Union Pacific Can Keep $3M Insurance Settlement in Fatal Ark. Train Crash
An insurance company does not have a valid claim to more than $3 million it tentatively paid in a settlement over an Arkansas Union Pacific train crash with a van that killed a Louisiana woman and her daughter, a federal appeals court has ruled.
A three-judge panel of the 8th U.S. Circuit Court of Appeals overturned a ruling by U.S. District Judge Harry F. Barnes, who agreed with Ohio Casualty Insurance Company that it did not have to pay part of a settlement reached in the Aug. 7, 2000, wreck.
Minza Johnson, 44, and her daughter, Christin Johnson, 14, of Natchitoches, La., were killed in the Lafayette County crash. Joseph Johnson, Minza's husband and Christin's father, sued Union Pacific for allegedly failing to provide adequate signs in a construction zone at a railroad crossing. Union Pacific settled the suit for $12.5 million.
At the time, Ohio Casualty, which insured Tri-State Traffic Control Inc., the company that provided traffic control and warning signs for Union Pacific, agreed to pay $3 million of the settlement but reserved the right to deny coverage if a court later determined that the insurance policy didn't cover Union Pacific.
The appeals panel said the policy did cover Union Pacific, and overturned Barnes' Sept. 21, 2005.
The van and train collided around lunchtime at the crossing on Arkansas 29 about a half mile north of the Louisiana border. The Johnsons were in the van. Joseph Johnson was injured, as was passenger Katie Colvin, 14, of Coushatta, La., state police said at the time.
The appeals panel noted testimony from Kenneth W. Heathington in the state lawsuit that the traffic control plan, signs and flagging at the crossing were substandard. The court said Heathington testified the number of signs was inadequate, the signs were not installed correctly and one of the signs was lying on the ground. Flaggers also were at lunch at the time of the accident.
On appeal, Union Pacific argued that the railroad company was an additional insured party under the contract it had with Tri-State and that even though the written contract had expired, Tri-State continued to work for Union Pacific and the accident "arose out of Tri-State's work.''
Ohio Casualty said Union Pacific wasn't covered because it wasn't specifically named in a written contract with Tri-State at the time of the accident.
The appeals court said Union Pacific's status as an additional insured party didn't automatically end when Tri-State's written contract with the railroad company expired.
Also, referring to Merriam-Webster's Collegiate Dictionary for the definitions of "to be'' and "currently,'' the appeals court said the Ohio Casualty policy took effect when the insurance company issued the policy Jan. 22, 2000, and was in play when the accident occurred.
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