Opinion ID: 1699909
Heading Depth: 1
Heading Rank: 3

Heading: does violation of the bottle club act create a cause of action for negligence in these cases?

Text: Section 50 of the Liquor Control Act provides criminal penalties for violations of the provisions of its act. MCL 436.50; MSA 18.1021. Section 26c of the act is a penal statute providing punishment for violations of its mandates. Compare Longstreth v Gensel, 423 Mich 675, 692; 377 NW2d 804 (1985), holding that § 33 of the act prohibiting the furnishing of alcoholic liquors to minors is a penal statute. Where a penal statute is silent concerning whether a violation of its provisions should give rise to a civil remedy, courts will infer a civil remedy for the violation to further the ultimate policy for the protection of individuals which they find underlying the statute, and which they believe the legislature must have had in mind. Prosser & Keeton, Torts (5th ed), § 36, p 222. The civil remedy may be afforded through an existing tort action or a new cause of action analogous to an existing tort action. [5] If there is no common-law tort sufficiently analogous to fit the situation, a new tort may be created for the purpose. 4 Restatement Torts, 2d, § 874A, comment f, p 304. In the interest of public policy, this Court has created a new cause of action to redress the violation of a penal statute and, pursuant to the following test, incorporated the statute as the specific standard of care: The court may adopt as the standard conduct of a reasonable man the requirements of a legislative enactment or an administrative regulation whose purpose is found to be exclusively or in part (a) to protect a class of persons which includes the one whose interest is invaded, and (b) to protect the particular interest which is invaded, and (c) to protect that interest against the kind of harm which has resulted, and (d) to protect that interest against the particular hazard from which the harm results. [ Longstreth, supra, pp 692-693, quoting Restatement Torts, 2d, § 286, p 25. See also Zeni v Anderson, 397 Mich 117, 137-138, ns 21, 22; 243 NW2d 270 (1976); Prosser & Keeton, Torts (5th ed), § 36, pp 229-230; 57 Am Jur 2d, Negligence, §§ 257-258, pp 641-643; SJI2d 12.01.] Where the court concludes that the statutory purpose was not to protect the person allegedly injured, or even if it was, that the harm suffered was not what the Legislature intended the statute to remedy, Zeni, supra, the court may conclude that the statute is not applicable to the facts of the case before it. [6] Thus, our determination should not only be consistent with legislative intent, but should further the purpose of the legislative enactment. Involved in the case at bar is a comprehensive legislative scheme creating new and particular remedies against persons not liable at the common law and vesting exclusive control of the licensing, taxation, sale, or distribution of alcoholic liquors in the state for the benefit of the public. While it is part of the court's historic common-law function to develop the law, a degree of caution must be exercised in fashioning civil remedies where a balance struck by a comprehensive regulatory scheme could be undermined. [7]
In Kiliszewski v St Vincent, the trial court dismissed the complaint against St. Vincent on the basis that the mere renting of the hall did not bring the defendant under the bottle club act. The Court of Appeals agreed that the bottle club act did not impose civil liability upon St. Vincent without discussing whether violation of the act could create a rebuttable presumption of negligence in a claim for injuries arising from the intoxication of a person who consumed alcohol on the unlicensed premises. The Court of Appeals understood plaintiffs' argument to impose liability pursuant to the dramshop provision of the Liquor Control Act. MCL 436.22; MSA 18.993. Citing Guitar v Bieniek, 402 Mich 152, 167; 262 NW2d 9 (1978), the Court of Appeals concluded that St. Vincent, as the lessor of the hall, did not fall within the class of persons liable under the dramshop provision. Therefore, the trial court's grant of summary judgment with regard to the dramshop count was affirmed. On appeal to this Court, plaintiffs contend that the purpose of the statute is to prevent circumvention of the Liquor Control Act by placing the duty to insure proper licensing, which would include the obtaining of a special license when needed, on the property owner, thereby protecting the general public from the very abuses that occurred. Plaintiffs do not argue that St. Vincent violated the bottle club act because it directly allowed persons on its unlicensed premises to engage in drinking of alcohol for a consideration. Rather, plaintiffs argue that St. Vincent should be held responsible for the alcohol-related accident because St. Vincent knew or should have known that the Schullos intended to furnish intoxicating liquors at the bunny hop without obtaining the requisite liquor license. In the companion case before us, Gardner v Wood, 150 Mich App 194; 388 NW2d 276 (1986), the plaintiffs urge us to affirm the holding of the Court of Appeals. The Court of Appeals concluded that defendant was in violation of subsection 2 of that act and, applying § 286 of the Restatement of Torts, 2d, found that the alleged violation