Redirecting blame, sounds like to me.
And people wonder why assumption of liability is such a big deal in any rail operations contracts for passenger service or any other deals with railroads.
Nothing to be surprised about here…the liability in the form of a likely-to-be sizeable chunk of payback money is going to be passed on until it can’t be passed any longer.
Not to sound too cynical, but isn’t one of the reasons to subcontract some of the work an effort to shift some of the liabilty issues. As in, shifting to an entity with…shallower(?) pockets?
Risk/reward judgments are the essence of all contracts. An owner who wants the contractor to assume high risk usually has to pay very high prices to attract a contractor. An owner who wants the the contractor to offer the lowest possible price usually has to retain most or all of the risk. Lawsuits emerge when one or both of the parties is incompetent, inexperienced, foolish, or careless, i.e., has misjudged the likelihood of risk and the value of the risk, and priced inappropriately.
RWM
There’s also room for the occasional Act of God, or put in a more secular fashion, “bad luck.” - a.s.
Actually, the contract will spell out who assumes risk for Acts of God, as God answers no subpeonas.[;)]
RWM
Thank goodness–I would not want to be responsible for that cross examination. It is difficult enough dealing with partners who merely think they are gods.
Gabe
P.S. Not to sound too synical, but this issue really comes down to which company is footing the insurance bill.
Most of these cases seem to boil down to dueling insurance companies, especially in this particular case, I’m sure. Every other day or so in the California appeals world, one sees a coverage catfight in the (usually unpublished) opinions.
Forgive me a little cynicism, but there is definitely a perverse pleasure seeing insurance companies suing each other.
The problem is we’re all going to pay for it.
You’d think they would cover this in the contract. If the NTSB finds your employee was at fault, then your insurance pays. If the NTSB finds my signal was at fault, then my insurance pays.
Write the rules beforehand.
You can bet that as many situations have been covered in the contract between the agency and the operator company as can be conceived of. Of course, there are always gaps that require judicial resolution (just saw that premise a week or two ago in an opinion) and there are also factual disputes.
As RWM noted above, assigning risks and costs comprise a lot of the lawyering in the contracts realms, then when the train jumps the track, the fun begins. It’s an old game that is sill played with gusto because the stakes can be very high.
There is actually yet another game being played. The other game, in my experience, often, is to get your opponent to pay for a percentage of something that they would otherwise not pay on a cold day in he!!.
For instance, if insurance Company A knows they are responsible for coverage but knows they have a 3% chance of beating the system legally, conventional wisdom would say that Insurance Company A would never file suit/make Insurance Company B or the injured plaintiff to file suit with such odds.
But, Insurance Company A will take–and from strickly an economic perspective, should–these odds EVERY time. The reason is, it files suit, raises all kinds of he!! to make the other side think they mean to go through with things, then they settle for 80% of the case’s worth. Usually, their attorneys fees for a very large case in doing that would be between $150,000 and $400,000. However, when you are talking about a $50,000,000 liability price tag, you just made yourself over $9,500,000. Sometimes, they get really lucky, and the other side’s attorneys make a mistake and they don’t have to pay anything.
In the mean time, you have the five kids who were orphaned as a result of someone’s negligence bringing suit for wrongful death. The insurance companies then point the orphans to the fact that the insurance company is claiming there is no coverage, so you better take this reduced settlement.
The best part of it, for the insurance companies, is when it is all done, you then blame plaintiff’s attorneys for all of the attorneys fees involved.
I am not saying all insurance companies do this or that Plaintiff’s attorneys don’t play the same game in reverse–they do. The difference is the insurance company has a huge bargaining power disparity in playing this game–they have infinit
That happens once in a while out here in earthquake country and usually the payoff is pretty good sized. What’s interesting is that most of the time, it seems to be lower level minions in the insurance company stonewalling a relatively small claim, which doesn’t make sense, especially where the facts are clear. Judgment is sometimes lacking at that level.
This is likely to be one of those cases that drags through the courts for years until one side or the other goes bankrupt or just gives up the fight.