Rice v. Union Pac. R.R. Co.

• Citation: 873 F.Supp.2d 1044
• Decision Date: 08 June 2012
• Docket Number: No. 4:12–cv–00108–SWW.,4:12–cv–00108–SWW.
• Parties: M. Randy RICE, trustee for Jody L. Clark, Plaintiff, v. UNION PACIFIC RAILROAD COMPANY, Defendant/Third–Party Plaintiff, v. Gunderson Rail Services, LLC, d/b/a Greenbrier Rail Services Pine Bluff d/b/a Gunderson Wheel Services and d/b/a Gunderson, Inc., Third–Party Defendant.
• Court: U.S. District Court — Eastern District of Arkansas

873 F.Supp.2d 1044

M. Randy RICE, trustee for Jody L. Clark, Plaintiff,

v.UNION PACIFIC RAILROAD COMPANY, Defendant/Third–Party Plaintiff,

v.Gunderson Rail Services, LLC, d/b/a Greenbrier Rail Services Pine Bluff d/b/a Gunderson Wheel Services and d/b/a Gunderson, Inc., Third–Party Defendant.

No. 4:12–cv–00108–SWW.

United States District Court,

E.D. Arkansas,

Western Division.

June 8, 2012.

G. Michael O'Neal, Jason R. Keck, Hubbell Peak O'Neal Napier & Leach, Kansas City, MO, M. Randy Rice, Rice Law Office, Little Rock, AR, for Plaintiff.

James C. Baker, Jr., Jamie Marie Huffman Jones, Friday, Eldredge & Clark, LLP, Little Rock, AR, for Defendant and Third–Party Plaintiff.

Joseph Cotten Cunningham, Laser Law Firm, P.A., Little Rock, AR, Melisa G. Thompson, David M. Alt, Joseph P. Pozen, Scott L. Carey, Bates Carey Nicolaides LLP, Chicago, IL, for Third–Party Defendant.

OPINION AND ORDER

SUSAN WEBBER WRIGHT, District Judge.

Plaintiff M. Randy Rice, Trustee for Jody L. Clark, brings this action under the Federal Employers' Liability Act (FELA), 45 U.S.C. § 51 et seq., the Federal Railroad Safety Act (FRSA), 49 U.S.C. § 20101 et seq., and the Federal Safety Appliance Act (FSAA), 49 U.S.C. § 20301 et seq., for personal injuries Clark sustained in an accident while working as a switchman/brakeman for defendant Union Pacific Railroad Company (Union Pacific).¹ Union Pacific, in turn, has filed a third-party complaint for indemnity against Gunderson Rail Services, LLC, d/b/a Greenbrier Rail Services Pine Bluff d/b/a Gunderson Wheel Services and d/b/a Gunderson, Inc. (Gunderson), alleging that Clark's accident was the result of failure and negligence of Gunderson and that Gunderson is liable for Clark's loss under indemnity provisions in a Track Lease Agreement pursuant to which Gunderson leases track from Union Pacific.

By Opinion and Order entered May 15, 2012, 2012 WL 1710906 [doc. # 94], the Court denied as moot Union Pacific's motion for summary judgment on Count II of Plaintiff's complaint under the FSAA as Plaintiff withdrew Count II of his complaint, denied as premature Union Pacific's motion for summary judgment on its claim for indemnity against Gunderson under the Track Lease Agreement, granted in part and denied in part Plaintiff's motion for partial summary judgment, and denied the parties' six motions to exclude expert testimony.

Following the Court's ruling on the motions, the parties settled Plaintiff's claims for $1,150,000, with Union Pacific and Gunderson each agreeing to pay Plaintiff $575,000.² Because Union Pacific is responsible for Plaintiff's loss incurred as a result of violations of its non-delegable duty to furnish a safe workplace under FELA, see, e.g., Burlington Northern R. Co. v. Farmers Union Oil Co. of Rolla, 207 F.3d 526, 532 (8th Cir.2000) (noting that the primary purpose of an indemnity agreement such as is at issue here is to indemnify a railroad when its lessee's act or omission causes the railroad to violate its non-delegable duty to furnish a safe workplace under FELA), Gunderson, by agreeing to pay Plaintiff $575,000 of the settlement, or one-half of Union Pacific's liability, indemnified Union Pacific for that same amount. Accordingly, the only question remaining is whether Gunderson will be required to indemnify Union Pacific for the full amount of its liability or whether Gunderson can limit Union Pacific's recovery of indemnity to one-half of its liability by proving that Union Pacific was negligent and that its negligence contributed to Clark's accident.³ The Court held a bench trial on Union Pacific's indemnity claim beginning on May 30, 2012 and concluding on June 1, 2012. This Opinion and Order constitutes the Court's findings of fact and conclusions of law pursuant to Fed.R.Civ.P. 52. ⁴

I.

At the time of his accident, Clark was a switchman working for Union Pacific. Clark was part of a three man crew, which also included a foreman, Edward Lybrand, and an engineer, Tommy Morrison. They were the only Union Pacific employees whose job was to switch cars at the Gunderson facility in Pine Bluff, Arkansas. Union Pacific owned the tracks at the Gunderson facility and allowed Gunderson to use the tracks under a Track Lease Agreement.

