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Ennabe v. Manosa
Citations: 58 Cal. 4th 697; 168 Cal. Rptr. 3d 440; 319 P.3d 201; 2014 WL 701894; 2014 Cal. LEXIS 1426Docket: S189577
Court: California Supreme Court; February 24, 2014; California; State Supreme Court
Original Court Document: View Document
The case involves Faiez Ennabe, the plaintiffs, appealing a decision against Jessica Manosa and others, the defendants. Significant legal history is highlighted, noting that three California Supreme Court cases from 1971 to 1978 previously established potential liability for sellers of alcoholic beverages for injuries caused by intoxicated individuals. However, in 1978, the California Legislature largely reversed this by reinstating the common law principle that the act of consuming alcohol, rather than its sale, is the proximate cause of injuries, effectively granting civil immunity to sellers in most circumstances. The Legislature did, however, create an exception in section 25602.1, which allows for liability if alcohol is sold to an obviously intoxicated minor. In this case, the court examines whether Manosa can be held liable under this exception after an underage guest at her party, who paid an entry fee for drinks, later caused a fatal car accident while intoxicated. The court solicited insights from the Department of Alcoholic Beverage Control regarding the interpretation of the law. The court concludes that the facts presented suggest potential liability for Manosa as she charged an entry fee allowing access to alcoholic beverages, which may qualify as selling alcohol under section 25602.1. This creates a triable issue, leading to the reversal of the Court of Appeal's affirmation of the trial court's summary judgment in favor of Manosa. The background details that the party, held without parental consent, attracted a large number of attendees, mostly underage. Manosa contributed $60 towards purchasing rum, tequila, and beer for her party and provided cups and cranberry juice, while friends Mario Aparicio and Marcello Aquino contributed funds and purchased the alcohol. The beverages were stored in a refrigerator and on a table outside. Manosa lacked a license to sell alcohol. Guests arrived around 9:00 p.m., entering through a side gate. Manosa instructed Todd Brown to act as a bouncer, charging $3 to $5 for entry. Uninvited guest Thomas Garcia paid $20 for himself and friends to enter, with Brown indicating alcohol was available. Brown collected $50 to $60 in entrance fees, allegedly used for more alcohol later. It was unclear if attendees brought their own drinks. Andrew Ennabe, an invited guest, arrived before midnight, followed by Garcia and his friends, who were underage and visibly intoxicated. Garcia had consumed whiskey beforehand but later denied drinking at the party, despite other guests witnessing him drink. His disruptive behavior led to him being asked to leave, with Ennabe and others escorting him out. A confrontation ensued leading to Garcia running over Ennabe as he drove away, resulting in Ennabe's severe injuries and eventual death. Plaintiffs Faiez and Christina Ennabe filed a wrongful death lawsuit against Manosa and her parents, citing general negligence, premises liability, and liability under section 25602.1, which addresses serving alcohol to intoxicated minors. Defendants sought summary judgment, arguing plaintiffs could not establish liability under the cited section and claimed civil immunity under sections 25602, subdivision (b), and Civil Code section 1714, subdivision (c). Plaintiffs contended that charging an entrance fee constituted selling alcohol, negating civil immunity. The trial court granted the defendants' summary judgment on all claims, a decision upheld by the Court of Appeal, leading to a petition for review by the plaintiffs. A trial court may grant a motion for summary judgment only when no triable issues exist and the moving party is entitled to judgment as a matter of law, per Code Civ. Proc. § 437c, subd. c. The moving party must demonstrate that the plaintiff cannot establish the elements of their cause of action. The court's decision is reviewed de novo, with evidence construed in favor of the opposing party. This case examines statutory immunity for social hosts who offer alcohol to guests and the exception for those who serve alcohol to obviously intoxicated minors. Historically, California law held that individuals who provided alcohol were not liable for damages from intoxication, a stance supported by the Legislature's inaction on dramshop laws. The first legal shift occurred in 1971 with Vesely v. Sager, which allowed liability for vendors serving alcohol to obviously intoxicated individuals. Bernhard v. Harrah’s Club later extended potential liability to noncommercial hosts, establishing that serving alcohol to an intoxicated guest who intends to drive constitutes a breach of reasonable care. The legal landscape has evolved from nonliability to recognizing potential civil liability under modern negligence principles. The service of alcoholic beverages to an obviously intoxicated person who intends to drive poses a foreseeable risk of injury to others, as established in prior case law. In response, the California Legislature enacted changes in 1978 to abrogate these case holdings and restore the common law principle that the consumption of alcohol, rather than its service, is the proximate cause of injuries from