// Greggs has won an initial case against insurer Zurich over its claims for business interruptions during the Covid-19 lockdown
// The bakery chain claimed more than £150 million on its policy with Zurich, arguing that it had suffered many cases of enterprise interruption
Greggs has won a landmark ruling in its legal battle over a £150 million pound insurance claim triggered by the coronavirus pandemic, The Times has reported.
Yesterday, a High Court judge backed nearly all of the bakery retailer’s claim for business interruptions attributable to the pandemic, in a move that could cost Zurich Insurance tens of millions more than it argued was its legal responsibility
Lawyers for Greggs, which employs about 25,000 staff across over 2,200 shops within the UK, stated that every outlet suffered some interruption or interference with trading due to government lockdowns put in place to limit the spread of Covid-19.
The retailer claimed more than £150 million on its policy with Zurich, arguing that it had suffered many cases of enterprise interruption.
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Although, Zurich argued that the entire chain’s losses may very well be traced to a “single occurrence”, for insurance purposes, which might cap the invoice for the insurer at £2.5 million.
In January last year, the company stated that it had discharged its obligations to Greggs after it paid the business that sum.
The courtroom heard that Greggs said on March 23, 2020, it was closing all its shops to protect customers and employees from Covid-19. The retailer remained closed till late May, when bosses started a phased reopening.
Lawyers for Greggs argued in court that subsequent restrictions imposed by ministers, mixed with the effects of the virus, created extra business interruption losses.
At the High Court in London, Mr Justice Butcher agreed that there was more than a single occurrence of business interruption and said he hoped the “parties will be able to agree as to the number”.
However, the judge — who handed down two different rulings on similar points regarding the Stonegate Pub Company and Various Eateries Trading — said that if Greggs and Zurich could not agree on the number of occurrences, he would have to hear arguments.
Manoj Vaghela, a partner at Charles Russell Speechlys, the law firm representing Greggs, stated the ruling had “wider implications for all businesses that purchased the resilience insurance policies”. The lawyer stated Zurich’s argument “has been firmly rejected”.
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