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You are here: BAILII >> Databases >> High Court of Ireland Decisions >> Marlin Apartments Ltd trading as Marlin Hotel Dublin v Allianz PLC (Approved) [2025] IEHC 226 (23 April 2025)
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Cite as: [2025] IEHC 226

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THE HIGH COURT

COMMERCIAL

Record No. 2021/1485P

[2025] IEHC 226

 

BETWEEN

MARLIN APARTMENTS LIMITED TRADING AS MARLIN HOTEL DUBLIN

PLAINTIFF

AND

 

ALLIANZ PLC

DEFENDANT

JUDGMENT (No. 2) of Mr. Justice Denis McDonald delivered on 23rd April 2025

Introduction

1.                  This judgment is supplemental to a judgment previously given by me in these proceedings on 19th September 2024 ([2024] IEHC 550) (which I shall refer to as "my principal judgment").  In this judgment, I address two further issues which have been raised by the defendant in relation to the implications of my principal judgment for other claims made  under Extension 6 of the Allianz business policy arising from interruption of an insured's business as a consequence of Government imposed restrictions on the use of the insured's premises in response to the COVID-19 pandemic.

2.                  In this context, the defendant is obliged pursuant to the Central Bank of Ireland COVID-19 and Business Interruption Insurance Supervisory Framework published in August 2020 ("the Supervisory Framework") to consider the extent to which my principal judgment has wider implications beyond the specific circumstances of the plaintiff's case. In particular, the defendant is required under the Supervisory Framework to analyse, determine and furnish details to the Central Bank of the following: -

(a)        Whether the final outcome of these proceedings has a wider beneficial outcome for groups of customers similar to the plaintiff; and

(b)        the remedial action which the defendant proposes to take to ensure that the beneficial outcome of the proceedings is applied to groups of customers in a similar position to the plaintiff.

Background

3.                  In order to understand how the issues arise, it is necessary to recall a number of features of this case.  Under Extension 6 of the Allianz policy (which is set out in full in para. 3(a) of my principal judgment), cover is available in respect of losses arising from an interruption of or interference with the business carried on by the insured at the insured premises in consequence of any occurrence of a notifiable disease at the premises which "causes restrictions on the use of the premises on the order or advice of the competent authority". COVID-19 was designated as a notifiable disease on 20th February 2020.  Thereafter, a number of orders were made by the Government (or by the Minister for Health) which had the effect of interfering with the business of hotels, bars and restaurants and other premises open to the public.  In this case, the insured premises comprises a hotel with an inhouse restaurant and bar. The hotel was subject to three periods of restriction [1] as a consequence of orders made by the Government or the Minister for Health. The first period of restriction commenced on 15th March 2020 when the Government issued an instruction to public houses to close.  That period of restriction continued until 29th June 2020 (albeit that the extent of the restrictions were varied from time to time over the course of that period).  There was then a second period of restriction which commenced on 19th September 2020 and continued until 3rd December 2020 [2].  This was followed by a third period of restriction which commenced on 24th December 2020 [3] under an order made by the Minister for Health on 23rd December 2020. 

4.                  The plaintiff claimed that, in the lead up to each of these periods of restriction, there were one or more cases of COVID-19 at its premises and that those cases were causative of the relevant government restrictions.  However, in my principal judgment, I came to the conclusion that there was no evidence of any such cases at the hotel in the lead-up to either the first round of restrictions imposed in March 2020 or the second round of restrictions imposed in September 2020. On the other hand, I came to the conclusion that, in relation to the third period of closure, there were at least two cases of COVID-19 at the insured premises in the period prior to the making of the order on 23rd December 2020 imposing restrictions with effect from 24th December 2020.  In this context, it was an agreed fact that the hotel manager tested positive for COVID-19 on 23rd December 2020 (following a test on 22nd December 2020) and that he had not left the hotel building during the preceding fortnight.  I came to the conclusion that, having regard to the incubation period for COVID-19 (which is a three to five day period) the manager must have been infected, at the latest, by 19th December 2020 (i.e. three days before his test).  I also concluded that, in circumstances where the hotel manager did not leave the hotel premises in the fortnight before 23rd December 2020,  there must have been a second case of COVID-19 at the premises prior to the making of the restriction order on 23rd December 2020 and that this second case led to the infection of the manager.

