Off the Rails

Rare will be the occasion when claims professionals are called upon to investigate and administer the hundreds of claims that can arise from a commuter train derailing after traveling 82 miles per hour through a 30 mile-per-hour curve. Rarer still are the thousands of claims resulting from the fiery derailment of a freight train after its handbrakes release on a long, steep hill, allowing the train’s 73 oil-filled tanker cars to reach 60-plus miles per hour as it enters and careens off of a long, left bend in the track.

Although Federal Railroad Administration statistics demonstrate that the number of train-related accidents in the U.S. has declined 43 percent over the past decade, the savvy claims professional nonetheless will recognize the public perception hurdles created for their railroad clients by front-page train accidents like those that occurred in the Bronx, N.Y., and Quebec, Canada, earlier this year. They also understand that the most effective means of clearing these hurdles is to conduct a detailed investigation of the train-related accident and implement a common-sense administration of the claims that arise in its aftermath.

Devil’s in the Details

In the day-to-day world of railroading, train-related accidents frequently involve the foolhardy tempting their fate against thousands of tons of rolling steel and stock or hundreds of milliamps of electrical current. Too often, however, these accidents also occur when the oblivious, but nonetheless sympathetic, fail to take heed of their surroundings. In either case, serious, if not fatal, traumatic injuries will result, and claims that have significant demands will ensue.

Narrowing the railroad client’s potential exposure in these cases will not happen by merely taking photographs, recording the crew’s statements, and securing the investigating police officer’s report. Rather, the first task to which claims professionals must attend is mastering the terminology and concepts that are unique to railroading and applicable to the accident scenario at hand.

Sadly—but admittedly with a tinge of amusement—there have been claimants, adjusters, and attorneys who honestly believe that a locomotive engineer is entirely at fault for not avoiding a crossing accident because he did not have his hands on the “locomotive’s steering wheel” or his foot covering the “locomotive’s brake pedal” and by not bringing his mile-long freight train to a complete stop from its 32-mile-per-hour speed within 100 feet of the crossing.

Understanding railroad terminology and concepts, however, does not require claims professionals to immediately incur the expense of an outside expert anytime a train-related accident occurs. Simply typing “railroad terminology” into any search engine will provide several highly reliable sites with pages of railroad jargon explanations. Similarly, visiting any science, technology, or engineering site dedicated to laymen will provide even the novice with ample information to understand the potential reasons a train-related accident may have occurred.

Armed with this knowledge, claims professionals are better able to discern among accident scene objects those that they must photograph and from what vantage point; what measurements must be taken and how best they can be preserved or otherwise memorialized; and what questions of the crew or bystanders are essential to understanding how, when, and why an accident occurred.

Like most incidents, train-related accidents typically transpire over a matter of seconds. Seconds, however, often are essential to gaining an accurate understanding of the events that precipitated an accident. Thus, early on in the investigation, claims professionals must confirm whether one or more of the locomotives of a train involved in an accident were equipped with event recorders. If so, they must be accurately downloaded at the earliest opportunity, and each item of data downloaded into the event recorder software program should be memorialized, preferably via photograph. Additionally, the locomotive’s maintenance history for at least one year’s time prior to the accident should be secured to eliminate any question of whether the event recorder was accurately calibrated.

Regardless of whether a train’s locomotives are equipped with event recorders, claims professionals also must confirm whether other computer-stored resources of information exist at or near the accident scene.

For example, if a train-related accident occurs near a crossing equipped with gates, flashers, or even a bell, there should be a computerized repository of information that indicates exactly when the train tripped the crossing’s signals and completely cleared it. Similar information can be recovered from the “hot box” and dragging equipment detectors located sufficiently close to the accident scene.

It also should be remembered that since 9/11, there has been a proliferation of security cameras installed in urban and industrial areas. Thus, if an accident occurs in or near these areas, claims professionals should canvas the scene to determine whether or not there are closed-circuit cameras that captured some or all of the accident. Because the footage on these cameras is periodically overwritten, it’s essential to secure this footage within the first few days of an accident, especially when the accident occurs toward week’s or month’s end.

