Arizona Supreme Court holds that the Arizona Department of Liquor Licenses and Control does not owe a statute-based duty of care to persons injured by drunk drivers.

The plaintiffs sued the State after being injured in a multi-vehicle collision caused by a drunk driver, alleging that the Arizona Department of Liquor Licenses and Control (“the Department”) had a statutory duty to prevent bars from overserving customers and, based on prior incidents, should have revoked or refused to renew the liquor license of the establishment that served the driver.

The superior court dismissed the claims, finding that the Department had no statutory duty to prevent the type of harm alleged. The court of appeals reversed in a divided opinion, with the majority holding that the Department owed a statute-based duty of care to the plaintiffs.

The Arizona Supreme Court reversed the court of appeals and affirmed the superior court’s dismissal, holding that the liquor statutes do not create a legal duty for the Department. Under the statutes relied on by the plaintiffs, the Department director “may” (1) “suspend, revoke or refuse to renew any license” if the licensee fails to comply with liquor laws, A.R.S. § 4-210(A)(9); (2) “impose a civil penalty” in lieu of or in addition to suspension or revocation, A.R.S. § 4-210.01(A); and (3) “visit during the hours in which the premises are occupied and inspect the premises of a licensee,” A.R.S. § 4-118.

The Court emphasized that although the liquor statutes give the Department broad regulatory authority—including power to revoke or suspend licenses for overservice—they are discretionary and do not require the Department to act or refrain from acting in any particular circumstance. Because these statutes do not impose mandatory obligations or prescribe a specific standard of care, they cannot serve as the basis for a public-policy duty.

The plaintiffs also relied on statutes imposing mandatory obligations, including § 4-112(C), which requires the director to establish an investigations unit, and § 4-203(A), which mandates that the Department issue liquor licenses only after “satisfactory showing” of specified qualifications. Because the plaintiffs did not allege that the Department failed to establish an investigations unit or that it improperly granted the initial liquor license, these statutes also did not impose a duty on the Department in this case.

The Court acknowledged that some of the liquor statutes explicitly impose liability on licensees and employees who serve alcohol. See, e.g., A.R.S. § 4-244(14) (prohibiting service of alcohol to obviously intoxicated persons and their presence on licensed premises, with certain exceptions). But these statutes do not regulate the conduct of the licensor (the Department), and do not support a duty here.

Justice King authored the opinion, which Chief Justice Timmer, Vice Chief Justice Lopez and Justices Bolick, Beene, Montgomery, and Pelander (Ret.) joined.

Posted by: Allie Karpurk