What is New Mexico's dram shop law and how does it work?

If you are injured by someone who was overserved at a bar, you can seek damages against the liquor seller by using New Mexico’s dram shop laws.

Most states have variations of dram shop laws—named after 18th century British establishments that sold gin by tiny a amount called a “dram.” Dram shop laws are used to hold the liquor seller liable if they continue to serve someone who is obviously intoxicated.

Third-party liability

In New Mexico, the dram shop law involves third-party liability. It means that if someone appears overly intoxicated and continues to be served alcohol at an establishment and then that person causes an accident, the person injured in the accident can hold the establishment partly responsible for the damage.

Unless the establishment conducts blood-alcohol tests on every customer, there is no definitive way to show that one customer is more intoxicated than another. However, state law says you can hold an establishment liable if it:

  • Sold or served alcohol to an intoxicated person AND
  • The person’s intoxication was “reasonably apparent” OR
  • The establishment knew the person was intoxicated.

The state Supreme Court in 2012 helped define the issue in Gutierrez vs. Meteor Monument. In that case, the court ruled that intoxication must be visible, evident and easily observed by the establishment or its employees. Circumstantial evidence is allowable, including the intoxicated person’s testimony, the amount of time spent at the establishment, and the police report.

In addition to being liable for any damages caused by the intoxicated patron, establishments that overserve alcohol may receive citations:

  • First citation in a 12-month period results in a one-day closure and a fine of $1,000 to $2,000
  • Second citation in a 12-month period results in a seven-day closure and a fine of $2,000 to $3,000
  • Third citation in a 12-month period results in the revocation of the liquor license and a fine of $10,000

Social host liability

What if someone wasn’t overserved at a bar or restaurant but was overserved at someone’s house? Is the host responsible for their guest’s intoxication?

The answer is yes. Under New Mexico’s social host liability portion of the dram shop law, the hosts of private functions are liable for injuries or death caused by overserving alcohol or failing to prevent an intoxicated guest from driving.

The key phrase is if the host served alcohol in “reckless disregard” of the rights of others.

Generally, claims under the third-party or social host liability laws must be filed within three years. If you or someone you love has been harmed by a person who was overserved at a restaurant, bar or nightclub, talk to an experienced personal injury lawyer about your options for holding the responsible parties accountable.

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