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HB-4684, As Passed Senate, February 19, 2008

SENATE SUBSTITUTE FOR

HOUSE BILL NO. 4684

A bill to amend 1998 PA 58, entitled

"Michigan liquor control code of 1998,"

by amending sections 707, 801, 901, 906, and 1025 (MCL 436.1707,

436.1801, 436.1901, 436.1906, and 436.2025), section 906 as amended

by 2000 PA 431 and section 1025 as amended by 2002 PA 725.

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

Sec. 707. (1) A vendor shall not sell, serve, or furnish any

alcoholic liquor to any person in an intoxicated condition.

(2) A licensee shall not allow a person who is in an

intoxicated condition to consume alcoholic liquor on the licensed

premises.

(3) A licensee, or the clerk, servant, agent, or employee of a

licensee, shall not be in an intoxicated condition on the licensed

premises.

(4) A licensee shall not allow an intoxicated person to

frequent or loiter on the licensed premises except where the

intoxicated person has been refused service of further alcoholic

liquor and continues to remain on the premises for the purpose of

eating food, seeking medical attention, arranging transportation

that does not involve driving himself or herself, or any other

circumstances where requiring the person to vacate the premises

immediately would be considered dangerous to that person or to the

public.

(5) A licensee shall not allow a minor to consume alcoholic

liquor or to possess alcoholic liquor for personal consumption on

the licensed premises.

(6) A licensee shall not allow any person less than 18 years

of age to sell or serve alcoholic liquor.

(7) A licensee shall not allow any person less than 18 years

of age to work or entertain on a paid or voluntary basis on the

licensed premises unless the person is employed in compliance with

the youth employment standards act, 1978 PA 90, MCL 409.101 to

409.124. This subsection does not apply to an entertainer under the

direct supervision and control of his or her parent or legal

guardian.

Sec. 801. (1) Except as otherwise provided in this act, before

the approval and granting, or renewal, of a license, the following

licensees or applicants for that license shall make, execute, and

deliver to the commission a bond executed by a surety company

authorized to do business in the state or, in the discretion of the

commission, by approved personal surety running to the people of

the state, in the following amounts:

(a) A manufacturer of beer, a manufacturer of wine, a mixed

spirit drink manufacturer, an outstate seller of beer, an outstate

seller of mixed spirit drink, and an outstate seller of wine, a

bond in an amount equal to 1/12 of the total beer, mixed spirit

drink, or wine excise taxes paid to the state in the last calendar

year or a bond in the sum of $1,000.00, whichever is greater, for

the faithful performance of the conditions of the license issued

and for compliance with this act. A surety shall not cancel a bond

issued under this subdivision except upon 30 days' written notice

to the commission.

(b) A special license authorizing the sale of beer, mixed

spirit drink, wine, or spirits for consumption on the premises, a

bond in the sum of $1,000.00. A bond issued under this subdivision

shall remain in effect for 60 days after the expiration of the

special license. A bond is not required for a church or school.

(2) A retail licensee shall not directly, individually, or by

a clerk, agent, or servant sell, furnish, or give alcoholic liquor

to a minor except as otherwise provided in this act. A retail

licensee shall not directly or indirectly, individually or by a

clerk, agent, or servant sell, furnish, or give alcoholic liquor to

a person who is visibly intoxicated.

(3) Except as otherwise provided in this section, an

individual who suffers damage or who is personally injured by a

minor or visibly intoxicated person by reason of the unlawful

selling, giving, or furnishing of alcoholic liquor to the minor or

visibly intoxicated person, if the unlawful sale is proven to be a

proximate cause of the damage, injury, or death, or the spouse,

child, parent, or guardian of that individual, shall have a right

of action in his or her name against the person who by selling,

giving, or furnishing the alcoholic liquor has caused or

contributed to the intoxication of the person or who has caused or

contributed to the damage, injury, or death. In an action pursuant

to this section, the plaintiff shall have the right to recover

actual damages in a sum of not less than $50.00 in each case in

which the court or jury determines that intoxication was a

proximate cause of the damage, injury, or death.

