What liability arises from buying and letting employees drink alcohol?

Worker driving truck accidentally causes injury to co-worker after celebration at workplace

BY Bernise Carolino 26 Jun 2023

In a recent case, the daughter of a deceased employee sued the employer and several employees based on negligence, failure to train, and premises liability. She obtained a jury verdict awarding over $4 million in damages.

Toward the end of 2013, Rudolph Automotive, LLC – doing business as Rudolph Mazda and Rudolph Chevrolet – was aiming for strong year-end results by making its sales team work 11-hour shifts or longer six days a week. One day, the two sales employees involved in this case, Irma Villegas and Christian Ruiz, finished their work and clocked out shortly after 8:00 p.m.

Their sales manager, seeking to improve morale through an end-of-day celebration, asked Ruiz to buy beer at the manager’s expense. The employees drank beer within the employer’s premises after the customers were gone.

The manager sent the employees home. Villegas first walked to her car then to a different area of the dealership. Ruiz, who was driving toward the exit in his truck, struck her in the parking lot. The accident seriously harmed Villegas. Permanent effects included a traumatic brain injury, paralysis on one side, and a severe facial deformity.

Villegas had to live in a nursing home for seven years. She died in 2020. Her daughter initiated this lawsuit.

The jury’s verdict made the following findings:

The manager who paid for the beer and who let the employees drink it at the end of the day was acting within the scope of his employment. Villegas and Ruiz were not.
The manager, Ruiz, and Villegas showed negligence, which proximately caused the accident. The employer, in general or as the owner or occupier of the premises, did not.
Responsibility for causing or contributing to the accident was allocated as follows: 35 percent to Ruiz, 30 percent to Villegas, and 25 percent to the manager. Though the employer was not negligent, it was assigned 10-percent responsibility.

The daughter alleged that there was a mistrial and asked for a new trial.

New trial unwarranted

The trial court agreed with the daughter and listed reasons justifying a new trial. One reason, according to the trial court, was the Texas Supreme Court’s ruling in Painter v. Amerimex Drilling I, Ltd. (2018), rendered on the same day as the jury verdict.

This important ruling addressed the question of whether an employee was acting within the course and scope of employment, the trial court said. As an effect of the Painter ruling, the trial court allegedly had to reconsider whether the employee was injured in the course of employment, which would make the daughter’s lawsuit a non-subscriber negligence case under section 406.33 of the Texas Labor Code.

The employer asked for relief in the form of mandamus. The court of appeals refused such relief and upheld the trial court’s decision.

In the case of In re Rudolph Automotive, LLC d/b/a Rudolph Mazda and Rudolph Chevrolet, LLC, the Texas Supreme Court issued a judgment conditionally granting the mandamus relief requested by the employer. It ordered the trial court to withdraw its order for a new trial and disagreed with all its reasons for granting a new trial.

The Supreme Court accepted that it rendered its ruling in the Painter case on the same day as the jury issued the verdict in this case.

However, there was no explanation for how the coincidence of that timing materially affected this case, the Supreme Court said. The Painter ruling had no material bearing on any issue relevant to this case and would not have plausibly changed the jury’s finding that Ruiz and Villegas were not acting within the scope of their employment at the time, the Supreme Court concluded.