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Steele v. Kerrigan

March 6, 1997

TY PAUL STEELE, A SINGLE MAN, PLAINTIFF-RESPONDENT,
v.
GEORGE KERRIGAN, GREGORY SUTOR, SERENA ULRICH, MICHAEL MCCOOL, AND JOHN DOE, A FICTITIOUS NAME, OPERATORS OF GILHOOLEY'S, JOINTLY, SEVERALLY AND IN THE ALTERNATIVE, DEFENDANTS, AND MUMS, INC., A NEW JERSEY CORPORATION, T/A GILHOOLEY'S, DEFENDANT-APPELLANT.



On certification to the Superior Court, Appellate Division.

The opinion of the Court was delivered by Stein, J. Chief Justice Poritz and Justices Handler, Pollock, O'hern, Garibaldi and Coleman join in Justice Stein's opinion.

The opinion of the court was delivered by: Stein

(This syllabus is not part of the opinion of the Court. It has been prepared by the Office of the Clerk for the convenience of the reader. It has been neither reviewed nor approved by the Supreme Court. Please note that, in the interests of brevity, portions of any opinion may not have been summarized).

Ty Paul Steele v. George Kerrigan, et al. (A-25-96)

Argued October 7, 1996 -- Decided March 6, 1997

STEIN, J., writing for a unanimous Court.

In this appeal, the Court addresses the apportionment of fault in actions arising under the New Jersey Licensed Alcoholic Beverage Server Fair Liability Act (the Act). In this particular matter, the central issue concerns the comparison of fault under the Act between a negligent tavern and an assaultive patron.

Steele, while a patron at Gilhooley's, a tavern owned by defendant Mums, Inc. (Mums), was assaulted and seriously injured by Kerrigan, an underage patron who was served alcohol by Gilhooley's. Subsequently, Steele filed suit against Kerrigan and Mums. The complaint alleged that Kerrigan intentionally or negligently stuck Steele and sought punitive as well as compensatory damages against Kerrigan. The complaint also set forth several theories of liability against Mums, including common-law liability based on negligent supervision of the tavern premises and statutory liability based on service of alcoholic beverages to Kerrigan when the tavern knew or should have known that Kerrigan was a minor.

In instructing the jury on the apportionment of fault between Kerrigan and Mums, the trial court told the jury that, if found negligent in serving Kerrigan, Mums bears full responsibility for Kerrigan's actions after service, except to the extent that Kerrigan's entering the bar and requesting that he be served contributed to his inability to appreciate the risk of his behavior after service. When the jury asked for clarification on the law concerning the actions of minors after they are served alcohol, the trial court repeated its instruction and suggested that the jury consider first the responsibility of Kerrigan and then apportion the remaining responsibility between the two theories of liability asserted against Mums. The apportionment of liability based on the two remaining theories of liability against Mums was necessary because Gilhooley's was covered by different insurance carriers for alcohol-service and for general liability.

Following trial, the jury found that Kerrigan was 30% at fault, and that the tavern was 50% at fault for negligent service of alcohol to a minor and 20% at fault for negligent supervision of the premises. After the trial court entered judgment for compensatory and punitive damages plus prejudgment interest, Mums, through its alcohol-service liability carrier, settled the claim for negligent service of alcohol. Mums, represented by counsel for the general liability carrier, appealed the verdict on the negligent supervision claim.

On appeal, Mums asserted that the trial court's instruction to the jury regarding the relative fault of Kerrigan and Mums on the statutory alcohol-service claim was flawed because it precluded the jury from attributing any fault to Kerrigan for his conduct after consuming alcohol at Gilhooley's. Mums argued that the instruction misinterpreted the law and also tainted the jury's apportionment of liability relating to negligent supervision. The Appellate Division affirmed the judgment below, concluding that it was appropriate under the Act to attribute fault to the minor only up to the point of service of the alcoholic beverages. Mums also asserted on appeal that the trial court committed harmful error by refusing to instruct the jury that the court would award prejudgment interest. The Appellate Division affirmed the judgment below on that point as well.

The Supreme Court granted Mums' petition for certification on the issue of the jury instruction regarding the apportionment of fault between Kerrigan and Mums and on the issue of the trial court's refusal to instruct on prejudgment interest.

HELD: The trial court's instruction was incorrect as applied to the comparison of fault between a tavern that is negligent under the Licensed Server Liability Act and an assaultive patron, because it precluded the jury from considering all the legally relevant evidence in apportioning fault among the parties.

1. Comparative negligence principles are applied to actions involving intentional and negligent tortfeasors. (pp. 7-13)

2. Although the Licensed Server Liability Act specifically calls for the application of the Comparative Negligence Act, it does not specify detailed principles to guide the apportionment of fault in such cases and guidance must be sought by reference to the historical application of contributory negligence and comparative negligence principles to actions brought under this State's common-law dramshop doctrine. (pp. 13-19)

3. The presumption that a patron, who has been negligently served by a tavern to the point of intoxication, will ordinarily lack the capacity to appreciate the risks of his subsequent actions that led to the injuries at issue is to be used in apportioning fault between a tavern and a patron only for that part of the injuries attributable to the patron's negligence caused by intoxication. (pp. 19-22)

4. The Licensed Server Liability Act reflects a legislative recognition that innocent plaintiffs injured in part as a result of negligent service by a licensed server may not always receive full compensation for their injuries. (pp. 22-23)

