On March 15, 1995, at 1545 eastern standard time, a Cessna 177B, N35138, collided with the ground 50 feet short of runway 03, while maneuvering for an emergency landing to the Collegedale Municipal Airport in Collegedale, Tennessee. The maintenance flight operated under the provisions of 14 CFR Part 91 with no flight plan filed. Visual weather conditions prevailed at the time of the accident. The airplane was destroyed,and the pilot received serious injuries. The flight departed the pilot's private airstrip in McDonald, Tennessee, at 1540 hours. About four months before the accident, a local mechanic removed the engine from N35138, and overhauled it. According to the pilot's family, the engine was installed on the airframe on March 14, 1995. During the ground runup , no fluid leaks were noted on the engine. The mechanic also stated that no new fluid lines were installed with the overhauled engine. On March 15, 1995, another engine runup was completed, and the mechanic again did not observe fluid leakage from the engine (see attached statements of interview and FAA Inspector's Statement.) Due to other aircraft discrepancies, the mechanic asked the pilot if he would test fly the airplane as part of the break-in procedure. The flight departed the private airstrip enroute to Lafayette, Georgia. After climbing to 600 feet and 3.5 miles south of the departure airport, the pilot experienced a loss of engine oil pressure, and the subsequent loss of engine power. He established an emergency descent for runway 03 at Collegedale Municipal Airport. The airplane collided with rising terrain 75 feet short of the runway. Upon arriving at the accident site, emergency medical personnel noticed that the airplane was covered with engine oil. An examination of the engine compartment disclosed that the engine oil line to the oil cooler had separated from the metal fitting. Citing cost concerns expressed by the pilot, the mechanic did not install new oil lines and hoses when the engine was installed. According to a mandatory service bulletin from Textron Lycoming dated March 31, 1992, "during overhaul of any Textron Lycoming reciprocating engine, it is mandatory that certain parts be replaced regardless of their apparent condition." All flexible hoses and all engine oil hoses are included in the list of parts that must be changed.