Landlord and Tenant Blame Each Other for Sprinkler Malfunction

What Happened: A pharmaceutical company used the warehouse it sublet to store its drug products. But the warehouse sprinkler system went haywire and inflicted $265,110 in damage to the products. The company sued the landlord and tenant. Naturally, each side blamed the other and filed cross claims—that is, claims pitting one defendant in a lawsuit against the other.

Ruling: The Delaware court refused to grant summary judgment to either side and ordered a trial instead.

Reasoning: The lease made the tenant responsible for routine maintenance and repairs, but not replacements; and it made the landlord responsible for replacing mechanical systems, but not repairs. The key question: Did the sprinklers malfunction because of a repair or maintenance issue, in which case the tenant would be on the hook; or did they fail because they were a “mechanical system” needing to be replaced, in which case the landlord would be liable? At this point, the answer was unclear. As a result, the parties had to go to trial and present their evidence so that a determination could be made.    

• Torrent Pharma, Inc. v. Priority Healthcare Distrib., 2020 Del. Super. LEXIS 2835, 2020 WL 6066275