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03/02/88 PICADILLY v. CHARLES H. COLVIN

Filed: March 2, 1988.

PICADILLY, INC., APPELLANT (DEFENDANT BELOW),
v.
CHARLES H. COLVIN, APPELLEE (PLAINTIFF BELOW).



Appeal from the Hendricks Circuit Court, The Honorable J.V. Boles, Judge, No. C683-235, On Civil Petition to Transfer

Dickson, J., Shepard, C.j., Givan, J., concur, Pivarnik, J., Dissenting with opinion in which DeBRULER, J., concurs.

Author: Dickson

DICKSON, J.

Following a jury trial, plaintiff-appellee Charles H. Colvin (Colvin) received a judgment of $75,000.00 in compensatory damages and $150,000.00 in punitive damages against defendant-appellee Picadilly, Inc. (Picadilly). The Court of Appeals reversed and remanded with instructions to enter judgment for Picadilly, finding that there was no common law cause of action for dram shop liability in Indiana, and that the evidence was insufficient to prove Picadilly's knowledge of its customer's intoxication. Picadilly, Inc. v. Colvin (1987), Ind.App., 503 N.E.2d 421. We disagree and grant transfer accordingly.

The Court of Appeals provided the following summary of facts. Deborah Brewer along with Joyce Carrico joined a group of six other women sometime between 7:30 and 9:30 p.m. at Picadilly. Picadilly is a bar licensed to sell beer, wine, and liquor. It is located in a building which formerly housed a department store and covers in excess of 40,000 square feet. The method used in selling alcoholic beverages to the patrons is similar to checkout counters at a supermarket. There are eight lanes for customer use. Each lane begins with a cashier where the drinks are ordered and paid for. The drink order is conveyed by computer to a bartender who prepares the drinks. The drinks are then given to a passer who places the completed order on a counter for the customer to pick up. Brewer drove Carrico home at about 1:30 a.m. and started toward her own home in Hope, Indiana. Brewer became lost and entered an interstate highway going in the wrong direction. She collided with Colvin at about 3:30 a.m. Two separate blood tests were taken after 6:00 a.m. which showed Brewer's blood alcohol content to be .114 and .1205. Colvin filed suit against Brewer and Picadilly with a settlement being reached with Brewer prior to trial.

We will regroup and discuss the issues presented by Picadilly on appeal as follows:

1. refusal of instructions limiting dram shop liability to statutory violation;

2. sufficiency of evidence of Picadilly's knowledge of customer's intoxication;

3. punitive damages.

1. Dram Shop Liability

Picadilly's tendered instructions no. 7, 8, 9, and 10 each related to its contention that absent a violation of the statute prohibiting the furnishing of alcoholic beverages to intoxicated persons, there could be no independent common law liability for injuries caused by a customer's intoxication. The trial court refused the instructions, observing that Picadilly's contention was an incorrect statement of law.

In considering whether any error results from refusal of the tendered instruction, the reviewing court considers: 1) whether the tendered instruction correctly states the law, 2) whether there is evidence in the record to support the giving of the instruction, and 3) whether the substance of the instruction is covered by other instructions which are given. Dahlberg v. Ogle (1978), 268 Ind. 30, 373 N.E.2d 159. Failure of a tendered instruction to meet any one of these criteria will support its refusal by the trial court.

The general common law duty of persons selling alcoholic beverages to exercise due care was recognized in Elder v. Fisher (1966), 247 Ind. 598, 217 N.E.2d 847. In Elder, plaintiff brought a damage action for personal injuries from a collision allegedly caused by an intoxicated 17-year-old who purchased liquor from the defendant. Two questions were identified and discussed: (1) whether violation of the statute prohibiting sale of alcohol to underage persons would constitute negligence per se, and (2) whether, even without such statute, there could be a common law cause of action for negligence based upon the sale of intoxicating liquor. Discussing each question independently, Elder expressly answered each in the affirmative. The common law liability applies when a negligent act or omission is a proximate cause of an injury, which injury "need be only a natural and probable result thereof; and the consequence be one which in the light of circumstances should reasonably have been foreseen or anticipated." Elder, 247 Ind. at 605, 217 N.E.2d at 852.

Picadilly contends that the sole basis for liability should derive from violation of Ind. Code § 7.1-5-10-15:[Footnote 1]

It is unlawful for a person to sell, barter, deliver, or give away an alcoholic beverage to another person who is in a state of intoxication if the person ...


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