Serving alcohol at events can be a good way to encourage socializing and build community. But it also raises significant concerns that need to be addressed at the event planning stage. After examining the potential risks, many churches may opt to limit alcohol to special events.
The obvious risk of serving alcohol at an event is that someone will drink at the event, try to drive home and end up in an accident. Depending on the specific facts of the case, someone who is injured in such a crash may have a cause of action against the church to recover compensation for expensive things like medical bills, lost earnings, and pain. A church can insure itself against such risks, but an insurer likely will seek to limit its exposure by requiring the church to take active steps to reduce the likelihood that someone will be irresponsible behind the wheel.
Serving alcohol also raises the potential that someone who is underage will be given alcohol at the event. In California an organization that knowingly serves alcohol to a minor is more likely to be held responsible for any damage that the minor causes while under the influence. Of course, serving a minor is also itself a punishable offense. There are practical ways to go about protecting the church from these problems, such as implementing an ID check and wristband policy.
The law draws a sharp distinction between selling alcohol and simply offering it for free to guests. Organizations that sell alcohol at events in California must comply with state licensing requirements. Selling alcohol may also raise the possibility that the church is conducting an activity that is unrelated to its core mission, which could create taxable income and other potentially serious tax issues.
One way a church might be able to manage some of these risks is by hiring an outside caterer to run events where alcohol will be served, and by holding events at a venue other than church-owned property. Such arrangements will be subject to contracts and additional insurance requirements, but they may provide the church with additional layers of protection in the event that something goes wrong.
The Church Law Center of California provides legal services to churches and secular nonprofits. Please call us today if your church is concerned about its risks related to serving alcohol at its events. We can be reached at (949) 689-0437 or through our contact page.