Union Stock Yards Co. of Omaha v. Chicago, Burlington & Quincy Railroad Co.
196 U.S. 217 (1905)
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Rule of Law:
When two parties are jointly liable to a third person for an injury resulting from the same type of negligence (a concurrent failure of duty), one party who pays the damages cannot seek indemnity from the other, as they are considered equally at fault.
Facts:
- Chicago, B. & Q. R. Co. (Railroad Company) delivered a railroad car owned by the Hammond Packing Company to the Union Stock Yards Co. of Omaha (Terminal Company).
- The car had a defective brake which made it unsafe to use.
- The Railroad Company had a duty to inspect the car for safety defects before delivering it, but it failed to do so.
- The Terminal Company also had a duty to inspect the car upon receipt before putting it into service for its employees, but it also failed to do so.
- An employee of the Terminal Company was injured as a direct result of the defective brake while operating the car.
Procedural Posture:
- The injured employee of the Terminal Company sued his employer in Nebraska state court.
- The Supreme Court of Nebraska affirmed a judgment against the Terminal Company, finding it liable for negligently failing to inspect the car.
- The Terminal Company paid the judgment to its employee.
- The Terminal Company then sued the Railroad Company in the United States Circuit Court for the District of Nebraska, seeking indemnity for the amount it had paid.
- The case was heard by the United States Circuit Court of Appeals for the Eighth Circuit, which certified the question of law to the U.S. Supreme Court for resolution.
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Issue:
Does a company that is found liable for failing to inspect a piece of equipment, resulting in injury to its employee, have a right to indemnity from another company that also negligently failed to inspect the same equipment before delivering it?
Opinions:
Majority - Mr. Justice Day
No. A company that is liable for its own negligence in failing to inspect equipment cannot obtain indemnity from another company guilty of the same omission. The general rule is that there is no contribution or indemnity among joint wrongdoers. An exception exists where one party is the 'principal wrongdoer' who created the dangerous condition, and the other party is only secondarily or passively liable. This case does not fall within that exception because the negligence of both the Railroad Company and the Terminal Company was of the same character: a failure to perform their respective duties of inspection. Neither company created the defect; both failed to discover it. Because they are in pari delicto (equally at fault), the law will not shift the entire loss from one to the other.
Analysis:
This decision solidifies the common law doctrine of 'in pari delicto' and clarifies the narrow scope of the exception for indemnity between joint tortfeasors. It establishes that when multiple parties have concurrent, independent duties to inspect for safety, a breach by both makes them equally culpable, precluding one from recovering from the other. This prevents a negligent party from shifting the entire financial burden of its own carelessness onto another party who was also negligent but not primarily responsible for creating the hazard. The ruling reinforces that each entity in a chain of possession is responsible for its own safety obligations.
