Opinion ID: 3184455
Heading Depth: 4
Heading Rank: 2

Heading: The 1979 legislation

Text: Section 1 of HB 3152, as originally introduced, stated: “The Legislative Assembly recognizes the need to restrict the liability of licensees and private hosts for damages incurred or caused by intoxicated patrons or social guests they have served. While there is a clear desire to hold responsible those licensees and private hosts who consciously or recklessly serve visibly intoxicated patrons or social guests, the Legislative Assembly believes that a person must be held responsible and accountable for the person’s voluntary actions when such actions are undertaken with a knowledge of possible, although not specifically foreseeable, consequences.” HB 3152 § 1 (1979). Section 2 of the bill provided that a licensee was not liable for damages caused or incurred by intoxicated patrons off the licensee’s business premises, unless the licensee served the patron while visibly intoxicated and the service was grossly negligent under the circumstances. HB 3152 § 2 (1979). Similarly, section 3 of the bill provided that “[n]o private host is liable for damages incurred or caused by an intoxicated social guest, unless the private host served or provided alcohol to the guest while visibly intoxicated and the service was grossly negligent under the circumstances.” HB 3152 § 3 (1979). The bill was first considered in the House Judiciary Committee. At its initial hearing, a representative from the Oregon Restaurant and Beverage Association (ORBA) testified that, in ORBA’s view, recent court decisions had gone beyond the “intent of the law.” Tape Recording, House 772 Deckard v. Bunch Committee on Judiciary, HB 3152, June 11, 1979, Tape 85, Side 2 (statement of Legislative Chairman John Van Horn, Oregon Restaurant & Beverage Association). According to ORBA, HB 3152 would reduce insurance costs, which had significantly increased as a result of those decisions. Id. Van Horn told committee members that ORBA wanted all parties to be held responsible for their actions, including patrons and licensees. See id. (“[I]f a licensee is negligent in serving a visibly intoxicated person, he or she should suffer the consequences of violating the law, including payment of a fine, suspension, or revocation of the license.”). However, ORBA disagreed with “the theory expressed by the supreme court—that a violation of the statute prohibiting the sale of liquor to minors or visibly intoxicated persons should constitute negligence per se—is sound public policy, as [that] act is not always necessarily the proximate cause of the plaintiff’s injuries.” Id. According to Van Horn, ORBA’s members were will- ing to bear part of the burden of risks of injuries to third parties, but they wanted that burden limited to circumstances where a licensee was grossly negligent. Id. In ORBA’s view, “[i]n the Campbell case, the court shifted the burden of evidence from the plaintiff to the defendant, so that in order to escape liability, the defendant must show that he had some specific knowledge that the particular individual in question was not going to be driving from the establishment.” Id. In ORBA’s estimation, a negligence standard reflected better public policy, because responsibility would be shared by licensees and social hosts, on the one hand, and patrons and guests who consume the alcohol, on the other, rather than placing the entire burden on the alcohol server, as, in ORBA’s view, the recent case law suggested. Id. At the same committee hearing, a representative from the restaurant industry, Dave Dietz, also testified. Dietz said that recent case law had led to problems for licensees in acquiring insurance; he noted that, in Wiener, the court concluded that there was no statutory presumption that a licensee would be liable, whereas in Campbell, common-law negligence liability was upheld based on the same types of laws as Wiener, and then extended to negligence per se in Davis. Tape Recording, House Committee on Cite as 358 Or 754 (2016) 773 Judiciary, HB 3152, June 11, 1979, Tape 85, Side 2 (statement of Dave Dietz). HB 3152 was the industry’s attempt to address its concerns about how far that liability ought to extend. Id. Dietz agreed with Van Horn that the burden of the risk of injuries needed to be better balanced between providers and consumers of alcohol. Dietz stated that “[s]ections 2 and 3 address directly the requirement of the proof of liability for the licensee and social hosts. In both cases, we are asking that a licensee or social host be held liable only in the case where they have served alcoholic beverages to a visibly intoxicated person and that server was grossly negligent under the circumstances then existing at the time of the service.” Id. Dietz noted that the visibly intoxicated standard reflected current law and, although potentially difficult to apply, it was a standard that servers understand. Id. Dietz stated that, if a server provides alcohol to a visibly intoxicated patron, the owner of the establishment “should be liable, and they should understand when and where that liability begins to exist.” Id. At the same hearing, Representative Frohnmayer took issue with the proponents’ position that recent case law had shifted the burden of risk of injury away from intoxicated patrons and guests. Tape Recording, House Committee on Judiciary, HB 3152, June 11, 1979, Tape 85, Side 2 (comments of Rep Dave Frohnmayer). He described the effect of recent court decisions as adding an additional category of potential plaintiffs, not limiting the liability of the intoxicated driver in any way. Id. In addition, Representative Frohnmayer expressed concern about the bill’s proposed gross negligence standard, which he described as impossible to administer. Id. The following exchange is informative: FROHNMAYER: “[I]sn’t it true that this bill doesn’t merely restore the status quo prior to the supreme court’s recent decision, but in fact rolls back the law as it has been understood for a decade or so to a point where third party liability is very difficult to obtain at all? DIETZ: “There’s an argument that could be made that it rolls it back much before the ’78 decision in Campbell. 