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July 17, 1970

Arlander PETTY, Plaintiff,
NEW YORK CENTRAL RAILROAD n/k/a Penn Central Transportation Company and Clark Equipment Company, Defendants

Croake, District Judge.

The opinion of the court was delivered by: CROAKE


CROAKE, District Judge.

 On November 25, 1964, Arlander Petty, the plaintiff herein, was injured while working as an employee of defendant New York Central Railroad (hereinafter the Railroad) as a fork lift machine operator when the boom of such a machine which he was operating collapsed upon him. *fn1" Plaintiff thereafter brought this action for damages under the Federal Employers' Liability Act, 45 U.S.C. § 51 et seq., against the Railroad. *fn2" A jury trial was held before the undersigned and the issue of liability was tried first. At the end of plaintiff's case on the trial of the liability issue, however the Railroad conceded liability and withdrew its claim that the plaintiff was guilty of contributory negligence. This concession and withdrawal of the defense of contributory negligence were not acquiesced in by defendant Clark. However, pursuant to the concession and withdrawal, verdict was directed at that point by the undersigned in favor of plaintiff Petty against the Railroad as to plaintiff's lack of contributory negligence vis-a-vis the Railroad and as to the latter's liability to plaintiff. Upon the subsequent trial of the issue of damages, the jury *fn3" returned with a verdict for plaintiff against the Railroad of $125,000.

 Presented to the undersigned at this point is the Railroad's cross-claim for indemnity against Clark. It was stipulated that the Court should decide this matter. Said cross-claim reads as follows:

FIRST: At the time mentioned in Plaintiff's complaint, there was in force a Rental Agreement between Clark Equipment Company (lessor) and the New York Central Railroad Company (lessee) whereby the rights and obligations of the parties with respect to the upkeep and maintenance of certain equipment were set forth, which Agreement is annexed hereto as Exhibit "A."
SECOND: By the terms of the aforesaid Agreement, particularly paragraph "Sixth" thereof, Clark Equipment Company agreed to maintain and service the equipment enumerated.
THIRD: If the Plaintiff herein recovers a verdict against the Defendant, New York Central Railroad Company, for personal injuries as alleged in the complaint, such will have been brought about and caused primarily by the carelessness and negligence of the Defendant, Clark Equipment Company. * * *

 The Rental Agreement between the Railroad and Clark reads in pertinent part as follows:

FIFTH: LESSEE agrees to take good care of the equipment in the use, maintenance and storage thereof and, without limiting the foregoing, to use and operate the same within its rated capacity, to restrict the use and operation thereof to safe, careful and competent personnel selected, employed and controlled by LESSEE, to prohibit anyone other than duly authorized personnel of LESSOR to make any repairs or adjustments to the equipment (unless otherwise previously authorized, in writing, by LESSOR, * * *
SIXTH: The equipment will be serviced and maintained in proper working condition by LESSOR, and LESSEE agrees to make the equipment available for servicing by the representatives of LESSOR at reasonable times during business hours. * * *
EIGHTH: * * * LESSEE agrees to assume sole responsibility and liability for death or injury to any persons (including employees of lessee), and all damage to property resulting from, and to indemnify and hold lessor harmless against and from all claims, damages, expenses and loss arising out of, the use, operation, storage or maintenance, except maintenance performed by LESSOR, of the equipment during the term of this lease. * * *

 It is clear from the provisions of the contract that the lessor, Clark, had the responsibility of the maintenance in good working condition of the equipment leased by it to the Railroad, including the fork lift machine in question herein. Contrary to the position taken by Clark, there is no condition that Clark be given prior notice of the deficient condition of a particular machine before the obligation attaches to keep that machine in proper working condition. Likewise, although the Railroad, as lessee, assumes general responsibility for death or injury caused by the machine, still it is clear that in the case where damages result from the lessor's maintenance, the lessor bears the responsibility for the said damages.

 The evidence adduced at the trial tends to show that Clark was in fact generally performing its maintenance responsibilities. Mr. Sciacchetano, the Railroad's agent at its Weehawken, New Jersey, installation, when called as a witness by plaintiff, testified that all mechanical maintenance on the leased machines was provided by Clark, not by the Railroad. It was undisputed that Clark had a mechanic, Mr. Hillman, on duty at Weehawken five or six days a week from eight to ten hours a day. Mr. Hillman testified that it was his duty to maintain the machines, keeping them in operating condition. He further testified that all machines were stored in his work area, except for those which broke down on the job and were not yet brought in. He stated that he was generally the only one who serviced the machines, although he had help at times from part-time employees. Mr. Hillman acknowledged that he did not have the chance periodically to inspect the fleet and was unable generally to keep the machines in proper working order because of inadequate help. It appeared also that in addition to Mr. Hillman, Mr. Richard Collins of Clark had occasion to be at the Railroad's Weehawken yard at least twice a week with the responsibility to make sure the equipment was running in proper condition and to check up on Mr. Hillman's work. Mr. Collins indicated that he was familiar with the Weehawken installation, with the area where the leased machines were used, and with the type of operation involved. He testified that he knew that from time to time trunnion caps or bolts were missing from machines and that bolts missing from trunnion caps represented a danger to a user of a machine.

 However, despite such knowledge, Clark never established any system whereby machines were inspected on a periodical basis. According to Mr. Collins, inspection or servicing of trunnion caps was only done on occasion. Machines were generally inspected by Clark only when they were repaired or, as Mr. Hillman testified, only in the event somebody made a complaint about a machine's not operating satisfactorily. Mr. Collins testified that an inspection of the machine involved in this suit shortly before the accident would have revealed some bolts missing and sheared and some worn wear strips. He indicated that his inspection, made immediately following the accident, showed that the sheared bolt looked "like it was sheared-off for quite some ...

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