Community Insider Spring 2018 - Page 14

WOULD YOU LIKE ANOTHER? By Jonathan D. Massie, Esq & Brian A. Kalmenson, CIRMS Jonathan D Massie is a principal of Massie Berman, APC, a full-service law firm, specializing exclusively in representation of homeowners associations. Mr. Massie can be reached at (619) 260-9010 or jmassie@ massieberman.com A frequent question that Board of Directors asks is whether it is advisable or permissible to serve alcohol during events sponsored by the association. The short answer to the question is yes provided the association does not sell alcohol, limits consumption to those of age and avoids serving alcohol to obviously intoxicated individuals. Civil Code §1714(c) provides: “no social host who furnishes alcoholic beverages to any person may be held legally accountable for damages suffered by that person or for injury to the person or property of, or death of, any third person, resulting from the consumption of those beverages.” The exception to this rule is “knowingly furnishes alcoholic beverages at his or her residence to a person whom he or she knows, or should have known, to be under 21 years of age...” Additionally, the furnishing of “any alcoholic beverage to any habitual or common drunkard or to any obviously intoxicated person is guilty of a misdemeanor.” See Bus. & Prof. Code §25602(a). The most efficient means of avoiding liability is to not serve alcohol. However, if the board wants to move forward with a sponsored event, there are precautions that can be taken. First, limit the number of drinks to no more than two. Whoever is serving the alcohol should be instructed to not serve anyone under the age of 21 and avoid serving anyone who may be obviously intoxicated. Require those who participate in the event to sign a release and indemnity agreement. 14 | SAN DIEGO COMMUNITY INSIDER SPRING 2018 One last consideration for every association opting to serve alcohol at sponsored events is insurance. The association will want to check in with its insurance service provider to verify that the association is covered for “host liquor liability” on its general liability policy. Host liquor liability protects the association if there is an incident stemming from the consumption of served (not sold) alcohol at its events. The association may also consider purchasing a special event liability policy if the event is going to be of considerable size, as this can shield the association’s primary policies from claims in the event of an incident. A claim on the association’s policies can impact the premiums for multiple years, while a claim on a special event policy will not have the same effect as it is typically in place for only one or two days. Brian A. Kalmenson, CIRMS, is a Commercial Insurance Specialist with the Michael Abdou Insurance Agency, an agency that has specialized in community association insurance since 1989. Brian can be reached at (619) 255.9433 or brian@ abdouinsurance.com. HOA BANKING Seacoast Commerce Bank offers a full range of comprehensive banking and financial services for Homeowner Associations and property management companies. HOA BANKING SOLUTIONS • Depository Services • Cash Management • Remote Deposit Capture Seacoast Commerce Bank provides • Lockbox Services our Property Management and • ACH Origination Homeowner Association clients the ability to maximize their use of bank services. Overall, the topic of alcohol at association sponsored events is always going to be a frequently asked about topic. Though the presence of alcohol will always increase the liability exposure to an association, the risk can largely be managed with proper precautions and safeguards in place so that everyone can have an enjoyable time with an adult beverage or (no more than) two. We understand the unique Banking needs of our Property Management and Association clients, providing industry specific products and customer service • HOA Financing • Online Dues Program that you have grown to expect and deserve. THOMAS CHEEK Senior Vice President Business Development Officer tcheek@sccombank.com 858-432-7020 Phone 858-312-7060 Fax 760-550-2030 Mobile 11939 Rancho Bernardo Road, Suite 200 San Diego, CA 92128 www.sccombank.com WWW.CAI-SD.ORG | 15