High Court judged prospects of BI appeal success 'insufficient'
The High Court of Australia rejected policyholder applications seeking leave to appeal in the second covid business interruption test case after deciding that the chances of success were “insufficient”.
The transcript of the case released last week shows that Justices Stephen Gageler, James Edelman and Jacqueline Gleeson took 10 minutes to consider arguments put on behalf of policyholders in two claims and by the insurer in a third.
“In the matters of Taphouse and LCA Marrickville, we consider that the prospects of persuading this court on appeal that the conclusions reached by the Full Court of the Federal Court were affected by any error of interpretative principle are insufficient to warrant the grant of special leave to appeal,” they said.
In the third test case dispute application, insurers had sought to appeal against a Full Court judgment that found JobKeeper payments shouldn’t be taken into account when calculating a business interruption payout if a policy responded.
In the High Court it was argued that the JobKeeper payments had reduced the loss of Meridian Travel and that the “doctrine of subrogation requires that payments which are made by third parties in reduction of the insured’s loss must be brought into account for the benefit of the insurer”.
But the Justices ruled that “in the Meridian Travel matter, we are not satisfied that the matter presents as a suitable vehicle for the operation of the question of principle sought to be raised by the grounds as formulated in the notice of appeal.”
Separate to the test case, the High Court also rejected a leave to appeal application filed by The Star Entertainment Group in its business interruption dispute with insurers.
In that case, lawyers for the casino company argued that the Full Court had “got it wrong” in relation to matters of principle and construction, which are of general application in the insurance industry.
But after five minutes consideration that application was also rejected.
“In our opinion, the foreshadowed appeal would not involve resolution of any principle of general importance. On that basis, special leave to appeal is refused with costs,” the justices determined.