In a rare policyholder gain, an appellate court in the state of New York on Tuesday upheld a lower court ruling and ruled that New York’s botanical garden is entitled to covid-19-related coverage of business interruptions from an Allied World Assurance Co. Holdings Ltd. unit.
The trial was brought by the 250-acre New York Botanical Garden in the Bronx against Allied World Assurance Corp., which had issued a “pollution liability” policy, according to the New York Supreme Court ruling, the Appellate Division, the New York New York Botanical Court. v. Allied World Assurance Co. (US) Inc.
The policy defines conditional business interruptions as “the necessary closure of your business on a site owned or leased to you as a result of an order from a government agency or authority denying access to the site,”; the tripartite ruling said.
Allied World denied the botanical garden’s claim that it was eligible for coverage in response to the government-ordered, covid-19-related shutdown, even though it acknowledged that the pandemic was a “pollution incident” as defined in the policy, the ruling said.
The Botanical Garden then brought an action, seeking an explanation that it was entitled to cover for its losses from business interruptions.
The trial court in the Bronx ruled in favor of the Botanical Gardens in October and was upheld by three judges in the state appellate court.
“The defendant failed to establish that, under the terms of the insurance it issued to the plaintiff, conditional business interruption protection was only available if the plaintiff was completely denied access to his property,” the judgment said.
“The police are considering coverage for periods when the plaintiff would have some temporary access to the property, including periods involving potentially partial resumption of operations to mitigate the damages that the plaintiff included maintaining his extensive plantings,” it said.
“The cases cited by the defendant, which involve coverage of civil authority in property liability policies and periods of complete denial of access due to physical harm, are inappropriate,” the verdict said.
The insurer “also failed to establish that the executive orders denying access were not solely and directly the result of a pollution in an” independent place “, within the meaning of that term in the insurance”, the decision stated, confirming the decision of the lower court. governing.
The insurer’s and botanical garden’s lawyers had no comment.
Last week, a judge in the state of Connecticut dismissed Covid-19-related business interruption litigation filed by a Native American tribal gaming authority against Factory Mutual Insurance Co.