Restaurant managers do not want to operate their business
in a way that will result in legal action being taken against
them. In today's litigious society, even for a prudent operator,
the threat of loss to the business because of lawsuits is
very real. Some of the lawsuits that are filed are frivolous,
while others raise serious issues. In either case, the effective
restaurant manager must be aware of how lawsuits are filed,
how they progress through the court system, and most importantly,
the role the restaurant manager plays in the process.
Much of your concern as a restaurant manager will focus on
the potential for damages that result from personal injury.
The reason for this is fairly straightforward. Restaurant
managers provide guests with food and beverages and entertainment.
Yet, the process of providing these goods and services can
place a business in potential jeopardy. "Accidents can
happen" may have been just a phrase in years gone by.
Today's equivalent phrase may well be "Accidents can happen,
and if they do, the affected parties may sue!"
Certainly it is best to manage your business in such a way
as to avoid accidents. However, accidents and injuries will
occur and there are many times when the responsibility for
an accident is unclear. Consider the case of Rachel Martinez.
Ms. Martinez, a guest of your restaurant one evening, goes
out to her car to retrieve her purse. While she is in the
parking lot, she is assaulted. She suffers physical harm,
fear during the attack, and a lingering apprehension about
being out after dark by herself. Listed below are just a few
of the questions that could be raised in a case such as this:
1. Were the lights in the parking lot working well enough
to minimize the chance that a guest would be assaulted?
2. Was management vigilant in eliminating potential hiding
places for would be assailants?
3. Had the restaurant experienced similar incidents in the
past, and if so, what precautions had been taken?
Notice that, in this example, there is not a clear-cut reason
for believing the restaurant is in any way responsible for
Rachel's injuries. It is important to remember, however, that
the court system gives Rachel and her attorney the right to
file a personal injury lawsuit in an effort to determine if,
in fact, the restaurant was totally or partially responsible
for the assault. In doing so, Rachel will seek damages resulting
from the assault. Such a lawsuit will, without doubt, be time
consuming for management, and expensive to defend against.
The reality, however, is that such lawsuits are filed on a
daily basis, and it is rare that restaurant managers do not
find themselves involved, to some degree, in such a suit at
some time in their career. For this reason, a manager needs
to be familiar with the anatomy of a personal injury lawsuit
from its inception to conclusion.
Typically, a manager will learn that he, she, and/or the business
is being sued when a demand letter is received. The demand
letter comes from an attorney who has been contacted by the
injured plaintiff and has agreed to take up the plaintiff's
cause. As you can see in the example provided, the typical
demand letter sets forth the plaintiff's version of the facts
surrounding an alleged personal injury, and may also include
the monetary amount of damages being sought and usually a
deadline for the manager to respond to the charges.
Attorneys, generally, will accept a personal injury case with
one of three payment plans. The first is the hourly fee, where
the attorney bills their client (the plaintiff) at an hourly
rate for each hour the attorney works on the personal injury
claim. In this case, it is clearly in the best interest of
the plaintiff to seek a conclusion to the case as quickly
as possible to minimize attorney fees that must be paid. In
a second type of plan, the attorney agrees to take the case
for one flat fee. In this situation, it is clearly in the
best interest of the attorney to seek a quick resolution of
The third payment form is the contingency fee. Lawyers representing
defendants charged with crimes may not charge contingency
fees, and in most states, contingency fee agreements must
be put in writing. Clearly, in a case where the attorney is
representing the client on a contingency basis, it is in the
best interest of the plaintiff and the attorney to seek the
most favorable, rather than the fastest, settlement possible.
Regardless of the form of payment agreed upon between the
plaintiff and their attorney, the demand letter is the first
step in the litigation process. If the response to the demand
letter does not satisfy the plaintiff, he or she will likely
instruct their attorney to file suit against the defendant.
Filing a Petition
Filing a petition (or pleading or complaint) is the term used
to describe the process of initiating a lawsuit. A petition
is a document that officially requests a court's assistance
in resolving a dispute. The petition will identify specifically
the plaintiff and the defendant. In addition, it will describe
the matter it wishes for the court to decide. Included in
the complaint against the defendant will be the plaintiff's
suggestion for resolution of the issue. The plaintiff may,
for example, ask for monetary damages. When the petition has
been filed with the administrative clerk of the court, the
lawsuit officially begins.
Once the complaint is filed with the court, the court (and/or
the plaintiff, through counsel) will notify the defendant
of the plaintiff's charge, and will include a copy of the
complaint in the notification. Upon receipt of the complaint
the defendant needs to respond in writing within the time
specified in the notice from the court.
In the discovery phase of a civil lawsuit, both parties seek
to learn the facts necessary to best support their position.
This can include answering questions via interrogatories or
depositions, requests for records or other evidence, and sometimes
visiting the scene of the incident that caused the complaint.
The discovery process can be short or very lengthy. Either
side may ask for information from the other, and if necessary,
a judge will rule on whether the parties to the suit must
comply with these requests. In some instances, one party in
a lawsuit may obtain a court order demanding that specific
documents be turned over, or that specific individuals be
called to testify in court. This order is called a subpoena.
