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Sanford v. Fillenwarth

Supreme Court of Iowa

May 8, 2015

JOSEPH H. SANFORD and SUZANNA L. SANFORD, Appellants,
v.
LYNN FILLENWARTH and JULIE FILLENWARTH, as Executors of the Estate of KENNETH FILLENWARTH, and JAMES LAWLER, Appellees. KENNETH FILLENWARTH d/b/a FILLENWARTH BEACH and KENNETH FILLENWARTH, Third-Party Plaintiffs,
v.
CARI LAWLER, JOHN LAWLER, MATT LAWLER, MICHAEL LAWLER, and TERRY LAWLER, Third-Party Defendants

Appeal from the Iowa District Court for Dickinson County, Don E. Courtney, Judge. An injured person seeks damages based on dramshop liability against a resort that served alcoholic beverages.

Erik A. Luthens of Luthens Law Offices, P.C., West Des Moines, for appellants.

Christopher L. Bruns (until withdrawal), Keith J. Larson, and Nicholas J. Kilburg of Elderkin & Pirnie, P.L.C., Cedar Rapids, and Michael J. Chozen of Chozen & Saunders, Spirit Lake, for appellees.

OPINION

Page 287

CADY, Chief Justice.

In this interlocutory appeal involving dramshop liability of a liquor license holder, we must primarily determine the meaning of the word " sold" within the Iowa Dramshop Law, Iowa Code section 123.92 (2011). The district court held that a beach resort that served alcoholic beverages without separate charge to resort guests during boat cruises provided as an advertised amenity of the hotel stay did not, as a matter of law, sell alcoholic beverages under the dramshop statute. It granted summary judgment to the resort licensee. On our review, we conclude the statute can encompass indirect sales under the facts alleged in this case. Accordingly, we reverse the district court and remand for further proceedings.

I. Background Facts and Proceedings.

Fillenwarth Beach is a resort in Arnold's Park, Iowa, on Lake Okoboji. It is open

Page 288

every year during the summer season. Kenneth Fillenwarth owned the resort as a sole proprietorship until his death in 2014.[1] Fillenwarth Beach provides a number of amenities to its guests. The resort has indoor and outdoor pools, basketball and tennis courts, and a playground. It offers paddleboats and canoes for use on the lake, maintains a beach, and offers a variety of lessons to its guests. Other amenities included in a stay at Fillenwarth Beach for guests of the resort are complimentary cruises on Lake Okoboji in Fillenwarth-owned boats where free soft drinks, alcoholic beverages, and other beverages are served. The cruises are limited to resort guests. Kenneth, doing business as Fillenwarth Beach,[2] holds two liquor licenses that authorize it to sell and serve alcoholic beverages. It offers wine and beer tastings and occasional social hours under a class " B" license and serves alcoholic beverages to guests on boat cruises around West Okoboji Lake under a class " D" license.

On July 31, 2011, Michael and Tonya Lawler checked into Fillenwarth Beach for a week stay, with their children Cari, James, and Kyle.[3] Michael assumed responsibility for the cost of the family stay at the resort. Vacations at Fillenwarth Beach with the extended family were a yearly event for the Lawlers. On the day the family arrived at the resort, several of them, including James, signed up for an adults-only lake cruise that served alcoholic beverages. While waiting for the cruise to start, James and other family members relaxed with alcoholic beverages they had brought to the resort.

Joseph and Suzanna Sanford were also guests at the resort on July 31, 2011. As with the Lawlers, the Sanfords and their family vacationed at Fillenwarth Beach each summer. The Sanfords had made friends among the yearly guests, and their sons enjoyed the resort activities. As with the Lawlers, the Sanfords signed up for the evening lake cruise on July 31, along with several friends who were staying at the resort, including Dr. Bill Weeks.

During the cruise, James consumed a number of alcoholic beverages. The bartender served James two mixed drinks, and he drank some beers from a self-serve keg near the bar. Towards the end of the cruise, while waiting for drinks near the bar on the boat, James and Michael exchanged heated words and threats with Dr. Weeks. Approximately half an hour after the end of the cruise, the Sanfords and their friends encountered some members of the Lawler family. The encounter soon escalated into physical violence when James assaulted Joseph Sanford.[4]

The Sanfords filed a lawsuit against Fillenwarth, Fillenwarth Beach (collectively Fillenwarth Beach), and James for damages resulting from the injury. The legal theories of recovery included dramshop liability against Fillenwarth Beach, loss of consortium based on the dramshop liability, assault and battery against James with related loss-of-consortium claims, and

Page 289

premises liability and related loss-of-consortium claims against Fillenwarth Beach.

Fillenwarth Beach moved for summary judgment on the dramshop-liability claims. It claimed the dramshop statute only applies to the sale and service of alcoholic beverages and does not apply to impose liability in this case because the alcoholic beverages were not sold but only served as an amenity of the resort. It also claimed no sale could have been made to James because he was not a paying guest. The district court granted summary judgment. It found no sale took place because James did not ...


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