Water Heater Express

My water heater is 5+ years old and still under manufacturer's warranty. It started leaking water and I called the home warranty company for service. Doug came out to diagnose the problem and called me. He said the heater was installed improperly and that it was venting CO inside the house as it was using the chimney. We have lived in the house for 9 years of which the 5+ years was with this heater. If what he said is right, we should all be dead as you know CO is a silent killer. However we are still alive and kicking. In fact I have my workshop right next to the water heater.
Thanks to his diagnosis, *** denied our claim citing some lame clause in the contract. I was on the phone for 2 hours and 15 minutes with the home warranty company fighting for the coverage.
I called the other company *** who installed the water heater and they said there was nothing wrong with the installation and they will be coming out on Monday to replace the heater. They said they will also give a certificate of installation by a master plumber to confirm that it complies with the standard.