A subpoena may also be used to obtain further evidence or
witnesses while a trial is ongoing.
The plaintiff in the lawsuit has the burden of proving the
allegations set forth in the petition. This is the responsibility
of proving to the finder of fact (judge or jury) that a particular
view of the facts is true. In a civil case, the plaintiff
must convince the court "by a preponderance of the evidence"
that is, over 50% of the believable evidence. In a criminal
case, the government has a higher standard, and must convince
the court "beyond a reasonable doubt" that a defendant is
Trial and Appeal
The trial is the portion of the injury suit process where
the plaintiff seeks to persuade the judge or jury that his
or her version of the facts and points of law should prevail.
In a like manner, the defendant also has an opportunity to
persuade for their side. Most personal injury cases are tried
in front of a jury. After a jury is selected to hear the trial,
the process, while it may vary somewhat from state to state,
is as follows:
1. Presentation by plaintiff
2. Presentation by defendant
3. Plaintiff's rebuttal
4. Summation by both parties
5. Judge's instructions about the applicable law and procedures
to the jury
6. Jury deliberation
8. Judgment or Award
9. Appeal of verdict and/or award
Either side has the right to appeal a verdict or award. In
the personal injury area, it is common for a losing defendant
to appeal the size of the award if it is considered to be
Upon receipt of a demand letter, turn it over to your insurance
company and your attorney for advice. Follow the recommendations
of the insurance company and your attorney. Be as cooperative
as possible with any investigations that your insurance company
or attorney may instigate.
Notification of Filing a Lawsuit
Ordinarily, a representative of the court (i.e., constable,
sheriff, etc. or a private person authorized by the court)
will personally hand you the pleading so the court actually
knows that you received it. If you are served with a pleading,
you must recognize that these pleadings, and your company's
obligations to respond, are time sensitive, and that you need
to deliver the pleading to your attorney, making sure your
insurance company gets a copy and you keep one for future
As stated previously, the discovery process enables each party
to obtain information from the other party, which will be
used as documentary evidence to help prove the facts of a
case. Managers will often be asked to turn over records of
their business, repair invoices, reports, and information
stored electronically. Plaintiffs often must turn over medical
records and reports, doctor bills, receipts for damages, and
other types of personal information. Often, a manager or staff
member may be asked to prepare a personal statement during
the discovery process, or even go to court and testify as
a witness during the trial.
The cost of responding to discovery requests, either by testifying
or preparing documents, can be a very expensive proposition
for your operation, not only from a financial perspective
but also because of the time and disruption to your staff.
Accordingly, the better organized you are at the outset of
the incident, the less of a burden the discovery process will
be. Work closely with your attorney during this phase and
be cooperative. Be sure to meet all time limits imposed for
responses, as a missed deadline can be fatal to your side
of the case.
Trial and Appeal
Request that your attorney update you frequently about trial
settings (the date the trial will commence). Reciprocally,
you need to let your attorney know about any times that you
or your employees will be unavailable to testify (such as
vacations, scheduled surgeries, etc.).
If your case is appealed, your involvement in the appellate
process will be very minimal, if at all. This process rarely
requires anything new from you that was not provided before
the trial. However, you should continue to maintain your records
of the case and keep track of any witnesses.
Alternative Dispute Resolution
There are alternatives to resolving personal injury claims
in court. The parties at any time during the litigation process
can agree on a settlement.
Two other common methods used in the restaurant industry are
mediation and arbitration. Both can be highly effective alternatives
to the time, cost, and stress involved in going through a
In mediation, a trained and neutral individual (the mediator)
facilitates negotiation between the parties, in order to achieve
a voluntary resolution of the dispute. In most cases, one
full day of mediation can result in a compromise acceptable
to both the plaintiff and defendant. Mediation can involve
sessions jointly held with both parties and their attorneys,
or separate meetings with each party, their attorneys, and
the mediator. The cost of mediation will vary based on the
complexity of the case, but is generally far less than that
involved in going to a trial. If the mediation is unsuccessful,
the parties may still pursue a trial. If a settlement is made,
the parties sign a settlement agreement approved by their
attorneys. This agreement, if drafted properly, is an enforceable
In arbitration, a neutral third party (usually chosen by mutual
agreement of both parties) makes a binding decision after
reviewing the evidence and hearing the arguments of all sides.
The Manager's Role in Alternative Dispute Resolution
Make sure that you and your attorney have established guidelines
about what you can say, if anything, and when you can say
it. Be patient. To be effective, the negotiation process can
sometimes appear tedious, but the art of compromise usually
takes time. Be flexible and willing to compromise. Many times,
an apology at this point in the process will help pave the
way for compromises on other significant issues, like the
amount of money to be paid.
Despite all of your careful planning, preparation, and prevention
techniques, guests can still be seriously injured on your
property. They may sue, but if they do you are now in a better
position to deal with the process.
Stephen Barth is an attorney and associate professor of law
and leadership at the Conrad N. Hilton College of Hotel &
Restaurant Management at the University of Houston. For more
information visit www.HospitalityLawyer.com.
Stephen can be contacted at (713) 963-8800 or via email at