5.                  For reasons which are explained in my principal judgment, I concluded that the restriction order made by the Minister for Health on 23rd December 2020 was caused not just by those cases of COVID-19 that were reported to the Minister at that time but also unreported or unknown cases of COVID-19.  Thus, for the purposes of the plaintiff's case, it did not matter that the Minister may have been unaware of the positive test for the manager on 23rd December 2020 (since that test would not have been reported by that time) or that the Minister was unaware of the case of COVID-19 which led to the manager's infection. Accordingly, I concluded that the plaintiff was entitled to recover under the policy in respect of the losses sustained by it as a consequence of the restrictions imposed by the order made on 23rd December 2020.  That conclusion disposed of the case brought by the plaintiff.  However, the defendant now wishes to explore the extent to which the judgment can be used to determine its liability to insureds in other circumstances.  In making this application, the defendant has very properly acknowledged that it is impossible to anticipate every potential scenario where an entitlement to cover might be said to arise. However, there are two specific matters on which the  defendant seeks further guidance from the Court.

The additional issues on which the defendant seeks rulings from the Court

6.                  In the first place, the defendant wishes to explore whether, for the purposes of causation, there is a cut-off date in the context of the three restriction orders in issue in these proceedings such that any cases of COVID-19 which occurred prior to that date could not be said to have caused the Minister to make those orders.  In other words, is there a date beyond which it becomes impossible for a policy holder to argue that a case of COVID-19 on an insured premises could be said to have caused the restriction orders in question?

7.                  The second issue (which also arises in the context of causation) relates to how far a policyholder can go to make a case that an infection, which is diagnosed or otherwise becomes apparent after the making of a restriction order, can be said to have occurred prior to the making of that order. This question arises against the backdrop of the uncontested evidence in this case that the incubation period for COVID-19 is between three and five days. It may also be relevant in this context that there was expert evidence to the effect that a person infected with COVID-19 may be infectious for up to 14 days.

The previous findings made in relation to causation

8.                  In order to understand how these issues arise, it is necessary to recall a number of the findings made in my principal judgment. In para. 222 and following paragraphs, I addressed the issue of causation in the context of the requirement in Extension 6 of the Allianz policy that the policyholder must prove not only that there was an occurrence of COVID-19 at the insured premises but also that the occurrence in question proximately caused the decision by the Minister or the Government (as the case might be) to impose the restrictions on the use of such premises.  As outlined in para. 224 of my principal judgment, it might appear, at first sight, to be counterintuitive to suggest that an undiagnosed case of COVID-19 could be said to be a proximate cause of a decision to restrict hotel or bar trade operations in the State.  However, on reviewing the very limited materials made available to the Court in connection with the making of the order, I came to the conclusion that, in making it, the Minister must have taken into account not only those cases of COVID-19 that had been reported at that time but also unknown cases of the disease.

9.                  Unlike the position in many other cases concerned with COVID-19 insurance claims, there were no agreed facts in relation to any advice that might have been given by the National Public Health Emergency Team ("NPHET") to the Government in advance of the decision made on 23rd December 2020 (which, in light of my findings of fact, was the only relevant closure order for the plaintiff's purposes). Nor was any evidence given at the trial which dealt with the issue. This created an obvious  problem for the plaintiff in terms of proof. Nonetheless, there was some valuable material available which assisted in understanding what prompted the Minister to introduce the restrictions which took effect on 24th December 2020.  The relevant order imposing those restrictions was the Health Act, 1947 (section 31A Temporary Restrictions) (COVID-19) (No. 9) (Amendment) (No. 2) Regulations 2020 (S.I. 695 of 2020). For convenience, I will refer to this order as "the Third Restriction Order" [4].  As identified in paragraph 229 of my principal judgment, there are a number of helpful recitals in the Third Restriction Order which assist in understanding what prompted the making of the order.  The recitals made clear, that in enacting the Third Restriction Order, the Minister for Health had regard to "the immediate exceptional and manifest risk posed to human life by the spread of COVID-19".  The recital also referred to the matters specified in s. 31A(2) of the Health Act, 1947 (as amended) which include the fact that there was, at that time, a national emergency of such character that there was an immediate and manifest risk to human life and public health which required extraordinary measures to be taken for the protection of such life and health.  The subsection also referred to the need to act expeditiously in order to prevent, limit, minimise or slow the spread of COVID-19.  In para. 230 of my principal judgment I observed that, as the recitals made clear, the Minister for Health must have formed the view that, as of 23rd December 2020, COVID-19 had been spreading and that the extent of its spread was such that there was an immediate, exceptional and manifest risk to human life and public health.

