An appeals court in the state of North Carolina on Tuesday overturned a lower court decision in favor of policyholders in a case of Covid-19 business interruption.
Separately, an appellate court in the state of Illinois last week upheld a lower court decision in a case of Covid-19 business interruption.
On October 9, 2020, a judge in the state of North Carolina ruled in favor of a group of 16 restaurants that filed a lawsuit against Cincinnati Insurance Co. in the State Court of Durham, which sought a declaratory judgment requiring the insurer to make up for lost business income. and additional expenses under their coverage, according to the judgment in North State Deli, LLC et al. v. Cincinnati Insurance Co., et. al.
A three-judge Raleigh Court of Appeal overturned that decision, saying, “We conclude that the unambiguous terms of the policies did not provide the coverage sought by the plaintiffs.”;
The decision referred to a 1997 case as well as more recent cases of the 4th U.S. Circuit Court of Appeals in Richmond, Virginia. “We agree with these courts that the relevant provisions of the policies are unambiguous.
“The plaintiffs did not allege that their loss was due to physical damage to their property, but that the state orders resulted in loss of business … According to the clear wording of the policies, only direct unintentional, physical loss or damage to property is covered,” the panel said. in lower court.
The policyholder’s attorney, Stuart M. Paynter of Paynter Law Firm PLLC in Hillsborough, North Carolina, said in a statement, “We are examining our options for further review.” The insurance company’s lawyers did not respond to a request for comment.
In the Illinois case, a panel of three judges in a Chicago-based appellate court upheld a verdict last Thursday in a Chicago court, in a case filed by 14 Illinois restaurants and restaurants operating under the name Bulldog Ale House, according to the decision in State & 9 Street Corp. ., d / b / a / Bulldog ale House et al. v. Society Insurance, A Mutual Co.
The plaintiffs “appear to be confusing and leveling property damage liability and covering business interruptions,” the verdict said, referring to the business owners’ policies they had purchased.
The ruling said that the purpose of the insurance they purchased “is to protect the insured from physical loss of or damage to property, such as the occurrence of a tornado or fire.
“This type of insurance limits coverage for business losses and generally does not insure business interruptions but the presence of physical loss,” it said, referring to the 7th Circuits Sandy Point Dental judgment, confirming the lower court’s dismissal.
Information about lawyers was not available.