Phillips Petroleum Co. v. Jenkins

Background

A man who worked for the Phillips Petroleum Company was injured while carrying a length of pipe with a fellow employee, J.H. Myers. A jury returned a verdict for the injured worker and a judgment for $50,000; the Arkansas Supreme Court reduced the award to $30,000. Phillips Petroleum is a Delaware corporation doing business in Arkansas. Arkansas law §7137 (enacted 1907) provides that corporations shall be liable for injuries caused by negligence of any employee, and the state court applied that statute and instructed the jury that a recovery could be had against the company if the injury resulted from Myers’s negligence.

Reasoning

The central question was whether Arkansas’s rule denies the company equal protection of the laws. The Court explained the State may set terms for corporate charters and require foreign corporations doing business there to accept the same rules as domestic ones. By construing §7137 as part of corporate charters, Arkansas effectively removed the common-law “fellow-servant” assumption for corporations and substituted corporate responsibility when an employee injures another. The Court found no record evidence showing the statute was an arbitrary or unjust classification, accepted the legislature’s determinations as adequate, and therefore rejected the equal protection challenge and affirmed the judgment.

Real world impact

The decision means injured workers in Arkansas can recover from corporations when a coworker’s negligence causes harm, rather than being limited by the old fellow-servant rule. Foreign companies doing business in Arkansas are treated like domestic firms for this rule. Corporations operating in Arkansas should expect exposure to employee injury claims and have stronger incentives to improve workplace safety.