The New Jersey legislature recognizes the difficulty that alcoholic beverage servers face when attempting to obtain liability insurance, due to a lack of availability and the increased costs. It realizes that this not only adversely effects the servers themselves, but patrons and third parties who suffer personal injury and property damage as the result of negligent service of alcohol by alcoholic beverage servers. In order to make it more economically feasible for insurance companies to provide liability insurance to alcoholic beverage servers at a reasonable cost, the legislature enacted the New Jersey Licensed Alcoholic Beverage Server Fair Liability Act. 

The Act can be found in N.J.S.A. 2A:22A-1 to -7, and allows recovery for damages resulting from the service of alcohol to a visibly intoxicated person. Laws such as this are commonly known as Dram Shop laws, and apply to taverns, liquor stores, and commercial establishments where alcohol is sold.  In New Jersey, a person who sustains personal injury or property damage as the result of the negligent service of alcoholic beverages by a licensed alcoholic beverage server may recover damages from the server if the negligent service was the proximate cause of the injury or damage and was a foreseeable consequent of the negligent service. Negligent service is defined as serving a visibly intoxicated person, or serving a minor, under circumstances where the server knew, or reasonably should have known, that the person served was a minor. 

In a recent case, the Supreme Court of New Jersey held that an injured motorcycle rider who was charged with, and pled guilty to, driving while intoxicated, was not barred from bring a Dram Shop claim against the restaurant he alleged negligently served him alcohol and therefore contributed to the accident in which he was injured. The restaurant argued that New Jersey law prohibits a Plaintiff who is found guilty of driving while intoxicated to recover for economic and noneconomic losses as the result of an accident. The Court however, found that while N.J.S.A. 39:6A-4.5(b) barred the right to sue for insurance coverage, it did not prevent an injured party convicted of driving while intoxicated from bringing a Dram Shop claim. The Court declared that there is no incompatibility between the two provisions. It further stated, “An intoxicated person is deterred from driving drunk by losing the right to sue for insurance coverage for his injuries. On the other hand, permitting an injured drunk driver to file an action against a liquor establishment and its servers for serving a visibly intoxicated patron similarly advances the goal of deterring drunk driving.” Voss v. Tranquilino, 992 A.2d 829, (2010 N.J. Super).

Source: LexisNexis, codes and case cited in article