Folks ask us all the time. What happens if I sell beer, wine or spirits without a license in Tennessee?
The short answer: It can be really bad. Do you want to go to jail or lose your business?
The sale of alcohol without a license is a crime in Tennessee, punishable as a Class B Misdemeanor. TCA 39-17-702. Conviction of a Class B Misdemeanor leads to jail time of up to six months, a fine of up to $500, or both. TCA 40-35-111.
From a practical perspective, a legitimate business that fails to have proper permitting may face serious legal consequences from the Tennessee ABC or local beer board. Criminal charges are rare in our experience.
However, the failure to have proper alcoholic beverage permits may disqualify the business from being issued a liquor license or beer permit. This is a risk that no responsible business owner should take.
Cosmetologists have a special exemption that allows service of complimentary wine, which we blog about here.
Kid Rock gets it:
So let’s roll the dice, one more time
Take a chance on love again tonight
Risk it all, lay it on the line
Perhaps the biggest concern is insurance. We find that most insurers limit liability to liquor claims. Generally, insurance policies exclude coverage for liquor liability without a valid liquor license.
Most folks do not recognize the importance of insurance, until you need it for a claim. If someone who drinks at your business later kills or maimes another person in a drunk driving accident, for example, your insurance may not cover the claim, if you do not have a liquor license and dram shop insurance.
Without insurance, you could end up spending tens of thousands of dollars in legal fees and hundreds of thousands or even millions of dollars in damages.
We think it is not worth the risk to play fast and loose with the liquor laws. Hire a licensed caterer.