Bethlehem Steel Corp. v. Consolidated Rail Corp.

• Decision Date: 14 December 2000
• Docket Number: No. 45A03-0004-CV-130.,45A03-0004-CV-130.
• Citation: 740 N.E.2d 900
• Parties: BETHLEHEM STEEL CORPORATION, Appellant-Defendant, v. CONSOLIDATED RAIL CORPORATION, Appellee-Plaintiff.
• Court: Indiana Appellate Court

740 N.E.2d 900

BETHLEHEM STEEL CORPORATION, Appellant-Defendant, v. CONSOLIDATED RAIL CORPORATION, Appellee-Plaintiff.

No. 45A03-0004-CV-130.

Court of Appeals of Indiana.

December 14, 2000.

David W. Weigle, Hammond, Indiana, George W. Gessler, Mark A. Pellegrino, Gessler, Hughes & Socol, Ltd., Chicago, Illinois, Attorneys for Appellant.

Harold Abrahamson, Abrahamson & Reed, Hammond, Indiana, Attorney for Appellee.

OPINION

RILEY, Judge

STATEMENT OF THE CASE¹

Appellant-Defendant, Bethlehem Steel Corporation (Bethlehem), appeals the trial court's grant of Appellee Plaintiff's, Consolidated Rail Corporation (Conrail), motion for partial summary judgment.

We reverse and remand for new trial on the issue of liability.

ISSUES

Bethlehem raises four issues on appeal, two of which we find dispositive² and restate as follows:

1. Whether the trial court erred in granting Conrail's motion for partial summary judgment.

2. Whether the trial court's grant of Conrail's motion for partial summary judgment should be reversed and summary judgment in favor of Bethlehem should be entered.

FACTS AND PROCEDURAL HISTORY

Conrail, a railroad carrier, provided railroad service to Bethlehem. In connection with the agreement to provide rail services, Conrail and Bethlehem entered into an agreement on April 30, 1974. The agreement provides in pertinent part as follows:

3. Maintenance

Said sidetrack shall be maintained (including removal of ice, snow, weeds and debris) and renewed to the satisfaction of the Railroad [Conrail]; the work shall be performed and the cost thereof borne as follows:

By the Railroad, at its expense, that portion on Railroad right of way.

By the Industry [Bethlehem], at its expense, that portion beyond Railroad right of way.

7. Clearances

The Industry shall not permit any obstruction over said sidetrack, less than 22 feet above top of rail, or alongside of said sidetrack less than 8 feet from center of track, with the necessary additional clearances on curves.

The minimum clearances herein specified may be changed by the Railroad to meet changes in operating requirements and conditions or legal requirements, and the Industry shall, upon written notice by the Railroad make such changes in its tracks and facilities of the Industry, as may be necessary.

The Industry shall observe and comply with all rules and regulations of the Railroad now in effect and as from time to time amended, governing the handling of flammable liquids and compressed gases, including loading and unloading of tanks cars, the location of racks and storage tanks, and protection of oil sidings from danger due to stray electric currents and other causes; said rules and regulations, designated as the current issue of General Notice No. 201 (basic number), attached hereto and by this reference made a part hereof. (Copy to be attached when track is to be used to handle flammable liquids and compressed gases.)

8. Liability in Connection with Sidetrack

(b) Other Liability. Except as herein otherwise specifically provided, in respect of all loss or damage to property, other than by fire as aforesaid, or in respect of injury to or death of persons, caused by or in connection with the construction, operation, maintenance, use presence or removal of said sidetrack, as between the parties hereto;

(i) The Railroad shall assume responsibility for and hold the Industry harmless and defend the Industry from all losses (including claims for injuries to employees of the Industry or of the Railroad), expenses, attorneys' fees, damages, claims and judgments arising from or growing out of the actionable acts or omissions of the Railroad, its agents or employes [sic] solely or in conjunction with a third person;

(ii) The Industry shall assume responsibility for and hold Railroad harmless and defend the Railroad from all losses (including claims for injuries to employes [sic] of the Industry or of the Railroad), expenses, attorneys' fees, damages, claims and judgments arising from or growing out of actionable acts or omissions of the Industry, its agents or employes [sic], solely or in conjunction with a third person; and

(iii) The parties hereto shall equally bear all losses (including claims for injuries to employes [sic] of the Industry or of the Railroad), expenses, attorneys' fees, damages, claims and judgments arising from or growing out of the joint or concurring actionable acts or omissions of both parties hereto, their respective agents or employes [sic].