5. The Licensed Server Liability Act does not distinguish between damages caused by intentional torts and damages caused by negligent acts. Rather, once a licensed server is found to have been negligent, the damages for which it is liable are limited only by issues of causation and foreseeability. (pp. 23-26)

6. In the context of social host liability, New Jersey treats the negligent operation of an automobile as a special risk of intoxication, different from all other intoxicated acts. (pp. 26-27)

7. The duty imposed on a tavern has never been limited to preventing automobile accidents. (pp. 28-30)

8. The imposition of liability on a tavern that serves a minor reflects the recognition that minors are especially likely to be adversely affected by alcohol and to cause damage to themselves and others. (pp. 31-34)

9. Foreseeability and causation are threshold issues that must be determined before imposing liability on a tavern under the Licensed Server Liability Act. (pp. 35-37)

10. Notwithstanding the correlation between alcohol use and incidence of violent behavior in general, a tavern is less able to foresee assaults committed by its patrons. Because causes other than intoxication, such as a preDisposition to violence or provocation by the victim, are more likely to contribute to the occurrence of an assault, an assaultive patron is not entitled to a presumption that he did not have the capacity to appreciate or control his own actions after being negligently served by the tavern. (pp. 38-39)

11. In apportioning fault, the jury should be instructed on the general purpose of tavern liability under the Licensed Server Liability Act and that its verdict should reflect the tavern's responsibility for negligent service to the extent that it influenced the behavior of persons whom the tavern should not have served. The jury should also be informed that, in general, assaultive behavior is considered one of the foreseeable risks of negligent alcohol service and should further be instructed concerning the heightened duty of taverns to underage patrons under the Act. (pp.39-40)

12. In apportioning fault, the jury must consider the degree to which the licensed server's negligence in serving alcohol to the underage patron contributed to the incident. In the case of an intentional assault, the jury should be instructed to apportion fault on the basis of all the evidence pertaining to each party's role in the incident. (pp. 40-41)

The judgment of the Appellate Division is REVERSED in part and REMANDED to the Law Division for retrial on the issue of liability only. The judgment of the Appellate Division on the issue of the trial court's omission of an instruction concerning prejudgment interest is AFFIRMED substantially for the reasons stated in the Appellate Division's opinion.

CHIEF JUSTICE PORITZ and JUSTICES HANDLER, POLLOCK, O'HERN, GARIBALDI and COLEMAN join in JUSTICE STEIN'S opinion.

The opinion of the Court was delivered by

STEIN, J.

This appeal provides another opportunity to address the principles that guide apportionment of fault in actions arising under the New Jersey Licensed Alcoholic Beverage Server Fair Liability Act, L. 1987, c. 152 (codified at N.J.S.A. 2A:22A-1 to -7) (Licensed Server Liability Act or Act). Plaintiff Steele was assaulted by defendant Kerrigan, an underage patron who was served alcohol by Gilhooley's, a tavern owned by defendant Mums, Inc (Mums). The central issue concerns the comparison of fault under the Act between the negligent tavern and the assaultive patron. The trial court instructed the jury that once a tavern is found negligent for serving alcohol to an underage patron, the tavern is responsible for the patron's subsequent acts except to the extent that the underage patron's behavior prior to consuming the alcohol contributed to the incident, and the jury apportioned fault accordingly. The Appellate Division affirmed. We reverse and remand for a new trial on liability.

I

Our summary of the underlying facts is based on the trial record. Shortly after midnight on the evening of November 27, 1992, defendant George Kerrigan, along with his friend George Sutor, entered Gilhooley's, a tavern in Margate. Kerrigan was nineteen years old at the time and Sutor was twenty. Kerrigan testified that he drank five to seven beers at Gilhooley's in the one and one half to two hour period that he was in the tavern. Plaintiff Ty Paul Steele was also at Gilhooley's that morning, accompanied by his friend Robbie Belk. Steele and Belk played a game of pool against Kerrigan and Sutor. Without Kerrigan's knowledge, the other players agreed to bet a round of beers on the game. After Steele and Belk won, Sutor left to buy the beers. Steele approached Kerrigan concerning the bet. Steele and Kerrigan exchanged words. Before long, Kerrigan hit Steele in the face with his fist. According to some testimony, Kerrigan was holding a cue ball in his hand. Kerrigan was six feet tall, weighed 185 pounds and had training as a boxer and weight lifter. Steele's hands were at his sides when he was hit.

Steele sustained serious injuries from the blow, including multiple fractures to his facial bones. He was treated at an emergency room that night and required extensive subsequent surgery that left him with permanent metal plates and screws in his face. Because of his injuries, Steele now suffers from misalignment of his teeth, chronic inflammation and congestion of his sinuses and nasal passages, headaches, earaches, ear ringing, and numbness in his gum and lip.

In January 1993, Steele filed suit against Kerrigan and Mums. Plaintiff also named the shareholders and an employee of Mums, individually, but agreed at trial not to pursue his claims against them. The complaint alleged that Kerrigan intentionally or negligently struck Steele and sought punitive as well as compensatory damages against Kerrigan. The complaint also set forth three theories of liability against Mums: (1) common-law liability based on negligent supervision of the tavern premises; (2) statutory liability based on service of alcoholic beverages to Kerrigan when the tavern knew or should have known that Kerrigan was a minor *fn1; and (3) statutory liability based on service of alcoholic beverages to Kerrigan after ...


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