Bennie Schmidt v. Centex Beverage Inc., Capitol Beverage Co., Brown Distributing Co., & Shiner of Austin, Inc.

IN THE COURT OF APPEALS, THIRD DISTRICT OF TEXAS,

AT AUSTIN

NO. 3-91-100-CV

BENNIE SCHMIDT,

APPELLANT

vs.

CENTEX BEVERAGE, INC., CAPITOL BEVERAGE CO., BROWN

DISTRIBUTING CO., AND SHINER OF AUSTIN, INC.,

APPELLEES

FROM THE DISTRICT COURT OF TRAVIS COUNTY, 53RD JUDICIAL DISTRICT

NO. 487,791, HONORABLE MARY PEARL WILLIAMS, JUDGE PRESIDING

This is an appeal from a summary judgment granted against appellant, Bennie

Richard Schmidt. On the evening of August 12, 1988, Schmidt trespassed onto the grounds of

Austin Aqua Fest, an annual outdoor music festival, by crawling under a fence. He was

confronted by a group of people, including Aqua Fest volunteers, and a struggle followed during

which Schmidt's neck was broken, leaving him paralyzed. Schmidt claims that the volunteers who

confronted him were intoxicated and belligerent as a result of Austin Aqua Fest's policy of

providing free beer to its volunteer workers, which was in turn made possible by the sale of beer

to Aqua Fest by wholesale beer distributors.

Schmidt sued the wholesale distributors who supplied beer to Aqua Fest on theories

of negligence and strict liability, as well as under the so-called dram shop statute. Tex. Alco.

Bev. Code Ann. §§ 2.02-03 (Supp. 1992). The trial court granted the distributors' motions for

summary judgment on the ground that they owed no duty to Schmidt. We affirm.

In a single point of error, Schmidt argues that the trial court erred in granting

summary judgment because the distributors (1) owed a duty to Schmidt arising from their

participation in creating the harm; (2) are strictly liable to Schmidt for failing to warn consumers

of the dangers of beer consumption; and (3) owed a duty to Schmidt arising from the statute which

prohibits the sale or service of beer to already intoxicated persons. The distributors raise one

cross-point, seeking damages for the taking of an appeal without sufficient cause and for purposes

of delay. Tex. R. App. P. Ann. 84 (Pamph. 1992).

The distributors are entitled to summary judgment if they demonstrate that there

is no genuine issue of material fact and that they are entitled to judgment as a matter of law. Tex.

R. Civ. P. Ann. 166a (Supp. 1992). All of Schmidt's claims hinge on the threshold question

whether the distributors owed a legal duty to Schmidt, which is a question of law for the court to

decide. Otis Eng'g Corp. v. Clark , 668 S.W.2d 307 (Tex. 1983).

NEGLIGENCE

Schmidt first argues that the distributors owed him a duty because they contributed

to the creation of a foreseeable risk of injury to him. As a general rule, one person is under no

duty to control the conduct of another, even if he has the practical ability to exercise such control.

Otis Eng'g , 668 S.W.2d at 309 (citing Restatement (Second) of Torts § 315 (1965)). However,

if a person negligently creates a dangerous situation it becomes his duty to act to prevent injury

to others. Buchanan v. Rose , 159 S.W.2d 109, 110 (Tex. 1942).

Schmidt claims that appellees created a dangerous situation by providing beer,

indirectly, to the volunteers who injured him. He reasons that by selling beer to Aqua Fest, with

knowledge of the festival's policy of providing free beer to its volunteers, the distributors

participated in creating the harm, thus giving rise to a duty on the part of the distributors to those

whom the volunteers might injure.

In support of this argument, Schmidt cites El Chico Corp. v. Poole , 732 S.W.2d

306 (Tex. 1987), in which the supreme court imposed a duty on retailers not to serve alcoholic

beverages to a patron when the retailer knows or should know the patron is intoxicated. Id. at

314 . This duty arises out of a retailer's control over the amount of alcohol served and the

statutory requirement to exercise that control. Id. at 315 .

The reasons enumerated in El Chico for imposing a duty on retail establishments

do not apply to wholesale distributors. Distributors have neither a right to control the amount of

alcohol served nor a statutory duty to do so. In fact, distributors are statutorily prohibited from

exercising any control over the retail sales of the beer they distribute. See Tex. Alco. Bev. Code

Ann. §§ 102.01-18 (1978 & Supp. 1992).

Schmidt argues in particular that the duty to exercise reasonable care in this

instance amounts to a duty to warn consumers of the dangerous effects of over-consumption of

alcohol. This argument was rejected in Morris v. Adolph Coors Co. , 735 S.W.2d 578 (Tex. App.

1987, writ ref'd n.r.e.). That case involved the operation of a motor vehicle, but its reasoning

is equally applicable here: the intoxicating effects of the consumption of alcoholic beverages

always have been common knowledge to the ordinary consumer and thus there is no duty to warn.

Id. at 585 ; see also Malek v. Miller Brewing Co. , 749 S.W.2d 521 (Tex. App. 1988, writ denied).

STRICT LIABILITY

In order to establish a cause of action for strict liability, the party must prove: (1)

the product was defective; (2) the product reached the consumer without substantial changes in

its condition from the time it was originally sold; (3) the defect rendered the product unreasonably

dangerous; and (4) the unreasonably dangerous defect caused an injury to the consumer.