The Track Lease Agreement was drafted by Union Pacific and entered into by Union Pacific and Gunderson on June 20, 2000. The Track Lease Agreement refers to Gunderson as “the Industry” and Union Pacific as “the Railroad.” Article 3 of the Track Lease Agreement governs maintenance of the leased track and provides in pertinent part as follows:

Article 3. MAINTENANCE OF TRACK STRUCTURE, RIGHT OF WAY AND TRACK APPURTENANCES.

A. The Industry, at its sole expense, shall maintain the track structure consisting of the rail, ties, ballast and other Track material including any paving or planking work that may be needed.

* * *

C. The Industry at its sole expense, shall remove snow, ice, sand and other substances as needed to permit safe operation over the Track....

D. Maintenance work performed by the Industry shall conform to the Railroad's standards....

* * *

Exhibit B to the Track Lease Agreement sets forth certain terms regarding the parties' responsibility for safety and liability. Section 2 of Exhibit B to the Track Lease Agreement addresses “SAFETY.” Section 2(c) governs walkways and provides that the “Industry, at its expense, shall provide and maintain a clear and safe pathway for Railroad employeesalong both sides of the Track....” Section 2(d) provides that the “Industry shall have a non-delegable duty and responsibility to train and oversee its employees and agents as to proper and safe working practices while performing any work in connection with this Agreement, or any work associated with the Railroad serving the Industry over the Track.” Section 2(e), regarding intraplant switching, states that the “Industry shall not perform, permit or cause intraplant switching without the prior written consent of the Railroad” and defines “intraplant switching” as “the movement of rail cars on the track by the Industry by any method and includes the Industry's capacity to move rail cars whether before, during or after any such movement.” Finally, section 2(f) requires the Industry to comply with “Standards,” defined as “all applicable ordinances, regulations, statutes, rules, decisions and orders including, but not limited to, safety, zoning, air and water quality, noise, hazardous substances and hazardous wastes” which are “issued by any federal, state or local governmental body or agency (hereinafter “Authority”).” Section 2(f) further provides:

If the Industry is not in full compliance with any Standards issued by any authorized Authority, the Railroad, after notifying the Industry of its noncompliance and the Industry's failure within twenty days of such notice to correct such noncompliance, may elect to take whatever action is necessary to bring the Track and any Railroad property into compliance with such Standards; PROVIDED, HOWEVER, that if Industry's failure to comply with Standards interferes with, obstructs or endangers Railroad mainline or yard operations in any way, Railroad may initiate compliance action immediately; and PROVIDED, FURTHER, nothing in this Agreement shall prevent Railroad from taking action to mitigate damages caused by Industry's noncompliance with Standards. The Industry shall reimburse the Railroad for all costs (including, but not limited to, consulting, engineering, clean-up, disposal, legal costs and attorneys' fees, fines and penalties) incurred by the Railroad in complying with, abating a violation of, or defending any claim of violation of such Standards. A waiver by the Railroad of the breach by the Industry of any covenant or condition of this Agreement shall not impair the right of the Railroad to avail itself of any remedy for any subsequent breach thereof.

Section 3 of Exhibit B to the Track Lease Agreement addresses “LIABILITY” and provides in pertinent part as follows:

Section 3. LIABILITY.

(b) Except as otherwise specifically provided in this Agreement, all Loss related to the construction, operation, maintenance, use, presence or removal of the Track shall be allocated as follows:

(1) The Railroad shall pay the Loss when the Loss arises from or grows out of the acts or omissions of the Railroad whether or not a Third Person contributes to cause the Loss.

(2) The Industry shall pay the Loss when the Loss arises from or grows out of the acts or omissions of the Industry. The Industry shall also pay Loss when the Loss arises from or grows out of:

* * *

(ii) the Industry's failure to construct or adequately maintain pathways or walkways as required by Section 2(c); (iii) the Industry's failure to comply with Standards, as required by Section 2(f);

(iv) intraplant switching as defined by section 2(e); ...

* * *

The Industry shall be liable under [ (ii) through (iv) ] regardless of whether the Railroad had notice of, consented to, or permitted the aforesaid impairments, failures, Standards, wastes or substances, and whether or not the Railroad or a Third Person contributed to cause the Loss.

(3) Except as otherwise more specifically provided in this Agreement, Railroad and Industry shall pay equal parts of the Loss that arises out of the joint or concurring negligence of the Railroad and the Industry, whether or not the acts or omissions of a Third Person contribute to cause the Loss.... ⁵

On Monday, August 30, 2010, Clark and the other members of his crew were picking up three wheel cars from the Gunderson facility to bring back to the Union Pacific facility. When Clark asked Morrison to “stretch,” or move the train forward to make certain that the cars were coupled together, Clark realized that the last car on the track, AOK6445, was not coupled to the others. Clark walked to the rear of Track 570 and he noticed that the drawbar on the last car was slued, or moved over to one side. Standing...