approval of the director of the Department of Law Enforcement to acquire an interest in a license and circumvent the policy of the act that only qualified persons own licenses and exercise rights thereunder.

103 Idaho at 368-369, 647 P.2d at 1240-41 (emphasis added).

Thus, clear and unequivocal language of Uptick Corp. establishes that only named licensees may operate under the authority of the license. There is nothing in the record, and the Coopers have made no claim, to sustain a finding that Mrs. Cooper transferred her liquor license to the Watsons pursuant to the requirements of Idaho statutes. The relevant statutes must be complied with. McBride, supra. Thus, Mrs. Cooper cannot escape responsibility for the activities of a tavern which is operated under a license issued to her...