Torres v. Jai Dining Servs. (Phoenix), Inc.

107 Arizona Cases Digest 16

536 P.3d 790

Roberto TORRES, et al., Plaintiffs/Appellees,

v.JAI DINING SERVICES (PHOENIX), INC., Defendant/Appellant,

No. CV-22-0142-PR

Supreme Court of Arizona.

Filed October 16, 2023

David L. Abney (argued), Ahwatukee Legal Office P.C., Phoenix; Robert F. Clarke, Clarke Law Offices, Phoenix; and Matthew D. Koglmeier, Koglmeier Law Group PLC, Mesa, Attorneys for Roberto Torres, Orlenda Guillen, Hernan Gastelum Rosas, and Maria Suarez

Eric M. Fraser (argued), Andrew G. Pappas, Osborn Maledon P.A., Phoenix; and Dominique Barrett, Quintairos, Prieto, Wood & Boyer P.A., Scottsdale, Attorneys for JAI Dining Services (Phoenix), Inc.

Daniel Rubinov, Rafat H. Abdeljaber, RAJ Law PLLC, Phoenix, Attorneys for Amici Curiae Arizona Association for Justice/Arizona Trial Lawyers Association

Amanda Heitz, Lauren Walter, Bowman and Brooke LLP, Phoenix, Attorneys for Amicus Curiae Arizona Association of Defense Counsel

Camila Alarcon, Alarcon Law & Policy, P.L.L.C., Phoenix, Attorney for Amicus Curiae Arizona Restaurant and Hospitality Association

Peter H. Schelstraete, Schelstraete Law Office, Tempe, Attorney for Amicus Curiae Arizona Licensed Beverage Association

Richard P. Traulsen, Begam Marks & Traulsen P.A., Phoenix, Attorney for Amicus Curiae Mothers Against Drunk Driving (MADD Arizona Chapter)

Mick Levin, Alexandra Van Duffelen, Mick Levin P.L.C., Phoenix; and Noah J. Van Amburg, Van Amburg Law Firm, P.L.L.C., Tucson, Attorneys for Amicus Curiae Homicide Survivors, Inc.

Michael G. Bailey, Arizona Chamber of Commerce, Phoenix, Attorney for Amicus Curiae Arizona Chamber of Commerce

CHIEF JUSTICE BRUTINEL authored the Opinion of the Court, in which JUSTICES BOLICK, LOPEZ, and BEENE joined. JUSTICE BOLICK issued a concurring opinion. VICE CHIEF JUSTICE TIMMER dissented.^*

CHIEF JUSTICE BRUTINEL, Opinion of the Court:

¶1 The Arizona Constitution guarantees that "[t]he right of action to recover damages for injuries shall never be abrogated." Ariz. Const. art. 18, § 6. This case requires us to consider whether that "anti-abrogation clause" extends to rights of action created after our constitution was ratified, and more specifically, whether the anti-abrogation clause prevents the legislature from limiting the common law dram-shop action recognized in Ontiveros v. Borak , 136 Ariz. 500, 667 P.2d 200 (1983), which imposed tort liability upon liquor licensees that cause harm by overserving their patrons. We hold the anti-abrogation clause does not extend to dram-shop actions because they were recognized after statehood.

I. BACKGROUND

¶2 After a night of heavy drinking at the Jaguars Club in Phoenix, Cesar Aguilera Villanueva drove away heavily intoxicated. Torres v. JAI Dining Servs. (Phx.) Inc. (Torres I ), 252 Ariz. 28, 29 ¶¶ 1–2, 497 P.3d 481, 482 (2021). After going to a friend's house to "sober up" and sleeping for a short time at his own house, Villanueva again drove and crashed into a car stopped at a red light, killing its two occupants, Guadalupe Gastelum Suarez and Jesus O. Torres Guillen. Id. ¶¶ 3–4.

¶3 The victims’ families, Roberto Torres et al. ("Plaintiffs"), sued Villanueva for negligence and sued JAI Dining Services ("JAI"), the owner of Jaguars Club, under theories of statutory and common law dram-shop liability.¹ Id. at 30 ¶ 5, 497 P.3d at 483. At trial, the jury found Villanueva liable for negligence but rendered a split verdict on the dram-shop claims against JAI. Id. ¶ 6. The jury found JAI was liable under the common law dram-shop action recognized by this Court in Ontiveros , which imposes liability on a liquor licensee that serves alcohol to an intoxicated patron if it "know[s] or should know that such conduct creates an unreasonable risk of harm to others." Id. ; Ontiveros , 136 Ariz. at 513, 667 P.2d at 213. However, the jury found JAI was not liable under the dram-shop cause of action codified at A.R.S. § 4-311(A), which imposes liability on a liquor licensee that serves alcohol to a patron who is "obviously intoxicated." Torres I , 252 Ariz. at 30 ¶ 6, 497 P.3d at 483 ; § 4-311(A)(1). The jury awarded Plaintiffs $2 million in damages, apportioning 40% of the fault to JAI. Torres I , 252 Ariz. at 30 ¶ 6, 497 P.3d at 483.

