The court last week ruled in six test cases that could have implications for businesses across Wales and England who suffered losses when they were forced to close due to national lockdowns during the pandemic.
The judgement takes Mark and Rhian Phillips, owners of SY23 restaurant and The Courtyard in Pier Street, one step closer to the insurance payouts they seek from Zenith Insurance PLC & QIC Europe Limited.
The couple were seeking payouts for when they had to close due to outbreaks of Covid-19 that they say were ‘unjustly refused’ by the firms.
Lawyers from firm Hugh James, who represented the pair, said insurers have tried to exploit the legal uncertainty in policy clauses surrounding illnesses taking place on business premises – which has seen firms deny businesses cover that would respond to the Covid-19 pandemic and trigger a potential payout.
The couple, who operate the company Why Not Bar, said: “The High Court’s ruling is a pivotal moment for our business and no doubt countless other businesses who continue to fight for survival amidst the fall out of the pandemic.
“We have faced significant financial struggles before, during and after the pandemic, which many businesses will have endured, made all the worse with the loss of Mark’s father, stepmother and aunt.
“This judgment offers real hope that we are one massive step closer to finally securing insurance payouts that are desperately needed and have been unjustly refused.
“As a member of the hospitality industry struggling to balance the loss of our loved ones with keeping our business afloat, this ruling provides an enormous sense of validation that the sacrifices we have made have not been in vain.”
The Supreme Court in January 2021 handed down a positive ruling to claimants with business interruption policies which contained a clause in relation to losses caused by Covid-19 occurring within a specified radius relative to the premises.
But no decision was made on insurance clauses covering the occurrence or manifestation of diseases ‘at the premise’ until today when the High Court ruled in favour of SY23.
Legal experts say the High Court judgment is of crucial importance to small and medium sized businesses, not least those in the hospitality and leisure sectors, who were amongst the worst hit - compounded by most insurers refusing to pay policyholders with insurance ‘at the premises’ cover.
Newly appointed Aberystwyth mayor Cllr Kerry Ferguson said: “The fight isn’t over, but I am so pleased to hear from Mark and Rhian that the news is positive in regards the ruling from the High Court about business interruption insurance during the pandemic.
“Could this news have a positive effect on your business?”
The Cambrian News has contacted QIC Europe and Zenith Insurance, which trade under the Markerstudy Group, for comment.
Erich Kurtz, senior associate at Hugh James’ financial mis-selling team, said: “It was a huge privilege to act on behalf of Mark and Rhian who have shown remarkable resilience, unwavering belief in their case and have been justly rewarded with today’s judgment. I am delighted for them and wish them every success in the future.
“Despite the unforeseen nature of Covid-19, three years after the onset of the pandemic, many businesses remain in complex disputes with insurers refusing to settle claims under the policy.
“The High Court’s judgment will now bind insurers, providing vital legal certainty, and be used to assist other policyholders with ‘at the premise’ insurance policies reach out to their insurers and secure compensation.
“The decision emphatically resolves one of the most contentious issues between businesses and their insurers in this field – whether cover exists in principle when the UK Government imposed national lockdown where businesses can show Covid-19 occurred or manifested ‘at their premises’.”