intoxication. This legislative change included amendments to Civil Code section 1714, which now states that social hosts who provide alcohol cannot be held liable for damages resulting from the consumption by intoxicated individuals. Additionally, Business and Professions Code section 25602 was amended to provide civil immunity to those who serve alcohol to habitual drunks or obviously intoxicated individuals, explicitly overriding previous case law. However, a single exception was established through section 25602.1, which allows for liability against licensees who serve alcohol to underage intoxicated minors, permitting actions for injuries they inflict on themselves or others. Section 25602.1 of California law establishes a narrow exception to civil immunity for alcohol providers, applicable only to licensed sellers who provide alcohol to obviously intoxicated minors. Nonlicensed sellers retain their immunity when serving sober minors or intoxicated adults. Notably, while an intoxicated minor and those injured by them can pursue legal action against the seller, adults and their injured parties cannot. The law does not extend liability to vendors who were required to be licensed but failed to obtain a license. This creates a liability disparity favoring nonlicensed sellers. Subsequent court cases, including Cory v. Shierloh and a Ninth Circuit ruling, highlighted these limitations and led to the 1986 amendments to section 25602.1, which aimed to clarify and expand the statute. The amendments were partly in response to judicial decisions that underscored the immunity enjoyed by unlicensed sellers and certain military establishments. The legislative intent was to eliminate the distinction between licensed and required-to-be-licensed sellers, while confirming that social hosts providing alcohol for free would not incur liability. Under the current version of section 25602.1, liability arises if a defendant provides alcohol to an obviously intoxicated minor, leading to injuries or death, under two conditions: the defendant must be licensed, required to be licensed, or federally authorized to sell alcohol, or they could be any other person who sold alcohol to the minor. Licensees and individuals required to be licensed can be held liable for providing alcoholic beverages, while nonlicensees, such as social hosts, are only liable if a sale occurs. Even if a nonlicensee provides drinks to an intoxicated minor, they typically retain statutory immunity. In this case, Thomas Garcia, an underage and obviously intoxicated individual, attended a party hosted by Manosa, who was not licensed to sell alcohol. Garcia’s intoxication led to Andrew Ennabe’s death, prompting the question of Manosa's liability under immunity statutes. Manosa argues she is immune from liability under both Business and Professions Code section 25602 and Civil Code section 1714, which generally protect social hosts from legal accountability for injuries resulting from alcohol consumption. However, the applicability of the Business and Professions Code to Manosa is examined. Legislative provisions indicate that section 25602.1, which outlines exceptions to immunity, is relevant to both commercial and noncommercial providers of alcohol. Although the statute primarily addresses licensed sellers, it also includes a catchall category for "any other person" who sells alcohol, suggesting that it applies to private individuals like Manosa who charge for alcoholic beverages. Thus, despite Manosa's claim of immunity, her potential liability arises from the classification of her actions as a sale of alcohol to an obviously intoxicated minor, thereby invoking the Business and Professions Code. The excerpt analyzes the applicability of section 25602.1 of the Business and Professions Code concerning the sale of alcoholic beverages by individuals, including those not engaged in commercial activities. It notes that while typically a license is required to sell alcoholic beverages, the term 'person' in this section can encompass private individuals, such as defendant Manosa, who may not operate a commercial enterprise. The excerpt references various provisions within the ABC Act that regulate both commercial and noncommercial activities involving alcohol, indicating that the code's scope extends beyond purely business contexts. It highlights that violations, such as providing alcohol to minors, can also be committed by private individuals, further supporting the interpretation that section 25602.1 is not limited to commercial sellers. Additionally, it points out that even if one were to argue that noncommercial social hosts should be governed by Civil Code section 1714, this does not clarify when a social host becomes a commercial entity by selling alcohol. The excerpt concludes with the intention to examine whether Manosa sold alcoholic beverages as defined by section 25602.1, which allows for a cause of action against any person who sells or causes to sell alcohol to an obviously intoxicated minor, potentially shedding civil immunity. The interpretation of 'sold' in this context is positioned as a matter of statutory construction, emphasizing the need to understand the Legislature's intent. The statute's plain meaning prevails if it is unambiguous, negating the need for extrinsic sources to determine legislative intent. California's Constitution grants the state exclusive authority to regulate alcohol sales, exercised through the ABC