10.              In paragraph 231 of my principal judgment, I also referred to two relevant reports from the Health Protection Surveillance Centre ("HPSC") which were in evidence, namely the reports of 4th August 2020 and 23rd December 2020.  By comparing those reports, it was readily apparent why it would have been considered necessary in late December 2020 to introduce the significant restrictions on normal societal activities at that time.  While the August report showed numbers of  cases of COVID-19 at less than 100 per day in the period up to midnight on 2nd August 2020, the December  report showed a steep increase in the daily rate of confirmed cases over the course of December 2020 rising to close to 1,000 per day at the end of the period shown (up to midnight on 21st December 2020).

11.              The HPSC Reports dealt solely with the number of confirmed cases.  However, in paragraph 232 of the principal judgment, I highlighted that the expert evidence available to the Court established that it was well known that, in addition to the confirmed cases reported by the HPSC, there were also a substantial number of unconfirmed cases of COVID-19 such that the overall burden of COVID-19 in the community invariably exceeded the number of reported cases.  I therefore took the view that, in deciding to enact the Third Restriction Order, the Minister (who can be taken to have been fully informed of the characteristics of the disease which triggered the decision to introduce such extensive restrictions) must, of necessity, have had in mind not only the reported cases of COVID-19 but also the very substantial number of unconfirmed cases.  I also expressed the view that, in reaching a conclusion that there was an immediate, exceptional and manifest risk to public life and public health as a consequence of the spread of COVID-19, the Minister must be taken to have had in mind the true or full extent of the caseload that existed at that time (both known and unknown).  On that basis, I concluded, at para. 233 of the judgment, that each case of the disease (whether confirmed or undiagnosed or not yet reported) was capable of spreading the disease and must accordingly be taken to have been instrumental in the decision to impose the restrictions stipulated in the Third Restriction Order.  I observed that, while those restrictions were prophylactic in nature (being designed to reduce the burden of infection) it was the existing spread of infection in the community which made them necessary and which therefore caused the restrictions to be imposed.

12.              For all of those reasons, I came to the conclusion, in para. 234 of my principal judgment, that each occurrence of COVID-19 (whether reported or not) was instrumental in the decision to enact the Third Restriction Order.  Because of the infection of the hotel manager (whose infection must have occurred quite proximate to the decision to impose that order) it was unnecessary, for the purposes of my principal judgment, to consider what was the outer date limit of the infections that could be said to have caused the Minister to make the Third Restriction Order.

Is there a cut-off date in respect of COVID-19 infections which could be said to have caused the making of the Third Restriction Order? 

13.              However, although it did not arise for the purposes of my principal judgment, I am now asked by the defendant to consider whether there is there a cut-off date in respect of those COVID-19 infections which could be said to be causative of the Third Restriction Order.  Although the plaintiff is not directly affected by this issue, it has agreed to act as legitimus contradictor [5] for this purpose.

14.              For the purposes of the additional issues addressed in this judgment, the parties agreed that some further additional material could be placed before the Court over and above the material considered at the trial. This additional material (which the defendant argues assists in throwing light on this issue) consists of three reports from the HPSC dated respectively 2nd December 2020, 9th December 2020 and 16th December 2020.  It is important to note that all of these reports were provided in the period after the enactment of an order by the Minister for Health that expressly relaxed many of the restrictions which had been in place up to the end of November 2020. This was done in the run-up to Christmas 2020 and appears to have been intended to allow some level of socialisation traditional at that time of year. The order in question was the Health Act 1947 (section 31A - Temporary Restrictions) (COVID-19) (No. 9) Regulations 2020 (S.I. 560 of 2020) enacted on 30th November 2020. This order lifted, with effect from 1st December 2020, some of the restrictions which had applied before that date including some of the restrictions on the use of public houses and restaurants. As noted in para. 17 of my principal judgment, the Marlin Hotel reopened to the general public on 4th December 2020.

