Potlatch Corp. v. Missouri Pacific R. Co.

• Decision Date: 10 July 1995
• Docket Number: No. 94-910,94-910
• Citation: 902 S.W.2d 217,321 Ark. 314
• Parties: POTLATCH CORPORATION, Appellant, v. MISSOURI PACIFIC RAILROAD COMPANY, Appellee.
• Court: Arkansas Supreme Court

Page 217

902 S.W.2d 217

321 Ark. 314

POTLATCH CORPORATION, Appellant, v. MISSOURI PACIFIC RAILROAD COMPANY, Appellee.

No. 94-910.

Supreme Court of Arkansas.

July 10, 1995.

Williams & Anderson, John E. Tull III, Philip S. Anderson and Leon Holmes, Little Rock, for appellant.

Ramsay, Bridgforth, Harrelson & Starling, Philip A. Raley and William M. Bridgforth, Pine Bluff, for appellee.

DUDLEY, Justice.

Missouri Pacific Railroad Co. filed a suit against Potlatch Corporation for negligence and breach of contract. The trial on the merits lasted six days. At the close of plaintiff's case, the trial court denied defendant Potlatch's motion for a directed verdict. At the close of the defendant's case, defendant renewed its motion for a directed verdict. MoPac moved for a plaintiff's directed verdict. The trial court denied both motions. After rebuttal each party moved for a directed verdict. The trial court again denied both motions. The jury returned a defendant's verdict. The trial court later entered a judgment notwithstanding the verdict and awarded compensatory damages of $2,350,000 to plaintiff plus attorney's fees in the amount of $25,000. We reverse and reinstate the jury verdict.

The procedure in this case was unusual, and for a clear understanding, we set out that procedure in detail along with the standard of review. The trial court granted a judgment notwithstanding the verdict in favor of the plaintiff. A motion for a directed verdict is a condition precedent to a motion for a judgment notwithstanding the verdict. ARCP Rule 50(b); Wheeler Motor Co. v. Roth, 315 Ark. 318, 867 S.W.2d 446 (1993). Technically, a motion for a judgment notwithstanding the verdict is just a renewal of the motion for a directed verdict. Id at 323, 867 S.W.2d at 448. In this case the judgment notwithstanding the verdict was a renewal of the motion for a directed verdict by the party having the burden of proof, plaintiff MoPac.

Absent rare circumstances, we do not affirm the grant of a directed verdict, or a subsequent motion for a judgment notwithstanding the verdict, in favor of the party with the burden of proof in a negligence case. The reasoning is sound. When the complaint is denied in the answer, the plaintiff in a negligence action has the burden of proving negligence, proximate cause, and damages. The defendant is entitled to have the jury pass on the credibility of the plaintiff's evidence even if the defendant offers no evidence. Under the Arkansas Constitution, the trial court is prohibited from telling the jurors that they are to believe the plaintiff's witnesses. Ark. Const. art. 2, § 7. The jury, in the first instance, is the sole judge of the credibility of the witnesses and of the weight and value of the evidence, and may believe or disbelieve the testimony of one or all of the plaintiff's witnesses, even though the evidence is uncontradicted and unimpeached. Barger v. Farrell, 289 Ark. 252, 711 S.W.2d 773 (1986); Morton v. American Medical Int'l, Inc., 286 Ark. 88, 689 S.W.2d 535 (1985); Spink v. Mourton, 235 Ark. 919, 362 S.W.2d 665 (1962). As a result, we have said that no matter how strong the evidence of the party having the burden of proof in a negligence case, "that party is not entitled to have those facts declared to have reality as a matter of law, unless there is utterly no rational basis in the situation, testimonially, circumstantially, or inferentially, for a jury to believe otherwise." Young v. Johnson, 311 Ark. 551, 845 S.W.2d 510 (1993) (emphasis added); (quoting United States Fire Ins. Co. v. Milner Hotels, 253 F.2d 542, 547 (8th Cir.1958)); Morton, 286 Ark. at 90, 689 S.W.2d at 537; Spink, 235 Ark. at 922, 362 S.W.2d at 667.

In 1985, we wrote that we were not aware of any Arkansas case in which a verdict for the party not having the burden of proof was set aside in a negligence case solely because it was not supported by substantial evidence. Morton, 286 Ark. at 90, 689 S.W.2d at 536. The statement still holds true although there is a case that deserves mention. In Young v. Johnson, 311 Ark. 551, 845 S.W.2d 510 (1993), the defendant filed a counterclaim against the plaintiff. The plaintiff moved for a directed verdict on the defendant's counterclaim. The defendant was the party with the burden of proof on the counterclaim. The trial court denied the motion. We reversed because the defendant did not meet the burden with substantial evidence. In the opinion we noted that we are "loath" to affirm a directed verdict in favor of the party who has the burden of proof. Young, 311 Ark. at 555, 845 S.W.2d at 513.

