The Liabilities Associated with Having A Liquor License

by Nickey on September 2, 2013

Retail establishment owners who obtain a liquor license are almost guaranteed to see their profits increase. Whether you own a restaurant, bar, convenience store or a business in an alcohol-serving venue, selling liquor is bound to attract new customers. But along with a liquor license comes increased legal liabilities. As the business owner, you are now legally responsible for any damages or injuries that may occur as a result of your liquor sales.

Liabilities Associated with Liquor Licenses

Risk management will take on a more prominent role in your business because of the increased liabilities associated with obtaining a liquor license. There are many factors that will increase your legal risk and here are the four most common factors:

1. Dram Shop Laws – This legislation holds you responsible for any personal injury or property damage done to a third party by someone who was served alcohol at your establishment. For instance, a person who was injured by a driver who was drunk after leaving your place of business, can sue you and the drunk driver under Dram Shop laws. The vast majority of states have these laws. Georgia, for instance, applies Dram Shop laws to convenience stores even though they sell alcohol in closed containers.

2. Failing to train employees – Problems with intoxicated customers are likely if your workers are not trained to prevent issues, as much as possible, from occurring. Because your employees will either serve or sell alcoholic beverages, it’s incumbent upon you to provide professional alcohol-awareness training to your workers.

3. Failing to update your business policy – Your business policy should be updated after obtaining a liquor license to include written procedures on protecting your establishment from safety liabilities.

4. Failing to update your business insurance coverage. Serving alcohol will require you to add liquor liability coverage to your business insurance to protect you from claims of damages or injuries caused by an intoxicated customer. Without this insurance, you will have to pay out-of-pocket for any claims filed as a result of damages that occur ed due to your alcohol sales.

Expect more inspections

From the time you obtain your liquor license, you will be under the scrutiny of your state’s liquor licensing bureau and local law enforcement. Periodically, state investigators and police officers will conduct undercover operations to determine whether you are following state laws regarding the serving and sales of alcohol, particularly to minors. Failure to follow state laws could result in fines, jail time, and the suspension or revocation of your liquor license.

As the owner, you should brand your establishment as a business that follows state and local alcohol ordinances and one that discourages intoxication of customers. Even a Los Angeles or a Montgomery County DUI attorney knows that without advertising this to the public and allowing overindulgence, you are setting yourself up for a customer to eventually be arrested for driving under the influence (DUI). An accident that occurs as a result of the DUI will be traced back to your business.

While a liquor license brings financial benefits, it should also bring caution to its owner. If this is your first time obtaining a license, it would be beneficial for you to have a discussion with a representative from your insurance company, and an attorney who specializes in Dram Shop laws and liquor liability for retail establishments.

Researcher Nickey Williams writes this article to those looking to obtain a liquor license in the near future. Montgomery County DUI attorney Steven E. Kellis will attest to the importance of making sure that all rules are adhered to when pertaining to Liquor licensing, and because he handles DUI cases regularly, he offers his legal guidance to unprepared owners.



Legal researcher and Home schooling mother of two with a degree in Management.

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