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State Farm Fire and Casualty v. Aquila Inc.6/14/2005
Appellants, owners and insurers of property damaged by the explosion of a natural-gas pipeline, bought suit against respondents, one of which is the owner of the pipeline, and the other is the firm that installed it. The district court granted summary judgment in favor of respondents on the ground that appellants' suits were barred by Minn. Stat. § 541.051 (2004), the statute of repose for improvements to real property. Appellants contend that the district court erred (1) in determining that the natural-gas pipeline at issue constituted an "improvement to real property" for the purposes of Minn. Stat. § 541.051; (2) in granting summary judgment for respondents where appellants alleged negligence and negligence per se, not merely as to the installation of the natural-gas pipeline, but also as to the inspection, maintenance, and/or repair of the natural-gas system; and (3) in determining that no negligence existed even though a prima facie showing by appellants was all that was required, discovery had only just begun, and substantive negligence issues were not briefed by the parties.
FACTS
In November 1990, respondent Aquila Inc., owner of a natural-gas pipeline at Hallmark Terrace Trailer Park, contracted with respondent Northern Pipeline Construction Company to replace the existing pipeline. The existing main lines and service lines (i.e., the lines that run from the main lines to the customers' homes) were made of steel. That pipeline was to be abandoned and Northern Pipeline was to install a new pipeline made of polyethylene. According to the work order, the old pipeline was replaced because of the hazardous location of the steel main and service lines. Appellants allege that the polyethylene pipeline was installed under driveways and roads using a pneumatic boring tool, and further allege that during the installation process, Northern Pipeline installed the new pipeline through an existing clay tile sewer line. The parties do no dispute the district court's finding that Aquila owned, and still owns, the polyethylene pipeline system. Northern Pipeline completed its work in December 1990. Thereafter, Aquila maintained ownership and control over the pipeline system. No further maintenance or repairs were performed on the pipeline until 2002.
In early 2002, Hallmark Terrace hired Robert Sauer, doing business as Drain-Rite, to repair sewer drains that were blocked by tree roots. On February 13, 2002, Drain-Rite used a trap-and-drain auger to unclog the sewer pipes. Appellants claim that in doing so, Drain-Rite's auger struck and ruptured the intersecting gas line, causing natural gas to migrate through the sewer pipes and into several of the manufactured homes at Hallmark Terrace. The gas built up and ignited, resulting in an explosion that destroyed property either owned or insured by appellants.
In November 2002, appellants brought suit against respondents and Drain-Rite, but eventually settled with Drain-Rite. Appellants claim that respondents were negligent in the "inspection, maintenance, repair and/or installation of the natural gas system." Appellants also claim that respondents were negligent per se for violating "applicable codes and standards regarding the inspection, maintenance, repair and/or installation of the natural gas system." Respondents brought motions for summary judgment, arguing that the suit was time-barred by the ten-year statute of repose for improvements to real property under Minn. Stat. § 541.051 (2004).
Appellants brought a cross-motion for summary judgment, seeking an order that the statute of repose was inapplicable because the pipeline was not an improvement to real property for the purposes of Minn. Stat. § 541.05
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