Ploog v. Ogilvie

• Decision Date: 23 September 1981
• Docket Number: No. 51415,51460.,51415
• Citation: 309 NW 2d 49
• Parties: Hugh PLOOG, Appellant, v. Richard OGILVIE, trustee in bankruptcy for Chicago, Milwaukee, St. Paul and Pacific Railway Company, Appellant, Donald Litin, d.b.a. Litin Paper Company, Respondent.
• Court: Minnesota Supreme Court

309 N.W.2d 49 (1981)

Hugh PLOOG, Appellant, v. Richard OGILVIE, trustee in bankruptcy for Chicago, Milwaukee, St. Paul and Pacific Railway Company, Appellant, Donald Litin, d.b.a. Litin Paper Company, Respondent.

Nos. 51415, 51460.

Supreme Court of Minnesota.

August 14, 1981.

Rehearing Denied September 23, 1981.

Yaeger & Yaeger, William G. Jungbauer, Minneapolis, for Ploog.

Rider, Bennett, Egan & Arundel and Scott K. Goldsmith, Minneapolis, for Ogilvie.

Meagher, Geer, Markham, Anderson, Adamson, Flaskamp & Brennan and M. J. Coyne, Minneapolis, for Litin.

Heard, considered, and decided by the court en banc.

PETERSON, Justice.

Plaintiff Hugh Ploog brought this action against defendants Richard Ogilvie, trustee in bankruptcy for the Chicago, Milwaukee, St. Paul and Pacific Railroad Company (the railroad), and Donald Litin, d.b.a. Litin Paper Company (Litin), for damages for personal injuries he sustained while removing a pallet from the sidetrack adjacent to Litin's freight dock. Each defendant crossclaimed for indemnity or contribution from the other. The jury found plaintiff entitled to damages of $140,000. The trial court directed entry of judgment for plaintiff in that amount and awarded Litin indemnity from the railroad. Plaintiff and the railroad appeal from the trial court's order denying their post-trial motions and from the judgment. We affirm in part and reverse in part.

The railroad is a Wisconsin corporation that operates railway lines in Minnesota and other states. Plaintiff was employed by the railroad as a switchman. Litin is a sole proprietorship owned by Donald Litin and engaged in the business of selling paper products to industries.

At all times relevant to this action Litin's plant was located on South Third Street in Minneapolis. The plant was on a block bisected by "Fish Alley," an alley through which the railroad's main switching track runs. Sidetracks branch off the main switching track to serve the industries adjacent to Fish Alley.

On July 25, 1976, a Sunday, plaintiff was working on a crew spotting railroad cars in Fish Alley. Two wooden pallets lay across the sidetrack by Litin's freight dock; many more were stacked on the freight dock. The crew foreman directed plaintiff to remove the pallets from the sidetrack to clear the way for freight cars. Plaintiff lifted each pallet onto the freight dock. While thrusting the second pallet on top of the first, he felt "a little catch in his back."

In the ensuing months plaintiff experienced severe back and leg pain. His condition was eventually diagnosed as degenerative disc disease with a herniated intervertebral disc producing nerve root compression. Although plaintiff has responded well to treatment, he is unable to return to his former occupation. Its physical demands, in his physician's opinion, would likely result in additional trauma.

In October 1978 plaintiff commenced this action against Litin and the railroad alleging his injury was caused by their negligence and seeking compensatory damages. Plaintiff's claim against the railroad was based upon the Federal Employers' Liability Act (FELA), 45 U.S.C. §§ 51-60 (1976).¹ Litin and the railroad denied liability to plaintiff and filed crossclaims against each other for indemnity or contribution.