(4) An action under this section shall be instituted within 2

years after the injury or death. A plaintiff seeking damages under

this section shall give written notice to all defendants within 120

days after entering an attorney-client relationship for the purpose

of pursuing a claim under this section. Failure to give written

notice within the time specified shall be grounds for dismissal of

a claim as to any defendants that did not receive that notice

unless sufficient information for determining that a retail

licensee might be liable under this section was not known and could

not reasonably have been known within the 120 days. In the event of

the death of either party, the right of action under this section

shall survive to or against his or her personal representative. In

each action by a husband, wife, child, or parent, the general

reputation of the relation of husband and wife or parent and child

shall be prima facie evidence of the relation, and the amount

recovered by either the husband, wife, parent, or child shall be

his or her sole and separate property. The damages, together with

the costs of the action, shall be recovered in an action under this

section. If the parents of the individual who suffered damage or

who was personally injured are entitled to damages under this

section, the father and mother may sue separately, but recovery by

1 is a bar to action by the other.

(5) An action under this section against a retail licensee

shall not be commenced unless the minor or the alleged intoxicated

person is a named defendant in the action and is retained in the

action until the litigation is concluded by trial or settlement.

(6) Any licensee subject to the provisions of subsection (3)

regarding the unlawful selling, furnishing, or giving of alcoholic

liquor to a visibly intoxicated person shall have the right to full

indemnification from the alleged visibly intoxicated person for all

damages awarded against the licensee.

(7) All defenses of the alleged visibly intoxicated person or

the minor shall be available to the licensee. In an action alleging

the unlawful sale of alcoholic liquor to a minor, proof that the

defendant retail licensee or the defendant's agent or employee

demanded and was shown a Michigan driver license or official state

personal identification card, appearing to be genuine and showing

that the minor was at least 21 years of age, shall be a defense to

the action.

(8) There shall be a rebuttable presumption that a retail

licensee, other than the retail licensee who last sold, gave, or

furnished alcoholic liquor to the minor or the visibly intoxicated

person, has not committed any act giving rise to a cause of action

under subsection (3).

(9) The alleged visibly intoxicated person shall not have a

cause of action pursuant to this section and a person shall not

have a cause of action pursuant to this section for the loss of

financial support, services, gifts, parental training, guidance,

love, society, or companionship of the alleged visibly intoxicated

person.

(10) This section provides the exclusive remedy for money

damages against a licensee arising out of the selling, giving, or

furnishing of alcoholic liquor to a minor or intoxicated person.

(11) Except as otherwise provided for under this section and

section 815, a civil action under subsection (3) against a retail

licensee shall be subject to the revised judicature act of 1961,

1961 PA 236, MCL 600.101 to 600.9947.

Sec. 901. (1) A person, directly or indirectly, himself or

herself or by his or her clerk, agent, or employee, shall not

manufacture, manufacture for sale, sell, offer or keep for sale,

barter, furnish, import, import for sale, transport for hire,

transport, or possess any alcoholic liquor unless the person

complies with this act.

(2) A licensee shall not allow unlawful gambling on the

licensed premises and shall not allow on the licensed premises any

gaming devices prohibited by law.

(3) A licensee shall not sell, offer or keep for sale,

furnish, possess, or allow a customer to consume alcoholic liquor

that is not authorized by the license issued to the licensee by the

commission.

(4) A licensee shall not sell or furnish alcoholic liquor to a

person who maintains, operates, or leases premises that are not

licensed by the commission and upon which other persons unlawfully

engage in the sale or consumption of alcoholic liquor for

consideration as prohibited by section 913.

(5) A retail licensee shall not, on his or her licensed

premises, sell, offer for sale, accept, furnish, possess, or allow

the consumption of alcoholic liquor that has not been purchased by

the retail licensee from the commission or from a licensee of the

commission authorized to sell that alcoholic liquor to a retail

licensee. This subsection does not apply to the consumption of

alcoholic liquor in the bedrooms or suites of registered guests of

licensed hotels or in the bedrooms or suites of bona fide members

of licensed clubs.

Sec. 906. (1) As used in this section:

(a) "Administrator" means a qualifying company, postsecondary

educational institution, or trade association authorized by the

commission to offer server training programs and instructor

certification classes in compliance with this section and to

certify to the commission that those persons meet the requirements

of this section.

