COVID-19 Australian Business Interruption Test Case Update

What does the business interruption test case appeal and second test case mean for my business?

Since the initial Business Interruption Test Case heard late last year by the NSW Court of Appeal, there have been significant developments, including an application for special leave to appeal which is currently before the High Court of Australia and the launch of a second test case.

To keep businesses informed, Tim Scott-Young, National Manager, Claims Operations – Marsh and Luke Stratford, Head of Claims Solutions – Marsh recently hosted a ‘Business Interruption Test Case Update’ webinar. This session was held in collaboration with Sophy Woodward, Special Counsel and Richard Jowett, Partner from HFW and aimed to unpack exactly what these developments may mean for businesses who have experienced business interruption losses resulting from COVID-19 restrictions. Our specialists have also outlined the key insights from the session below.

Initial Business Interruption Test Case Update

Second Business Interruption Test Case

View the Replay

Initial Business Interruption Test Case Update

The initial business interruption test case focused specifically on the application of a common insurance policy exclusion relating to the repealed Quarantine Act 1908. In a unanimous decision, the NSW Court of Appeal found in favour of policy holders and held that this exclusion did not apply to listed human diseases under the Biosecurity Act 2015 (Cth). This meant that policyholders have one less hurdle to overcome when presenting their business interruption claim.

Following this decision, an application was lodged with the High Court of Australia for special leave to appeal the judgement of the NSW Court of Appeal.

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Second Business Interruption Test Case

There are also many other considerations relating to the interpretation of business interruption policies. As a result, insurers have commenced proceedings in a second test case in the Federal Court of Australia. This will determine the meaning of various policy wordings, particularly those that relate to an outbreak of disease within a particular proximity to a business and prevention of access to premises due to a government mandate.

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View the Replay

To understand what the business interruption test case appeal and second test case mean for Australian businesses in greater detail, the replay from our ‘Business Interruption Test Case Update’ webinar has been made available for viewing. Our presenters provide:

  • An update on the Financial Conduct Authority’s Business Interruption Test Case Appeal Outcome within the UK and what this may mean for Australia
  • Overview of the status of the appeal relating to the first test case in Australia concerning the Quarantine Act
  • Information on additional test cases within Australia including what types of cases may be heard and what needs to be tested
  • Tips on how Marsh can assist in preparing and submitting a claim on behalf of policyholders

Check out the full replay below.

COVID-19 Business Interruption Test Case Update

If you have any questions regarding the developments of the business interruption test cases in Australia, or would like to make a claim, please contact our Claims team here.

 

Please note: The content of this webpage and the webinar including any recommendations, analysis or advice (collectively, the ‘Analysis’) is general in nature, is not intended to be taken as advice regarding any individual situation and should not be relied upon as such.  Specific advice about your particular circumstances should be sought before taking any action. Any projections are subject to inherent uncertainty, and the Analysis could be materially affected if any underlying assumptions, conditions, information, or factors are inaccurate or incomplete or should change. The information contained therein is based on sources we believe reliable, but we make no representation or warranty as to its accuracy. Except as may be set forth in an agreement between you and Marsh, Marsh shall have no obligation to update the Analysis and shall have no liability to you or any other party with regard to the Analysis. LCPA No. 21/098. 

Marsh Pty Ltd (ABN 86 004 651 512, AFSL 238983) (“Marsh”) arrange this insurance and is not the insurer. The Discretionary Trust Arrangement is issued by the Trustee, JLT Group Services Pty Ltd (ABN 26 004 485 214, AFSL 417964) (“JGS”). JGS is part of the Marsh group of companies. Any advice in relation to the Discretionary Trust Arrangement is provided by JLT Risk Solutions Pty Ltd (ABN 69 009 098 864, AFSL 226827) which is a related entity of Marsh. The cover provided by the Discretionary Trust Arrangement is subject to the Trustee’s discretion and/or the relevant policy terms, conditions and exclusions. This website contains general information, does not take into account your individual objectives, financial situation or needs and may not suit your personal circumstances. For full details of the terms, conditions and limitations of the covers and before making any decision about whether to acquire a product, refer to the specific policy wordings and/or Product Disclosure Statements available from JLT Risk Solutions on request. Full information can be found in the JLT Risk Solutions Financial Services Guide.”