774 Deckard v. Bunch And, of course, that’s exactly what we’re attempting to do. I think it takes it back very nearly to the 1971 decisions, in both Wiener and Stachniewicz, both of which spoke more to the issue of what the common law had at that point in time determined. We think this is something that should be determined statutorily. And therefore we need a statutory standard that addresses this issue specifically. We never have had a statute in this state that precisely and definitely addresses this very point. And because of that, the courts have had to do a great deal of shifting and changing to try to arrive at the responsibilities of the parties involved. I don’t think it rolls it back so much as it finally establishes a standard that will be consistently applied. FROHNMAYER: “Well, let me see if I can spell out, what I’m thinking. The supreme court decided a case on the basis of a statute that some people feel shouldn’t have established a statutory standard but was taken to be. Therefore, the legal effect of it is, once you’ve violated the statute, then that’s negligence per se. That’s the first clear holding of the supreme court on that and that was, in the minds of many, including my own, an extension of the law beyond that that I think the legislature intended. Now, and again, speaking for myself, if you came and just said to us, ‘we don’t believe that violation of statute in this context ought to be negligence per se,’ I think I could buy it. To go back from that and say that not only is it not negligence per se, but that instead you now have to establish gross negligence, even after you meet the requirement that shows that the guest is visibly intoxicated, then I think that maybe rolls it back into the ’50s or the ’40s, not just the 1970s. DIETZ: “Well, don’t forget, when the court held precisely that the violation was negligence per se, the court was not looking at 471.410. It looked at 471.130 which held that the negligence per se occurred when you served a minor. Now, that we think was an unintended interpretation, at least in terms of why the legislature passed that particular statute. And the courts had held in 1971 that 410, 471.410 were intended as protection statutes—protection of minor statutes. For the court then in 1978 to turn around and say to our licensees that service to a minor was negligence per se for the actions that that minor later engaged in, and which ultimately led to the injury of a third party or a third party’s property, we think entirely unintended by the enactment of 471.130 and a gross extension of the statute beyond Cite as 358 Or 754 (2016) 775 any reason. And, yes, we want to roll it back to make very clear exactly what legislative intent is. Maybe it’s not precisely this language, but we hope it will be something that once and for all establishes a standard that the court can use in deciding the cases that are brought to it.” Tape Recording, House Committee on Judiciary, HB 3152, June 11, 1979, Tape 85, Side 2 (statements of Dave Dietz and Rep Dave Frohnmayer). It is apparent from the foregoing exchange that both Representative Frohnmayer and Dietz were primarily concerned about the reach of Davis, where this court had held that a violation of former ORS 471.130(1) constituted negligence per se. At a later work session on HB 3152, Dietz proposed amendments to remove the gross negligence standards for both licensees and social hosts in response to the committee’s concerns. Tape Recording, House Committee on Judiciary, HB 3152, June 26, 1979, Tape 96, Side 1 (statement of Dave Dietz). “In other words, we would go back to what is essentially the pre-[Davis] standard of common law negligence for finding third party liability that was expressed in the Wiener case in 1971.” Id. Dietz stated that the amendments to delete the gross negligence standard were “to get back towards the common law negligence test, not necessarily that we want to go all the way back to a point where licensees could be unfairly or inequitably held liable for service to patrons.” Id. The amendments to remove the gross negligence standard from HB 3152 were then adopted. Id. Representative Rutherford then expressed con- cern about the preamble of the bill, section 1, which, as noted, provided, in part: “While there is a clear desire to hold responsible those licensees and private hosts who consciously or recklessly serve visibly intoxicated patrons or social guests, the Legislative Assembly believes that a person must be held responsible and accountable for the person’s voluntary actions when such actions are undertaken with a knowledge of possible, although not specifically foreseeable, consequences.” Representative Rutherford opined that section 1 was redundant and could muddy the water. Tape Recording, House Committee on Judiciary, HB 3152, June 26, 1979, Tape 96, Side 1 (comment of Rep Rutherford). 776 Deckard v. Bunch He was concerned that “if we write the statute to say what we intend it to say, we don’t need someplace else saying, ‘what we really mean is this.’ And it has a number of words that can appear to add another layer of meaning to the words in the document.” Id. A discussion ensued regarding inconsistencies in section 1 of the bill after the gross negligence standard had been removed and a “common-law negligence standard” was retained, and the committee subsequently deleted section 1. Id. Afterwards, Representative Frohnmayer stated that perhaps a more informal expression, such as a statement of legislative history, could replace the editorial statement in section 1. Tape Recording, House Committee on Judiciary, HB 3152, June 26, 1979, Tape 96, Side 1 (comments of Rep Dave Frohnmayer). He then said, “I think it is clear that it’s the agreement of the committee, if the bill passes, that the liability situation with respect to persons who innocently serve liquor in their home or in some instances has gotten out of hand creating serious problems with respect to the availability of insurance and so forth and that the committee is doing its best to address that question by retreating at least somewhat from the implications of certain court decisions which have been the subject of the committee’s discussions. That is my understanding of what the bill is doing.” Id.12 As pertinent here, the discussion next centered on section 5, concerning minors. Section 5, as initially proposed, would have amended ORS 417.130(1) to provide that a licensee shall not be liable for failure to require proof of age for persons about whom there is reasonable doubt as to whether they had reach the age of 21. HB 3152 § 5 (1979). 