In Tri-State Insur. Co. of Minn. a/s/o Campus Chalet, Inc. v. East Tennessee Sprinkler Company, Inc., the Court of Appeals of Tennessee recently addressed whether the state’s four-year statute of repose could shield a contractor from liability in 2020 where the initial construction project was completed in 1992. The court found that the trial court improperly granted the contractor a motion to dismiss on its statute of repose defense because the owner’s complaint properly pled breach claims arising out of a separate ongoing maintenance agreement between the parties.
East Tennessee Sprinkler Company, Inc. (ETS) installed a sprinkler system at Campus Chalet in 1992. Campus Chalet also contracted on an ongoing basis with ETS to inspect, repair, and maintain the sprinkler system. A waterline in the sprinkler system burst in 2020, damaging Campus Chalet’s property.
Tri-State Insurance Company of Minnesota, Campus Chalet’s insurer, filed a complaint against ETS. The complaint alleged negligence and breach of contract, specifically claiming that ETS had failed to properly inspect, test, and maintain the sprinkler system since its installation. Tri-State argued that the proximate cause of the sprinkler line burst was improper sloping, a condition that ETS should have identified and corrected through its ongoing maintenance work…