When service creates liability

By the end of this lesson you can say who gets sued when an over-served guest causes harm. You can also check the sign that Ontario law makes your sale depend on. A refusal protects your guest, and it protects you and your employer from a bill.

What section 52 sets up

Section 52 of the Liquor Licence and Control Act, 2019 creates civil liability for a liquor sale. Civil liability means a person who was harmed can sue you and recover money. It is separate from any charge or fine.

The section applies only when one condition is met at the time of the sale. A person, or that person's employee or agent, sells liquor to or for a guest whose condition is such that:

• the liquor would apparently intoxicate the guest, or
• the liquor would increase the guest's intoxication,

and the guest would then be in danger of causing injury to themselves, or injury or damage to another person or their property.

Look at two words. "Apparently" asks what the guest's condition shows at the point of sale. "Sells" covers a sale to a guest directly, or for a guest through someone else's order, so you stay exposed either way.

Two parties are exposed: the person who sold the liquor, and the person whose employee or agent sold it. That is you and your employer.

The section sets out two rules:

1. If the guest dies by suicide or by accident while so intoxicated, an action under Part V of the Family Law Act lies against those two parties.
2. If the guest injures another person, or damages their property, while so intoxicated, that person is entitled to recover compensation from those two parties.

One night through section 52

A guest has been at your bar since six. By nine his condition is plain to you. He orders another double rye, and you pour it. That sale meets the condition in section 52: the drink would increase his intoxication, and put him in danger of causing injury or damage.

He drives home and hits another car. The other driver breaks her wrist, and her car is written off. Rule 2 gives her the claim. She recovers compensation for her wrist and her car from you, because you sold the liquor, and from your employer, because their employee sold it.

Change one fact. The guest dies by accident in that crash while so intoxicated. Rule 1 then opens an action under Part V of the Family Law Act against the same two parties.

Why this changes your job

The refusal you make is legal protection for three parties: the public, your employer, and you.

Section 32 of the Act already bans the sale. No person shall sell or supply liquor, or permit it to be sold or supplied, to a person who is or appears to be intoxicated. Section 32 tells you to stop. Section 52 says what the sale costs if you do not.

Module 4 teaches you how to read a guest's condition and refuse the sale, and section 52 is why that skill matters this much.

Sandy's Law and the FASD sign

Section 36 of the Act makes a lawful sale depend on a sign. No person shall sell or supply liquor, or offer to sell or supply it, from prescribed premises unless a prescribed sign warning of the dangers of fetal alcohol spectrum disorder (FASD) is displayed in accordance with the regulations. That disorder is the birth defects and brain damage the sign warns about.

Section 24 of O. Reg. 745/21 prescribes the premises, and where the sign goes in each one:

• a liquor consumption premises licence: where liquor is sold and served
• an endorsement authorizing the sale and service of liquor: where liquor is sold and served
• a ferment on premises facility licence: where persons make beer or wine
• a retail store: where liquor is purchased

In every case it goes up prominently, where patrons can see it.

The sign is the one posted on the website of the Alcohol and Gaming Commission of Ontario. It bears the words "WARNING: Drinking alcohol during pregnancy can cause birth defects and brain damage to your baby". A French sign from the same website may also be displayed. The sign must be at least 8 inches by 10 inches.

Bill 43 became Sandy's Law (Liquor Licence Amendment), 2004, assented to on June 24, 2004. It added section 30.1 to the old Liquor Licence Act, in force on February 1, 2005. Ontario repealed that Act on November 29, 2021, and the requirement moved into section 36 of the Act and section 24 of O. Reg. 745/21.

If the sign is missing

Before you sell or supply liquor, check that the sign is displayed where section 24 requires it. Section 36 binds "no person", so everyone who sells or supplies liquor from prescribed premises sits inside the prohibition, including you at the bar. Raise a missing sign and get it displayed before service continues.

The trap to expect on the test

The test likes to answer a civil liability question with a penalty. Section 52 is about compensation paid to the person who was harmed. A fine sits elsewhere in the Act.

The test may also name one party only. Section 52 names the seller and the employer, so an answer that clears either one is wrong. Expect a sign question with a wrong size or place. The sign is at least 8 inches by 10 inches, and where it goes depends on the premises type.

Recap

• Section 52 of the Act covers a sale to or for a guest whose condition shows the liquor would apparently intoxicate them, or increase their intoxication, into danger of causing injury or damage.
• If that guest injures a person or damages property while so intoxicated, the harmed person recovers compensation from the seller and the seller's employer.
• If that guest dies by suicide or by accident while so intoxicated, an action under Part V of the Family Law Act lies against the same two parties.
• Section 32 bans the sale to a person who is or appears to be intoxicated. Section 52 says what that sale costs.
• Section 36 bans sale or supply from prescribed premises unless the FASD warning sign is displayed. Section 24 of O. Reg. 745/21 sets its wording, its 8 by 10 inch minimum size, and its location. That rule is Sandy's Law.