Indiana Harbor Belt R.R. Co. v. American Cyanamid Co. – Case Brief
Indiana Harbor Belt Railroad Co. v. American Cyanamid Co., 916 F.2d 1174, 32 ERC 1228, 59 USLW 2295 (7th Cir. 1990).
Facts: American Cyanamid (D) loaded acrylonitrile into a railroad car for shipment to a processing plant in New Jersey. Acrylonitrile is a flammable and highly toxic liquid. Several hours after arrival employees of the switching line noticed fluid gushing from the broken bottom outlet of the car. Homes near the train yard were evacuated and decontamination measures were conducted at a cost of approximately $1 million.
Indiana Harbor Belt Railroad (P) brought claims based in negligence and strict liability to recover the cost of decontamination. Indiana Harbor maintained that the transportation of toxic chemicals is an ultrahazardous activity and therefore strict liability should apply. The trial court granted Indiana Harbor’s motion for summary judgment on the strict liability count and dismissed the negligence count with prejudice. American Cyanamid appealed and Indiana Harbor cross appealed the dismissal of the negligence count.
Issue: 1) What standard applies regarding the shipper’s liability for the consequences of a spill of a hazardous chemical during shipment? 2) Under what circumstances is strict liability appropriate?
Holding and Rule (Posner): 1) A shipper of a hazardous chemical is held to a negligence standard for the consequences of a spill during shipment. 2) Strict liability is only imposed when the high degree of risk associated with an activity cannot be eliminated through due care.
Restatement (Second) of Torts §520: In determining whether an activity is abnormally dangerous, the following factors are to be considered:
(a) existence of a high degree of risk of some harm to the person, land or chattels of others;
(b) likelihood that the harm that results from it will be great;
(c) inability to eliminate the risk by the exercise of reasonable care;
(d) extent to which the activity is not a matter of common usage;
(e) inappropriateness of the activity to the place where it is carried on and;
(f) extent to which its value to the community is outweighed by its dangerous attributes.
Accidents that are due to a lack of care can be prevented by taking care. When a lack of care can be proven such accidents are adequately deterred by the threat of tort law liability for negligence. If a tank car is carefully maintained the danger of a spill of acrylonitrile is negligible. There is no compelling reason to move to a regime of strict liability, especially one that might embrace all other hazardous materials shipped by rail.
The usual view is that common carriers are not subject to strict liability for the carriage of materials that make the transportation of them abnormally dangerous, because a common carrier cannot refuse service to a shipper of a lawful commodity. It is easy to see how the accident in this case might have been prevented at reasonable cost by greater care on the part of those who handled the tank car of acrylonitrile. It is difficult to see how it might have been prevented at reasonable cost by a change in the activity of transporting the chemical. This is therefore not an apt case for strict liability.
In the context of strict liability, ultrahazardousness is a property of activities, not of substances. The manufacturer of a product is not considered to be engaged in an abnormally dangerous activity merely because the product becomes dangerous when it is handled or used in some way after it leaves his premises, even if the danger is foreseeable.
It has not been shown that the transportation of acrylonitrile in bulk by rail through populated areas is so hazardous an activity, even when due care is exercised, that the law should seek to create incentives to relocate the activity to nonpopulated areas, or to reduce the scale of the activity, or to switch to transporting acrylonitrile by road rather than by rail. It is no more realistic to propose to reroute the shipment of all hazardous materials around a major city than it is to propose the relocation of homes adjacent to a switching yard to more distant suburbs. Strict liability is inappropriate in this context. Negligence standards are adequate for deterring railway spills.
Disposition: Reversed and remanded.
Notes: In general courts will not impose strict liability if it is possible to render an activity safe through due care. Strict liability can apply if the activity cannot be made safe even with due care.
See Lavender v. Kurn for another case brief involving a railway accident.