It's an all-too-common scenario. You're driving to the grocery store one afternoon. Without warning, a drunk driver plows into your car, causing you serious injuries. Once you've sufficiently recovered, you pursue a legal claim against the driver, only to discover that they were driving without insurance. Unfortunately, you didn't have uninsured motorist coverage. Do you have any legal options?
In Indiana, the answer might be yes. Like a majority of states, Indiana has enacted a liquor liability law—sometimes called a "dram shop" or "social host liability" law—that might cover situations like yours.
After a quick review of liquor liability laws in general, we'll take a look at Indiana's law.
It might surprise you to learn that as a general rule, absent a statute (or in a few states, a court decision) that creates legal responsibility, there's no liability for selling or furnishing alcohol, even to an underage or clearly drunk person. The rule in most states, even today, is simple: Alcohol-related accidents are caused by drinking alcohol, not by providing it.
Our hypothetical example above illustrates how this rule can create real hardship for someone injured by a drunk person. Fortunately, as of 2023, 43 states plus the District of Columbia have enacted liquor liability laws. These laws, which make those who sell or furnish liquor legally responsible for any resulting injuries, fall into two categories:
Long ago, inns and taverns sold liquor by a measurement called a "dram." This led to "dram shop," a term commonly used to describe a law making liquor retailers responsible, under some circumstances, for injuries caused by their customers. A typical dram shop law imposes liability when a liquor licensee—a person or business licensed by the state to make retail liquor sales—furnishes alcohol to an underage or obviously drunk customer, who then injures someone else.
While also common, social host liability laws aren't as widespread as dram shop laws. A "social host" is simply a person who hosts a party or similar get together. Liquor often flows freely and, on occasion, a guest gets drunk. If that guest then injures someone, and if the state has a social host liability statute, the host can be on the financial hook to pay compensation ("damages," in the language of the law) to the injured person.
Unlike most states, Indiana's liquor liability law doesn't distinguish between dram shops (meaning liquor retailers) and social hosts. The state has enacted a "one-size-fits-all" statute that covers both.
Ind. Code § 7.1-5-10-15.5 (2023) applies to any "person" who "furnishes" alcoholic beverages to another person. Liability under the statute arises when:
(See Ind. Code § 7.1-5-10-15.5(b) (2023).)
Proving actual knowledge can be tricky. It requires proof of what the person who furnished the alcohol actually knew, not simply what they should have known based on the circumstances. For instance, meeting this standard will require evidence that the person who was drinking:
Many states also impose liability for furnishing alcohol to underage drinkers, even if they're not intoxicated. But Indiana law doesn't make that distinction. Legal responsibility hinges solely on furnishing liquor to a visibly intoxicated person, regardless of whether that person was of legal drinking age.
There is one situation where the age of the person who was furnished alcohol matters. Under Indiana's statute, the person who was furnished alcohol is allowed to sue for injuries they suffered because of their own intoxication. If that person was at least 21 years old, they must prove the two elements described above (that is, actual knowledge of visible intoxication and proximate cause). (See Ind. Code § 7.1-5-10-15.5(c) (2023).)
The statute doesn't put the same burden on a person younger than 21 years old. Simply furnishing alcoholic beverages to an underage drinker is enough to create liability for harm they do to themselves.
After a long day of work, Dave stopped at Tina's Tavern on his way home. He had several drinks. Although the bartender, Tina, saw that Dave was slurring his speech and having difficulty walking, she continued to serve him alcohol. Many hours and more drinks later, Dave left the bar and got behind the wheel of his car. On his way home, Dave rear-ended a car driven by Pete, injuring him.
Pete can bring a claim against Dave for the injuries he suffered in the accident. Pete can also bring a dram shop claim against Tina's Tavern because Tina continued to serve Dave even after she had actual knowledge that Dave was visibly intoxicated.
Suppose that in the example above, Dave skipped Tina's Tavern in favor of attending a wine-tasting party held by Hannah, a friend from work. At the party, Dave had several glasses of wine. Hannah saw that Dave began slurring his speech and having trouble walking. Nevertheless, Hannah continued to refill Dave's glass. Later, Dave wandered out onto the deck, where he stumbled into Pete, knocking Pete off the edge of the deck and injuring him.
Pete likely can make a claim against Hannah for his injuries. Hannah saw that Dave was visibly intoxicated and yet she continued serving him, making her liable to Dave under Indiana law.
Dram shop and social host claims are civil lawsuits. If you win the case, you're entitled to collect money damages. Most often, you'll be awarded what the law calls "compensatory damages." As the name suggests, these damages are meant to compensate you for your injuries and losses, including:
Under Indiana law, a dram shop case is a type of personal injury claim. If you need to file your case in court, you must do so within Indiana's personal injury filing deadline, called the "statute of limitations."
You have two years, usually from the date of your injury, to file your dram shop or social host liability case in the proper Indiana court. (See Ind. Code § 34-11-2-4(a) (2023).) What happens if you miss the deadline? If you try to file your case after the statute of limitations has expired, then barring any exception, the court will have no choice but to dismiss your case. You won't be allowed to collect any compensation for your injuries.
It might seem that a dram shop or social host liability case would be straightforward and easy to win. More often than not, that isn't so. Because you must show what the person who served the alcohol actually knew, proving your case can be a challenge. In addition, you need to understand how Indiana courts have interpreted and applied the state's liquor liability statute in past cases like yours.
Your best chance for success will come from having experienced legal counsel on your side—someone who's handled many liquor liability cases and who understands Indiana law. When you're ready to move forward with your dram shop or social host liability claim, here's how to find a lawyer who's right for you.