Restatement (Second) of Torts § 402A (1965); see McKisson v. Sales Affiliates, Inc. , 416 S.W.2d

787, 789 (Tex. 1967) (adopting § 402A as the law of Texas). Failure to provide adequate

warnings or instructions may constitute a defect. Lucas v. Texas Indus. , 696 S.W.2d 372, 377

(Tex. 1984). However, there is no duty to warn when the danger is a matter of common

knowledge. Restatement (Second) of Torts § 402A, cmt. j (1965).

Schmidt argues that the wholesale beer distributors had a duty to warn consumers

of the effects of intoxication. He relies on two cases holding manufacturers strictly liable for

failing to warn consumers of the dangers of alcohol consumption. See McGuire v. Seagram and

Sons, Inc. , 790 S.W.2d 842 (Tex. App. 1990), rev'd , 814 S.W.2d 385 (Tex. 1991); Brune v.

Brown Forman Corp. , 758 S.W.2d 827 (Tex. App. 1988, writ denied).

Schmidt's reliance on these cases is misplaced. Since the filing of this appeal, the

Texas Supreme Court has reversed McGuire . McGuire , 814 S.W.2d at 385 . In its opinion, which

addressed both strict liability and negligence theories, the Texas Supreme Court held that

manufacturers of alcoholic beverages have no duty to warn consumers of the dangers of chronic

alcoholism because such dangers are commonly known. McGuire , 814 S.W.2d at 387-89 .

Comment j to § 402A of the Restatement (Second) of Torts, cited in McGuire , states:

[A] seller is not required to warn with respect to products or ingredients in them,

which are only dangerous, or potentially so, when consumed in excessive quantity,

or over a long period of time, when the danger, or potentiality of danger, is

generally known and recognized. Again, the dangers of alcoholic beverages are an

example . . . .

Restatement (Second) of Torts, § 402A, cmt. j (emphasis added). Applying this

common-knowledge exception, Texas courts have declined to recognize a duty for manufacturers

to warn of the dangers of driving while intoxicated. Malek , 749 S.W.2d at 521 ; Morris , 735

S.W.2d at 578 .

Schmidt also relies on Brune , 758 S.W.2d at 827 , in which a court of appeals held

a manufacturer of tequila strictly liable for failing to warn a consumer of the dangers of acute

alcohol poisoning. In Brune , the court refused to apply the common-knowledge exception because

the dangers of acute alcohol poisoning are extreme and thus not as commonly known as the

dangers of intoxication. Id. at 831 . Indeed, that court stated "[T]here can be no dispute that there

are twelve inches in a foot, that the sun rises in the morning, or even that a person drinking

alcoholic beverages will become intoxicated. " Id. (emphasis added).

Schmidt alleges only that the Aqua Fest volunteers who confronted him were

intoxicated and belligerent. We hold that these effects of alcohol consumption come within the

common-knowledge exception to strict liability and thus that the distributors had no duty to warn

consumers.

DRAM SHOP

Schmidt also claims that the distributors owed him a duty under section 2.02 of the

Texas Alcoholic Beverage Code, which creates a statutory cause of action against a party who

provides, sells, or serves alcohol to an already intoxicated person, by one later injured by this

intoxicated person. Tex. Alco. Bev. Code Ann. § 2.02 (Supp. 1992); see also El Chico Corp. ,

732 S.W.2d at 306 . Schmidt concedes he cannot show that the distributors provided beer directly

to the volunteers who injured him.

Section 2.02 applies to a "provider," who is defined as "a person who sells or

serves an alcoholic beverage . . . to an individual." Tex. Alco. Bev. Code Ann. § 2.01 (1) (Supp.

1992). Thus, the statute upon which Schmidt relies does not apply to wholesale beer distributors

under these facts. Furthermore, a cause of action under section 2.02 requires proof that "at the

time the provision occurred it was apparent to the provider that the individual being sold, served,

or provided with an alcoholic beverage was obviously intoxicated to the extent that he presented

a clear danger to himself and others. . . ." Id. § 2.02 (1).

Schmidt argues that appellees exercised de facto control over the beer provided to

Aqua Fest volunteers in general because agents of the distributors attended the festival with free

passes given to them by Aqua Fest and had reason to know alcohol would be consumed to excess

at the event. This argument has no merit. The fact that appellees' agents may have attended the

multi-day festival does not bestow on them the duty, prohibited by law, to oversee the sale of

alcohol to consumers.

Because the distributors owed no legal duty to Schmidt under any of the theories

pleaded, Schmidt's point of error is overruled.

CROSS-POINT

In a cross-point, the distributors seek damages from Schmidt for the taking of an

appeal for delay and without sufficient cause. Tex. R. App. P. Ann. 84 (Pamph. 1992). We

cannot conclude that this appeal was brought for delay and without sufficient cause. Indeed, one

of appellant's primary sources of authority was overruled after he filed this appeal. The cross-point is therefore overruled.

The trial court's summary judgment is affirmed.

Marilyn Aboussie, Justice

[Before Chief Justice Carroll, Justices Aboussie and Kidd]

Affirmed

Filed: March 4, 1992

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