Baltimore & Ohio Chicago Terminal Railroad v. Soo Line Railroad

646 F. Supp. 327, 1986 U.S. Dist. LEXIS 20747
CourtDistrict Court, N.D. Illinois
DecidedSeptember 5, 1986
DocketNo. 84 C 5342
StatusPublished
Cited by4 cases

This text of 646 F. Supp. 327 (Baltimore & Ohio Chicago Terminal Railroad v. Soo Line Railroad) is published on Counsel Stack Legal Research, covering District Court, N.D. Illinois primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Baltimore & Ohio Chicago Terminal Railroad v. Soo Line Railroad, 646 F. Supp. 327, 1986 U.S. Dist. LEXIS 20747 (N.D. Ill. 1986).

Opinion

MEMORANDUM OPINION AND ORDER

ROVNER, District Judge.

I. INTRODUCTION

This case involves an errant interstate rail shipment of waste material in twenty-one open-topped gondola cars. The plaintiff, the Baltimore and Ohio Chicago Terminal Railroad Company (“B & OCT”), has filed a multicount complaint to recover its expenses in handling eighteen of the cars while they were on its Chicago terminal property. B & OCT’s expenses included building covers for the cars to prevent rain from washing out the contents, and securing the railcars to protect the public. B & OCT also seeks demurrage charges from some defendants pursuant to a tariff it has filed with the Interstate Commerce Commission. The defendants are Soo Line Railroad Company (“Soo Line”), Environmental Services, Inc. (“ESI”), Fritz Enterprises, Inc. (“Fritz”) and Bell Lumber and Pole Company (“Bell”).1

The rail shipment of the waste material originated on Bell’s site in New Brighton, Minnesota. Pursuant to an agreement between Bell and ESI, Bell loaded twenty-one Soo Line gondola cars with waste material consisting primarily of sand and wood chips. The waste material was allegedly contaminated with pentachlorophenol and oil. Bell does not dispute that it was the owner of the waste material prior to loading.

The railcars traveled under bills of lading. Soo Line, as the line haul carrier, transported the railcars from Bell’s premises to B & OCT’s railyard in Illinois. The bills of lading indicate, and all parties agree, that Fritz Enterprises, Inc., in River-dale, Illinois, was the intended recipient of the railcars. The bills of lading also identify ESI as the shipper, Soo Line as the line haul carrier, and B & OCT as the delivering carrier. Soo Line had no direct connection [329]*329to Fritz’ property and delivered the cars into B & OCT’s hands so that B & OCT could “switch” the cars onto Fritz’ property. In rail carrier parlance, B & OCT was the “switching carrier,” and Soo Line was the “originating carrier.” In all, B & OCT received eighteen cars out of the twenty-one car shipment at its terminal railyard. When B & OCT attempted to deliver the eighteen cars to Fritz, Fritz rejected the shipment and physically blocked the tracks leading to its property. B & OCT refused to accept the remaining three cars from Soo Line.

In early April, 1984, the Illinois Attorney General brought suit against Fritz Enterprises, Inc., Environmental Services, Inc., and their principals in the Chancery Division of the Circuit Court of Cook County, Illinois. People of the State of Illinois v. Fritz Enterprises, Inc., et al, 84 CH 3081. The Attorney General sought a Temporary Restraining Order (“TRO”) to prohibit the defendants from taking any actions to unload or treat the waste material. The TRO was entered by Circuit Court Judge Albert Green on April 6, 1984. In July, 1984, the TRO was modified to permit the return of the railcars to Minnesota. The Attorney General requested the modification after entering into a settlement agreement with Bell, ESI and Fritz.

The eighteen railcars containing the waste material remained on B & OCT’s premises until July 20, 1984. On or about that date, B & OCT returned the cars to Soo Line. Soo Line, in turn, transported the cars and their contents back to the Bell site in New Brighton where presumably they were unloaded.

The expenses B & OCT claims as damages in this case were incurred while the eighteen cars were in the B & OCT terminal railyard. In its complaint, B & OCT requested the Gourt to order the defendants to remove the cars from its premises. When the cars were returned to Minnesota, that portion of the dispute became moot.

Defendants Soo Line and Fritz have moved to dismiss the complaint for failure to state a claim. Bell has moved to dismiss this action for lack of personal jurisdiction, or alternatively, to transfer this case to the District of Minnesota. Fritz has moved to strike ESI’s cross-claim for failure to comply with Fed.R. of Civ.P. 11. As set out below, all of the motions are denied.

II. Soo Line’s Rule 12(b)(6) Motion to Dimiss Count I

Defendant Soo Line has moved to dismiss Count I pursuant to Fed.R. of Civ.P. 12(b)(6) for failure to state a claim upon which relief can be granted. Both Soo Line and B & OCT have submitted documents and affidavits in recognition of the Court’s power to treat Soo Line’s motion as one for summary judgment under Rule 56. The Court has concluded that it cannot consider the appropriateness of summary judgment since Soo Line and B & OCT have not fully addressed all the relevant factual and legal issues.2 Rather, the Court has confined its review to the Rule 12(b)(6) challenge made by Soo Line. The Court holds that B & [330]*330OCT has stated a common law claim for indemnity and Soo Line’s motion accordingly is denied.3

Soo Line and B & OCT are rail carriers regulated by the provisions of the Interstate Commerce Act, 49 U.S.C. § 10101, et seq. (“I.C.A.”). As discussed in the Introduction, B & OCT became involved in this dispute because its railyard abuts the property of the shipment consignee — Fritz. Soo Line passed the cars into B & OCT’s hands with the expectation that B & OCT could and would deliver them to Fritz. Fritz, however, refused to accept delivery and B & OCT was left with possession of the eighteen cars from approximately March 23, 1984, until the cars were returned to Minnesota in July of 1984.

In Count I of its complaint, B & OCT alleges that when it accepted the railcars from Soo Line, it did so solely as Soo Line’s agent and for the limited purpose of delivering the railcars to Fritz. B & OCT claims a common law right to be indemnified for the reasonable expenses it incurred on behalf of its principal — Soo Line.

In addition to its factual arguments, which the Court has explained it will not consider at this time, Soo Line makes one wholly legal argument against Count I. Soo Line argues that a switching carrier cannot sue an originating carrier for an amount not specified in a tariff on file with the Interstate Commerce Commission. Soo Line bases its argument on a provision in the Interstate Commerce Act which provides in relevant part:

... [a] carrier may not charge or receive a different compensation for that transportation or service than the rate specified in the tariff whether by returning a part of that rate to a person ... or another device.

49 U.S.C. § 10761. Because Chessie System Railroads Freight Tariff BEF 8001-A (the Reciprocal Switching Tariff) specifies a $261 per railcar charge for B & OCT switching services, Soo Line argues B & OCT is limited to that amount in payment for all services B & OCT rendered. In essence, Soo Line argues that Congress preempted all rail carriers’ common law rights against fellow carriers with respect to payment for services rendered during the interstate transportation of freight. Soo Line proposes an absolute rule that makes no allowances for unusual situations created by the nature of the property passed on to the switching carrier by the line haul carrier.

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Cite This Page — Counsel Stack

Bluebook (online)
646 F. Supp. 327, 1986 U.S. Dist. LEXIS 20747, Counsel Stack Legal Research, https://law.counselstack.com/opinion/baltimore-ohio-chicago-terminal-railroad-v-soo-line-railroad-ilnd-1986.