15.              In light of the making of the order of 30th November 2020, counsel for the defendant argued that there could be no reality to any argument by a policyholder that occurrences of COVID-19 at an insured premises prior to 1st December 2020 were causative of the restrictions imposed on 23rd December 2020.  That argument was not seriously disputed by the plaintiff.  I believe that this must be correct.  If the Minister was prepared to lift restrictions with effect from 1st December 2020, the Minister must have been satisfied at that stage that it was safe to do so notwithstanding the cases of COVID-19 reported at that time or any of the preceding cases of COVID-19 that may have occurred previously. The making of that order would seem to break any chain of causation between the incidents of COVID-19 before that date and any subsequent restriction order imposed (including the Third Restriction Order). This conclusion is reinforced by the fact that, as explained in more detail below, an order was subsequently made by the Minister for Health on 17th December 2020 which further relaxed the restrictions previously in place. In those circumstances, it is implausible to suggest that cases of COVID-19 which occurred prior to 1st December 2020 had any impact on the making of the Third Restriction Order.

The HPSC report of 2nd December 2020

16.              On the basis of the three additional HPSC reports, the defendant argues that there is, likewise, no basis to conclude that cases of COVID-19 in the periods covered by those three reports could be said to be causative of the Third Restriction Order.  In this context, counsel for the defendant drew attention, first, to the report of 2nd December 2020.  That report makes clear that it addresses confirmed COVID-19 cases notified to the HPSC from 18th November 2020 up to midnight on 1st December 2020.  It showed a total number of confirmed cases in that period of 4,033 and a national incidence of confirmed cases per 100,000 population of 84.69.  Counsel for the defendant highlighted the graph which appears as Figure 1 in that report which plots in graphic form the number of cases during that period and also plots the five day moving average  which is given as 275 cases.  Figure 1 also shows that the five day moving average was falling in the period between 18th November 2020 and 24th November 2020 and that it was more or less level in the period from 25th November 2020 to the closing point on the graph.  A similar picture emerged in respect of the 14 day cumulative incidence rate per 100,000 population.  As noted above, the figure for the 14 day period in question was 84.69.  The relevant graph showing the 14 day incidence rate over the entire period (Figure 3) shows that it was dropping over the course of the period.

The HPSC report of 9th December 2020

17.              The HPSC report of 9th December 2020 covers the period from 25th November 2020 up to midnight on 8th December 2020.  The total number of confirmed cases in that period was less than in the period covered in the preceding report.  It had dropped to 3,788 confirmed cases.  The cumulative incidence rate per 100,000 population had also dropped in the same period.  It was now 79.55 cases per 100,000 population.  Again, Figure 1, as plotted in that report, shows that the five day moving average was more or less level throughout the period at 286 cases (which is a very slight increase over that recorded in the previous report).  Figure 3 also shows that the 14 day cumulative incidence rate was dropping over the course of the period.

The HPSC report of 16th December 2020

18.              In the case of the report of 16th December 2020, this shows the total number of confirmed COVID-19 cases notified to the HPSC from 2nd December 2020 up to midnight on 15th December 2020.  This shows an increase (when compared to the period covered by the report of 9th December 2020) in the total number of confirmed cases which, for this period, amounted to 4,185 cases. The national incidence of confirmed cases per 100,000 population had also risen somewhat to 87.89.  Figure 1 to the report showed a five day moving average of 339 (which is more that the previously reported five day average).  Figure 1 shows a gradual rise in cases in the period from 9th December to 13th December.  Figure 3 (plotting the 14 day cumulative incidence rates per 100,000 population) also shows a slight increase over the course of the period.  However, the graph suggests that it was very gradual over the course of that 14 day period.

The further easing of restrictions with effect from 18th December 2020

19.              Notably, on 17th December 2020 (i.e. just one day after the latest HPSC report) new regulations were introduced by the Minister for Health which provided for the disapplication of a number of further restrictions over the Christmas period running from 18th December 2020 to 6th January 2021. This included the removal of the restriction on travel outside a person's county of residence during that period and the removal of the prohibition on events held in private dwellings. The restrictions on certain sporting events and live performances were also eased.  Counsel for the defendant argued that, in a similar way to the cases which occurred prior to 1st December 2020, there could be no reality to any suggestion that occurrences of COVID-19 at the insured premises prior to 17th December 2020 were causative of the restrictions imposed in the Third Restriction Order of 23rd December 2020.

What caused the enactment of the Third Restriction Order?

