PALESTINE, Texas — A Texas judge has ruled for the city of Palestine and Anderson County and against Union Pacific in the railroad’s efforts to close a car repair shop in the city, continuing an ongoing legal battle underway on two levels.
The Palestine Herald-Press reports that in a May 15 ruling, state District Court Judge Michael Davis issued a summary judgment in favor of the city and county on UP efforts to dissolve an agreement requiring the railroad to maintain a set percentage of its workforce in the city.
At issue is a 1955 judgment regarding an 1872 agreement between Palestine and predecessors of Missouri Pacific, which merged into UP in 1982. UP filed suit in 2019 to void the agreement [see “UP sues to end employment provision …,” Trains News Wire, Dec. 2, 2019].
Davis has ruled that the railroad is out of compliance with provisions of the 1955 judgment requiring the railroad to provide employment numbers and payroll reports to the city, and has been since December 2020, and will revisit the case if proper pleadings are filed in the future, the Herald-Press reported.
The summary judgment means the case will not go to trial. Union Pacific can appeal the decision.
Separately, Union Pacific has won decisions at the federal level contending that federal regulation of railroads overrides the local agreement, most recently before the U.S. Fifth Circuit Court of Appeals in New Orleans [see “Union Pacific wins another round …,” News Wire, Sept. 1, 2022]. After an earlier federal decision, it informed employees in Palestine in April 2021 of its plans to close the car shop within 60 days, a move that would eliminate 57 jobs. But that closure has been prevented by the ongoing legal battle.
I can’t understand how, and on what basis UP can break the agreement. Has Missouri Pacific been in a bankruptcy proceeding that would allow MoPac and successor UP to break the agreement.
Could Palestine repossess the right of way and deny UP use of the property in question?
I’m no lawyer but that would be my response.
Obviously one must conclude that any contract UP signs can be thrown in the trash, not by the payee but, by the grantor. Yes, UP did not originate the contract but in merging with MP it got their obligations as well.