Smith v. Teel

• Citation: 2008 OK CIV APP 7,175 P.3d 960
• Decision Date: 15 November 2007
• Docket Number: No. 104,640. Released for Publication by Order of the Court of Civil Appeals of Oklahoma, Division No. 1.,104,640. Released for Publication by Order of the Court of Civil Appeals of Oklahoma, Division No. 1.
• Parties: Charles SMITH, Surviving Spouse of Sabrina Smith, deceased, Plaintiff/Appellant/Counter-Appellee, v. Stephen G. TEEL, individually, and as Manager/Owner of Kongo's, and Jay Williams, as Manager/Owner of Kongo's, Defendants/Appellees, and Kongo's L.L.C., an Oklahoma limited liability corporation,<SMALL><SUP>1</SUP></SMALL> Defendant/Appellee/Counter-Appellant.
• Court: United States State Court of Criminal Appeals of Oklahoma. Court of Civil Appeals of Oklahoma

175 P.3d 960

2008 OK CIV APP 7

Charles SMITH, Surviving Spouse of Sabrina Smith, deceased, Plaintiff/Appellant/Counter-Appellee, v. Stephen G. TEEL, individually, and as Manager/Owner of Kongo's, and Jay Williams, as Manager/Owner of Kongo's, Defendants/Appellees, and Kongo's L.L.C., an Oklahoma limited liability corporation,¹ Defendant/Appellee/Counter-Appellant.

No. 104,640. Released for Publication by Order of the Court of Civil Appeals of Oklahoma, Division No. 1.

Court of Civil Appeals of Oklahoma, Division No. 1.

November 15, 2007.

Certiorari Denied January 14, 2008.

Appeal from the District Court of Cleveland County, Oklahoma; Honorable William C. Hetherington, Judge.

AFFIRMED

Robert J. Haupt, John W. Cloar, Kathleen J. Adler, Shannon C. Smith, Leonard & Associates, P.L.L.C., Oklahoma City, Oklahoma, for Plaintiff/Appellant/Counter-Appellee.

Gregory T. Tontz, Norman, Oklahoma, for Defendants/Appellees/Counter-Appellants.

KENNETH L. BUETTNER, Judge.

¶ 1 Plaintiff/Appellant/Counter-Appellee Charles Smith, surviving spouse of Sabrina Smith, appeals summary judgment entered in favor of Defendants/Appellees Stephen G. Teel and Jay Williams. Defendants Teel, Williams, and Kongo's L.L.C. filed a joint motion for summary judgment. In its Journal Entry, filed April 5, 2007, the trial court granted the motion as to Teel and Williams (collectively, "Defendants"), but overruled it as to Defendant/Appellee/Counter-Appellant Kongo's L.L.C. (Kongo's).² Smith's claims were for the wrongful death of his wife, who died after the car in which she was riding was hit by a drunk driver who had just left Kongo's. The undisputed facts in the record on appeal do not show that Defendants personally served alcohol to a noticeably intoxicated person who caused Smith's injury, nor do the facts show that Defendants may be personally liable for claims against the limited liability company, Kongo's. Defendants were entitled to judgment as a matter of law and we affirm.

¶ 2 Summary judgment proceedings are governed by Rule 13, Rules for District Courts, 12 O.S.2001, Ch. 2, App.1. Summary judgment is appropriate where the record establishes no substantial controversy of material fact and the prevailing party is entitled to judgment as a matter of law. Brown v. Alliance Real Estate Group, 1999 OK 7, 976 P.2d 1043, 1045. Summary judgment is not proper where reasonable minds could draw different inferences or conclusions from the undisputed facts. Id. Further, we must review the evidence in the light most favorable to the party opposing summary judgment. Vance v. Fed. Natl. Mortg. Assn., 1999 OK 73, 988 P.2d 1275.

¶ 3 Smith filed his Petition March 29, 2006. He alleged that on October 10, 2004, his wife, Sabrina Smith, was a passenger in a car stopped at a traffic light in Norman when the car was struck from behind by a car driven by Regina Bedell. Smith alleged that the collision occurred immediately after Bedell left Kongo's, after spending nearly seven hours drinking alcohol at Kongo's. Sabrina Smith died about nine hours after the collision.

¶ 4 Smith asserted that Defendants, as managers and owners of Kongo's, were present at Kongo's on October 10, 2004, held Oklahoma liquor licenses, and had a statutory and common law duty to exercise care in operating Kongo's and in selling alcohol to the public. Smith asserted that Defendants knew or should have known that Bedell was noticeably intoxicated October 10, 2004, and that Defendants and Kongo's continued to sell alcohol to Bedell for her consumption.

