Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

Schweitzer v. Consolidated Rail Corp.

March 29, 1985

SCHWEITZER, JOSEPHINE, APPELLANT,
v.
CONSOLIDATED RAIL CORPORATION (CONRAIL) AND READING COMPANY (CIVIL NO. 81-5375, E.D. OF PA.); SEIBERT, MILDRED, INDIVIDUALLY AND AS EXECUTRIX OF THE ESTATE OF SEIBERT, PAUL D., DECEASED, APPELLANT, V. CONSOLIDATED RAIL CORPORATION (CONRAIL) THE READING COMPANY (CIVIL NO. 81-5376, E.D. OF PA.); WENTZEL, GEORGE A., APPELLANT, V. CONSOLIDATED RAIL CORPORATION (CONRAIL) AND THE READING COMPANY (CIVIL NO. 82-1683, E.D. OF PA.); ELAINE SCHWAMBACH, EXECUTRIX OF THE ESTATE OF WOODROW W. SCHWAMBACH AND MERLIN SCHWAMBACK, EXECUTOR OF THAT ESTATE, APPELLANTS V. CONSOLIDATED RAIL CORPORATION (CONRAIL) AND THE READING COMPANY ( CIVIL NO. 82-2467, E.D. OF PA.); FRANK, MARILYN L., AS EXECUTRIX OF THE ESTATE OF RUSSELL C. WENNELL, DECEASED, APPELLANT, V. CONSOLIDATED RAIL CORPORATION (CONRAIL) AND THE READING COMPANY (CIVIL ACTION NO. 82-2999, E.D. OF PA.); SCHOLL, MARTIN H., INDIVIDUALLY AND AS EXECUTOR OF THE ESTATE OF ETHEL M. SCHOLL, DECEASED, APPELLANT, V. CONSOLIDATED RAIL CORPORATION (CONRAIL) AND THE READING COMPANY (CIVIL ACTION NO. 84-1685, E.D. OF PA.) FENSTERMACHER, EARL R., AND SCHOLING, CARL, V. CONSOLIDATED RAIL CORPORATION, A CORPORATION, AND THE READING COMPANY, A CORPORATION, V. ANCHOR PACKING COMPANY, CELOTEX CORPORATION, SUCCESSOR-IN-INTEREST TO PHILIP CAREY MANUFACTURING COMPANY, PHILIP CAREY CORPORATION, BRIGGS MANUFACTURING COMPANY AND/OR PANACON CORPORATION, CERTAINTEED CORPORATION, DUROX EQUIPMENT COMPANY, GARLOCK, INC., JANOS INDUSTRIAL INSULATION CORPORATION, JOHN CRANE-HOUDAILLE, INC., J.W. ROBERTS LTD., KEENE CORPORATION, NICOLET, INC., NOSROC CORPORATION, SUCCESSOR-IN-INTEREST TO G & W.H. CORSON, INC. AND CALCITE QUARRY CORPORATION, STUDEBAKER-WORTHINGTON, INC., TANNETICS INC., TURNER & NEWALL PLC, TURNER ASBESTOS FIBERS LTD., UNION RUBBER, INC. AND VELLUMOID COMPANY, THIRD PARTY DEFENDANTS, EAGLE PICHER INDUSTRIES, INC. AND FLINTKOTE COMPANY; FENSTERMACHER, EARL R., APPELLANT IN NO. 84-1203 (D.C. CIVIL NO. 82-4923), SCHOLING, CARL, APPELLANT IN NO. 84-1204 (D.C. CIVIL NO. 82-1684) (CIVIL NOS. 82-4923 AND 82-1684, E.D. OF PA.) JOSEPHINE SCHWEITZER, MILDRED SEIBERT, INDIVIDUALLY AND AS EXECUTRIX OF THE ESTATE OF PAUL D. SEIBERT, DECEASED, GEORGE A. WENTZEL, ELAINE