Canada: ‘Tis The Season – Alcohol-Related Liability

Last Updated: December 17 2013
Article by Krista Prockiw

'Tis the season of holiday parties with many over imbibing on egg nog and other festive cocktails. Unfortunately, overdoing it during the holiday festivities can give rise not only to hangover-related headaches, but also to various forms of liability headaches.

Two recent Alberta decisions illustrate the potential types of claims that could arise out of a boozy holiday gathering.

Employer Liability

The liability of employers towards employees who consume alcohol at work gatherings (formal, informal, holiday or otherwise) was recently canvassed by the Court of Queen's Bench of Alberta in Jenkins v. Muir, 2012 ABQB 352.

In that decision, Melanie Bakalar, an employee of 4M Water Hauling Ltd. ("4M"), was killed in a head-on collision in the early hours of the morning when the vehicle that she was driving crossed the centre line and collided with a truck. Expert evidence established that at the time of the accident, Ms. Bakalar had a blood alcohol level of 3x the legal limit.

Ms. Bakalar's estate brought an action against 4M and its principals alleging that they failed to meet the standard of care required of an employer by, among other things:

  • providing alcohol to Ms. Bakalar;
  • allowing Ms. Bakalar to consume alcohol at their business premises;
  • not taking any or sufficient steps to prevent Ms. Bakalar from operating a motor vehicle when they knew or ought to have known that her ability to drive was impaired by alcohol;
  • failing to provide alternate transportation to Ms. Bakalar when they knew or ought to have known that her ability to drive was impaired by alcohol;
  • failing to monitor Ms. Bakalar's alcohol consumption and thereby creating unsafe workplace conditions and putting Ms. Bakalar at risk;
  • failing to set or to implement policies sufficient to forestall employees from driving when their ability to do so was impaired by alcohol.

The evening of the accident, an informal gathering had taken place after work hours at the offices of 4M. Various individuals came and went from this gathering, many of whom brought alcohol with them. The owner of 4M, Mr. Muir, gave evidence that he left the gathering around 9:00 p.m. at which time Ms. Bakalar did not appear intoxicated. It was his expectation that the gathering would shortly break up and people would leave. However, Ms. Bakalar and another colleague, Mr. Caya, stayed at the 4M office until 2:00 a.m., although Mr. Caya gave evidence that they stopped drinking at midnight. None of the other individuals at the gathering believed that Ms. Bakalar was intoxicated so as to be concerned about her ability to get home.

As 4M was in the transport business and its employees were mainly truck drivers whose livelihood depended upon them maintaining their driver's licenses, 4M had a strict policy that employees were not to drink and drive. Further, 4M had a well-known policy that employees were free to use local taxis at any time, for any reason, and to charge the company. In this regard, 4M had contracts with all of the local taxi companies. This policy was not limited to situations where taxis were needed because an employee's driving ability was impaired and, in fact, Ms. Bakalar herself had used taxis at 4M's expense a few times when her son needed to be driven somewhere and she was at work.

The court noted that the process for determining whether a duty of care arises, involves a three step inquiry:

  1. Foreseeability – a plaintiff must show that the defendant ought reasonably to have seen the risk that his or her acts or omissions would cause harm;
  2. Proximity – a plaintiff must show there was sufficient proximity between a plaintiff and a defendant to justify the recognition of a prima facie duty of care.
  3. The third and final step is for defendants to show whether there are any considerations which ought to negate or limit the scope of the duty of care.

The court in Jenkins focused on the foreseeability issue and framed the issue as being: "when Mr. Muir permitted Ms. Bakalar to drink alcohol at the 4M office in the context of the gathering that evening, ought he to have foreseen the risk that she would become so intoxicated by alcohol that her ability to drive would become impaired and that in the state of impairment she would drive her car and be involved in an accident?"

