Winning the Cup!

For many business owners in Ireland, last Friday was akin to waking up on the day of a cup final when their team is playing. The judgement was due from the Commercial High Court in respect of the Business Interruption case brought by four publicans’ against FBD insurance. Like many Cup Finals, there are many there at the end to applaud the result, but few appreciate the difficult journey and the additional work and stress that was undertaken to arrive at the desired result. Noel Anderson’s business partners will appreciate the work that goes in behind the headlines and the big wins, all 4 have been hugely successful in their rugby careers. They knew that they had the right captain in place for the challenge their business faced.

“It should never have come to this. I had specifically taken out a business interruption policy to protect against Covid-19 and its potential financial impact on our business.”
Excerpt from Statement by Noel Anderson, Managing Director of Lemon & Duke, on Friday 4^th February.

When Noel Anderson went to bed on 2^ndMarch 2020, he must have believed his business and team were well protected against the threat of Covid-19. He had switched his insurance policy to FBD Insurance, leaving him exposed for 4 days without insurance, as he had secured a side letter confirming that there was specific cover in place for Covid-19. Little did he realise what the next 10 months would bring.

There can be no doubt that FBD Insurance put considerable effort in to denying these claims and to avoid their contractual obligations. It took considerable courage and bravery on Noel’s part to proceed with the case, the road may have ended with plaudits and the result, but for many months at the start, it would have been a lonely road, whilst being on the hook for significant additional risk and financial strain. There were tactics employed by the Insurer to undermine the claim and those of the other 3 publicans, it appears like a ‘divide and conquer’ strategy was applied. Thankfully, they all stood firm together and won the day. The financial pressure associated by taking on this case eased somewhat following the Central Bank’s intervention that this should be tried as a test case.

“Yet in order to have our claim settled we were forced to go through 10 months of deep financial uncertainty, significant additional risk in taking this action as well as extensive stress and strain to arrive at an outcome that should have been clear from the outset.”
Excerpt from Statement by Noel Anderson, Managing Director of Lemon & Duke, on Friday 4^th February.

Ruling

The ruling was originally due to be delivered on Friday January 15^th but was deferred to allow both parties make further legal submissions following the ruling by the UK Supreme Court. On Friday 15^th January, the UK Supreme Court ruled against Insurance Companies in the ‘Business Interruption’ case. A ruling that is set to benefit 370,000 businesses across the UK. There is a key difference between the cases in each jurisdiction. The case in the UK was brought by the Financial Conduct Authority against major insurance companies, delivering a ruling that benefitted a high proportion of businesses impacted by Covid-19 restrictions. The case in Ireland was brought by 4 Publican’s against one insurance company. It will not be feasible for many individual businesses to take cases to court against their Insurers. Now is the time for the Central Bank to put emphasis on their role in respect of Consumer Protection. It is clear from the case brought before the courts that the use of language by Insurance companies in the writing of their Business Interruption policies played a significant part in legal deliberations. The Central Bank have a crucial investigative role to play to protect Irish Businesses and should begin an Examination process into the policies that were written by Insurance companies in terms of Business Interruption, like the examination process that was enabled on the back of the tracker mortgage scandal.

“We could not have achieved this outcome without the tremendous faith and understanding shown by our staff during these very testing times where they were understandably concerned about the implication for their livelihoods.”
Excerpt from Statement by Noel Anderson, Managing Director of Lemon & Duke, on Friday 4^th February.

Noel Anderson was interviewed by Matt Cooper on ‘The Last Word’ last Friday evening and the overriding sense of relief was evident throughout the interview. The emotion from Noel was particularly evident when he spoke about the impact that the last 10 months has had on his team. The story he told in terms of the issues faced by his team is being replicated in hospitality businesses across the country, the stress of the impact on his team was exacerbated for Noel during this period as he believed he had insurance in place to protect his business and his team.

Finally

When the judgement came in last Friday morning, it brought hope that this case may assist other businesses to progress their Business Interruption claims. I am sure that solicitors all over the country have been extremely busy in the last few days poring over BI clauses in Insurance policies on behalf of their clients. The floodgates may not have opened fully but there is considerable pressure building on them and Industry groups have been quick to engage on the matter in the wake of Friday’s result. Hopefully, this pressure through legal actions and lobbying will lead to Central Bank intervention and ensure that many more will receive the peace of mind that a successful BI claim would bring.

Well done to all involved in Lemon & Duke, Sinnotts Bar, The Leopardstown Inn and Sean’s Bar in Athlone, their courage & tenacity has done a great service for the wider Industry.