Denver & Rio Grande Western Railroad v. Terte
Headline: Court limits state courts’ power to force out-of-state railroads to defend accident suits, allows Missouri-based railroad to be sued while blocking trial against the nonresident carrier as an undue burden on interstate commerce.
Holding:
- Limits state courts from forcing out-of-state carriers to defend where the accident occurred.
- Allows in-state railroad companies to be sued in their home counties.
- Prevents plaintiffs joining nonresident carriers just to burden interstate commerce.
Summary
Background
A man injured while working at an interlocking track and signal plant in Pueblo, Colorado sued two railroads for damages under a federal employers’ liability law. One railroad (Santa Fe) had lines, an office, and agents in Jackson County, Missouri; the other (Rio Grande) operated only in Colorado, Utah, and New Mexico, owned some Missouri property and had soliciting agents there, but was not licensed to do business in Missouri. After summonses and an attachment were served and the trial court refused to quash them, the railroads asked the Missouri Supreme Court to bar further proceedings; that court denied relief, and the case reached the United States Supreme Court.
Reasoning
The core question was whether Missouri courts could make both railroads defend a suit about an accident that happened in Colorado. The Court said the local railroad with Missouri operations could properly be sued in Jackson County, but the nonresident Rio Grande could not be forced to defend there because that would place an undue burden on interstate commerce. The Court explained that joining the two companies or attaching property could not be used to evade that protection, and that a plaintiff’s new residence or imagined local witnesses did not justify imposing serious burdens on an out-of-state carrier.
Real world impact
The ruling protects out-of-state carriers from being hauled into distant state courts merely by naming them with a local company or attaching property. At the same time, railroads that actually do business and have offices in a county can be sued there. The decision concerns where the case may be tried, not whether anyone was negligent; the case was sent back for further proceedings consistent with the opinion.
Dissents or concurrances
One Justice (Stone) did not take part in the consideration or decision of the case.
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