20.              Counsel for the defendant argued that it was plainly the subsequent HPSC report of 23rd  December 2020 which triggered the enactment of the Third Restriction Order. That report (which was part of the evidence in the hearing which led to my principal judgment) showed a significant increase in the total number of confirmed cases in the period from 9th December 2020 up to midnight on 22nd December 2020.  The total number of confirmed cases in that period was 7,297 which was a 74% increase over the (partly overlapping) period running from 2nd December 2020 to midnight on 15th December 2020.  The national incidence of confirmed cases per 100,000 population showed a sharp increase.  It now stood at 153.24.  Figure 1 to that report also showed a dramatic rise in the five-day moving average.  It had risen to 785 and the line plotted on the graph shows a very steep rise over the course of the period from 9th December 2020 to the end of that period.  This was more than double the figure for the five-day moving average given in the previous report in respect of the period running from 2nd  to 15th  December 2020. 

21.              In the report of 23rd  December 2020, Figure 1 depicts the curve for the five-day moving average. The curve shows a reasonably gradual rise in the period between 9th December and 15th December 2020 (which overlapped with the second week covered in the report of 16th December 2020) but thereafter it rose very sharply and steeply over the course of the period from 15th to 22nd December 2020.  The significant rise in cases is also apparent from Figure 3 to the same report.  Counsel for the defendant stressed that, while Figure 3 showed a relatively gradual rise between 9th and 15th December 2020, there was a notably greater increase in the 14 day cumulative incidence rate in the period between 15th and 22nd December 2020.  On the basis of the story graphically told by Figures 1 and 3, it was submitted by counsel for the defendant that only cases in that seven day period (i.e. the period between 15th and 22nd December) could be said to be causative of the Third Restriction Order. Counsel also relied on the fact that the seven day period running from 9th December 2020 to midnight on 15th December 2020 had already been the subject of the previous report of 16th December and that, given the order made by the Minister on 17th December, the state of the pandemic in that week had plainly caused no alarm.

22.              If the HPSC reports up to 16th December 2020 were read on their own, I would have no difficulty in accepting that it would not be plausible to suggest that COVID-19 cases reported by the HPSC in those reports (and the associated unreported cases for the same time periods) were causative of the decision by the Minister for Health to impose the Third Restriction Order. That would cover all of the COVID-19 cases in the period between 18th November 2020 (which is the start date for the purposes of the HPSC report of 2nd December 2020) up to midnight on 15th December 2020 (which is the end date for the purposes of the HPSC report of 16th December 2020). In circumstances where the Minister had been prepared to ease restrictions on 17th December 2020, it would make no sense to suggest that the HPSC reports up to that date were of concern to the Minister. Given that the Minister was prepared to ease restrictions on 17th December 2020, this strongly suggests that the cases disclosed in the HPSC reports of 2nd, 9th and 16th December were not regarded by him as sufficient to merit the previously imposed restrictions. 

23.              On the other hand, it has to be kept in mind that, when the HPSC came to report on 23rd December 2020, the report addressed not only the cases notified after midnight on 15th December 2020 (which was the end date of the previous report) but also those cases (which were covered by the previous report) from 9th December 2020 up to midnight on 15th December 2020.  This was consistent with the practice adopted by the HPSC over the course of all of the reports which were admitted in evidence.  While the reports were produced on a weekly basis, each of the reports addressed a 14 day period. The defendant's expert, Dr. Roe, also used 14 day periods as a metric. In addition, although the relevant NPHET letter to the Minister which preceded the making of the Third Restriction Order was not put in evidence, it appears from an earlier NPHET letter of 20th August 2020 to the Minister (which is in evidence [6]) that NPHET also gave advice based on a 14 day period. In that letter, reference is made by the acting Chief Medical Officer to the profile and pattern of COVID-19 and this appears to be derived, at least in part, from observations made of the preceding 14 day period. There are five references in the letter to the 14 day incidence rate. While that is not the only metric that is used by NPHET in that letter, it is clear from the letter that it is an important metric. In addition, the letter used a 14 day period to describe the demographic and location trends. It set out the percentage of new cases within the under 45 age bracket, the median age for cases notified in the preceding 14 days and it identified that 12 counties had a incidence rates higher than 15 per 100,000 population "in the past 14 days". Having regard to the pattern of the HPSC reports, the approach taken by Dr. Roe and the approach taken by NPHET, it seems to me to be clear that the practice of the relevant public health advisers in Ireland was to consider trends in the progress of the COVID-19 pandemic over 14 day time periods.

