Booze And Boating Don’t Mix (But They Do Lead To An Interesting Discussion Of Negligent Entrustment)

by: Peter J. Gallagher (@pjsgallagher) (LinkedIn)

Boat and beer (pd)Some sets of facts just seem tailor-made for a potential lawsuit. Climbing up a ladder with a chainsaw to cut your neighbor’s tree limbs that are hanging over your lawn comes to mind.  Also on that list, a day out on a boat with your friends from the local bar, more than a few beers, and a jet-ski. Those were the basic facts in Votor-Jones v. Kelly. In that case, what started out as a fun day out at sea for a group of friends became a very bad day for plaintiff and an opportunity for the court to opine on the rarely-invoked tort of negligent entrustment.

In Kelly, plaintiff was “one of seven employees and patrons of Kelly’s Tavern invited on a social trip organized by the tavern’s owner and plaintiff’s boyfriend.” While plaintiff described the event as a “bar outing,” it was not the more formal, “large scale ” “customer appreciation days” that the bar had organized in the past. Instead, it was “small and planned the night prior at the suggestion of the boat’s operator.” Each attendee was required to bring their own food and alcohol. To that end, plaintiff and her boyfriend testified that, on the morning of the cruise, they went to the bar and fulled their cooler with approximately 24 beers and a bottle of wine. The group had a total of four or five coolers like this on the boat.

The attendees had a “tacit agreement” that they would not drink until 4pm, but some apparently ignored this agreement. One defendant acknowledged that she was drinking prior to boarding the boat and plaintiff testified that she saw this woman have “at least three beers on the dock” before the cruise began. Once the cruise started, this same woman was seen with a beer in her hand and was described by plaintiff as being “loud,” “boisterous,” and “excited.” Plaintiff conceded that she did not know if the woman was drunk, but did see her “wobbling on the boat, as was everyone else.”

About an hour into the cruise, the captain stopped the boat and allowed it to drift. The boat was accompanied by a jet-ski. About 20 minutes after the boat stopped, the owner of the jet-ski asked the woman, who plaintiff had seen drinking on the dock and the boat, if she wanted to drive it. She did, and the two rode off, with the woman driving. When they were “pretty far off,” plaintiff and her boyfriend jumped in the water to swim. Thereafter, the woman “turned around and approached the boat [on the jet-ski] at approximately 40 miles per hour when she struck plaintiff and [her boyfriend].” Plaintiff and her boyfriend were assisted back to the boat and rushed to the nearest dock. Police were contacted, but no arrests were made and no summonses were issued.

Plaintiff sued the woman who was operating the jet-ski, the owner of the boat, her boyfriend, and the bar. She alleged that the bar was liable for serving alcohol to a visibly intoxicated person in violation of New Jersey’s Dram Shop Act. She asserted claims of social host liability and negligent entrustment against her boyfriend, who owned the bar. The court dismissed each of these claims on summary judgment and plaintiff appealed.

The Dram Shop Act imposes liability on an establishment that serves alcohol to a visibly intoxicated person. It is designed to “protect the rights of persons who suffer loss as a result of the negligent service of alcoholic beverages by a licensed alcoholic beverage server.” In Kelly, the Appellate Division affirmed the trial court’s holding that the bar was not acting as a “licensed alcoholic beverage server” and the woman who operated the jet-ski was not a customer, therefore the circumstances did not fall within the scope of the Dram Shop Act. It further held that there was insufficient evidence that the woman was “visibly intoxicated.” Drinking, yes, but not “visibly intoxicated” as that phrase had been interpreted by New Jersey courts. So, even if plaintiff had been able to establish that the bar had served the woman, the bar still would not have been liable under the Dram Shop Act.

For some of the same reasons, the Appellate Division also affirmed the trial court’s dismissal of plaintiff’s social host liability claim. To recover damages from a social host under this theory, a plaintiff must prove that the host served a “visibly intoxicated” person. The Appellate Division held that plaintiff had, at best, offered evidence that the woman who hit her with the jet-ski had been drinking, “but submitted insufficient evidence to support a claim of visible intoxication.”

Finally, the Appellate Division affirmed the trial court’s dismissal of plaintiff’s negligent entrustment claim.Plaintiff claimed that her boyfriend was “negligent for entrusting the [jet-ski] to someone who had been drinking” and that he had a “duty to inquire as to [the woman’s] knowledge, fitness, and experience before permitting her to use the [jet-ski].” The Appellate Division began its review if the trial court’s decision on this claim by describing negligent entrustment as follows:

[P]ermit[ting] a third person to use a thing or to engage in an activity which is under the control of the actor, if the actor knows or should  know  that  such  person  intends  or  is likely to use the thing or to conduct himself in the activity in such a manner as to create an unreasonable risk of harm to others.

To prevail on a claim under this theory, a plaintiff must prove, among other things: (1) that the “entrustee” (here, the woman who was entrusted with the jet-ski) was “incompetent, unfit, inexperienced, or reckless;” and (2) that the “entrustor” (here, the boyfriend) “knew . . . should have known, or had reason to know of the entrustee’s condition or proclivities.” In Kelly, the Appellate Division held that plaintiff could not satisfy either of these elements. First, the woman who operated the jet-ski “possessed a certificate demonstrating completion of a boat safety course,” and testified that she had prior experience on jet-skis. Second, there was “insufficient evidence to establish that [the boyfriend] knew or should have known of [the woman’s] level of intoxication or experience with [jet-skis].” He apparently asked is she had a certificate, was told that she had driven jet-skis before, and “conditioned his permission on [another man], a certified boat captain, accompanying her.” Therefore, the boyfriend (qua “entrustor”) did not know or have reason to know that the woman was “incompetent, unfit, inexperienced, or reckless” before he entrusted her with the jet-ski.

(NOTE: There was no word in the opinion about whether the relationship between plaintiff and her boyfriend survived the lawsuit.)

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