42 498 Kelley v. Southern Pacific Company 8212 1270

Decision Date23 December 1974
Docket NumberNo. 73,73
Citation42 L.Ed.2d 498,419 U.S. 318,95 S.Ct. 472
Parties. 42 L.Ed.2d 498 Eugene C. KELLEY, Petitioner, v. SOUTHERN PACIFIC COMPANY. —1270
CourtU.S. Supreme Court

Petitioner, an employee of a trucking company (PMT), was injured while transferring automobiles in respondent's railyard from respondent's railroad car to a PMT auto trailer, an operation that PMT performed under contract for respondent. Although respondent's employees occasionally consulted with PMT employees about the operation, PMT supervisors controlled the day-to-day unloading process. Petitioner, claiming that he was sufficiently under respondent's control to bring him under the coverage of the Federal Employers' Liability Act (FELA), which makes a covered railroad liable for negligently causing injury or death to any person 'while he is employed' by the railroad, and that the accident resulted from respondent's negligence, brought suit against respondent under the FELA. The District Court found that the relationship between petitioner and respondent sufficed to make the FELA apply, the court having concluded that: PMT was serving generally as respondent's agent; PMT employees were respondent's agents for purposes of the unloading operation; and the work performed by petitioner fulfilled a nondelegable duty of respondent. The Court of Appeals reversed, having concluded that the District Court's test for FELA liability was too broad. Held:

1. The 'while employed' language of the FELA requires not only that the FELA plaintiff be an agent of the rail carrier but the carrier's servant, and here the District Court erred in holding that petitioner (who according to the court's findings was neither a borrowed servant of respondent nor a dual servant of respondent and PMT) came within the coverage of the FELA, since those findings also did not establish a master-servant relationship between respondent and PMT that would be necessary to render petitioner a subservant of the railroad. Nor was the District Court's conclusion that respondent was 'responsible' for the unloading operation tantamount to a finding that the railroad controlled or had the right to control the physical conduct of PMT employees like petitioner in the unloading operation. Pp. 322—326.

2. The District Court's findings that petitioner worked most of the time on respondent's premises and that respondent's employees were responsible for checking the safety conditions on the railroad cars showed only that the two companies' operations were closely related, not that respondent's employees supervised the unloading operation, and consequently the FELA's 'while employed' requirement remains unsatisfied even under the proper test. Pp. 326—331.

3. The record should be re-examined by the District Court in light of the proper legal standard. Pp. 331—332.

9 Cir., 486 F.2d 1084, vacated and remanded.

R. Jay Engel, San Francisco, Cal., for petitioner.

John J. Corrigan, Los Angeles, Cal., for respondent.

Mr. Justice MARSHALL delivered the opinion of the Court.

Petitioner Eugene Kelley was seriously injured when he fell from the top of a tri-level railroad car where he had been working. He sought recovery for his injuries from the respondent railroad under the Federal Employers' Liability Act (FELA), 35 Stat. 65, as amended, 45 U.S.C. §§ 51—60. Under the FELA, a covered railroad is liable for negligently causing the injury or death of any person 'while he is employed' by the railroad. Although petitioner acknowledged that he was technically in the employ of a trucking company rather than the railroad, he contended that his work was sufficiently under the control of the railroad to bring him within the coverage of the FELA. The District Court agreed, but the Court of Appeals for the Ninth Circuit reversed, 486 F.2d 1084 (1973), creating an apparent conflict with a previous decision of the Fourth Circuit, Smith v. Norfolk & Western R. Co., 407 F.2d 501, cert. denied, 395 U.S. 979, 89 S.Ct. 2134, 23 L.Ed.2d 767 (1969).1 We granted certiorari to resolve the conflict. 416 U.S. 935, 94 S.Ct. 1931, 40 L.Ed.2d 285 (1974). We vacate the judgment and remand the case for further proceedings in the District Court.


At the time of his accident, petitioner had worked for the Pacific Motor Trucking Co. (PMT), a wholly owned subsidiary of the Southern Pacific Co., for about eight years.2 PMT was engaged in various trucking enterprises, primarily in conjunction with the railroad operations of its parent company. Among PMT's functions was transporting new automobiles from respondent's San Francisco railyard to automobile dealers in the San Francisco area. As part of its contractual arrangement with the railroad, PMT would unload automobiles from Southern Pacific's 'trilevel' auto-carrying flatcars when they arrived in the yard. It was petitioner's job to unhook the automobiles from their places on the railroad cars and to drive them into the yard for further transfer to PMT auto trailers. PMT maintained the unloading operation in the yard on a permanent basis. Although there were Southern Pacific employees in the area who would occasionally consult with PMT employees about the unloading process, PMT supervisors controlled and directed the day-to-day operations.