Act, which emphasizes a liberal construction to counter unlicensed sales and promote temperance. This liberal interpretation suggests a tendency to allow liability to deter underage or intoxicated alcohol provision. However, general civil immunity exists for alcohol sales, with section 25602.1 as a strict exception requiring careful interpretation. The ABC Act's section 23025 defines 'sell,' 'sale,' and 'to sell' broadly, encompassing any transaction that transfers title to alcoholic beverages for any consideration, thereby indicating legislative intent for extensive coverage, including indirect transactions. The defendant's argument, which claims there was no sale due to the absence of a title transfer at the time of an entrance fee payment, is countered by the broad statutory definition that does not necessitate possession transfer. The 1937 amendment to section 23025 supports this interpretation, reinforcing the conclusion that the definition captures indirect sales. The original version of section 23025, which predated the ABC Act, defined the transfer of title to alcoholic beverages without possession as not constituting a sale. In 1937, the Legislature removed this provision, thereby expanding the definition of a sale to include situations without immediate possession transfer. Legislative intent is presumed to change when statutory language is modified. In the case of Garcia, title to a drink passed to him when he poured and consumed it, despite not having immediate possession upon paying an entrance fee. The definition of 'sale' under section 23025 includes Garcia's payment, and the absence of immediate possession does not negate the transaction. The defendant argues section 23025 is ambiguous compared to other statutes that explicitly define direct and indirect sales; however, those statutes are irrelevant as they do not pertain to alcoholic beverages. Section 23025 specifically addresses the sale of alcoholic beverages and uses 'any' to encompass indirect sales. There is no prior California appellate decision regarding the classification of a cover charge as a sale of alcohol under the ABC Act. Nevertheless, the ruling aligns with section 25604, which recognizes 'consideration' for alcoholic beverages as including cover charges, thereby supporting that a cover charge constitutes a sale. Concluding otherwise would contradict legislative intent, as no evidence suggests a narrower definition of 'sale' was intended. The analysis concludes that the facts presented indicate a sale occurred under section 25602.1, aligning with an opinion from the Office of the Attorney General regarding the provision of complimentary alcoholic beverages. The Attorney General, responding to the Department of ABC's inquiry, determined that offering complimentary drinks while simultaneously charging for related services constitutes a sale under section 23025, focusing on whether the drinks are genuinely free or provided for consideration. Although the AG's opinion pertains to commercial operators rather than social hosts, its reasoning remains relevant. The Attorney General referenced three out-of-state cases where complimentary alcoholic beverages were deemed part of a sale: in one case, a restaurant provided wine with a meal; in another, a social club charged a fee for entry that included free drinks; and in the last, a dwelling charged for meals that included free alcohol. All cases concluded that a sale had occurred. The Attorney General asserted that when the cost of an alcoholic beverage is embedded in a broader charge (like for meals or admission), it constitutes a sale, even if no separate price is assigned. Applying this reasoning, Manosa's practice of charging guests for party entry while providing alcoholic beverages means those drinks were not free but provided for consideration, thus constituting a sale under the ABC Act. The Department of ABC supports this interpretation, indicating that a sale can occur through admission fees to access alcohol. The department's position, articulated in its amicus curiae brief, aligns with its November 2009 trade enforcement information guide (TEIG) regarding the ABC Act. The TEIG specifies that under section 23399.1, a liquor license is not required if there is no sale of alcohol at a private party. However, it clarifies that the term 'sale' encompasses indirect transactions, such as when an admission fee includes alcohol, thereby necessitating an ABC license. This interpretation supports the conclusion that transactions at Manosa's party constituted a sale of alcoholic beverages, making her liable under section 25602.1 for any resulting injuries or deaths. Manosa argues that the definitions of "sell" and "sale" imply a profit motive, suggesting that the context of section 25602.1's civil immunity exception necessitates a different interpretation. While the TEIG is not legally binding as it was not formally adopted under the Administrative Procedure Act, it reflects the department's expertise in enforcing the ABC Act and is considered persuasive. Courts typically defer to the department’s interpretations unless context dictates otherwise. Ultimately, the consensus among the department, the Attorney General, and established legal definitions supports the view that the activities at Manosa's party qualify as sales under the law, permitting legal action against her. The legal interpretation of the term "sale" within the context of the statute is