(b) "Instructor" means an individual certified by an

administrator and approved by the commission to teach server

training programs. An instructor may be a licensee or an employee

of a licensee.

employee of a licensee to a visibly intoxicated person or to a

minor, or both.

(d) "Responsible vendor" means a designation by the commission

of a retail licensee meeting the standards of this section.

(e) "Server training program" means an educational program

whose curriculum has been approved by the commission under the

standards described in this section and is offered by an

administrator or instructor to a retail licensee for its employees.

(2) The commission shall approve the establishing of a server

training program designed for all new on premises licensees or

transferees of more than a 50% interest in an on premises license

on or after the commencement of the mandatory server training

program, and for any existing retail licensees the commission

determines to be in need of training due to the frequency or types

of violations of this act involving the serving of alcoholic

liquor. This subsection does not apply to special licenses except

that the commission may require server training for certain special

licensees based upon the size and nature of the licensed event. The

commission may adopt the existing standards and programmatic

framework of private entities and may delegate nondiscretionary

administrative functions to outside private entities.

(3) The commission shall establish a program in which the

commission designates certain retail licensees, except special

licenses, as responsible vendors. The commission may adopt the

existing standards and programmatic framework of private entities

and may delegate nondiscretionary administrative functions to

outside private entities.

(4) The commission shall designate as a responsible vendor a

retail licensee who makes available to all full-time and part-time

retail employees, within 60 days after being hired, a server

training program and who is also free of convictions or

administrative determinations involving prohibited sales for not

less than 12 months before applying for the designation. The

designation continues until suspended by the commission.

(5) A person may apply to the commission for qualification as

an administrator for the offering of server training programs and

instructor certification classes.

(6) The commission shall approve a curriculum for a server

training program presented by a certified instructor in a manner

considered by the commission to be adequate that includes, but is

not limited to, all of the following topics:

(a) The identification of progressive stages of intoxication

and the visible signs associated with each stage.

(b) The identification of the time delay between consumption

and visibility of signs of progressive intoxication.

drinks containing alcoholic liquor.

(d) Variables associated with visible intoxication, including

the rate of drinking, experience, weight, food consumption, sex,

and use of other drugs.

(e) Personal skills to handle slow-down of service and

intervention procedures.

(f) Procedures for monitoring consumption and maintaining

incident reports.

(g) The understanding of acceptable forms of personal

identification, techniques for determining the validity of

identification, and procedures for dealing with fraudulent

identification.

(h) Assessment of the need to ask for identification based on

appearance or company policy.

(i) The identification of potential second-party sales and

furnishing ~~alcohol~~ of alcoholic liquor to minors by persons 21

years of age or over.

(j) The understanding of possible legal, civil, and

administrative consequences of violations of this act, the rules of

the commission, and other pertinent state laws.

(k) The understanding of Michigan laws pertaining to minors

attempting to purchase, minors in possession, and second-party

sales or furnishing of ~~alcohol~~ alcoholic liquor from adults to

minors.

(l) Knowledge of the legal hours of ~~alcohol~~ alcoholic liquor

service and occupancy.

(m) The identification of signs of prohibited activities, such

as gambling, solicitation for prostitution, and drug sales.

(n) Any other pertinent laws as determined by the commission.

(7) The commission shall issue an instructor certification to

an individual presenting evidence acceptable to the commission of

having successfully completed instructor certification classes and

shall issue an identification card indicating that certification by

the commission.

(8) Upon approval by the commission of a server training

program, the commission shall appoint the person sponsoring the

server training program as an administrator of that program. The

administrator shall provide a certification to the commission that

a retail licensee has successfully completed the server training

program offered by a certified instructor and approved by the

commission and shall recommend that the commission designate the

licensee as a responsible vendor.

(9) A certified instructor who is a licensee or an employee of

a licensee may offer server training programs approved by the

commission to the employees of the licensee and certify to the

commission those persons who successfully completed the program.

