§797h Employee and Personal Injury Claims

Summary

For employee claims under collective bargaining agreements that arose before April 1, 1976, the Corporation, the National Railroad Passenger Corporation, or a carrier that buys the railroad must take over handling and pay claims that are decided or settled on or after the date the railroad properties were conveyed under section 743(b)(1). They can be repaid directly by the Association under section 721(h) when the Association says the claim was the reorganizing railroad’s responsibility. Any amounts paid stay as pre-conveyance obligations of the railroad’s estate for purposes of section 721(h)(1). The payer may file a direct claim as a current administrative expense under section 721(h) (other than paragraph (4)(A)) to get reimbursement, including processing costs, from the railroad’s estate. If an employee’s claim was decided or settled before the conveyance date, the employee must seek payment from the railroad’s estate. All employee claims for personal injury or death that arose before the conveyance date must be assumed by the Corporation or the acquiring railroad. The Corporation or acquiring railroad must process and pay claims that are decided or settled and may be repaid directly by the Association under section 721(h) to the extent the Association finds the reorganizing railroad was liable. Those payments remain pre-conveyance obligations of the railroad’s estate for section 721(h)(1), and the payer may file a direct current-administration expense claim under section 721(h) (other than paragraph (4)(A)) to recover reimbursement and processing costs from the estate.