SCHWAMBACH, EXECUTRIX OF THE ESTATE OF WOODROW W. SCHWAMBACH AND MERLIN SCHWAMBACH, EXECUTOR OF THAT ESTATE, MARILYN L. FRANK, AS EXECUTRIX OF THE ESTATE OF RUSSELL C. WENNELL, DECEASED, MARTIN H. SCHOLL, INDIVIDUALLY AND AS EXECUTOR OF THE ESTATE OF ETHEL M. SCHOLL, DECEASED, V. CONSOLIDATED RAIL CORPORATION (CONRAIL) AND THE READING COMPANY; CONSOLIDATED RAIL CORPORATION, APPELLANT (CIVIL NOS. 81-5375, 81-5376, 81-1683, 82-2467, 82-2999, 82-1685) E. D. OF PA. EARL R. FENSTERMACHER AND CARL SCHOLING, V. CONSOLIDATED RAIL CORPORATION, A CORPORATION, AND THE READING COMPANY, A CORPORATION V. ANCHOR PACKING COMPANY, CELOTEX CORPORATION, SUCCESSOR-IN-INTEREST TO PHILIP CAREY MANUFACTURING COMPANY, PHILIP CAREY CORPORATION, BRIGGS MANUFACTURING COMPANY AND/OR PANACON CORPORATION, CERTAINTEED CORPORATION, DUROX EQUIPMENT COMPANY, GARLOCK, INC., JANOS INDUSTRIAL INSULATION CORPORATION, JOHN CRANE-HOUDAILLE, INC., J.W. ROBERTS LTD., KEEN CORPORATION, NIOLET, INC., NOSROC CORPORATION, SUCCESSOR-IN-INTEREST TO G & W.H. CORSON, INC. AND CALCITE QUARRY CORPORATION, STUDEBAKER-WORTHINGTON, INC., TANNETICS, INC., TURNER & NEWALL PLC, TURNER ASBESTOS FIBERS LTD., UNION RUBBER, INC. AND VELLUMOID COMPANY, THIRD-PARTY DEFENDANTS; EAGLE PICHER INDUSTRIES, INC.,AND FLINTKOTE COMPANY; CONSOLIDATED RAIL CORPORATION, APPELLANT (CIVIL NOS. 82-4923 AND 82-1684 - E.D. PA.) IN THE MATTER OF THE CENTRAL RAILROAD COMPANY OF NEW JERSEY, DEBTOR, CONSOLIDATED RAIL CORPORATION, INTERVENOR, ANDREW THOMAS AND TRUDELL THOMAS, HIS WIFE, APPELLANTS; ANDREW THOMAS AND TRUDELL THOMAS, APPELLANTS IN NO. 84-5293; INTERVENOR CONSOLIDATED RAIL CORPORATION, APPELLANT IN NO. 84-5310, (B-67-401- DIST. OF N.J. - NEWARK) IN THE MATTER OF THE CENTRAL RAILROAD COMPANY OF NEW JERSEY, DEBTOR, CONSOLIDATED RAIL CORPORATION, INTERVENOR , N* N* OUR READING OF THE RECORD INDICATES THAT CONSOLIDATED RAIL CORPORATION IS NOT A PARTY IN NO. 84-5451. JOSEPH PONGRAC, SR., ROBERT A. BINGLE, ALEXANDER, REDELICO AND EVELYN REDELICO, H/W, JOSEPH C. POPADICK AND ELMA POPADICK, H/W, EDWARD WITOS AND PHILOMENA WITOS, H/W, MARK GAMMEL, HARRY GURALCHUK, STEVE PALICHAK, JOSEPH M. PINTO, FRANK PONGRAC, JR., JOHN SOWIZRAL, HARRY WILSON, GEORGE J. ZEBLISKY, ROBERT J. F. BROBYN RICHARD, RICHARD MIDDLETON AND ANY AND ALL PERSONS ACTING ON THEIR BEHALF, APPELLANTS, (B-67-401 - DIST. OF N.J. - NEWARK)



