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ARBITRATION AWARD NO. 4

Wallace Miers and Lucille Fortenot Miers vs.ACP Industries, Inc., St. Louis Southwestern Railway Company and Missouri Pacific Railroad Company

The captioned suit arose from fatal injuries to Michael W. Miers at Crowley, Louisiana, May 17, 1977. The plaintiffs are the mother and father of the deceased. The plaintiffs itemized their damages in the Complaint, filed in United States District Court, Western District of Louisiana, Lafayette Division, on May 17, 1978, in the total amount of $605,000. Defendants were ACF Industries, Inc., manufacturer of the covered hopper car involved, St. Louis southwestern Railway Company ("Cotton Belt"), leassee of the car and originating carrier, Enserch Corporation, and/or Enserch Exploration, Inc.,) NiPak, Inc.), shipper and consignee, and Missouri Pacific Railroad Company, delivering carrier. Southern Pacific Transportation Company, another defendant and alleged to have transported car, was subsequently dismissed.

This suit was fully and amicably settled and compromised with all claims and demands of Wallace Miers and Lucille Fortenot Miers and all crossclaims of ACF Industries, Inc., St. Louis Southwestern Railway Company, a/k/a/ SSW "Cotton Belt" Railroad Company, and Missouri Pacific Railroad Company, each one against the other defendants, dismissed with prejudice. St. Louis Southwestern Railway Company and Missouri Pacific Railroad reserved their rights under and pursuant to the Intra-Industry Agreement. Third party demand of Missouri Pacific Railroad Company against NiPak, Inc was dismissed without prejudice. Settlement was consummated as follows: Missouri Pacific Railroad Company paid $40,000 plus $2,666.67 costs; ACF industries, Inc. paid $10,000 plus $1,333.33 costs.

It was agreed among the Carriers that disposition of the suit would be made in the above manner and that the respective responsibilities of the two railroads as between themselves would be arbitrated under the Intra-Industry Agreement. Thereafter, Missouri Pacific Railroad Company, pursuant to Rule 33, requested Arbitration.

The members of this Arbitration Panel were named by Secretary J. D. Temple pursuant to Rule 36.

Pursuant to Rule 38, each Carrier submitted to the Arbitrators its statement of position as recited below:

Missouri Pacific Railroad Company contends that the SSW, as the ORIGINATING CARRIER, should very definitely "bear full responsibility for COSTS" of Michael Miers' death pursuant to Rule 12. There can be no question that both types of defective conditions of SSW 76407 asserted by the plaintiffs and on the basis of which the SSW and MoPac agreed to settle with the plaintiffs i.e., both the long-term maintenance complaints of "tight" and rusted hinges and worn non-skid paint, and the absence of a space-dividing bar in the hatch opening as a substitute for a vertical railing installation not only can be shown to have existed in SSW 76407, but must have existed in SSW 76407 when the SSW placed the car for loading at origin.

The SSW should therefore "bear full responsibility" for the $42,666.67, which was "paid in compromise" of [the] lawsuit, see Rule 1(e), by the MoPac on behalf of both the SSW and the MoPac, as well as the $12,198.l89 in legal fees that the MoPac incurred after the applicability of the IICA was recognized and the MoPac offered to assume and thought that it had assumed the SSW's defense.

The only issue in this arbitration that does not have a clear answer is whether or not the legal fees that were incurred prior to the recognition of the applicability of the IICA should be included in the COST. On this point, the MoPac quite frankly has no confident answer and will abide by whatever the Arbitration Panel deems proper.

St. Louis Southwestern Railroad a/k/a SSW "Cotton Belt" Railroad contends that MoPac should be required to pay on its own and without apportionment all the attorney fees incurred by Cotton Belt after September 27, 1979, which is the date Cotton Belt tendered its defense to MoPac under Rule 4. These attorney fees total $15,797.92. The remaining cost should be apportioned in accordance with Rule 17 on a ratio of 68 percent MoPac, 32 percent Cotton Belt. In the alternative, all costs should be apportioned in accordance with Rule 17.