¶4 When this case was previously before us, we vacated the court of appeals’ decision, which had found that an intervening and superseding cause—Villanueva's "decision to resume driving after reaching home"—had broken the chain of proximate causation and relieved JAI from liability for Villanueva's actions. Id. ¶¶ 1, 20. We disagreed and found the jury "could have reasonably concluded that Villanueva's act in driving while intoxicated, even after he reached home ... was nevertheless foreseeable by someone in [JAI's] position and not extraordinary in hindsight." Id. at 32 ¶ 18, 497 P.3d at 485. We remanded and instructed the court of appeals to consider whether JAI had waived its separate argument that § 4-312(B), which bars dram-shop claims not raised under § 4-311, preempted the common law dram-shop action recognized in Ontiveros . Torres I , 252 Ariz. at 32–33 ¶¶ 19–20, 497 P.3d at 485–86. If not waived, we instructed the court to decide the preemption question. Id.

¶5 On remand, the court of appeals found that, although JAI did not make its preemption argument to the trial court, both parties "had ample notice and multiple opportunities" to argue this issue, and an exception to the waiver doctrine was warranted because the case was an "appropriate vehicle" to consider this recurring issue. Torres v. JAI Dining Servs. (Phx.), Inc. (Torres II ), 253 Ariz. 66, 71–72 ¶¶ 15–16, 508 P.3d 1148, 1153–54 (App. 2022).

¶6 On the merits, the court of appeals found that § 4-312(B) "expressly preempts" Plaintiffs’ common law dram-shop claim and that such preemption "does not run afoul" of the anti-abrogation clause. Id. at 69 ¶ 2, 508 P.3d at 1151. To arrive at this conclusion, the court read our most recent decisions interpreting the clause, Cronin v. Sheldon , 195 Ariz. 531, 991 P.2d 231 (1999) and Dickey ex rel. Dickey v. City of Flagstaff , 205 Ariz. 1, 66 P.3d 44 (2003), to hold "that if a plaintiff could not have asserted a claim for a particular type of harm against a particular defendant in 1912, then the anti-abrogation clause provides that claim no protection." Id. at 75 ¶ 31, 508 P.3d at 1157. And based on our holding in Ontiveros , which "abolished the common law doctrine of tavern owner nonliability in Arizona," id. at 72 ¶ 19, 508 P.3d at 1154, the court concluded dram-shop actions "could not have been maintained at the time the anti-abrogation provision was instituted" and are subject to abrogation. Id. at 76 ¶ 32, 508 P.3d at 1158 (quoting Dickey , 205 Ariz. at 5 ¶ 18, 66 P.3d at 48 ). The court therefore held that the anti-abrogation clause did not preclude the legislature from "expressly preempt[ing] the common law liability created by Ontiveros ... and replac[ing] it with a more clearly defined statutory liability scheme." Id. at 77 ¶ 38, 508 P.3d at 1159. The court acknowledged that its holding conflicted with an earlier decision that had found § 4-312(B) unconstitutionally abrogated the dram-shop action recognized in Ontiveros , id. ¶ 37 (discussing Young v. DFW Corp. , 184 Ariz. 187, 908 P.2d 1 (App.1995) ), but found that Young ’s analysis "was error" and "cannot be good law after Dickey ." Id. The court therefore reversed the "portion of the superior court's judgment against JAI and remand[ed] for that court to enter judgment in favor of JAI and in favor of Plaintiffs only as to Villanueva." Id. ¶ 39.

¶7 Plaintiffs timely petitioned for review. JAI also asked us to review the issue and settle the conflict between Young and Torres II . We granted review, asking the parties to address whether the anti-abrogation clause only extends to common law rights of action that could have been brought at the time of statehood, or if it instead covers all common law rights of action regardless of when they were recognized. We have jurisdiction under article 6, section 5(3) of the Arizona Constitution and review this constitutional issue de novo. State v. Mixton , 250 Ariz. 282, 285–86 ¶ 11, 478 P.3d 1227, 1230–31 (2021).

II. DISCUSSION

¶8 Our case law squarely answers the question at hand. Because the anti-abrogation clause only applies to rights of action that either "existed at common law" or find their "basis in the common law at the time the constitution was adopted," Dickey , 205 Ariz. at 3 ¶ 9, 66 P.3d at 46, the clause does not preserve the dram-shop action first recognized in Ontiveros . Although contradictory dicta can be found in a few of this Court's cases—namely, Boswell v. Phoenix Newspapers, Inc. , 152 Ariz. 9, 17–18, 730 P.2d 186, 194–95 (1986) and Hazine v. Montgomery Elevator Co. , 176 Ariz. 340, 343–44, 861 P.2d 625, 628–629 (1993) —this Court has never extended the anti-abrogation clause to rights of action not recognized at statehood, and we will not do so now. Below, we first discuss our caselaw interpreting the clause and the standard guiding an anti-abrogation analysis, and then analyze whether dram-shop actions are protected by the anti-abrogation clause.

A. The Anti-Abrogation Clause.

¶9 Throughout over a century of jurisprudence, this Court has never extended the anti-abrogation clause's protections to rights of action incognizable at statehood. Rather, we have consistently rejected arguments asking us to do so. For instance, in Morrell v. City of Phoenix , 16 Ariz. 511, 147 P. 732 (1915), we found that a city charter immunizing the City of Phoenix from certain tort liability did not violate the anti-abrogation clause, stating the clause "only undertakes to preserve rights already cognizable by law , and does not undertake to create new rights of action." Id. at 517, 147 P. 732 (emphasis added). We held that the required election of remedies under Arizona's worker's compensation law, whereby an injured employee can either sue an employer for...