On appeals from the United States District Court for the Eastern District of Pennsylvania. On Appeal from the United States District Court for the District of New Jersey - Newark. On Appeal from the United States District Court for the District of New Jersey - Newark.

Author: Seitz

Before: SEITZ, GARTH, and HIGGINBOTHAM. Circuit Judges.

SEITZ, Circuit Judges.

These appeals, in the various procedural postures set forth in Part I, infra, call upon us to interpret § 77 of the Bankruptcy Act of 1898 ("section 77"), as amended, formerly codified at 11 U.S.C. § 205 (repealed 1978). Among the questions presented is whether a plaintiff in an asbestos-related personal injury action who had no manifest injury prior to the consummation date of his employer's reorganization in bankruptcy had a dischargeable "claim" within the meaning of section 77.

I.

Former railroad workers, representatives and survivors brought tort actions against The Reading Company ("Reading") and other defendants in the United States District Court for the Eastern District of Pennsylvania pursuant to the Federal Employer's Liability Act, 45 U.S.C. § 51 et seq. (1982) ("F.E.L.A."). Subject matter jurisdiction existed pursuant to 28 U.S.C. § 1331 (1982) and 45 U.S.C. § 56 (1982).

Reading filed motions in each action to dismiss it as a party. These motions were opposed by plaintiffs and Consolidated Rail Corporation ("Conrail"), co-defendant in each of these actions. The motions were granted, express determinations were made that there was no just reason for delay, and, pursuant to Fed. R. Civ. P. 54(b), final judgments were entered in favor of Reading in each action. Plaintiffs and Conrail filed timely notices of appeal. This court has jurisdiction to review the judgments pursuant to 28 U.S.C. § 1291 (1982).

In addition, tort actions were brought in federal court against Central Jersey Industries, Inc. ("CJI") by former employees of Central Railroad Company of New Jersey ("CNJ") and their spouses pursuant to F.E.L.A. One similar action was brought in a New Jersey state court. In response to these actions, CJI filed two separate petitions for relief in the United States District Court for the District of New Jersey. That court had presided over CNJ's reorganization under section 77. The district court had retained jurisdiction to consider such petitions in accordance with its equitable power "to secure or preserve the fruits and advantages of a judgment or decree entered therein." Local Loan Co. v. Hunt, 292 U.S. 234, 239, 78 L. Ed. 1230, 54 S. Ct. 695 (1934). In one petition, CJI sought a declaration that the state court action was barred. It also sought an injunction seeking: (1) to restrain plaintiffs from prosecuting that action against CNJ, CJI, and Robert d. Timpany and (2) to require plaintiffs to dismiss as to those defendants. The second petition requested similar relief with respect to the federal court actions and, in addition, sought to restrain other former employees from commencing actions.

Conrail sought intervention to oppose the petition seeking relief against the state court plaintiffs, and the district court permitted intervention. The court then granted both of CJI's petitions and entered judgments to that effect. Timely notices of appeal were filed and this court granted a motion to stay the district court's injunction insofar as it enjoined the commencement of new actions and insofar as it ordered that the existing actions in federal court be dismissed. Appellate jurisdiction exists to review these judgments pursuant to 28 U.S.C. § 1291 (1982). See Ex Parte Tiffany, 252 U.S. 32, 64 L. Ed. 443, 40 S. Ct. 239 (1920).

II.

Reading and CNJ operated railroads before they reorganized in bankruptcy an divested themselves of their rail assets. Reading filed its bankruptcy petition on November 23, 1971, and transferred all of its rail assets to Conrail on April 1, 1976. The consummation date of Reading's reorganization was December 31, 1980. CNJ filed its petition on March 12, 1967, transferred its rail assets on April 1, 1976, and the consummation date of its reorganization was September 14, 1979. Robert D. Timpany was the trustee of CNJ's assets during it reorganization. CJI is the company that resulted from the reorganization.

Subsequent to the consummation dates, a number of actions were brought against Reading, CNJ, CJI, and Timothy ("defendants"), alleging personal injury former employees of Reading and CNJ as a result of exposure to asbestos in the course of their work for the railroads. Plaintiffs in those actions include former railroad employees, representatives, survivors, and spouses ("plaintiffs"). Plaintiffs allege that the asbestors-related injuries did not become manifest until after the relevant consummation dates. It is undisputed that, at this stage in the proceedings, plaintiffs' allegations must be accepted as true.

Defendants argued that plaintiffs' claims were discharged in the bankruptcy proceedings. Plaintiffs and Conrail argued, however, that these claims were not discharged. Further, they argued that those claims did not arise until after the consummation dates and that section 77 does not provide for discharge of such claims. They also argued that if section 77 did provide for discharge in these circumstances, it would violate due process. The ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.