(10) An on premises licensee whose license was issued or who

was the transferee of more than a 50% interest in an on premises

license on or after the commencement of the mandatory server

training program or an on premises licensee determined by the

commission to be in need of training due to the frequency or types

of violations of this act involving the serving of alcoholic liquor

must have employed or present on the licensed premises, at a

minimum, supervisory personnel who have successfully completed a

server training program on each shift and during all hours in which

alcoholic liquor is served. An on premises licensee must keep a

copy of the responsible vendor designation or proof of completion

of server training on the licensed premises to facilitate the

verification of such designation by the commission, agent of the

commission, or law enforcement officer. An on premises licensee

determined by the commission to have violated this subsection is

subject to revocation, suspension, or other sanction as provided

for in section 903. A violation of this subsection is not a

violation of section 909.

(11) As a condition of the designation of a licensee as a

responsible vendor, the licensee shall make available to the

administrator in not less than 60-day time increments records

sufficient to verify the names and social security numbers of his

or her employees. The administrator shall provide to the commission

a list of names and social security numbers of individuals who have

successfully completed the server training program and shall

monitor the licensee in a manner approved by the commission in

order to verify continued compliance of the licensee's status as a

responsible vendor. The administrator shall notify the commission

in writing as soon as it determines that the licensee has failed to

maintain the standards for server training or has failed to

cooperate with the administrator's verification procedure. Upon

receipt of such a notice from the administrator, the commission

shall suspend the licensee's designation as a responsible vendor.

(12) The commission may suspend the designation of a retail

licensee as a responsible vendor upon a conviction or

administrative determination of a prohibited sale on the licensee's

licensed premises. The retail licensee losing such a designation

may reapply for designation as a responsible vendor upon the

passage of 12 months from the date of the conviction or

administrative determination of a prohibited sale if the licensee

is not convicted or administratively determined to have engaged in

a prohibited sale on the licensed premises. After the first

instance of a retail licensee losing its designation as a

responsible vendor, that retail licensee is not eligible to reapply

for such a designation until an additional 3 months for each

subsequent conviction or determination. The 3-month time periods

are to be in addition to the 12-month period described in this

subsection.

(13) A responsible vendor is not considered to be in violation

of the prohibition contained in ~~R 436.1005(4) of the Michigan~~

~~administrative code~~ section 707(4) regarding allowing an

intoxicated person to frequent or loiter on the licensed premises

unless the facts demonstrate otherwise.

Sec. 1025. (1) A vendor shall not give away any alcoholic

liquor of any kind or description at any time in connection with

his or her business, except manufacturers for consumption on the

premises only.

(2) Subsection (1) does not prevent any of the following:

(a) A vendor of spirits, brewer, mixed spirit drink

manufacturer, wine maker, small wine maker, outstate seller of

beer, outstate seller of wine, or outstate seller of mixed spirit

drink, or a bona fide market research organization retained by 1 of

the persons named in this subsection, from conducting samplings or

tastings of an alcoholic liquor product before it is approved for

sale in this state, if the sampling or tasting is conducted

pursuant to prior written approval of the commission.

(b) A person from conducting of any sampling or tasting

authorized by rule of the commission.

tourists and visitors in a resort area from giving away alcoholic

liquor to an invitee or guest in connection with a business event

or as a part of a room special or promotion for overnight

accommodations.

(3) A vendor shall not sell an alcoholic liquor to a person in

an intoxicated condition.

(4) Evidence of any breathalyzer or blood alcohol test results

obtained in a licensed establishment, or on property adjacent to

the licensed premises and under the control or ownership of the

licensee, shall not be admissible to prove a violation of this

section, section 707(1), (2), (3), or (4), or section 801(2). To

establish a violation of this section, section 707(1), (2), (3), or

(4), or section 801(2), the person's intoxicated condition at the

time of the sale or consumption of alcohol must be proven by direct

observation by law enforcement or commission enforcement personnel

or through other admissible witness statements or corroborating

evidence obtained as part of the standard investigation other than

breathalyzer or blood alcohol test results.

Enacting section 1. The following rules are rescinded:

(a) R 436.1005 of the Michigan administrative code.

(b) R 436.1009 of the Michigan administrative code.

(d) R 436.1017 of the Michigan administrative code.

(e) R 436.1033 of the Michigan administrative code.