Texas Dram Shop Laws and Alcohol Related Accidents

What Is a Dram Shop Claim in Texas

A dram shop claim is a legal action brought against a business that sells or serves alcoholic beverages when that business's service of alcohol contributed to an accident. The term "dram shop" dates back to 18th-century establishments that sold gin by a unit of measure called a "dram." Today, dram shop laws apply to any licensed provider of alcoholic beverages, including bars, restaurants, nightclubs, hotels, sports venues, and liquor stores.

In Texas, the dram shop cause of action is codified in the Texas Alcoholic Beverage Code, Chapter 2. Section 2.02 establishes that a licensed provider of alcoholic beverages may be held liable for damages caused by the intoxication of another person if the provider served alcohol to the person when it was apparent to the provider that the individual was obviously intoxicated to the extent that he presented a clear danger to himself and others.

The Two Requirements for a Texas Dram Shop Claim

Texas dram shop liability requires proof of two elements.

1. The Person Was Obviously Intoxicated
The plaintiff must prove that the person who caused the accident was "obviously intoxicated" at the time they were served. Under Section 2.02 of the Texas Alcoholic Beverage Code, obvious intoxication means intoxication "to the extent that he presented a clear danger to himself and others."
This is a high standard. It is not enough to prove that the person had been drinking or even that they were legally intoxicated. The plaintiff must show visible, outward signs of intoxication that would have been apparent to the server. These signs might include slurred speech, unsteady gait, bloodshot eyes, loud or aggressive behavior, difficulty with coordination, or other observable indicators that the person was clearly impaired.

2. The Establishment Served Alcohol Anyway
The plaintiff must also prove that the establishment actually served the person alcohol despite these obvious signs of intoxication. If the person became intoxicated from alcohol consumed elsewhere and the establishment did not serve them, there is no dram shop liability.
Evidence of service can come from receipts, credit card records, bartender or server testimony, surveillance footage, and witness statements from other patrons. In many cases, the most powerful evidence is video from the establishment's own security cameras showing the visibly intoxicated person being served additional drinks.

Why Dram Shop Claims Matter in Drunk Driving Accident Cases

Drunk drivers frequently carry minimum liability insurance or have no insurance at all. A driver with a $30,000 policy limit cannot adequately compensate a victim who has suffered catastrophic injuries. In these situations, a dram shop claim against the bar or restaurant that over-served the driver can provide an additional source of recovery.

Commercial establishments that serve alcohol are typically required to carry liquor liability insurance, and many carry substantial coverage. A successful dram shop claim can significantly increase the total compensation available to the victim.

Dram shop claims also serve an important public safety function. By holding establishments financially accountable for over-serving visibly intoxicated patrons, the law creates a financial incentive for bars and restaurants to train their staff properly and cut off service when a customer has had too much.

Social Host Liability in Texas

Texas dram shop law treats commercial providers and social hosts differently. Under Section 2.02 of the Texas Alcoholic Beverage Code, only a "provider" who holds a license or permit to sell alcoholic beverages can be held liable under the dram shop statute.

A social host, meaning a person who serves alcohol at a private party or gathering, is generally not liable under Texas law for injuries caused by an intoxicated guest. The Texas Supreme Court addressed this issue in *Graff v. Beard*, 858 S.W.2d 918 (Tex. 1993), holding that social hosts are not subject to dram shop liability because they are not "providers" within the meaning of the statute.

The one exception involves furnishing alcohol to a minor. Under Section 2.02(c) of the Alcoholic Beverage Code, an adult who is not a licensed provider may be liable if they provide alcohol to a minor (under 18 years of age) and the minor's intoxication causes damage to a third party.

The Statute of Limitations for Dram Shop Claims

The statute of limitations for a Texas dram shop claim is two years from the date of the injury, the same as the general personal injury statute of limitations under Texas Civil Practice and Remedies Code Section 16.003. However, because dram shop cases require extensive investigation to identify the establishment, gather service records, and obtain surveillance footage before it is deleted, it is critical to begin the investigation as soon as possible after the accident.

Many establishments retain surveillance footage for only 30 to 90 days before it is overwritten. Your attorney should send a preservation letter to the establishment immediately after the accident to ensure that this critical evidence is not destroyed.

Building a Strong Dram Shop Case

A successful dram shop claim requires thorough investigation. Your attorney will need to identify every establishment where the intoxicated driver consumed alcohol before the accident, obtain the driver's bar tab, credit card receipts, and any loyalty program records, subpoena the establishment's surveillance footage, interview bartenders, servers, and other patrons, review the establishment's training records and TABC (Texas Alcoholic Beverage Commission) compliance history, and obtain the driver's blood alcohol content results from law enforcement.

Expert testimony is often important in dram shop cases. A toxicology expert can testify about the driver's likely level of intoxication at the time they were served based on their blood alcohol content at the time of the accident. A hospitality industry expert can testify about the standard of care for alcohol service and whether the establishment's staff should have recognized the signs of obvious intoxication.

Damages in a Dram Shop Case

The damages available in a Texas dram shop case are the same as in any personal injury case. They include past and future medical expenses, lost wages, loss of earning capacity, physical pain and suffering, mental anguish, disfigurement, physical impairment, and, in appropriate cases, exemplary (punitive) damages.

Punitive damages may be available in dram shop cases when the establishment's conduct was especially reckless, such as serving a customer who was staggering drunk or continuing to serve someone who had already caused a disturbance due to intoxication.

Contact Medina and Medina if You Were Injured by a Drunk Driver

If you were injured by a drunk driver in Texas, there may be more sources of compensation available to you than just the driver's insurance policy. A dram shop claim against the bar or restaurant that over-served the driver can provide the additional recovery you need to cover your medical bills, lost wages, and pain and suffering.

Call Medina and Medina at (512) 883-0012 for a free consultation. We will investigate every potential source of liability and fight to get you the full compensation you deserve. You pay nothing unless we win.