The Sober Truth of New Jersey’s BYOB Law and the Acquisition of a Liquor License

by Wilentz, Goldman & Spitzer P.A.
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New Jersey became home to America’s first commercial distillery when, in 1780, an immigrant from Scotland established an Applejack production facility in what is now Colts Neck.  Since that time, New Jerseyhas become the birthplace to some of the most complex liquor license laws in the Country.  For those familiar with the application process and cost of a license, there can be no dispute that acquiring and maintaining a liquor license through the New Jersey Division of Alcoholic Beverage Control (the ABC) and it’s many coordinate local licensing authorities is both an expensive and intensive pursuit subjecting owners and operators to routine inspection of books, records and on premises activities.  There is, however, an undeniable economic incentive to obtaining the privilege to sell and serve the panoply of popular intoxicating beverages that diners and revelers alike willingly peel out the plastic to purchase in mass quantities.

The relative scarcity and expense of consumption licenses has led many restaurants to instead turn to New Jersey’s BYOB (Bring Your Own Bottle) law, which permits patrons to bring their own alcoholic beverages to consume on unlicensed premises—those restaurants that do not have a liquor license.  Importantly, however, our BYOB law, codified at N.J.S.A. 2C:33-27, is far more limiting than many restaurants and patrons may realize.

Primarily, New Jersey’s BYOB law permits only wine and malt alcoholic beverages (the most common malt beverage being beer) to be consumed, thus, patrons may not bring and establishments should not allow their patrons to consume distilled beverages.  Thus, vodka, gin, rum, whiskey, and the many other beverages that are produced through distillation are simply not permitted in any form regardless of the particular proof of the spirit.

Few are familiar with the fact that BYOB is not universally allowed.  Restaurants may not permit BYOB in their establishments if the local government of the municipality in which the restaurant is located has forbidden the practice.  Club 35, L.L.C. v. Borough of Sayreville, 420 N.J. Super. 231 (App. Div. 2011).  Even where the practice is permitted under local law, it is ultimately up to each restaurant to determine whether it will or will not permit BYOB on its premises.  Importantly, even where BYOB is permitted, restaurants may not advertise in any manner that they are a BYOB establishment, instead, leaving it to potential patrons to be prepared.  In addition, restaurants cannot charge any fee, cover, service or corkage charge for customers who bring their own wine or malt beverage.  Finally, not only must consumption be limited to specific hours but, more importantly, BYOB premises should not allow their patrons to overindulge on their premises, despite the fact that the establishment is neither providing nor serving the intoxicating beverages.

Notably, the BYOB law places the burden on the establishment to comply with law and leaves enforcement to local law enforcement as the New Jersey ABC does not have legal jurisdiction over unlicensed establishments.  Thus, patrons who seek to unlawfully consume distilled beverages, or those who continue consuming after becoming visibly intoxicated, are placing the operator of the restaurant in legal jeopardy.  While patrons who violate the law could be subject to penalties that range up to six months in jail, a municipality through its local police powers could charge the establishment with per incident violations, which could become progressively more punitive.  Ultimately, for those establishments that routinely permit the abuse of the BYOB law, it is foreseeable that they could suffer the loss of the advantage offered by the BYOB law.  Further, a history of violating the BYOB law would likely be considered and employed as a reason to reject a future bid for licensure by the ABC.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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