24.              In the context of the defendant's arguments that only a 7 day period is relevant, it is important to keep in mind that, consistent with the usual pattern of HPSC reports, the report delivered on 23rd December 2020 is in respect of a 14 day period. Moreover, looked at as a whole, that 14 day period shows a significantly worse picture, overall, from that presented in the report dated 16th December 2020.  In the later report, the Minister for Health was presented with a complete picture for the 14 day period which showed in Figure 1 the relevant curve depicting the five day moving average over the whole of that 14 day period.  Similarly, Figure 3 showed the curve depicting the 14 day cumulative incidence rate for the entire 14 day period.  While it is true to say that both curves rise significantly more sharply after 15th December 2020 than before, both the five day moving average curve shown in Figure 1 and the curve plotted in Figure 3 show an increase in cases on a daily basis over the whole of that 14 day period.  In those circumstances, I find it very difficult to see how it could be said that the Minister, in deciding to enact the Third Restriction Order, excluded from his consideration those cases which occurred between 9th December 2020 and midnight on the 15th December 2020. While the Minister may not have been alarmed by the rise shown over that period when presented with the report dated 16th December 2020, the Minister, at that point, had no information as to how the curve was likely to develop in the seven day period beginning immediately after midnight on 15th December. It was only when he was presented with the later report on 23rd December 2020 that he could see how the curve actually developed after midnight on 15th December 2020. On an overall basis, although both curves overlapped, the curve for the 14 day period beginning at midnight on 9th December 2020 showed a much more concerning trend over the whole of a 14 day period than had been apparent from the curve shown for the 14 day period commencing at midnight on 2nd December 2020. Critically, both the five day moving average curve and the 14 day cumulative incidence rate curve showed a progressive upward movement over the entire 14 day period commencing at midnight on 15th December 2020. Given the practice to look at trends over 14 days, I believe it is very clear that, in deciding to take action on 23rd December 2024, the Minister for Health was prompted to do so by a consideration of  the burden of COVID-19 cases over the entire 14 day period covered by the HPSC report of the same date.

25.              In the circumstances, I am of the view that any cases of COVID-19 shown to be present on the premises of an insured in the period between midnight on 9th December 2020 and 22nd December 2020 all form part of the cases which caused the Minister to enact the Third Restriction Order. However, I can see no basis on which it could be suggested that the enactment of the Third Restriction Order was caused by cases of COVID-19 which occurred prior to midnight 9th December 2020. This seems to me to follow from the decision of the Minister on 17th December 2020 to further relax restrictions. At the time the Minister made that decision, he had available to him the HPSC reports of 2nd, 9th and 16th December 2020 which gave him an assessment of the state of the pandemic over the course of almost a month running from midnight on 18th November 2020  up to midnight on 15th December 2020. Save for the final week of that period, he had a complete and final picture of all of the reported cases of COVID-19 and the associated  trend of the disease over each individual 14 day period falling between those dates. As he was satisfied to ease restrictions, the Minister cannot have been concerned by the burden of the disease in the community during that time. It follows that, with the exception of the cases in the final week beginning at midnight on 9th December 2020, none of the cases of COVID-19 which arose up to that point, could be said to have caused the enactment of the Third Restriction Order. In contrast, for the reasons I have sought to explain in para. 24 above, a different picture emerged when the Minister received the HPSC report of 23rd December 2020 which showed an increasing trend of infection over the 14 day period commencing on 9th December 2020. It seems to me to be clear that this is what caused the Minister to reverse track and to enact the Third Restriction Order.

Can a cut-off date be imposed in respect of the earlier restriction orders made in March and September 2020?

26.              Counsel for the defendant also sought to argue that there should be a cut-off date in respect of the restriction orders made in March 2020 and September 2020.  However, in the course of the hearing in relation to these issues, I indicated that there was insufficient material before the Court in these proceedings to reach any conclusion in relation to the periods leading up to those orders.  In those circumstances, counsel for the defendant did not press the case in relation to anything other than the period leading up to the making of the Third Restriction Order. 

