Laws and Liability


As a person who works in a licensed business, there are a number of rights, responsibilities and liabilities that apply to you.

Rights are actions that you can choose to take in the responsible running of your business. Many of them are specified in the law (e.g., Business and Professions Code and Government Code). As an example, you have the right to refuse service if someone fails to show you adequate I.D.

Responsibilities are actions that you must take under specified circumstances. Again, many of them are spelled out in the law.                               ·

Liability occurs when you are held responsible for injury and damage that either occurs to your patrons or is caused by them. Some forms of liability are specified in the law–this is known as statutory liability. Other forms evolve through common law – a set of principles that guide the laying of responsibility in any specific case.

This training is designed to give you skills and knowledge to help you avoid breaking the law and reduce your risk of liability.

Licensees are strictly liable for all activities that occur at the licensed business and for the acts of their agents/employees.

Retail Operating Standards (License Types 20, 21, 40, 42, 48, 61)

The following requirements apply to stores, bars and taverns only:

  • Signs – “no loitering” and “no open containers” if requested by law enforcement
  • No drinking inside an off-sale (store) or outside an on-sale (bar) premises
  • Good lighting outside
  • Remove litter daily; sweep weekly
  • Graffiti removal – 3 days
  • Keep 2/3 of windows and doors clear
  • Pay phones – no incoming calls if requested by law enforcement
  • “Adults only” area for videos
  • Keep Standards on premises

Objectionable Conditions (All license types)

Upon notice from a district attorney, city attorney, county counsel or ABC, licensees must take reasonable steps to correct objectionable, nuisance conditions on or about the licensed premises and on abutting public sidewalks up to 20 feet from the premises, within a reasonable period of time.

The following is a list of objectionable conditions:

  • Disturbing the peace
  • Loitering
  • Drinking or drunk in public
  • Urinating
  • Harassing passersby
  • Drug activity
  • Loud music
  • Prostitution
  • Lewd conduct
  • Gambling

Types of Liability

Liability occurs when you are held responsible for injury and damage that either occurs to your patrons or is caused by them. This could include injury and damage from things such as slips and falls, fights or drunk driving collisions.

The liability of licensees and their employees falls into three areas of law: criminal, administrative, and civil. One situation that could potentially result in all three types of liability is the sale of alcohol to a minor.

Types of Liability

Type of Liability Arena Results
Criminal Court Fine, Community Service, Jail
Administrative ABC Fine, Suspension, Revocation
Civil Lawsuit Money Judgment

Criminal Liability (Court/Against the Server)

  • Individual seller/server held responsible for crime observed by law enforcement officer
  • Penalties
    • fine
    • community service
    • jail
  • Refer to ABC-608, Quick Summary of Common ABC Laws

Administrative Liability (ABC/Against the Licensee)

  • Fines range from $750 – $20,000
  • Suspension of license
  • Revocation of license
  • Licensee may accept penalty recommendation or request a hearing
  • Penalties decided on a case-by-case basis
  • Type of violation, facts of case and licensee’s past record taken into account
  • Administrative disciplinary action protects the public welfare and morals

Civil Liability (Lawsuit/Against Everyone)

Statutory Civil Liability

Civil liability refers to the potential civil legal liability of licensees and their seller/servers for injuries caused by their intoxicated patrons. Section 25602.1 of the Business and Professions Code defines statutory civil liability in California. Under the statute, liability exists only when the patron was obviously intoxicated and under age 21 at the time of the sale or service.

Common Law Duties of Care

Under common law, a licensee has a duty to exercise reasonable care for the safety of his or her patrons. When a licensee is negligent in exercising reasonable care, an aggrieved party may file a common law action in court and civil damages may result. Therefore, if the service of alcohol is negligent, common law liability may result under common law duties of care, regardless of the customer’s age.

Reckless conduct may also give rise to a lawsuit under common law. Reckless conduct goes beyond mere negligence. Reckless conduct is when a person has intentionally done an act of an unreasonable character; has disregarded a risk that he knew or should have known of; and it was highly probable that harm would follow. It usually is accompanied by a conscious indifference to the consequences.

If the service of alcohol can be characterized as reckless, the drinker – whether a minor or an adult – can recover for self-inflicted injuries. Or, at a minimum, not bar a wrongful death suit by his or her beneficiaries.

Reducing Risk of Liability

Recommendations for reducing the risk of liability:

  • Promote food and non-alcoholic drinks
  • Promote safe rides
  • Implement no drinking on duty policy
  • Have responsible promotions
  • Provide training for staff
  • Maintain adequate staffing
  • Have written-policies
  • Hire qualified employees
  • Support employees’ decisions

Pertinent Laws

Section 25658(a) Business and Professions Code (Sale to a Minor):
Every person who sells, furnishes, gives, or causes to be sold, furnished, or given away, any alcoholic beverage to any person under the age of 21 years is guilty of a misdemeanor.

Section 25658(b) Business and Professions Code (Purchase/Consumption by Minors):
Any person under the age of 21 years who purchases any alcoholic beverage, or consumes any alcoholic beverage in any on-sale premises, is guilty of a misdemeanor.

Section 25665 Business and Professions Code (No Person Under 21 Allowed):
Any bar or tavern licensee who permits a minor to enter and remain without lawful business is guilty of a misdemeanor. The minor is also guilty of a misdemeanor.

Section 13202.5(a) Vehicle Code (Use-Lose Law):
A person aged 13-20 convicted of a drug or alcohol related crime the court shall suspend their driver’s license for one year or delay the issuance for one year.


Additional information may be obtained by contacting:

Alcoholic Beverage Control
3927 Lennane Drive, Suite 100
Sacramento, CA 95834

Email us at
Call (916) 419-2500