12 Nobody present disputed Representative Frohnmayer’s statement. At the same time, it is apparent that other legislators, if left to their own devices, would have preferred either more relaxed or more rigid standards for over-service liability claims. For example, Representative Rutherford commented, “Since we are talking about legislative [intent], it seems to me that people who serve liquor to other people should be responsible for their negligence, if any, and that term is commonly understood[.]” Id. On the other side, Representative Bugas stated that he did not like third party liability and would vote for all the restrictions that could be placed on it. Id. Cite as 358 Or 754 (2016) 777 Framing the issue, Representative Lombard contrasted this court’s decisions in Wiener and Davis: “[I]n 1971, in the case of Wiener v. Gamma Phi ATO Fraternity at the University of Oregon, we had a situation in which the suit was based simply on common law negligence and foreseeability of that against an individual that had sold liquor to, not an intoxicated minor, but an un-intoxicated minor, and the liquor was thereafter conveyed to a party.    And the court in that kind of situation looked at the foreseeability on the part of the defendants selling the alcohol, as to whether or not that the alcohol being purchased would be distributed unwisely and so on and so forth. Now what those who support the [Davis] case, I think, want to say as a matter of public policy that it shall be presumed that sale of any alcoholic liquor to a minor will be consumed unwisely.” Tape Recording, House Committee on Judiciary, HB 3152, June 26, 1979, Tape 96, Side 1 (statement of Rep Lombard). According to Representative Lombard, section 5 stated the legislature’s true intent with regard to ORS 471.130(1). Id. Representative Rutherford then moved to delete section 5 in order to retain existing case law with respect to minors, that is, the holding in Davis. Id. Representative Frohnmayer then suggested that a middle ground between Wiener and Davis could be found; he was content with Wiener but thought that Davis went too far. Id. At an ensuing work session, the committee approved an amendment stating that no alcohol provider shall be liable for damages caused by persons under the age of 21, “unless it is demonstrated that a reasonable person would have determined that [proof of age] should have been requested or that the identification [provided] was altered” or otherwise false. HB 3152 (1979), Amendments, A-Engrossed bill (June 29, 1979). With that amendment, the committee approved HB 3152, and sent it to the House floor, where it subsequently passed without further amendment. Before the Senate Committee on State and Federal Affairs and Rules, Dietz again testified that HB 3152 was meant to retreat from recent court decisions which the restaurant and beverage industry believed had gone too far in interpreting then-existing statutes on the issue of third 778 Deckard v. Bunch party liability. Tape Recording, Senate Committee on State and Federal Affairs and Rules, HB 3152, June 30, 1979, Tape 9, Side 1 (statement of Dave Dietz). Dietz stated, “We believe [HB] 3152 is a reasonable response to the court’s recent efforts. We believe it would bring good balance, both for protecting the rights of people that are injured, as well as protecting the ability of a licensee or permittee to conduct business in a responsible manner.    Matter of fact, we regard this bill as a measure that increase the responsibility of our permitiees and our licensees. The bill, very simply, protects both licensees, permittees, and social hosts in sections one and two of the measure, and indicates that a licensee, permittee, or social host would only be liable for damages incurred or caused by an intoxicated patron or guest in the event that beverages were provided to a visibly intoxicated patron or guest.” Without significant discussion, HB 3152 then passed through committee and the Senate floor, and was enacted as Oregon Laws 1979, chapter 801, sections 1 to 6. To summarize, as enacted, the pertinent statutes provided: Former ORS 30.950 (1979). “No licensee or permittee is liable for damages incurred or caused by intoxicated patrons off the licensee’s or permittee’s business premises unless the licensee or permittee has served or provided the patron alcoholic beverages when such patron was visibly intoxicated.” Former ORS 30.955 (1979). “No private host is liable for damages incurred or caused by an intoxicated social guest unless the private host has served or provided alcoholic beverages to a social guest when such guest was visibly intoxicated.” Former ORS 30.960 (1979), renumbered as ORS 471.567 (2001). “Notwithstanding ORS 30.950, 30.955 and 471.130, no licensee, permittee or social host shall be liable to third persons injured by or through persons not having reached 21 years of age who obtained alcoholic beverages from the licensee, permittee or social host unless it is demonstrated that a reasonable person would have determined that identification should have been requested or that the identification exhibited was altered or did not accurately describe the person to whom the alcoholic liquor was sold or served.” Cite as 358 Or 754 (2016) 779