Supreme Court hand down judgment in landmark FCA business interruption test case

The Supreme Court has today handed down its judgment in the landmark COVID-19 business interruption test case, The Financial Conduct Authority v Arch & Others [2021] UKSC 1, following an expedited ‘leapfrog’ appeal from the Commercial Court decision of Flaux LJ and Butcher J ([2020] EWHC 2448 (Comm)). Adam Kramer (who was instructed for both the Commercial Court and Supreme Court hearings) and Peter Ratcliffe (who was instructed for the Supreme Court hearing) acted for the FCA, led by Colin Edelman QC and instructed by Paul Lewis, Sarah McNally and Greig Anderson of Herbert Smith Freehills.

The Supreme Court’s decision consolidates the FCA’s success at first instance: insurers’ appeals were dismissed; the FCA’s appeals were, for the most part, allowed. The case provides authoritative guidance on the operation of cover under a variety of standard non-damage business interruption insurance wordings in respect of COVID-19 related losses. Also of some note, the Supreme Court determined that the decision in Orient-Express Hotels Ltd v Assicurazioni Generali SPA was wrongly decided and should be overruled.

Click here to read the full judgment.