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Alcohol at Company Parties: When to Say 'When'?

By Aditi Mukherji, JD | Last updated on

If your business has an office party or company picnic coming up, you might want to think twice before topping off that guy with bloodshot eyes who reeks of Jägermeister. Your state may have laws that make party hosts liable for over-serving guests.

Depending on what state you're in, social hosts who serve or otherwise provide alcohol to someone who is visibly drunk can be liable for injuries caused by the intoxicated person.

When can your business liable for over-serving alcohol at a company party?

Social and Business Host Liability

It would fall under social host liability or alternatively, business host liability. Under social/business host liability laws, adults who serve or provide alcohol to minors or persons who are obviously intoxicated can be held liable if the person who was provided alcohol is killed or injured, or kills or injures another person.

The purpose of dram shop laws is to discourage the folks pouring the drinks from ignoring signs of heavy intoxication. Awkwardness aside, a social host can choose to cut a guest off when he's clearly past the legal limit. Placing liability on hosts for drunken driving-related injuries or deaths will help them muster up the courage to get past the awkwardness.

The 'Obvious Intoxication' Test

So what exactly is considered "over-serving"? Good question. States are all over the place on the rule.

When it comes to social host liability, the test most courts use is the "obvious intoxication test." It sounds more sarcastic than it is. Generally, your business might be on the hook if you knew or should have known that a guest was so intoxicated that more alcohol would cause danger to himself or to others.

Just remember, your small business could be on the hook for any accidents that occur from an intoxicated guest at your company shindig -- even off-site. If you need to find out if your company is covered under social host liability, it might be helpful to consult an attorney in your area.

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