The crossclaims are based upon three contracts that together comprise the track agreement between Litin and the railroad. The first of these contracts was executed on October 24, 1938, by the railroad and, inter alia, Allis Chalmers Manufacturing Company, Litin's predecessor in interest. In the first contract Allis Chalmers Manufacturing Company agreed to furnish the railroad with the right-of-way necessary for the sidetrack. The railroad agreed to construct the sidetrack and to "maintain, repair and renew" it. The contract contains a clearance provision:

The Industry the tenant of Allis Chalmers Manufacturing Company shall not place or permit to be placed, or to remain, any material, equipment, structure, pole, or other obstacle or obstruction, within 8.5 feet, on straight track, or 9.5 feet on curved track, laterally of the center, or within twenty-five (25) feet vertically from the top of either rail of said track; nor shall it make or permit to be made, or to remain, any excavation within six (6) feet laterally from the nearest rail of said track.

The contract also contains an indemnity and contribution provision:

The Industry also agrees to indemnify and hold harmless the Railroad Company for loss, damage or injury from any act or omission of the Industry, its employes, or agents, to the person or property of the parties hereto and their employes, and to the person or property of any other person or corporation, while on or about said track; and if any claim or liability other than from fire shall arise from the joint or concurring negligence of both parties hereto, it shall be borne by them equally.

The second contract was executed by the same parties on April 13, 1939, and allows the tenant to maintain reduced clearances at specified locations along the sidetrack. The third contract was executed by the railroad and Litin on December 24, 1971. It recites that Litin "has succeeded to all the right, title and interest of Allis Chalmers Manufacturing Company in and to the said agreements of October 24, 1938 and April 13, 1939" and further provides:

Litin hereby certifies that it is familiar and conversant with the contents of said agreements of October 24, 1938 and April 13, 1939, and agrees to assume, be bound and governed by all of the terms, conditions, stipulations, releases and acquittances in said agreements contained, with the same force and effect as though it had originally been the party with whom the agreements were made.

Prior to trial plaintiff and the railroad read a settlement agreement into the record. The apparent purpose of the settlement agreement was to provide plaintiff with a minimum recovery of $75,000 and to limit the railroad's payment to plaintiff to that amount. The railroad agreed to pay plaintiff $75,000 in exchange for plaintiff's relinquishing all claims against it arising out of the incident of July 25, 1976. Plaintiff agreed that if he recovered more than $75,000 from Litin, alone or together with the railroad, and if Litin was held entitled to contribution or indemnity from the railroad, then plaintiff would pay the railroad the amount awarded as contribution or indemnity provided he received a net recovery of at least $75,000. In no event was plaintiff to receive from Litin and the railroad a sum greater than the sum determined by the jury to be necessary to compensate plaintiff for his injury.

The matter was tried to a jury on August 20-24, 1979. Evidence adduced at trial disclosed that the sidetracks near many of the industrial freight docks on Fish Alley were littered with debris. Donald Litin testified that twice a week a railroad crew came through Fish Alley to clear the debris from the tracks. At the end of each working day Litin's employees were accustomed to remove from the track area anything of value to Litin in its business, including pallets. Donald Litin assumed this had been done on Friday, July 23, 1973, the last working day before the day on which plaintiff was injured. Plaintiff, Donald Litin and a switchman whom plaintiff called as a witness all testified they had never seen pallets lying on the tracks before.

The jury was informed of the fact of the settlement but not of the amount the railroad had agreed to pay plaintiff. The trial court declined to construe the track agreement before submitting the case to the jury. The trial court stated it would decide the question of the parties' rights to indemnity after receiving the benefit of the jury's verdict and reviewing the applicable law.

The jury returned a special verdict finding (1) that Litin was negligent and that its negligence was a direct cause of plaintiff's injuries; (2) that plaintiff's injuries resulted in whole or in part from conduct of the officers, agents or employees of the railroad; (3) that 60% of the causal fault was attributable to Litin and 40% to the railroad; and (4) that $140,000 was the amount necessary to compensate plaintiff fairly for his injuries. By an order dated February 4, 1980, the trial court awarded plaintiff judgment against Litin and the railroad in the amount of $140,000. It further held Litin entitled to indemnity from the railroad for any sums Litin might pay in satisfying the judgment.

Plaintiff and the railroad each subsequently moved for judgment requiring Litin to indemnify the railroad or, in the alternative, a new trial. By...