Justices deny previously granted transfer

Despite a previous decision to accept a case, the Indiana Supreme Court has decided to revoke its previous order to consider whether Indiana or Illinois law should apply to a dram shop suit.

Now, a Court of Appeals decision from March will stand, meaning Indiana law applies to the case.

Justices this week vacated its July decision to accept transfer in Rebecca Shaw, Individually, and for the Estate of Kayla Nichole Hughes, and Stephen Hughes v. LDC Enterprises d/b/a I&I Steakhouse, et al., in which the court heard arguments Sept. 13.

During arguments, justices expressed concern about issuing injunctive relief to force the establishment to close or to delve into jurisdictional issues with other states.

The Court of Appeals had reversed a lower court decision from Fountain County, holding that Indiana law should apply to a complaint against a steakhouse owner in Illinois for an accident that happened in Indiana and resulted in the death of a teenager.

The owner moved to dismiss the counts on grounds that Illinois law should control the disposition of the action, and the trial court granted the motion. On appeal, the appellate court ruled, “The last event necessary to make LDC liable for its alleged wrong took place in Indiana with Kayla’s death, and application of Illinois law would leave (mother Rebecca) Shaw without a remedy. The substantive law of Indiana therefore applies.”

Illinois dram shop law is one of the strictest in the nation, allowing plaintiffs to essentially recover if they can prove the sale happened and some type of connection between the furnishing, intoxication, and injury – not knowledge of intoxication. But unlike Indiana, the neighboring state has no common law clause of action for injuries arising out of sale or gift of alcoholic beverages, and the legislature has restricted it to only a “person who is injured within this State.”

This would leave the family without a remedy, as Kayla Hughes died in Indiana, and the court applied the principle of lex loci delicti in its decision – the last act necessary to make LDC liable for nuisance was the place of injury in Indiana, the appellate court ruled.The case now goes back to Fountain Circuit Judge Susan Orr Henderson for further proceedings.