Products Liability Statute of Repose Bars Claim

Tennessee products liability claims are subject to a ten-year statute of repose, and that limitation period is not subject to equitable estoppel.

In Ismoilov v. Sears Holdings Corporation, No. M2017-00897-COA-R3-CV (Tenn. Ct. App. April 25, 2018), plaintiff brought a products liability suit based on a water heater that broke, causing a leak and damaging his property. The water heater in question was purchased on June 2, 2005, and plaintiff asserted that it was sold with a 12-year warranty. Plaintiff filed his suit on June 16, 2015, seeking damages for property damage to his home, unpaid rent, reduced rental value and cleaning fees. It was undisputed that defendant had replaced the water heater before the suit was filed.

The trial court dismissed all claims other than the warranty claims on a motion for judgment on the pleadings, finding that the claims all sounded in product liability and were time barred by the ten-year statute of repose. The trial court subsequently granted defendant summary judgment on the express warranty claim after defendant put forth evidence that the express warranty included replacement of the damaged heater only. Plaintiff appealed these findings, and the Court of Appeals affirmed.

The Court first reviewed the trial court’s decision to grant judgment on the pleadings. The Court noted that plaintiff’s “claims focus on an allegedly defective water heater sold by [defendant],” and that therefore his “claims based in strict liability, negligence, and breach of implied warranty are subject to the products liability statutory scheme.” Tennessee law provides a ten-year statute of repose for products liability claims, and since the water heater at issue here was purchased on June 2, 2005, plaintiff’s suit on June 16, 2015 was time-barred.

After the water heater broke, plaintiff corresponded with one of defendant’s employees about getting the incidental damages covered by defendant. According to plaintiff, the employee asked for documentation of plaintiff’s expenses and stated that “when [defendant] accepted a repair estimate, ‘we can move forward and get the claim processed and resolved.’” After providing itemized expense estimates, however, plaintiff did not hear from the employee again.

Based on these communications, plaintiff argued that defendant had violated the TCPA. The Court of Appeals held, though, that the employee’s “actions did not constitute ‘trade,’ ‘commerce,’ or a ‘consumer transaction’ as those terms are defined in the TCPA,” as this was “not a case wherein the representations regarding a warranty induced the buyer to purchase the product.”

Plaintiff also argued that defendant “should be equitably estopped from relying on expiration of the ten-year statute of repose for products liability due to [employee’s] alleged admission of liability and promise to pay for damages.” The Court held, though, that the statute of repose here was not subject to equitable estoppel, noting that previous case law had held that “the statute of repose would not be tolled even by a defendant’s fraudulent concealment.” (internal citation omitted). Because the suit was filed more than ten years after the purchase, and because there was no tolling of the statute of repose, dismissal was affirmed.

The Court of Appeals likewise affirmed summary judgment on the express warranty claims. Defendant produced a copy of the owner’s manual that accompanied the water heater, which stated that there was a 12-year replacement only warranty. Defendant also provided an affidavit stating that this was the only warranty that was given with the water heater. Plaintiff failed to produce any contradictory evidence, and since defendant had already replaced the unit, summary judgment was affirmed.

This case is a good reminder to pay attention to statutes of repose when accepting cases, as statutes of repose can be fatal to your claim. Here, this case was filed just a few weeks after the statute of repose expired, making it completely time-barred.