¶ 5 Defendants filed their Motion for Summary Judgment January 9, 2007. They noted that all public records about the collision indicated it occurred October 24, 2004, rather than October 10. Defendants listed 30 undisputed material facts.³

¶ 6 Defendants noted that in Oklahoma, commercial vendors of alcohol sold for on-premises consumption may be liable where the vendor failed to exercise reasonable care not to sell liquor to a noticeably intoxicated person, citing Brigance v. Velvet Dove Restaurant, Inc., 1986 OK 41, 725 P.2d 300. But, Defendants contended that it was undisputed that neither Teel nor Williams served alcohol to Regina Bedell while she was noticeably intoxicated. Defendants based this assertion on testimony from Bedell's husband that he purchased drinks for Bedell, and then two men who joined the Bedells purchased drinks for Regina Bedell. Defendants further relied on Bedell's husband's testimony that Bedell did not show visible signs of intoxication while she was at Kongo's. Bedell's husband testified that Bedell sat at a table and did not interact with any Kongo's staff. Defendants asserted that Smith was required to present evidence of Bedell's demeanor, actions, or physical state as observed or observable by Defendants in order to avoid summary judgment on a claim of selling alcohol to a visibly intoxicated person, citing Battles v. Cough, 1997 OK CIV APP 62, ¶ 18, 947 P.2d 600. Defendants also argued the fact that Bedell was involved in the collision and was convicted of driving while intoxicated after leaving Kongo's was not sufficient to create an issue of fact as to whether she was noticeably intoxicated at Kongo's, citing Battles, supra, and similar cases. Defendants distinguished cases where the evidence showed the intoxicated person was loud and boisterous before leaving the alcohol-vendor's premises. Bennett v. Covergirls, 1999 OK CIV APP 3, 973 P.2d 896; McGee v. Alexander, 2001 OK 78, 37 P.3d 800. Defendants asserted Smith had failed to present any evidence of similar loud or boisterous behavior by Bedell at Kongo's.

¶ 7 Defendants next claimed they were entitled to summary judgment because neither of them personally served alcohol to Bedell or any other person at Kongo's, and they were immune from liability for the obligations of Kongo's, pursuant to 18 O.S.2001 § 2022. Defendants averred that Oklahoma has not addressed piercing the veil of protection offered by a limited liability company to hold individuals liable for damages arising from the sale of alcohol. Defendants cited two Oklahoma cases in which the plaintiff sought to pierce the corporate veil in a case arising out of the sale of alcohol to an intoxicated person. See King v. Modern Music Co., 2001 OK CIV APP 126, 33 P.3d 947 and Pate v. Alian, 2002 OK CIV APP 68, 49 P.3d 85. In King, this court held that where there was no evidence the individual corporate owners personally served the alcohol to the intoxicated person who caused the damage, nor did the owners know that their employee would serve an intoxicated person, there was no basis to pierce the corporate veil. The court explained that the Brigance holding was based on public policy grounds, and found that extending the Brigance rule by holding individual corporate owners, who did not serve the noticeably intoxicated person, was error. Defendants argued also that the undisputed evidence showed neither of them personally leased the space Kongo's occupied, was employed by Kongo's, served food or drinks there, supervised employees, received money or benefit from the sale of alcohol, nor was present at Kongo's on the night of the collision. Defendants asserted there was no evidence showing either of them failed to abide by the Kongo's operating agreement. Finally, Defendants asserted there was no evidence that they were ever on notice that Kongo's may have sold alcohol to an intoxicated person, or that they knew or should have known that Kongo's would sell alcohol to a noticeably intoxicated person.

¶ 8 In his response, Smith first urged the trial court to strike each affidavit offered in support of the motion for summary judgment, because the affidavits do not state they are based on personal knowledge nor that the affiant is competent to testify.⁴ The challenged affidavits are sworn under oath, as required by 12 O.S.2001 § 422. Rule 13 does not require the affidavits to state they are based on personal knowledge. The affidavits appear to be made on personal knowledge; each includes declarations of the affiant's actions and observations. Additionally, although the affidavits do not express that the affiant is competent to testify, Smith has not suggested that each affiant was not in fact competent to testify: The Oklahoma Evidence Code provides that every person is competent to be a witness, except as provided in the Code. 12 O.S.2001 § 2601. And Rule 13 provides that the court may rule on a request to strike affidavits in support of summary judgment. We find no abuse of discretion in the trial court's decision not to rule on Smith's request.

¶ 9 Additionally in his objection to summary judgment, Smith denied Defendants' material facts numbered 4, 8-12, 14-18, 20-23, and 25-31. However, Smith did not present evidence showing a dispute of any material facts as to the liability of Teel or Williams.⁵

¶ 10 Specifically, Smith repeated his claim that Bedell must have been visibly intoxicated when she left Kongo's because she first collided with a car in the Kongo's parking lot, before driving out of the lot and onto the street where, "a little over half a mile from" Kongo's, she hit the car containing Smith's wife. Smith's response averred, however, that "(n)one of Kongo's alleged security guards or staff saw or noticed how intoxicated Regina Bedell was prior to her collision with a parked vehicle." Smith complained that the parking lot video tapes no longer existed. Smith further asserted that Bedell ran from the scene and police did not arrest her until 3 or 4 days later.

¶ 11 Smith asserted that Teel was the manager of Kongo's, based on Teel's signature as manager and owner, on Kongo's liquor license application. Smith claimed therefore that Teel lied either to the ABLE Commission or in his deposition testimony, where he claimed he was not the manager of Kongo's. Smith also claimed that 37 O.S. 2001 § 523.2(B) requires a limited liability company to notify the ABLE...