Michigan's dram shop law: suing a bar or store that served an intoxicated driver

Michigan's dram shop law, MCL 436.1801, lets a person injured by a minor or a visibly intoxicated person sue the bar, restaurant or store that unlawfully sold, gave or furnished the alcohol, as long as that unlawful sale was a proximate cause of the injury.^[1] The claim comes with tight rules: the suit must be filed within 2 years, written notice must go to every defendant within 120 days after the injured person hires a lawyer for the claim, and the drinker must be named and kept in the case.^[2][3]

This page explains the civil claim against an alcohol seller. Suing the impaired driver directly is covered in suing an impaired driver after a crash, and claims against people who served alcohol at home are covered in social host liability.

Who the dram shop law applies to

The duty falls on a "retail licensee." Section 801 says a retail licensee may not sell, furnish or give alcohol to a minor (except as the Liquor Control Code allows), and may not sell, furnish or give alcohol to a person who is visibly intoxicated.^[1] In the code's section on sales to minors, a "retail licensee" is a person licensed to sell alcohol at retail for consumption on or off the licensed premises, which reaches both places that serve drinks and stores that sell packaged alcohol.^[6] A "minor" under the Liquor Control Code is anyone under 21.^[7]

Section 801 is the only route to money damages against a licensee for selling or furnishing alcohol to a minor or an intoxicated person.^[8] Apart from the special rules in sections 801 and 815, the suit follows the Revised Judicature Act, Michigan's general civil procedure statute.^[9]

What an injured person has to prove

Read together, the statute and the leading Supreme Court case set out these elements:

• An unlawful sale. The licensee, or its clerk, agent or servant, sold, gave or furnished alcohol to a minor or to a visibly intoxicated person.^[1]
• Visible intoxication. In Reed v Breton (2006), the Michigan Supreme Court held that the plaintiff must present evidence of actual visible intoxication. Evidence such as the amount consumed or blood alcohol content can reinforce that finding but cannot substitute for it.^[5]
• Injury caused by that person. The plaintiff suffered damage or personal injury caused by the minor or visibly intoxicated person.^[1]
• Proximate cause. The unlawful sale must be proven to be a proximate cause of the damage, injury or death.^[1]

The standard civil jury instruction quoted in Reed describes a person as "visibly intoxicated" when the intoxication "would be apparent to an ordinary observer."^[5] The statute itself does not define the phrase.^[5] Where the court or jury finds that intoxication was a proximate cause, the plaintiff may recover actual damages, and the statute sets a minimum of $50 in each case.^[10]

The dram shop claim is separate from any criminal OWI case against the driver. A conviction is not listed as an element of the civil claim, and setting aside a later conviction does not affect a crime victim's right to bring or defend a civil action for damages.^[1][11]

Who can sue, and who cannot

The right of action belongs to the person who suffered the damage or injury, or to that person's spouse, child, parent or guardian.^[1] If either side dies, the claim survives to or against the personal representative of the estate.^[2] Parents who are both entitled to damages may sue separately, but a recovery by one bars an action by the other.^[2]

Two groups are shut out. The allegedly visibly intoxicated person has no claim under section 801, and no one may sue under it for the loss of that person's financial support, services, gifts, parental training, guidance, love, society or companionship.^[4] So a drunk driver who is hurt, or the driver's family, cannot use the dram shop act against the bar that served the driver.^[4]

The dram shop deadlines

Deadline	What it applies to	Consequence of missing it
2 years after the injury or death	Filing the dram shop lawsuit[2]	The action "must be instituted" within this time[2]
120 days after entering an attorney-client relationship for the claim	Written notice to all defendants[2]	Grounds for dismissal as to any defendant not notified, unless the licensee's possible liability was not known and could not reasonably have been known within the 120 days[2]

The 120-day clock is tied to hiring a lawyer for the dram shop claim, not to the crash date.^[2] The 2-year filing period is shorter than the general 3-year period for injury and death claims.^[12][2] Keeping a dated record of when a lawyer was retained, and of every notice letter sent, is a practical way to track both dates.

The "name and retain" rule

A dram shop action against a retail licensee may not be started unless the minor or the alleged intoxicated person is a named defendant, and that person must be kept in the case until it ends by trial or settlement.^[3] A licensee held liable for serving a visibly intoxicated person also has the right to full indemnification from that person for all damages awarded against the licensee.^[13]

Defenses the statute gives the bar or store

• The drinker's defenses. All defenses available to the allegedly visibly intoxicated person or the minor are available to the licensee.^[14]
• The last-server presumption. A licensee other than the one that last sold, gave or furnished the alcohol is presumed not to have done anything that gives rise to a claim; the presumption is rebuttable.^[14]
• Responsible business practices. A licensee may offer evidence that it was following responsible business practices when it served.^[14] Those are the policies, procedures and actions an ordinarily prudent person would follow in like circumstances, and paying an on-premises employee on commission counts as an unreasonable practice.^[15]
• Checked identification (minors). In a claim based on a sale to a minor, it is a defense that the licensee or its employee demanded and was shown a genuine-looking Michigan driver's license or state ID showing the minor was at least 21.^[16]

Separately, Michigan's comparative-fault statute makes it an absolute defense in any injury or death action that the injured person was impaired by alcohol or a controlled substance and, as a result, was 50% or more the cause of the accident; below 50%, damages are reduced by that percentage.^[17]

What people get wrong about dram shop claims

• "There are 3 years to sue the bar." The dram shop act sets 2 years, plus the 120-day notice rule.^[2]
• "A high BAC proves the bar over-served." Reed requires evidence of actual visible intoxication; test results can only reinforce it.^[5]
• "Sue only the bar and leave the driver out." The intoxicated person must be named and retained as a defendant.^[3]
• "The drunk driver can sue the bar too." The statute bars claims by the allegedly visibly intoxicated person.^[4]
• "The party host is liable the same way." Section 801 applies to retail licensees; Michigan courts have said social host liability does not extend to serving adults.^[1][18]

How the civil claim fits with the criminal case and other benefits

In the criminal case, the court must order the defendant to pay full restitution to crash victims at sentencing, in felony and misdemeanor cases alike.^[19][20] That obligation survives a later set-aside.^[11] The criminal-case rights of people hurt by an impaired driver are explained in crime victims' rights in OWI cases, and state payment for out-of-pocket losses is covered in crime victim compensation. Medical and wage benefits from auto insurance are described in no-fault benefits when the driver was intoxicated.

For an overview of every route available to injured people and families, start with rights of people injured by impaired drivers. For the criminal charges the driver may face, see OWI causing serious impairment and OWI causing death, and for every time limit in one place, the OWI deadlines calendar.