was sufficient to create a prima facie case of negligence: Applying this analysis, we find that the alleged violation of MCL 436.26c(2); MSA 18.997(3)(2) was sufficient to preclude summary judgment. The statute was meant to protect a class of persons. The class of persons protected by the statute extends beyond licensees whose economic interests may be harmed if unlicensed commercial establishments selling food are permitted to allow the consumption of alcohol on their premises. As noted above, the statute, as amended in 1980, regulates more than bottle club activity that could threaten the economic interests of licensees. The statute now, in part, protects all persons who come into contact with customers of unlicensed commercial establishments selling food. Plaintiff falls within this protected class. The statute in part protects a particular interest, i.e., freedom from injury caused by the consumption of alcohol on the premises of an unlicensed commercial establishment selling food. The statute was also intended to protect against the kind of harm which resulted, i.e., injury and death. And lastly, the statute was meant to protect against a particular hazard, i.e., the substantially expanded exposure to harm resulting from the dangerous effects of intoxication if unlicensed commercial establishments selling food were permitted to allow customers to consume alcohol on the premises. Based on this analysis, we conclude that the trial judge properly determined that plaintiff can maintain a cause of action based on defendant's violation of MCL 436.26c(2); MSA 18.997(3)(2). The violation of the statute creates a prima facie rebuttable presumption of negligence. We note that plaintiff must still establish before a trier of fact that defendant's violation of the statute was a proximate cause of plaintiff's decedent's death. However, we are unable to state that plaintiff's cause of action is precluded as a matter of law. Therefore, the trial judge properly denied defendant's motion for summary judgment based on plaintiff's failure to state a claim. [150 Mich App 202-204.] Whether the bottle club act was violated need not be addressed in either of these cases because we hold that the hazard presented by the furnishing of alcohol to an intoxicated person is not the hazard which the bottle club act was intended to eliminate. Plaintiffs seek to impose a duty under the bottle club act which is analogous to that imposed upon a licensee under the dramshop provision to refrain from serving alcohol to a minor or a visibly intoxicated person. MCL 436.22; MSA 18.993. We recognize that if the penal provisions of the bottle club act were successfully enforced, one by-product would be that liquor would only be consumed for a consideration in circumstances where the licensees' obligations would protect persons injured by a minor or a visibly intoxicated person. While creation of a cause of action under the bottle club act would promote effectiveness by imposing on nonlicensees the financial incentive to avoid liability in addition to the incentive to avoid criminal penalties, we are constrained to conclude that this is a matter for legislative resolution. We decline to impose such a duty under either subsection (1) or (2) of the act for several reasons. At common law, there was no cause of action against a person for recovery of damages due to the unlawful serving of intoxicating beverages. Longstreth v Gensel, supra . The Legislature filled the gap existing at common law through enactment of the dramshop provision which created a remedy for that wrong. Id. Though the option to create a similar remedy for violations of the bottle club act clearly existed, the option has gone unexercised. Further, in Guitar v Bieniek, supra , this Court refused to find that a bottle club nonlicensee came within the civil liability provision of § 22 of the Liquor Control Act. In Guitar, the nonlicensee lessor, Alcamo's Hall, Inc., rented its hall for a wedding reception where alcohol was to be consumed and provided a waiter and facilities for dispensing the alcoholic beverages. The alcohol which was consumed on the premises was privately furnished by the celebrants with the exception of a keg of beer which was provided at retail cost by Alcamo's. While this Court recognized in Guitar that nonlicensees who engaged in operations tantamount to those engaged in by licensees are equally chargeable under § 22, the dramshop provision of the Liquor Control Act, the Court held that Alcamo's did not fit within the category of persons subject to that provision. The purpose of the civil liability provision in § 22 was to impose a special legal duty upon a group of retailers who the Legislature may have believed needed additional encouragement to subject their immediate pecuniary interests to the ultimate welfare of their patrons and society as a whole. That encouragement has been made to consist in part of the resultant vicarious liability. [ Id., p 167.] In the case of Alcamo's, the manifest legislative purpose was inapposite. Whereas the class of retailers specifically named in § 22 may be directly proprietorily motivated to dispense `that additional drink' which is `one too many,' such motivation is totally inapplicable to a social setting in which the alcohol is supplied as a mere social amenity. Id.