Assigned to JUD                                                                                                          AS PASSED BY THE SENATE

ARIZONA STATE SENATE

Forty-seventh Legislature, Second Regular Session

AMENDED

FACT SHEET FOR H.B. 2621

illegal liquor sales; liability

Purpose

            Limits the type of knowledge a licensee may be charged with and what the trier of fact may consider in a dram shop liability case.

Background

            The Arizona Department of Liquor Licenses and Control (ADLLC) is responsible for administering and enforcing state liquor laws.  Its mission is to protect the health, safety and welfare of Arizona citizens by licensing the liquor industry and assuring compliance with state liquor laws through enforcement, training and adjudication.  All businesses that produce, distribute or sell spirituous liquor throughout the state are required to have a liquor license.  As of July 2004, 10,050 liquor licenses existed in Arizona.  There are many different types of liquor licenses.  The most common of these is the restaurant license (Series 12) and as of July 2004, ADLLC had issued 2,334 restaurant licenses.  In order to hold a restaurant license, the establishment must have kitchen facilities connected with the restaurant for keeping, cooking and preparing foods required for ordinary meals and must derive at least 40 percent of its revenue from the sale of food (A.R.S. § 4-205.02).  ADLLC periodically may require a restaurant to submit an audit of its records to demonstrate compliance with the restaurant license.  If the audit reveals that the licensee did not obtain at least 40 percent of its revenues from food sales, ADLLC must revoke the license (A.R.S. § 4-213).

            Statute provides that if any liquor licensee sold alcohol to a person who was obviously intoxicated or to a person who was under the age of 21 without asking for proof of the person’s age, the person consumed the alcohol and the consumption of the alcohol was the proximate cause (primary cause) of an injury, death or property damage, then the licensee is liable for the property damage, personal injuries or is liable to a person who may bring an action for wrongful death.  These types of laws are often referred to as “dram shop liability laws.”  Forty states have dram shop liability laws (The Marin Institute).

            There is no anticipated fiscal impact associated with this legislation.

Provisions

1. Prohibits a liquor licensee from being charged with knowing that a person has become intoxicated at other locations unless the person was obviously intoxicated.

2. Prohibits the trier of fact from considering any information obtained as a result of a restaurant audit in a dram shop liability case, unless the court finds it relevant.

3. Makes technical and conforming changes.

4. Becomes effective on the general effective date.

Amendment Adopted by Committee

· Removes the provisions regarding negligence per se and the requirement that the finder of fact consider all circumstances in determining negligence.

Amendments Adopted by Committee of the Whole

· Prohibits the trier of fact from considering certain information in a dram shop liability case unless the court finds it relevant.

House Action Senate Action

COM               2/1/06     DP    6-1-0-2                        JUD                 3/20/06     DPA     7-0-1-0

3rd Read         3/2/06              41-15-4-0                    3rd Read         5/3/06                    27-2-1-0

Prepared by Senate Research

May 3, 2006

JE/ac