On July 3, 1963, petitioner was unhooking automobiles in the usual fashion from the top level of one of the tri-level flatcars. A safety cable, normally affixed to the flatcar to protect against falls, was apparently not in place because of an equipment defect. During the unhooking process, petitioner fell from the top of the car and suffered a disabling injury. He subsequently received workmen's compensation payments from PMT. Shortly before the three-year FELA statute of limitations had run, he brought suit against the respondent,3 claiming it had been negligent in failing to maintain the safety cable in its proper place and in proper working order.

In his complaint, petitioner alleged that he was employed by the respondent railroad within the meaning of the FELA. After a six-day hearing, the District Court, sitting as trier of fact,4 ruled in petitioner's favor on the employment question. The job of unloading automobiles was the railroad's responsibility, the court found, 'pursuant to its contractual responsibilities to the shippers and its tariff responsibilities.' In addition, the court found that the railroad supplied the necessary ramps and owned the area in which the PMT employees worked. The responsibility for supervision and control of the unloading operations was respondent's, the court concluded, even though 'the exercise thereof was executed by employees of Pacific Motor Trucking Company.' In sum, the court found that PMT was serving generally as the railroad's agent; PMT employees were agents of the railroad for the purposes of the unloading operation; and because the work being performed by petitioner was 'in fulfillment of a non-delegable duty of defendant Southern Pacific Company,' the relationship between petitioner and the railroad was sufficient to bring him within the coverage of the FELA. After this resolution of the employment issue, the railroad stipulated to its negligence, the parties agreed to set damages at $200,000, and the trial court entered judgment for petitioner in that amount.

The Court of Appeals observed that the District Court had not found that petitioner was 'employed' by the railroad, either permanently or at the time of his accident. The court noted that the 'while employed' clause of the FELA requires a finding not just of agency but of a master-servant relationship between the rail carrier and the FELA plaintiff. Concluding that the District Court had applied an unduly broad test for FELA liability, the Court of Appeals reversed the District Court's judgment.


Petitioner insists that the District Court in effect made a factual finding of employment and that the Court of Appeals erred in upsetting that finding. Of course, even if the District Court made such a finding of employment after applying the proper principles of law, that would not be the end of the matter. Under Fed.Rule Civ.Proc. 52(a), an appellate court must set aside the trial court's findings if it concludes that they are 'clearly erroneous.' See United States v. United States Gypsum Co., 333 U.S. 364, 394—395, 68 S.Ct. 525, 541—542, 92 L.Ed. 746 (1948). We need not reach the question whether any of the District Court's findings in this case were clearly erroneous, however, since we agree with the Court of Appeals that the trial court applied an erroneous legal standard in holding that the plaintiff was within the reach of the FELA. United States v. Singer Mfg. Co., 374 U.S. 174, 194 n. 9, 83 S.Ct. 1773, 1783, 10 L.Ed.2d 823 (1963).

The heart of the District Court's analysis was its conclusion that the 'traditional agency relationship' between respondent and PMT, in conjunction with the master-servant relationship between PMT and petitioner, was sufficient under the circumstances of this case to bring petitioner under the coverage of the Act. But this Court has repeatedly required more than that to satisfy the 'while employed' clause of the FELA. From the beginning the standard has been proof of a master-servant relationship between the plaintiff and the defendant railroad. See Robinson v. Baltimore & Ohio R. Co., 237 U.S. 84, 94, 35 S.Ct. 491, 494, 59 L.Ed. 849 (1915); Hull v. Philadelphia & Reading R. Co., 252 U.S. 475, 479, 40 S.Ct. 358, 359, 64 L.Ed. 670 (1920); Baker v. Texas & Pacific R. Co., 359 U.S. 227, 228, 79 S.Ct. 664, 665, 3 L.Ed.2d 756 (1959).

In an early FELA case, this Court noted that the words 'employee' and 'employed' in the statute were used in their natural sense, and were 'intended to describe the conventional relation of employer and employe .' Robinson, supra, 237 U.S., at 94, 35 S.Ct., at 494. In Baker, supra, the Court reaffirmed that for the purposes of the FELA the question of employment, or...

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