Facts
On August 13, 1999, A. AG (the Buyer) purchased so-called "Z.-Glass" as fire-resistant glass from B.X. AG (the Seller). This was manufactured by [C. AG] in Bern and delivered directly to the Buyer, who installed it in the facade of a bank. In December 2001, defects in the glass occurred, which were attributable to production errors. The Seller then supplied new glass, and the Buyer demanded reimbursement of the re-glazing costs from the Seller.
[C. AG] had taken out a general liability insurance policy with E. Insurance Company, which also covered its liability. By contract dated June 19, 2003, [C. AG] transferred the fire protection business and all rights and claims to B.Y. AG, which also took over the Seller. B.Y. AG then sued E. Insurance Company for payment of the re-glazing costs.
Considerations
The Federal Supreme Court confirmed the lower instances that the Plaintiff's claims for damages from the delivery of defective glass were time-barred. It stated that the buyer may assert not only warranty claims but also general contractual claims for damages. However, the alternative nature of these claims is limited insofar as in both cases the warranty law regulations on the buyer's duty to inspect and notify as well as on the statute of limitations apply.
The Federal Supreme Court justified this by stating that the short statute of limitations under Art. 210 CO not only serves to balance the interests between buyer and…