As with locomotive event recorders, inspection and maintenance records for signal event recorders and closed-circuit cameras should be secured to eliminate questions regarding calibration.

In addition to the element of time, the function of distance typically is critical to gaining an accurate understanding of a train-related accident’s cause. Distances important to this understanding include pictorial line-of-sight measurements, which must be taken under conditions substantially similar to those existing when the accident occurred. For example, photographs of line-of-sight distances taken in the summer at the scene of an accident that occurred in midwinter will be distorted by foliage and likely will not capture the contrast between the color of a vehicle or a person’s clothes and snow on the ground.

Other measurements of import will be a train’s overall length (which in railroad-related premises liability cases assists in confirming the plausibility of a trespasser’s account of his interaction with a train) and the distance between a train’s initial brake application and ultimate point of rest (which in crossing cases will demonstrate whether an earlier brake application would have prevented the accident). Information as to a train’s length, as well as its combined weight, should be recorded in train consist documents. Although the distance traveled by a train while stopping involves consideration of various sources of information, one such source should include photographs of the stopped train’s lead and trail ends relative to fixed landmarks. This photo documentation will eliminate any question of where the train actually came to rest.

Two final items that claims professionals will find helpful while on scene are aerial or bird’s-eye photographs and the track chart or a topographical map that encompasses the accident scene. Both items lend a broader perspective and often eliminate the need for traipsing several miles east or west of the scene in foul elements to determine the track’s contour preceding the accident locale. Knowing whether a mile-long freight train weighing thousands of tons was traveling uphill or coasting down along a lengthy bend provides the claims professional with an eye-witness account of the crew’s likely activities shortly prior to an accident.

A Wealth of Information

Surprisingly, there is an absence of reference to or use of Internet-available information exclusively dedicated to railroad operations and safety. Prime repositories of this information are the sites run by the Federal Railroad Administration, the Surface Transportation Board, and the Federal Highway Administration.

The information maintained on these sites is vast and includes surveys of the number and type of train-related accidents occurring at a crossing, in a particular area, or involving a specific railroad over a designated length of time; the federal government’s detailed, lengthy study of the ineffectiveness of fencing along railroad right-of-ways; and the examination, establishment, and funding of quiet zones and at-grade crossings, which may carry preemptive effect to claims asserted against the railroad client. Also available are the federal government’s railroading regulations and opinions construing these rules.

The federal government is not alone in maintaining railroad-related information online. Several states’ public utility commissions provide computerized public access to detailed information concerning the establishment or abandonment of rail lines, as well as investigations into any merit of complaints about certain railroad operations.

In the time and space allotted, it is impossible to exhaust the potential sources of information to which one can resort in fending off the variety of potential claims faced by railroad clients. Suffice it to say, however, that in today’s highly computerized world, potential data resources are limited only by one’s ingenuity and effort.

Common Sense and Transparency

Having so marshaled the facts of the accident in question, claims professionals should appreciate that they likely enjoy greater expertise and insight on the accident than those asserting claims. Using common sense and a transparent approach to administering these claims largely undercuts the media-driven sensation with which these claims are delivered.

For example, on several occasions, counsel well versed in their clients’ accounts of an accident and its resulting injuries—but lacking any real understanding of railroading—opened their claims salvo with reference to one front-page railroad accident or another. However, in each instance, the claims professional openly shared his photo-documented time and distance measurements with counsel, knowing that counsel ultimately would be able to procure these measurements in any forthcoming lawsuit. The forthright disclosure of this information—which demonstrated that the claimants’ versions of the accident were far from plausible—resulted in the claims being withdrawn or counsel firing his less-than-upright client.

In contrast, some claims professionals steadfastly hold close to their vests unimpeachable physical data from their investigations out of concern that claimants counsel will “creatively invent” some theory or rendition of the facts that undermines the investigation’s results.

