The Insurance Council of Australia (ICA) has announced acknowledgement of the High Court’s request to hear arguments on the applications for special leave to appeal the Full Court of the Federal Court of Australia’s recent judgment on the interpretation of policy wordings in business interruption policies during COVID-19.
This second BI test case follows the initial test case heard in the NSW court of appeal in 2020 regarding the application of the Quarantine Act exclusion to business interruption policies.
The Full Court of the Federal Court delivered its judgment on the 21st of February 2022, where it substantially upheld the arguments of insurers in four of the five matters in the test case which were appealed. The Full Court found that the insurers were not liable to indemnify the policyholders in those four matters.
Applications for special leave to appeal to the High Court were filed by two policyholders in March 2022.
An application was also filed by the insurer IAG in respect of whether JobKeeper payments should be taken into account when calculating any insurance payment.
The industry will meet the costs of the policyholders in these special leave applications and any resulting appeals as agreed as part of the decision to obtain an outcome through test cases. Further details can be found on the Federal Court file.
The High Court indicated that the oral hearing will not be listed before October 2022 at the earliest.
Andrew Hall, CEO of the Insurance Council of Australia, stated, “The Insurance Council and insurers acknowledge the High Court’s request to hear oral arguments on the applications for special leave to appeal parts of the judgment of the Full Court of the Federal Court of Australia.”
“We recognise this has been a particularly difficult time for many small businesses and we sought the courts’ determinations to establish the principles necessary to minimise disputes.”
