A significant legal victory has been achieved by a Manchester-based law firm, marking a noteworthy development for businesses affected by Covid-19. On September 6, a favourable ruling was secured in the Court of Appeal for six Business Interruption Claims (BIC), focusing on insurance policies that explicitly included ‘at the premises’.
This precedent-setting decision is poised to impact potentially thousands of businesses and insurance companies with similar clauses who were not participants in the proceedings. The Managing Director of the firm, Craig Cooper, described the ruling as a monumental victory for numerous policyholders and small to medium-sized business owners.
“Affected business owners have had to wait well over 12 months for confirmation of the approach to be taken towards policy construction following the decision of the High Court in their favour in 2023. The Court of Appeal has provided much-needed certainty and clarity around how ‘at the premises’ claims arising out of the Covid-19 pandemic are to be assessed,” Cooper stated.
The ruling clarified the approach to understanding the insured risk and the test of causation, adhering to the principles established by the Supreme Court in the FCA test case. The firm, well-versed in Business Interruption cases, played a crucial role in the ongoing proceedings which were brought to the Court of Appeal by insurers following the High Court’s favourable ruling for policyholders in the previous year.
The firm represented businesses including Kaizen Cuisine, My Time Fine Fair, Umberto’s Restaurant, Hairlab, Muscleworks, and Bodylines Fitness, thus bolstering the legal standing of a diverse range of enterprises such as barbers, hairdressers, guesthouses, retailers of non-essential goods, and tattoo parlours.
Cooper further elucidated that the decision confirms the irrelevance of specific incidence knowledge of the disease at the insured premises by authorities to trigger cover. It also defined ‘public authority’ as encompassing all levels of local and national government. He noted, “The decision applies a common-sense approach to determining what the policyholder would have reasonably understood the cover to provide when incepting the policy of insurance.”
The firm is now set to assist all its clients, whose claims had been placed on hold pending this decision. “For most business owners, Covid-19 shutdowns were a once-in-a-lifetime disruption, but it’s crucial that this setback doesn’t define their legacy or the future of their business,” Cooper emphasized.
This landmark ruling by the Court of Appeal offers substantial clarity and support for businesses striving to recover from the unprecedented impact of Covid-19, reinforcing the rights of policyholders under specific insurance clauses.