Who’s Liable for Property Damage Caused by Derailments?

Train Derailment in Glendale, KY Brings Up Questions of Property Damage Liability

On Thursday, March 16, 2023, at approximately 2:30 pm, a train derailed in downtown Glendale, Kentucky. There was a semi on the tracks at the Gideon Church Road crossing, and in its attempt to stop to avoid the semi, the train derailed. Luckily, no one was seriously injured, and the train wasn’t carrying any chemicals that pose a threat to the public.

However, there was property damage. The 21 cars that derailed were carrying expensive vehicles that were all totaled and turned into scrap metal as a result of the accident. The derailed cars also hit a vehicle and a store. Additionally, the derailment blocked foot traffic, compromising local businesses, and local officials advised people to avoid the area for a few days, hurting local businesses even more.

This was the second derailment at this crossing in less than a year, and the news brings up interesting issues about train company liability for property damage and other types of losses.

Liability for Derailments

According to Daniel Bancroft of Willis North America as quoted by the Insurance Information Institute, the train operator is usually liable for derailments. They are liable for the damaged freight, and they are also liable for any property damage that occurs as a result of the derailment.

In this instance, the derailed train hit an occupied vehicle as well as an antique store.  Based on Bancroft’s explanation, the owner of the vehicle and the store may attempt to hold the operator responsible for the cost of their damages. However, liability isn’t always that straightforward as multiple parties are often involved.

Additional Liable Parties

Rail transport involves a lot of different companies. This can make it very confusing to assess liability, but if you’ve suffered damages due to a derailment, the number of companies involved can also increase the potential of making a successful claim.

Generally, the railroad operator owns the engine and the tracks, and the company that owns the engine usually owns the transport cars. However, in some cases, engines pull cars owned by other operators, and in other cases, the cars are even owned by the shippers. The freight inside the cars is owned by the shippers — except in cases where ownership passes to the recipient before arrival.

On top of that, you also need to consider which entity controls the crossing. It may be the railroad company, but it’s often a public entity such as a city, county, or state. This can become relevant if unsafe crossing conditions contributed to the derailment.

In other words, depending on the situation, the company that owns the tracks, the engine, the cars, or the freight may bear liability when their property causes damage to another party. If an unsafe crossing caused the derailment, then the crossing owner may be liable.

Railroad Liability Coverage

If you bring a lawsuit for damages against a railroad company, they’ll usually rely on their liability insurance to cover the claim. While they aren’t necessarily required to have this type of coverage, most companies do, and it tends to cover the following:

• Bodily injury and property damage
• Cargo coverage
• Coverage for cars hauled but not owned by the operator (aka foreign rolling stock coverage)
• Evacuation expense coverage for cleaning up hazardous materials or pollutants
• Employee liability coverage, which is similar to workers’ compensation specifically for the railroad industry.

What if you suffered damages that are not on this list? That doesn’t mean the railroad company or another party isn’t liable for your injuries. It simply means that if held liable, the railroad company may not be able to use its insurance policy to cover the losses.

Negligence and Legal Violations

When you suffer damages, you usually need to establish negligence if you want to bring a legal claim against another party.

Because this issue is multi-layered and legally complex, you should work with a law firm that has experience with railroad derailments and liability issues. Also, as the laws vary from state to state, you need to consult with an attorney who is well versed on the legal issues in your state.

Schedule a Free Consultation Today

At Satterley & Kelley, PLLC, we are personal injury lawyers based in Kentucky, and we are committed to helping our clients get the justice they deserve. We focus on railroad, asbestos, and truck-accident liability, and we are committed to getting our clients the best results possible, regardless of the size or influence of the corporations we go up against.

Have you suffered property or other financial damages as the result of a rail derailment or any other type of railroad issue? Then, contact us today. We’ll start with a free consultation, and if we can meet your needs, we’ll move forward together. Let us help you get the justice you deserve.