27.              That said, there is no reason why the defendant, in dealing with claims from its policyholders, cannot apply the guidance available from judgments given in other cases. In this context, it is clear from the decision in Hyper Trust Ltd. v. FBD Insurance plc [2021] IEHC 78, at p. 144, that the first restriction order (namely the instruction given by the Government on 15th March 2020 to close all public houses) was caused by each case of COVID-19 which had occurred in the State in advance of that date. No issue was raised in that case about any cases of COVID-19 that may have arisen before the date when it was first declared to be a notifiable disease. Unlike the Allianz policy here, the relevant extension in the FBD policy spoke solely of outbreaks of "contagious or infectious diseases" There was no requirement that the disease be notifiable. However, more recently, this issue has been considered by the Court of Appeal of England and Wales in London International Exhibition Centre plc v Allianz Insurance plc [2024] EWCA Civ 1026 ("the Excel case"). That judgment addresses the issue as to whether a claim could be made under the Allianz policy in respect of a case of COVID-19 which occurred prior to the date when it was designated as a notifiable disease.

28.              In the Excel case, the Court of Appeal addressed a number of different claims by policyholders insured by a range of insurers. A variety of different clauses were considered by the Court. For present purposes, the equivalent clause is that considered in the context of the Kaizen claim but it is worth recording what was said by the Court in respect both of that clause and the clause (in somewhat different terms) in issue in the Hairlab claim. The most relevant passages for present purposes are at paras. 96 - 98 of the judgment:

"96.  ... It is a fundamental tenet of insurance law that cover responds to insured perils and there is no cover unless an insured peril has been made out. In the Hairlab policy the insured peril is 'any occurrence of a Notifiable disease at the premises'. This is what has been called pure disease cover, with no part of the peril requiring closure or restrictions by an authority etc. 

97.  An 'occurrence', which is part of the insured peril, is something which happens at a particular time, at a particular place, in a particular way, as also confirmed in FCA v Arch at [67]. In the Hairlab policy the occurrence must be of a notifiable disease at the premises. That requirement is not fulfilled if a person is present at the premises with what is not then a notifiable disease. Nor is it fulfilled if they have a notifiable disease at some later stage when they are not at the premises. The presence of a person with Covid‑19 at the premises of the Hairlab policyholders before 6.15 on 5th March 2020 is simply not an occurrence of a notifiable disease at the premises; it is the occurrence of a non‑notifiable disease at the premises. Thereafter, when Covid‑19 becomes notifiable there is no occurrence of a notifiable disease at the premises because the person with the disease is not at the premises. If all a policyholder could point to was such a person, it would fail to establish the relevant insured peril.

98.  The analysis is the same for the Kaizen policyholders, although their policy has different wording which requires separate consideration. It is a hybrid clause in which the insured peril operates in two stages: The first is 'a Notifiable Human disease occurring at the premises'; the second is 'Closure or restrictions placed on the Premises as the result of [that occurrence]'. So it was argued on behalf of the Kaizen policyholders that the disease need only be notifiable when the insured peril is complete, which is the date when the closure or restriction is imposed. However the argument involves a failure correctly to identify the first stage of the insured peril. It is not the occurrence of a disease which is not then notifiable. As with the Hairlab wording, it requires a notifiable disease to occur at the premises: It is the presence of the disease at the premises which constitutes the relevant occurrence and it is not all diseases which qualify, but only notifiable diseases. If the only presence of Covid‑19 to which a Kaizen policyholder can point is the presence at the premises of a person with Covid‑19 when it was not notifiable, it cannot establish the relevant facts."

29.              In circumstances where there is no material before the Court in these proceedings in relation to that issue, I do not believe that it would be appropriate for me to make any definitive ruling in relation to the issue considered in the Excel case. However, the decision is plainly logical and rational and should be of considerable assistance to both the defendant and policyholders in so far as there may be any claims arising from cases of COVID-19 which are said to have occurred prior to 20th February 2020 when COVID-19 was declared to be a notifiable disease in Ireland. In that context, I recall that, according to the evidence available in the Hyper Trust case, the first case of COVID-19 reported in Ireland did not arise until 29th February 2020. It therefore seems highly unlikely that there are any such claims.

30.               Insofar as the second restriction order is concerned, I simply do not have sufficient material available to me to make any attempt to address the position of COVID-19 in the period immediately prior to the restriction order made on 19th September 2020.  It would be necessary to carefully review each of the orders made by the Minister for Health in the period leading up to 19th September 2020 in conjunction with the relevant HPSC reports which preceded the making of each relevant statutory instrument and, if available, to consider the relevant correspondence from NPHET to the Minister during the same period.  Those materials were not made available to me for the purposes of this judgment.

To what extent can cases of COVID-19 which emerged after the Third Restriction Order be said to have caused the enactment of that Order?