However, the vast majority of claimants’ counsel are business-oriented professionals who are not particularly well versed in railroading and do not want to invest monies in speculative ventures with a poor likelihood of return. Thus, in several instances when solid investigation results were not shared and suit was filed, defense counsel’s candid, but nonetheless well-crafted and aptly-timed conversation with his opponent about data disclosed in discovery and its impact on the claimant’s story, frequently resulted in claimants’ counsel eagerly looking to cut his losses.

Although railroading safety has significantly improved over the past decade, it must be conceded, nonetheless, that not every train-related accident is always “somebody else’s fault.” In those instances when an investigation reveals that someone simply made a mistake or that a piece of equipment failed, claims professionals should take the opportunity to resolve reasonably all claims arising from the accident.

An excellent example of this proactive approach was demonstrated by one railroad that experienced a derailment of a train that was hauling a small number of hazardous material cars. Although the derailment resulted in a confined breach of some of this material, the railroad did not waste resources bickering with local officials about the reasonableness of their decision to evacuate a sizeable portion of the area’s residents. Rather, the railroad “took the bull by the horns” by coordinating, negotiating, and paying for reduced-rate transportation, hotel and dining accommodations and reasonably compensating residents for their inconvenience.

These outlays, which measured in the hundreds of dollars per resident, effectively forestalled a class-action suit that was attempted one week after the derailment.

A Satisfying Conclusion

Much of what claims professionals must command when arriving at their first derailment, crossing accident, or trespasser injury can be mastered readily from a relatively brief, yet focused, study of the unique aspects of railroading. This knowledge, coupled with a keen eye for the finer, but often readily obvious, details will enable claims professionals to actually enjoy solving the “riddles” that frequently are train-related accidents.

Moreover, with an attention to detail and consideration of the array of resources available to all, claims professionals invariably will attain a satisfying conclusion to their investigations, which always results in satisfied clients.   

Inside the Metro-North Derailment

By Issy Bustamante

Following the 2008 Los Angeles Metrolink commuter train derailment that killed 25 people, Congress passed a requirement that all rail lines implement by the end of 2015 high-tech PTC that involves Wi-Fi, GPS, radio, and other technologies—including 20,000 new cell towers along 60,000 miles of track. Rail systems are required to be able to communicate with each other, which is projected to cost more than $13 billion.

Lawmakers, however, are calling on Metro-North to install systems to forestall the human errors that cause about 40 percent of train accidents. Sen. Richard Blumenthal, D-Conn., said, “I know you are going to hear from Metro-North that there are costs, but the cost of these audio and visual recorders is negligible compared to the hundreds of millions of dollars this tragic incident will cost [them] in the end.” For example, in 2009, an Illinois jury awarded more than $29.5 million to a Chicago woman injured in a 2005 commuter derailment. In fact, if investigators determine that human error is the cause, the MTA (Metro-North’s corporate parent) could be held liable for the negligence of its employees through vicarious liability. 

For vicarious liability, plaintiffs will try to make the case for engineer negligence. However, if mechanical failure is deemed to be the cause, then liability can be spread among various defendants. Metro-North is insured for $10 million in liability, and an additional $50 million in coverage is carried by the MTA, which also has $350 million in coverage through commercial markets, according to officials.

In other incidents Metro-North has argued that federal law governed the case, not state law. That pre-emption defense could allow it to avoid liability in this case if it can show compliance with federal requirements. Metro-North also may cite immunity from punitive damages as a public entity—making its worst-case scenario the federal limit of $200 million. 

The MTA released a statement detailing immediate improvements. In addition, train engineers are to develop new signal protections to automatically enforce speed restrictions at four other critical curves by March and at five movable bridges by September. It also will require that conductors stand with engineers to ensure adherence to new reduced curve speed limits.

Though costs for recent changes are unknown, Metro-North began working on the PTC systems in 2009 and budgeted $600 million for the installation, which includes a $428 million procurement for a system integrator. Full implementation, however, is expected to cost $900 million.   

Issy Bustamante is a senior claims consultant in the risk control and claim advocacy practice for Willis Group. She has been a CLM Fellow since 2007 and can be reached at issy.bustamante@willis.com, www.willis.com.