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Union Pacific Railroad Company v. Caballo Coal Company

February 14, 2011

UNION PACIFIC RAILROAD COMPANY, APPELLANT (PLAINTIFF),
v.
CABALLO COAL COMPANY, APPELLEE (DEFENDANT). CABALLO COAL COMPANY, APPELLANT (DEFENDANT),
v.
UNION PACIFIC RAILROAD COMPANY, APPELLEE (PLAINTIFF).



Appeal from the District Court of Campbell County The Honorable Dan R. Price II, Judge

The opinion of the court was delivered by: Kite, Chief Justice.

Before KITE, C.J., and GOLDEN, HILL, VOIGT, and BURKE, JJ.

NOTICE: This opinion is subject to formal revision before publication in Pacific Reporter Third. Readers are requested to notify the Clerk of the Supreme Court, Supreme Court Building, Cheyenne, Wyoming 82002, of typographical or other formal errors so correction may be made before final publication in the permanent volume.

[¶1] Union Pacific Railroad Company (UP) appeals from the district court's order granting summary judgment in favor of Caballo Coal Company (CCC) on UP's claim that it was entitled to be indemnified for payments it made to one of its employees who was injured on CCC property. In a cross appeal, CCC claims the district court erred by granting summary judgment in favor of UP on CCC's counterclaim for attorney fees.

[¶2] We conclude the district court properly granted summary judgment to CCC because UP did not make any showing that CCC's negligence caused its employee's injury. However, the district court erred by granting summary judgment in favor of UP on CCC's claim for attorney fees because no motion had been filed and CCC was not given notice or an opportunity to be heard on the matter.

[¶3] Affirmed in part and reversed and remanded in part.

ISSUES

[¶4] We restate the issues presented by UP in Case No. S-10-0112 as follows:

1. Whether the court erred in granting Caballo's motion for summary judgment on the ground that Caballo had no duty to UP's employee.

2. Whether the district court should have granted UP's motion for partial summary judgment on the reasonableness of its settlement with Mr. Riecke.

The issue presented by CCC in Case No. S-10-0013, as restated, is:

1. Whether the district court erred by granting summary judgment in favor of UP on Caballo's claim for attorney fees when UP had not filed a summary judgment motion and Caballo had no opportunity to be heard on the matter.

FACTS

[¶5] On November 22, 2004, UP locomotive engineer, Roy Riecke, fell while inspecting the locomotive on the train he was operating from a CCC coal mine near Gillette, Wyoming to Bill, Wyoming. Mr. Riecke stated that he lost his footing on a thick layer of coal dust covering the ballast and fell backwards. He injured his right knee and lower back.

[¶6] Mr. Riecke filed suit against UP in district court in Nebraska, claiming a right to compensation under the Federal Employers Liability Act. He claimed damages for his pain and suffering, loss of enjoyment of life, lost earnings and other compensatory and consequential damages. UP notified CCC of the suit and tendered the defense, claiming CCC was obligated to indemnify it pursuant to an agreement between the parties. The agreement, dated December 10, 2001, supplemented earlier agreements between the parties and their predecessors and stated in pertinent part:

Section 4. LIABILITY: INDEMNIFICATION

CCC hereby agrees to indemnify and hold harmless UP from any and all loss, damage, injury or death arising from the operation of UP delivered trains over the Industry Tracks as provided in this Agreement, to the extent that they result from any negligence or wrongful act or omission of CCC's officers, employees or agents. UP hereby agrees to indemnify and hold harmless CCC from any and all loss, damage, injury or death arising from the operation of UP delivered trains over the Industry Tracks as provided in this Agreement, to the extent that they result from any negligence or wrongful act or omission of UP's officers, employees or agents.

[ΒΆ7] CCC denied UP's request to take over the defense of Mr. Riecke's suit and indemnify UP for its costs. UP settled with Mr. Riecke for $400,000 on November 9, 2007. UP then filed a complaint against CCC seeking indemnification for the amount it paid to settle Mr. Riecke's suit and its attorney fees and costs. CCC generally denied liability under the agreement and counterclaimed under the indemnity provision quoted above for its costs and attorney fees associated with defending the pending suit. UP did not file a timely response to CCC's counterclaim and the district court clerk entered a default against UP. ...


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