Pub owners settle with FBD over scale of Covid-19 payout

Two of the four pub owners who successfully challenged FBD’s failure to pay out on business disruption claims caused by Covid-19 have settled most of their outstanding legal issues against the insurer.

However, issues largely centred around the quantum of losses that are to be paid to the publicans remain outstanding between FBD and two other pub owners. These are due to be argued before the court later this month.

The cases were briefly mentioned on Tuesday before Mr Justice Denis McDonald, who expressed his disappointment that all four test actions had not been resolved.

Last year the judge ruled that a policy sold by FBD covered losses pubs sustained by having to close due to the pandemic in what were important test actions that had implications for more than 100 bars and restaurants.

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The lead cases were brought before the High Court by Dublin bar owners Aberken, trading as Sinnott’s Bar; Hyper Trust Ltd, trading as The Leopardstown Inn and Inn on Hibernian Way Ltd trading as Lemon & Duke. Leinster Overview Concepts Ltd, the owner of Sean’s Bar, which is based in Athlone, Co Westmeath, is the fourth party to bring a test action.

However, several issues including the quantum of losses to be paid out for the disruption of business caused by Covid-19, remained pending before the courts.

The High Court heard on Tuesday that Leinster Overview Concepts and Inn on the Hibernian Way have settled the bulk of their outstanding issues with the insurer, including the matter of quantum. The details of the settlement are understood to be confidential. Issues over the costs of those two parties’ proceedings against FBD remain pending before the court.

While talks have taken place between FBD and the two other parties over the quantification of those entities’ losses., those cases remain live before the court and are due back before the judge later this month.

On Tuesday, Mr Justice McDonald accepted that differences remain between FBD and the pub owners. However, given the length of time the action has taken to hear, and the number of decisions handed down by the court, including the main judgments, the judge expressed his disappointment that the remaining cases have not been settled. The judge urged the parties to keep working on finding a solution, and adjourned the outstanding issues to a date later this month.

In his judgment last year the judge disagreed with FBD’s interpretation of its business disruption policy regarding Covid-19 and ruled in favour of the four publicans.

The pub owners had challenged FBDs refusal to indemnify them, as well as the insurer’s claim its policies did not cover the disruption caused by Covid-19. They claimed that under their policies of insurance they were entitled to have their consequential losses covered by the insurer.

FBD claimed the policies contained a clause that states the pubs will be indemnified if their premises were closed by order of the local or government authority if there are “outbreaks of contagious or infectious diseases on the premises or within 25 miles of same”. The judge said that cover was not lost in such circumstances.