D. Houston, Inc. v. Love
2002 Tex. LEXIS 102, 92 S.W.3d 450, 45 Tex. Sup. Ct. J. 943 (2002)
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Rule of Law:
The Texas Dram Shop Act does not abrogate a commercial seller's common law duties as an employer to its employees and independent contractors. If an employer requires its independent contractor to consume alcohol in sufficient amounts to become intoxicated while working, the employer owes a duty to take reasonable care to prevent that contractor from driving when leaving work.
Facts:
- Melissa Love worked day-shifts as a waitress at Treasures night club, and on October 6, 1996, at 7:45 p.m., she began working at the same location as an exotic dancer, changing her status to an independent contractor.
- While working as a dancer, Love consumed at least twelve alcoholic beverages with customers and became intoxicated, performing her last table dance around 1:00 a.m.
- Treasures' waitresses were instructed to encourage customers to buy drinks for dancers to increase sales, and Love testified that Treasures' management directly pressured dancers to drink alcohol with customers, implying job security and income depended on it.
- Love testified that she consumed alcohol to keep her job, and at about 11:00 p.m., she felt intoxicated and accidentally fell on a customer during a private dance.
- Love left Treasures around 1:30 a.m.; the club manager asked if she was alright, and she replied she was 'fine,' but no one at Treasures attempted to keep her from driving.
- While driving herself home, Love's car struck a guardrail, causing her serious personal injuries.
- At 4:00 a.m., Love’s blood alcohol level measured at the hospital was .225, more than twice the then-applicable legal limit of .10.
- A doctor's affidavit stated that given her blood alcohol level at 4:00 a.m., Love would have been "unmistakably intoxicated to anyone coming into contact with her and would have presented [as] a young woman well beyond being too intoxicated to drive" when she left Treasures.
Procedural Posture:
- Melissa Love sued Treasures under Chapter Two of the Texas Alcoholic Beverage Code (Dram Shop Act) and for common law negligence and gross negligence.
- Treasures moved for partial summary judgment on the Dram Shop claims, asserting a 'trained-server' statutory defense and arguing Love was not 'obviously intoxicated.'
- The trial court granted Treasures' motion only on the 'trained-server' defense.
- Treasures filed a second summary judgment motion, arguing Love’s common law claims were barred because the Dram Shop Act is the exclusive cause of action for providing alcohol to an adult.
- The trial court granted Treasures' second motion for summary judgment and ordered that Love take nothing in her suit.
- Love appealed the second summary judgment to the court of appeals (appellant Love, appellee Treasures).
- The court of appeals reversed the summary judgment and remanded, extending Otis Eng’g Corp. v. Clark to hold that an employer who asserts control over an independent contractor with knowledge of their incapacity has a duty to exercise reasonable care.
- Treasures appealed the judgment of the court of appeals to the Texas Supreme Court (appellant Treasures, appellee Love).
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Issue:
Does the Texas Dram Shop Act provide the exclusive remedy for suing a commercial seller of alcohol when the seller, acting as an employer, allegedly required an independent contractor to consume alcohol on the job, leading to the contractor's intoxication and subsequent injury while driving home?
Opinions:
Majority - Chief Justice PHILLIPS
No, the Dram Shop Act does not abrogate a commercial seller's common law duties as an employer to its employees and independent contractors, and thus does not provide the exclusive remedy in this situation. The Court concluded that the Dram Shop Act's exclusivity provision, Section 2.03, applies to liability arising from the 'provision' of alcohol to customers, members, or guests. However, Love's lawsuit against Treasures stemmed from its alleged failure as an employer to use reasonable care in exercising retained control over her work as an independent contractor, particularly concerning her required alcohol consumption. The duty arises from the employer-independent contractor relationship, not merely from Treasures' role as an alcohol provider. The Court found summary judgment evidence, including Love's testimony that she drank to keep her job and management's pressure on dancers to drink, created a fact question regarding Treasures' control over her alcohol consumption. This alleged requirement of alcohol consumption by Treasures compromised Love's ability to judge her fitness to drive, thereby imposing a duty on Treasures to take reasonable care to prevent her from driving while intoxicated. Since Treasures failed to disprove at least one essential element of Love's common law claims as a matter of law, the summary judgment against her was inappropriate.
Analysis:
This case significantly clarifies the scope of the Texas Dram Shop Act's exclusivity clause, limiting its application to claims arising solely from the 'provision' of alcohol and preventing it from precluding common law employer liability. It establishes that an employer's duty of care extends to independent contractors when the employer exerts control over the contractor's work, especially if that control involves requiring alcohol consumption that leads to intoxication. This ruling emphasizes that businesses cannot use the Dram Shop Act to shield themselves from negligence claims arising from their direct actions and policies as employers that contribute to worker impairment and foreseeable injury. This may influence how employers structure their relationships with independent contractors and manage on-the-job alcohol-related activities to mitigate potential liability.
