DRAM SHOP ACT
&
PREMISES LIABILITY
FOR BAR AND TAVERN OWNERS
BY
CHRISTOPHER J. FORREST
BENJAMIN E. CURRIER
MILLER & STEIERT, P.C.
1901 W. LITTLETON BLVD.
LITTLETON, CO. 80120
303-798-2525
C.R.S. § 12-47-801
DRAM SHOP ACT
• No licensee is civilly liable to an individual due
to sale or service of alcohol, except when:
– Licensee willfully and knowingly has sold or served
alcohol to
• A person under 21, OR
• A person who was visibly intoxicated
POSITIVE ATTRIBUTES OF THE STATUTE
• 3rd Party Liability limited to $280,810.00 (per
person injured).
• Statute of limitations is 1 year.
• No claims by the person who is sold the
alcoholic beverage or his or her estate – only
third persons.
• Must show high level of intent – willful and
knowing service – but can be proved by
circumstantial evidence
LIABILITY
If the licensee willfully and knowingly sells to:
• Person under 21, OR
• Person who was visibly intoxicated
Licensee will be responsible for damages to third persons, even if the
conduct was unforeseeable, impossible to predict.
BUILD IT AND THEY WILL DRINK, INC. V. STRAUCH
BUILD IT AND THEY WILL DRINK, INC. V. STRAUCH
COLORADO SUPREME COURT DECISION – 2011
Facts
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New Year’s Eve Party at club.
Dickerman bought VIP Lounge Package – Comp. Champagne, unlimited bottle
service, access to VIP room with unsupervised self-service bar.
Guests told to mix their own drinks.
Employees were monitoring doorways and checking wristbands.
Witnesses testified that patrons in general were:
– Stumbling into walls, falling down, throwing drinks, vomiting, taking off
clothes, passing out!
Dickerman was escorted from nightclub for breaking a light fixture, yelling at
patrons and vomiting.
Dickerman was then RE-ADMITTED to club.
Strauch leaves club with his date and about a block-and-a-half away Dickerman
comes screaming behind him yelling obscenities wielding a knife.
Dickerman then stabs Strauch, severely injuring him.
There was no evidence that Strauch and Dickerman had been involved in any
confrontation in the bar.
MAJOR NEW HOLDING OF BUILD IT:
Foreseeability that sale of alcohol would lead to the specific
resulting injury is not necessary to establish liability!
• Licensee who violates Dram Shop Act may be liable for a wide range of
unpredictable injuries to a third person that result from the
intoxicated person’s conduct.
Build It and They Will Drink, Inc. v. Strauch, 253 P.3d 302 (Colo. 2011)
• Build It left open the possibility of separate
premises liability claims against a bar owner.
PREMISES LIABILITY
• Three types of persons on premises:
– Trespasser – enters or remains on land without
consent (duty not to willfully or deliberately
injure).
– Licensee – enters or remains on land for licensee’s
convenience pursuant to landowner’s consent
(duty to warn against dangers actually known).
– Invitee (bar/tavern customers) – enters or
remains on land to transact mutually beneficial
business or at owner’s representation that public
is requested or expected to remain.
PREMISES LIABILITY (CONT.)
• Tenant may be a “landowner” for purpose of
premises liability – Sundheim v. Board of County
Commissioners, 904 P.2d 1337, 1350 (Colo. App. 1995)
• No caps on economic damages for premises
liability suits.
• Caps or non-economic losses (pain and
suffering) are higher than Dram Shop Act =
$468,010.00
INVITEE/CUSTOMER
• Business Owner’s Obligation to an Invitee (customer) –
Duty to take reasonable steps to protect against
dangers known or should have known.
– Examples:
 Lombard v. Colorado Outdoor Education Center, Inc., 187 P.3d 565 (Colo. 2008) – Ladder
to loft not built to code – Supreme Court held that building code violation can be used
to prove knowledge of danger. “Land owner could be liable to a plaintiff under the
premises liability statute if the landowner had constructive notice of a danger”
 Observatory Corp. v. Daly, 780 P.2d 462 (Colo. 1989) – Assault by one bar patron against
another - Plaintiff must prove that patron “constituted an unreasonable risk of harm to
persons legitimately on the tavern premises.”
 Taco Bell, Inc. v. Lannon, 744 P.2d 43 (Colo. 1987) – Armed Robbery - “Fast food
restaurant had legal duty to take reasonable measures to protect its patrons from
consequences of criminal acts on part of unknown third persons, where there had been
ten armed robberies at particular restaurant in three previous years”
OTHER CONDITIONS WHICH MAY IMPLICATE
PREMISES LIABILITY STATUTE
• Spilled milk
– Lawson v. Safeway, Inc., 878 P.2d 127 (Colo. App. 1994)
• Melting snow on steps
– Henderson v. Master Klean Janitorial, Inc., 70 P.3d 612 (Colo. App. 2003)
• Dog bites
– Wilson v. Marchiondo, 124 P.3d 837 (Colo. App. 2005)
• Flying hockey pucks
– Tenyck v. Roller Hockey Colorado, Ltd., 10 P.3d 707 (Colo. App. 2000)
• Sponsored activities – towing an inner-tube
around a frozen lake.
– Wycoff v. Grace Community Church of the Assemblies of God, 251 P.3d
1260 (Colo. 2010)
PREMISES LIABILITY V. DRAM SHOP ACT
• Even though Dram Shop Act states that it is an
exclusive remedy, the Build It case from the
Colorado Supreme Court indicates that
separate premises liability claims (with risk of
higher damage claims) may still be pursued
against a tavern owner.
RECENT TRENDS WITH LOCAL LIQUOR
LICENSING AUTHORITIES