emphasized, focusing on the avoidance of rendering the term "furnish" redundant. Courts are urged to give significance to every word in a statute, as seen in Arnett v. Dal Cielo and California Teachers Assn. v. Governing Bd. of Rialto Unified School Dist. The definition of "sale" in the Business and Professions Code indicates a business or commercial context, similar to the placement of statutes in other codes. The argument against imposing a commercial gain requirement on the term "sells, or causes to be sold" in section 25602.1 is supported by the statutory definition of "sale," which does not necessitate profit. Courts should not alter clear statutory language or add requirements not present in the statute or its legislative history, as reiterated in In re Jennings and Security Pacific National Bank v. Wozab. The Department of ABC agrees that neither profit nor intent to gain is necessary for a sale, and that consideration equal to or less than the seller's cost is valid. The distinction between "sell" and "furnish" maintains that a sale involves consideration while mere furnishing does not. Section 25602.1 creates liability for licensees providing alcohol to intoxicated minors, differentiating between commercial entities and individuals, reflecting legislative intent to address concerns raised in Cory v. Shierloh regarding social host immunity. A benefit provided to a promisor by another individual, which the promisor is not legally entitled to, or any detriment willingly accepted by that person, can serve as valid consideration for a promise. The defendant argues against the application of section 23025’s definition of a "sale" in cases involving the provision of alcohol to minors at social gatherings, claiming it could lead to illogical outcomes. However, it is clarified that consideration for a sale does not need to be in cash; it can be any form of value. The defendant's example of a social gathering where guests bring desserts in exchange for alcohol is refuted, as such gifts are customary and do not constitute a transactional exchange for alcohol. The situation in question involved an operation resembling a nightclub with a cover charge, which clearly fits the definition of a sale under section 23025. The Department of ABC states that they do not typically regulate informal gatherings among friends but will act when alcohol is exchanged for payment. Furthermore, the Department expresses no concern that the current standard is unworkable, and the interpretation aligns with the statutory language and the agency's enforcement practices. The importance of context in social settings is emphasized, noting that alcohol is often provided at various events where contributions from attendees are anticipated. The defendant contends that recognizing indirect transactions as sales of alcohol under section 23025 would disrupt societal norms. However, this claim is deemed exaggerated. Typically, guests at events like bar mitzvahs or weddings do not pay an entrance fee, and alcohol provision at such gatherings falls under social host immunity per Civil Code section 1714, subdivision (c). Even if a host charges for alcohol, civil liability arises primarily if alcohol is sold to an obviously intoxicated minor. Unlike the defendant's behavior at her event, ordinary hosts do not employ bouncers or charge guests. The court argues that maintaining social norms does not necessitate protecting individuals who serve alcohol to visibly intoxicated minors. The defendant also argues that applying section 25602.1 could yield irrational outcomes, citing scenarios where guests might pay but not drink, drink beverages from others, or enter for free. The court rejects this notion, stating that liability hinges on the proximate cause of injury. If a paying guest does not drink, liability cannot arise, as the sale must be the proximate cause of the injury. Similarly, if a guest consumes alcohol not provided by the host, the host cannot be held liable. Guests who pay no admission charge maintain the host's immunity since consideration is necessary for a sale under section 23025. Ultimately, if evidence shows that the defendant charged an entrance fee that allowed guests to consume provided alcohol, she could be liable for the death of Ennabe under section 25602.1's exception to immunity concerning sales of alcohol to intoxicated minors. The conclusion emphasizes the Legislature's intent to limit liability for those providing alcoholic beverages, asserting that the act of consuming, rather than serving, is the proximate cause of resulting injuries. Social hosts are generally protected from liability for damages resulting from the consumption of alcoholic beverages they provide, according to Civil Code section 1714, subdivision c. However, there are specific exceptions to this immunity. One pertinent exception involves liability for hosts who sell alcohol to minors who are obviously intoxicated, as outlined in section 25602.1. The court found sufficient evidence suggesting that defendant Manosa sold alcoholic beverages to Garcia, an obviously intoxicated minor, whose intoxication was the direct cause of Andrew Ennabe's death. Consequently, the trial court's grant of summary judgment in favor of Manosa was incorrect. The Court of Appeal's decision is reversed, and the case is remanded for further proceedings. The opinion is supported by justices Werdegar, Cantil-Sakauye, Kennard, Baxter, Chin, Corrigan, and Liu.