The court noted that in this instance, it was not proven that 4M or Mr. Muir provided the alcohol consumed by Ms. Bakalar. Nor did the evidence establish how much alcohol she actually drank during the part of the evening that Mr. Muir or others were able to observe her. Mr. Muir did not observe that she was inebriated when he left and neither did any of the witnesses who were at the gathering.

The court concluded that when Mr. Muir left the office it was not foreseeable that Ms. Bakalar would continue drinking to impairment. In addition, the court said held there was:

"no basis for concluding that Mr. Muir ought to have recognized it if Ms. Bakalar stayed and drank so much that her ability to drive was impaired that she would in fact drive."

The court noted that the evidence established that 4M had a generous taxi use policy which had in fact been used by Ms. Bakalar on prior occasions.

In short the court concluded that:

[63] In these circumstances I find that it has not been proved on a balance of probabilities that when Mr. Muir permitted Ms. Bakalar to drink alcohol in his office at the 4M premises, in the context of the gathering that occurred there on February 10, 2005, he ought to have foreseen the risk that she would become so intoxicated by alcohol that her ability to drive would become impaired and that in that state of impairment she would drive her car and be involved in an accident.

The action was therefore dismissed.

Motor Vehicle Liability

Unfortunately, the potential liability headaches do not end once a person enters a taxi as was illustrated in the recent case Alberta Court of Queen's Bench decision of Johnston v. Day, 2013 ABQB 512.

Karen Middleton ("Middleton") was a taxi driver for Crow's Nest Taxi and had collected a regular fare, Gary Day ("Day") who was known as a habitual drunk and drug user. According to Middleton, Day was drunk 75% of the time when being transported by Crow's Nest Taxi. When Day was being driven by Crow's Nest Taxi he would, on occasion, ask the drivers to run errands such as going to a convenience store.

The day of the accident, Day asked Middleton, if she could buy him some fruit at a roadside fruit stand. Middleton stopped the taxi and parked it adjacent to the fruit stand leaving Day in the front seat. Unfortunately, Middleton also left the keys in the ignition. While standing in line at the fruit stand, Middleton heard Day start the taxi but she continued to wait in line and did not return to the taxi. Unfortunately, Day then put the taxi in drive and drove into the fruit stand injuring Middleton and others. Middleton and others commenced actions against Day and Crow's Nest Taxi with Middleton being a defendant in some of these actions.

At trial the owner of Crow's Nest Taxi stated that there were no rules, policies or discussions given to their drivers regarding leaving keys in the ignition or leaving a vehicle running while the driver was not in the vehicle. Middleton herself admitted that leaving the keys in the ignition with an impaired passenger ought to be something she should have known not to do as a matter of common sense because of the risk that the impaired passenger might take over the vehicle. Middleton also admitted to knowing that individuals impaired by alcohol and drugs can act erratically and unpredictably.

The court had no difficulty in finding that Day was negligent for the accident. The court also held that Middleton was liable as she appreciated the risks of leaving the keys in the vehicle with Day unattended. While Middleton had driven Day on numerous other occasions, the mere fact that nothing had occurred on these prior occasions was not determinative of the issue of liability. The court noted that:

"A practice that is foolhardy is not elevated to the normative discharge of a duty owed. It is precisely because the practice is foolhardy that when an event occurs, as a result of a foolhardy practice, a duty is breached attracting liability."

The court also held that the owner of Crow's Nest Taxi was negligent in failing to properly instruct the drivers, including Middleton, never to leave the keys in the vehicle with a drunk passenger in the front seat. Ironically, this was a practice that the owner of the taxi company himself followed in his dealings with Day.

With regards to apportionment of liability, the court found that Day was the most blameworthy and ultimately apportioned liability 65% to Day, 20% to Middleton and 15% to Crow's Nest Taxi.

The holiday season brings with it many challenges ranging from what gift to get your picky in-laws to, as illustrated above, avoiding liability. Best wishes for a Merry Christmas and a litigation-free holiday season.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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Krista Prockiw
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