Grayson Fraternal Order of Eagles, Aerie No. 3738, Inc. v. Claywell

• Citation: 736 S.W.2d 328
• Decision Date: 24 September 1987
• Docket Number: No. 86-SC-832-DG,86-SC-832-DG
• Parties: GRAYSON FRATERNAL ORDER OF EAGLES, AERIE NO. 3738, INC., Appellant, v. Patricia CLAYWELL, Individually and as Administratrix of the Estate of Jack D. Claywell; and Rick May and Larry Whitt, Appellees.
• Court: United States State Supreme Court — District of Kentucky

Page 328

736 S.W.2d 328

GRAYSON FRATERNAL ORDER OF EAGLES, AERIE NO. 3738, INC. Appellant, v. Patricia CLAYWELL, Individually and as Administratrix of the Estate of Jack D. Claywell; and Rick May and Larry Whitt, Appellees.

No. 86-SC-832-DG.

Supreme Court of Kentucky.

Sept. 24, 1987.

David R. Reeves, Grayson, for appellant.

Edwin J. Walbourn, III, Ashland, for appellee, Claywell.

Mark Webster, Hollis L. Searcy, Amshoff, Amshoff & Searcy, Louisville, for appellee, May.

Robert W. Miller, Grayson, for appellee, Whitt.

LEIBSON, Justice.

The issue in this case is whether and under what circumstances one may recover damages against a dram shop furnishing intoxicating liquor to a person actually or apparently under the influence of alcoholic beverages, who, because of his intoxicated condition, subsequently injures a third party. Otherwise stated, does a claim grounded in common law dram shop liability state a cause of action?

The trial court held that it did not, and sustained a motion to dismiss the complaint upon grounds that it failed to state a claim upon which relief can be granted. CR 12.02. The Court of Appeals reversed, and we have accepted discretionary review to consider the question.

This case arises out of a motor vehicle collision on June 16, 1983, at the intersection of U.S. 60 and Robert and Mary Streets in Carter County, Kentucky. The complaint, as amended, seeks damages against the appellant, Grayson Fraternal Order of Eagles, Aerie No. 3738, Inc. ("Eagles Club"), and its bartender, Larry Whitt, for negligence in the unlawful sale of alcoholic beverages to a patron of the club who then had an automobile accident because he was intoxicated. It is alleged that the Eagles Club was engaged in the sale of alcoholic beverages for profit in dry territory, that it served alcoholic beverages to Jacky Kevin Bailey and Homer Craig Horton, Jr., who became intoxicated thereby, and that upon leaving the premises of the Eagles Club and as a direct consequence of this overconsumption of alcoholic beverages, Horton (or Bailey) then proceeded to operate Horton's automobile carelessly, negligently, recklessly and wantonly and collided with a police car operated by Officer Claywell in which Officer May was a passenger. As a result Claywell was killed and May sustained serious and substantial personal injuries.

The deposition of Larry Whitt, the bartender in charge of the Eagles Club at the time, is part of the record. He testified as follows in pertinent part: (1) Horton was already "a little tight" when he came to the Eagles Club, and he was "very drunk" when he left; (2) Horton and Bailey were each served beer followed by "four or five double shots of whiskey" over a period of about "an hour and a half" while at the club; (3) the bartender literally forced these two out of the bar so that he could close up and then forced them to get into Horton's car and leave the parking lot so that he could close the gate; (4) and Horton, who was driving, almost ran down Whitt with his car as he was departing the premises of the Eagles Club. Whitt further testified that the Eagles Club sells alcohol for a profit across the bar "just like at any other bar."

The appellees claim that the complaint states a cause of action in common law negligence, and the Court of Appeals agrees. On its face, the complaint contains the usual elements for a cause of action, charging negligence, proximate cause from a foreseeable risk of harm, and subsequent injury. However, the appellant claims that regardless of negligence, we should be bound by an archaic common law doctrine The historical basis for this ancient rule, as with many others, lies with the old English writ system, which only selectively recognized a duty and provided a remedy at the King's pleasure. The writ system has been long since discarded as the basis for the tort system, replaced in the main with the negligence concept. As stated in Gas Service Co., Inc. v. City of London, Ky., 687 S.W.2d 144, 148 (1985), paraphrasing Tort Law in America, An Intellectual History, by G.E. White, pp. 17-18 (1980):

                now overwhelmingly rejected by our sister states, 1 that "no cause of action existed against one furnishing liquor in favor of those injured by the intoxication of the person so furnished."   See 97 A.L.R.3d 528, 533
                

"The concept of liability for negligence expresses a universal duty owed by all to all. The duty to exercise ordinary care commensurate with the circumstances is a standard of conduct that does not turn on and off depending on who is negligent."

