Company Holiday Parties: Could Your Organization Be Liable for a Drunk Driving Accident?

The holiday season is almost upon us, which makes this a good time to talk about company holiday parties and potential liability for the intoxication of employees attending the party.
After attending a dinner purportedly sponsored by her employer, an airline employee got into a car accident with another vehicle, killing herself and the other driver. The administrator of the other driver’s estate sued, claiming that the airline was vicariously liable for the employee’s intoxicated driving. The employer claimed that Illinoislaw preempted it from any alcohol-related liability.What Happened

The administrator, “Lane,” produced evidence that the purpose of the dinner was to entertain the general manager of another branch of the employer, Korean Air, and that it had paid for the bill. The circuit court said this evidence created a genuine issue of material fact as to whether the employee was acting within the scope of her employment when the collision occurred, but it still dismissed the case, agreeing with the airline’s claim that state law preempted its liability for the provision of alcohol. Lane appealed.

What the Court Said

The Illinois Court of Appeals explained that it has “generally refused to impose liability under [state law] on employers who supply their employees with free alcohol at employer-sponsored events.”

In reviewing past case law, however, the court cited the case of a business operator who was found to have a “duty of ordinary care” to individuals who were killed because of the negligent operation of a motor vehicle driven by one of its patrons after the business operator “encouraged [an] invitee to bring alcoholic beverages onto its premises in order [to] consume to the point of intoxication; thereafter removed its invitee from the premises because of his intoxication; [and] ordered and assisted the invitee into the driver seat of his vehicle.”

The court also cited a case in which two brothers were cleared of a negligence claim for providing alcohol to a plaintiff’s daughter, but were held liable after “voluntarily undertaking to care for her after she became unconscious” and not doing so. This ruling showed that an act of omission, as well as affirmative misconduct (such as placing an intoxicated individual in his car), could result in liability. These cases established “a difference between claims arising from the defendant’s provision of alcohol and claims based on other theories of liability.”

Lane argued that a jury could find Korean Air vicariously liable under the theory of respondeat superior for the employee’s negligent driving. Since the lower court had already determined that it was at least possible that the employee had been acting within the scope of her employment at the time of the accident, appellate judges agreed and allowed her case to go forward.

Point to Remember

The court noted that liability for negligence can arise from acts, omissions or, in the case of respondeat superior, the employer-employee relationship, so long as the employee’s negligence is within the scope of the employment. (Hicks v. Korean Airlines Company, No. 1-09-0542 [2010]).

Tomorrow, we’ll offer some tips for having a holiday party for employees without risking liability.

Courtesy of BLR

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