Australian High Court rejects special leave applications 

The decision was announced on 14 October.

The Australian High court has rejected applications by insurers for special leave to appeal the judgment of the Full Court of the Federal Court of Australia on the interpretation of policy wordings in business interruption policies.

The Full Court of the Federal Court delivered its judgment on 21 February 2022 where it substantially upheld the arguments of insurers in four of the five matters in the test case which were appealed.

The Court found that in those four matters the insurers were not liable to indemnify the policyholders.

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In the other case, the Full Court upheld the earlier decision to the effect that cover had been triggered but that there were substantial issues as to whether the policyholder could prove any relevant business interruption.

The policyholder in this case is entitled to bring it back before the Federal Court for determination if it considers that it can identify any loss covered by the policy.

With the exception of the one case that might go back before the Federal Court, the High Court’s rulings on these matters draws to a close the formal test case process concerning Covid-19 related business interruption matters.

The Insurance Council of Australia said that they acknowledge the decision by the High Court.

“This has not been an easy or straightforward process, and insurers and the Insurance Council want to thank the policyholders who agreed to be part of both test cases for their patience and community spirit. We recognise this has been a particularly difficult time for many small businesses and we sought the courts’ determinations and funded these test cases in order to establish the principles necessary in order to minimise disputes,” Andrew Hall, CEO of the ICA said.