Nevertheless, in the present case, appellant argues as an historical premise that there is no duty owed by the tavern owner to the person subsequently injured, regardless of negligence, foreseeability and proximate cause. Prosser discusses the "artificial character" of reasoning from the premise of "no duty" in disregard of negligence principles in these words:

"The statement that there is or is not a duty begs the essential question--whether the plaintiff's interests are entitled to legal protection against the defendant's conduct.... It is a shorthand statement of a conclusion, rather than an aid to analysis in itself.... [I]t should be recognized that 'duty' is not sacrosanct in itself, but is only an expression of the sum total of those considerations of policy which lead the law to say that the plaintiff is entitled to protection." Prosser and Keeton on The Law of Torts, Sec. 53, 357-58 (5th ed. 1984).

It is a subject of controversy in this case as to whether or not it was ever the rule in this jurisdiction that, regardless of circumstances, a tavern owner had no liability for injuries subsequently caused by intoxication, and whether or not, if it ever was the rule, this rule has already been rejected by our Court in Pike v. George, Ky., 434 S.W.2d 626 (1968). The appellant argues that the Pike case restates an earlier "no liability" rule, and, indeed, the case refers to an earlier rule without expressly overruling it. Nevertheless, when one analyzes the earlier cases (see infra ) it is debatable that we ever applied an absolute "no liability" rule, and in Pike we reversed the decision of a trial court to dismiss for failure to state a cause of action, holding that a complaint that charged a tavern owner with liability for subsequent injuries resulting when he negligently and illegally sold alcoholic beverages to a minor was sufficient. Indeed, Kentucky is listed among the states recognizing common law dram shop liability in the article previously cited, 97 A.L.R.3d 528 at Sec. 6[a], and in a multitude of other law review articles and case appendices attempting to list states which recognize common law dram shop liability, and states which do not. See, e.g., Beitman, Dram Shop Liability, Trial, March 1985 at 38-40; Ling v. Jan's Liquors, 237 Kan. 629, 703 P.2d 731 (1985); and Sorensen v. Jarvis, 119 Wis.2d 627, 350 N.W.2d 108 (1984).

While it is true that Pike v. George, supra, involved illegal sale of intoxicating liquor to a minor, whereas the present case involves sale to an intoxicated person, it is arbitrary to make a distinction on this basis, and textbook authorities have not done so. See Prosser and Keeton, supra at 718. The operative facts continue to be proof of negligent conduct, foreseeability and proximate cause. Kentucky now defines proximate cause in the terminology of "a substantial factor" in causing the event which occasions the injury. Claycomb v. Howard, Ky., 493 S.W.2d 714, 718 (1973); Collins It is questionable that there ever was a blanket common law rule of nonliability for a tavern owner who illegally sells alcohol in Kentucky. The authority cited for such a rule is a case now 76 years old, Britton's Adm'r v. Samuels, 143 Ky. 129, 136 S.W. 143 (1911), which denied the right to sue to the family of a man who drank himself to death, stating that "death was produced, not by the sale [of the liquor], but by the drinking thereof by deceased." Nevertheless, the court indicated that there would, perhaps, be a cause of action if the widow established that the sale was made for the purpose of injuring her husband or with the knowledge that her husband intended to drink the alcohol to such an extent as to produce injury, or if the seller had reason to believe that the purchaser could not be safely trusted with whiskey.

v. Galbraith, Ky., 494 S.W.2d 527, 530 (1973).

Another 1911 case, Waller's Adm'r v. Collinsworth, 144 Ky. 3, 137 S.W. 766 (1911), like Britton's Adm'r, supra, held that the plaintiff had failed to state a cause of action for wrongful death against a tavern keeper, but, again, with reservations. The defendant unlawfully sold intoxicating liquor to one who thereby became intoxicated and, after leaving the defendant's premises, shot and killed the plaintiff's decedent. The court stated that the inquiry "in every case" is whether the injury was a natural and probable consequence of the wrongful act and whether the injury ought to have been foreseen in light of the attendant circumstances. This suggests that in a case such as the present one where it is claimed that there is ample evidence from which it could be inferred that the probable consequences from further intoxication were reasonably foreseeable, a different result should obtain.

The most important consideration in reviewing these earlier cases is that there is a qualitative difference between the present situation and the circumstances at the turn of the century, a difference that is critical to the foreseeability question. That change in circumstances has been brought about by the advent of the principle instrument of death and destruction of our day, the highspeed automobile. As stated in Lopez v. Maez, 98 N.M. 625, 651 P.2d 1269, 1276 (1982), wherein New Mexico discarded the anachronistic rule of nonliability:

"In light of the use of automobiles and the increasing frequency of accidents involving drunk drivers,...