In summary, we affirm the grant of a directed verdict or the grant of a judgment notwithstanding the verdict in favor of the party having the burden of proof only when "there is utterly no rational basis in the situation, testimonially, circumstantially, or inferentially, for a jury to believe otherwise." United States Fire Ins. Co, 253 F.2d at 547.

In the case at bar, both parties have misstated the above standard and have argued this case using the standard applicable when the party that does not have the burden of proof moves for a directed verdict, which is whether there is substantial evidence to support a verdict. We address the points of appeal as they are argued by the parties because, in this case, it makes no difference since the party that did not have a burden of proof, defendant Potlatch, put on a substantial amount of evidence which supported the jury's verdict.

We now turn to the facts of this case. In the early 1960's, Potlatch began making plans to build a pulp and paper mill at Cypress Bend on the Mississippi River in Desha County. In 1974, it started construction of the mill and MoPac asked to provide rail service. The principal raw materials utilized at the mill are woodchips which are shipped from another Potlatch facility at Warren. MoPac agreed to provide sufficient numbers of woodchip cars for Potlatch to continually operate the Cypress Bend facility. In 1977, MoPac and Potlatch executed an Industrial Track Agreement.

After the Agreement was entered, MoPac began delivering loaded chip cars to the mill every morning. There are three sets of tracks in the mill yard that are relevant to this suit. The first is the loaded chip track, the second is the dumper track, and the third is the empty chip track. Every morning MoPac delivers the loaded chip cars and leaves them standing on the loaded chip track. A Potlatch engine then transports the cars to a rotary dumper, which rotates each car upside down and dumps the contents down onto a conveyor system which conveys the chips into the mill. The rotary dumper then turns the car upright, and immediately afterwards a Potlatch switch engine pushes the unloaded car out of the dumper and onto the track. As the empty car moves away from the dumper, gravity causes it to travel down a declining track for a designed distance. It then begins to go up an incline until stopped by gravity, at which point it begins to roll back downhill. As it rolls back downhill an automatic switch causes it to move onto the empty chip track. The empty cars come to a stop on the empty chip track and are subsequently removed by the same MoPac crew that delivered the load of chips earlier that day.

On January 28, 1982, Clarence Higley, an employee of plaintiff MoPac, was severely injured while working on the empty car track. His arm was caught between two railroad cars, and eventually his arm had to be surgically amputated. On the day of the accident, Higley's MoPac crew left the loaded chip cars on the loaded chip track and then proceeded to pick up the empty cars sitting on the empty car track. A MoPac employee was coupling the empty cars by pushing them into one another with the MoPac engine. Higley saw that two cars failed to couple and walked to those cars to manually couple them. As he got between the cars, they moved and he was pinned between them. He testified that the movement of the car came from the direction of MoPac's engine and not from the direction of the dumper facility. Evidence showed that the Potlatch engine does not operate on the empty chip track where the injury occurred.

Higley filed a Federal Employers' Liability Action suit against MoPac in federal district court, was awarded a judgment of $2,371,000, and eventually settled with MoPac for $2,350,000. Mopac asked Potlatch for indemnity under the Industrial Track Agreement. Potlatch concluded that the accident was not covered by the indemnity agreement and declined to defend the suit. After Higley obtained the $2,350,000 FELA judgment against MoPac, it filed this indemnity action against Potlatch. The case was tried to a jury in circuit court, and the jury found for Potlatch. MoPac moved for judgment notwithstanding the verdict, and in the alternative, a new trial. The trial court granted a judgment notwithstanding the verdict.

In granting the judgment notwithstanding the verdict, the trial court erroneously stated that Potlatch's engineer was operating Potlatch's engine at the time Higley was injured. To the contrary, all of the evidence was that MoPac's engineer was operating MoPac's engine and Potlatch's engine was not being operated. The trial court's oral findings of fact were incorporated into the judgment notwithstanding the verdict.

In addition, there was evidence that the Potlatch rotary dumper crew was not negligent in the manner in which they opened the car couplers on the day of the accident, and there was evidence that Potlatch was not negligent in the design of the yard and tracks. Therefore, even using the standard the parties have advanced, there was substantial evidence to support the jury's finding that Potlatch was not guilty of negligence. Under the correct standard of review, we would hold that the evidence did not clearly and unmistakably show that MoPac, the party with the burden of proof, was entitled to have facts declared sufficient as...