(iv) Notwithstanding anything contained in this Section 8(b), and irrespective of any joint or concurring negligence of the Railroad, the Industry assumes sole responsibility for and agrees to indemnify, save harmless and defend the Railroad from and against all claims, actions or legal proceedings arising, in whole or in part, from (a) the failure of the Industry to comply with requirements set forth in Sections 3 and 7 hereof, or (b) any claims, actions or legal proceedings under the Federal Employer's Liability Act and any amendments to said Act now or hereafter in effect, alleging or claiming, in legal effect, that the Railroad failed to correct or guard against an unsafe condition if the unsafe place to work or the condition resulted in whole or in part from any act or omission of the Industry, its agents, employes [sic], tenants, licensees or invitees.

(R. 13-15).

On November 23, 1990, Gregory Seckler (Seckler), a Conrail employee, was killed when he was caught between a moving Conrail train and a loading dock at Bethlehem's Burns Harbor Plant in Porter County, Indiana. Following the accident, Conrail investigated the accident. M.A. Love (Love), a senior officer from Conrail's Division Headquarters in Dearborn, Michigan, conducted the investigation. Conrail took statements from crew members and supervisors, inspected and photographed the railroad cars and the scene, inspected and tested equipment, took measurements, and conducted two reenactments. Subsequently, Love issued the following report:

On Friday November 23, 1990 the yard crew YDBH03 on duty at 8:00 AM CST at Burns Harbor Yard with the crew of Engineer J.K. Evans, Conductor G.L. Seckler, and Trainman J.W. Fields were switching the Bethlehem Steel Plant at approximately 3:10 PM CST. When Conductor G.L. Seckler was rolled between the CR 607070 empty gondola and loading dock.

Mr. Seckler received a contusion to left shoulder, fractured right forearm, fractured ribs both front and back, and interior laceration of both liver and spleen which were fatal.

Mr. Seckler caused his own injuries as a result of the following.

1. Placing himself in the close clearance situation of which he was aware of.

2. By working on the east side of track # 540 when there was no reason to due [sic] so.

3. He was in clear view of the Brakeman while the shoving into the building started and crossed from west to east in front of moving equipment in a matter of 30 to 60 seconds. For which there was no reason to do so.

4. Mr. Seckler and his Brakeman Fields had an understanding (which was obtained through the statements) that neither of them would work on the east side and thats [sic] where he was found.

5. Not paying attention to the instruction he set for his own crew.

6. The entire move could have been performed from the west side of the track without incident and should have been done so.

Corrective Actions:

All close clearance situation in Bethlehem Steel Plant will be identified and those without visible clearance signs as track 540 was, will have signs installed.

Personal contact with all crews going on duty at Burns Harbor to identity [sic] close clearance inside the mill.

Issue instructions that under no circumstance are employees to be allowed to position between the dock and dock track regardless of clearances.

Personal contact with all crews through their Trainmaster discussing close clearance situations in their assigned territory.

(R. 2737-2738).

Conrail promptly contacted Seckler's widow and commenced settlement negotiations with her. Within two months, Conrail reached a $620,000 settlement agreement with the widow. Seckler's widow never retained a lawyer and did not file suit against Conrail. After agreeing to settle, Conrail demanded indemnity from Bethlehem under their agreement. Bethlehem declined to indemnify Conrail for the accident. Conrail then brought action against Bethlehem for indemnification.

On April 20, 1998, Conrail's expert, William Pugh (Pugh), was deposed by Bethlehem. Pugh, a former National Transportation Safety Board examiner, was asked, "[w]hat if any blame do you assess to Bethlehem in this case?" (R. 928). Pugh responded by stating, "Lack of clearance signs and sufficient lighting. Everyone talked about it being dark in there and the clearance sign was gone. A clearance sign is just another caution warning. And lighting, of course, you can see better where you are going, what you are doing, particularly coming from the outside, walking in on a bright day or something. They all talked about it being dark." (R. 928-929).

On May 12, 1998, Conrail filed a motion for partial summary judgment on liability. The motion contended that the terms and conditions of the agreement between Conrail and Bethlehem required that Bethlehem "assume full responsibility for...and indemnify, and save harmless" the railroad from "any claims, actions or legal proceedings under the Federal Employer's Liability Act." (R. 31-32). Bethlehem responded and asserted that Conrail's motion was not supported by the law or facts. Furthermore, Bethlehem maintained that multiple issues of fact exist, requiring determination by a jury. On November 4, 1998, the trial court entered an order determining that the indemnity agreement was unambiguous and valid and that Bethlehem failed to object to the settlement. The trial court further held that Conrail was entitled to indemnity in the full amount; and the only remaining issue was the...