We hold that all parties to this dispute are subject to the terms of the Intra-Industry Claims Agreement as provided in its Rule 2, in that each was a Carrier [1(d)] participating in a Movement [1(h)] in which there was an Accident [1(a)] that occurred.

The investigative materials submitted reveal that car SSW 76407, a covered hopper, high cube design, tri-hopper center flow car, owned or leased by the St. Louis Southwestern Railway Company ("Cotton Belt") was delivered to NiPak, Inc., at Kerens, Texas, by ("Cotton Belt"). The car was loaded with bulk urea dry fertilizer with waybill date being May 5,1977. It was routed and moved SSW-WACO-MP, to Crowley, Louisiana, where it was delivered to NiPak, Inc. by Missouri Pacific, on May 16, 1977.

Michael Miers, the decedent, was working alone, engaged in unloading the urea granules from car SSW 76407. He was found dead inside the hopper car, lying face down in the granules. Since there were no eyewitnesses, it is not known why he was at the bay opening, nor is it known what caused him to fall into the car opening. Cause of death was "asphyxiation secondary to falling into the railroad bunker car of 45 percent urea granules." This was ruled as "accidental death."

An inspection of the car following the accident revealed that there were no "mechanical defects of any kind." There was another inspection of the car made on March 16, 1979. Among the findings were: that the three (3) hatch covers were difficult for one man to open, and that this was possibly caused by the torsion bars having lost tension over the years. It was further revealed that there was "no evidence of lubrication on the hinge points of the three hatch covers."

There appears to be no evidence that the car received a mechanical inspection by the St. Louis Southwestern ("Cotton Belt") at origin. It further appears that there were no exceptions taken of the hatch covers or the bay openings at origin. There appear to have been no exceptions taken to the car at interchange to MoPac.

It was not until nearly one year following Miers' death that his parents filed a wrongful death action. The Plaintiffs set out in Paragraph 5 of the Complaint six (6) specific allegations of defects and negligence on the part of ACF and in Paragraph six (6) of the Complaint incorporated by reference those same allegations and added six (6) more specific allegations of defects and negligence against all the defendants to include St. Louis southwestern ("Cotton Belt") and Missouri Pacific. Eventually, Southern Pacific and Enserch were dismissed, thus leaving ACF, SSW and MoPac as the defendants.

There appeared to have been no clear evidence that there was any actual defect. Plaintiff did file a Complaint on May 17, 1978, and it was then and there that the allegations of defect were made as defined in Rule 1(f). It is obvious that the Carriers were willing to settle this case on a reasonable basis to avoid the issue of defect with the Court and Jury. It is our finding that the apportionment of this settlement will fall under Rule 17 of the Intra-Industry Claims Agreement, with Missouri Pacific to pay the first $2,500 (Rule 17(b)), and remaining costs apportioned between Missouri Pacific and SSW in shares proportionate to the share of each Carrier in the total revenue (Rule 17(c)), with definition under Rule 1, Paragraph (e) to apply.

It is obvious that there has been continuous quarrel between Missouri Pacific and SSW from the time it was first discovered that this was an IICA case. In our opinion there has been no time when SSW has tendered the defense without restrictions nor has there been a time when Missouri Pacific has assumed the defense without restrictions as provided by the IICA. The excuse was alleged "conflict of interest" when none exists if the terms of the IICA are followed.

Costs in this matter in our opinion are as follows:

$42,666.67	Settlement with plaintiff
18,038.88	Missouri Pacific legal fees
24,080.17	SSW legal fees
$84,785.72	Total Costs

Costs to be apportioned as follows:

$84,785.72
2,500.00	MoPac (Rule 17(b))
$82,285.72	To be apportioned between MoPac and SSW in shares proportionate to the share of each Carrier in the total revenue (Rule 17(c)), 67% MoPac - 33% SSW or 68% MoPac - 32% SSW, whichever to correct. These costs not to include any compensation for services paid to or expense incurred by, full-time non-contract employees (or full-time house counsel).

V. C. Smith
Claims Supervisor
Chicago & Northwestern

W. H. Cress
Asst. Gen. Claims Mgr.
Illinois Centralgulf

C. B. Cheney
Asst. Chief Clain Agent
Norfolk & Western Railway