31.              The second issue raised by the defendant relates to cases of COVID-19 which arise on an insured premises subsequent to the date of a restriction order. At first sight, it might appear to be a contradiction in terms to suggest that an order of this kind could be prompted by a case of COVID-19 which only became evident after the date of the order. However, it is necessary to keep two matters in mind in this context. First, it is essential to recall that I have previously held that, in enacting the Third Restriction Order, the Minister for Health was responding not just to reported or known cases of COVID-19 cases but also to the unknown and, therefore, unreported cases. Second, it is also important to bear in mind that, on the evidence before the Court at the main trial, the experts were agreed that the usual incubation period for COVID-19 was between three and five days. On that basis, it would follow, for example, that a person who first displayed symptoms of COVID-19 two days after the enactment of the Third Restriction Order, is likely to have first been infected prior to the making of the Order. While it might be impossible to identify precisely the date when the infection occurred, it would, on the evidence, be possible to conclude that the infection occurred between one and three days prior to the making of the Restriction Order.  If the infected person in question had been on the insured premises in that one to three day period, it would seem to me that, on the balance of probabilities, there was an occurrence of COVID-19 at the premises during the same period.  Once that period predates the making of the relevant restriction order, any such case (even though unknown to the Government or the Minister for Health) would, on the same logic as outlined in my principal judgment, form part of the body of COVID-19 cases which caused the making of the Restriction Order in question.

32.              In the context of this issue, one could very easily be distracted by complex questions of causation.  For example, if a person first displayed symptoms on the second day after the making of a restriction order, but was only present for an hour on the insured premises three days prior to the restriction order, an issue might arise as to whether it could be said, on the balance of probabilities, that the person in question had been suffering from COVID-19  while on the premises.  Given that the incubation period varies between two and five days, an argument might be made that one could not conclude, as a matter of probability, that the relevant person had been infected at the moment he or she was present in the insured premises three days prior to the making of the restriction order.  However, it seems to me that this would place an impossible burden on the insured.  I am very conscious in this regard that, as counsel for the defendant stressed in the course of his submissions on this issue, the defendant is seeking to apply a clear and simple approach.  This is consistent with observations made by Lord Hamblen and Lord Leggatt in FCA v Arch Insurance [2021] AC 649 at para. 206 of their judgment where they stressed the need to adopt a clear and simple approach which accords with the desire for certainty.  Similar observations were made by the Court of Appeal of England and Wales in the Excel case at para. 72 of the judgment where the Court said: -

"On the assumption that there were occurrences of COVID-19 at each of the policyholders' premises, those occurrences together with all other cases of COVID-19 in the country were a cause of the closure of those premises.  In ordering the national lockdown, therefore, the government was responding to the fact of disease having occurred at each of these premises.  This is an approach which is clear and simple to apply, in contrast with an interpretation which would require the policyholder to establish precisely what knowledge (or belief) the relevant authority had as to the existence of a disease at any given location.  In our judgment it reflects the way in which the words of the contract would be understood by a reasonable person and in particular the ordinary policyholder taking out this kind of policy".

33.              While those observations were made in relation to a different issue, it seems to me that the rationale underlying those observations can be applied equally here. It is necessary to take a simple and straightforward approach and one which avoids tying a policyholder up in knots in relation to issues of proof.  Given the evidence available at the trial on both sides as to the relevant incubation period, it seems to me that a policyholder should be able to look to a period of up to five days following the making of a closure order to establish whether there were any occurrences of COVID-19 on the insured premises prior to the making of the restriction order.  In other words, if a policyholder can show (a) that a person was on the insured premises on the day a restriction order was made; and (b) that person was later diagnosed as suffering from COVID-19 within five days after the making of the restriction order or was otherwise shown to be suffering from COVID-19 within that five day period, that occurrence of COVID-19 should be accepted as having occurred prior to the making of the restriction order such that it can be considered to be part of the cohort of cases of COVID-19 which led to the making of the restriction order in question.

34.              The same principle should also apply where an infected person is shown to have been on the insured premises 24 hours before the making of the restriction order. In that event, the relevant post-order period to consider would be up to four days. In turn, if the infected person was on the insured premises 48 hours before the restriction order, the relevant post-order period would be up to three days. The post-order period would be reduced to two days if it transpired that the infected person was last on the insured premises 72 hours before the making of the restriction order. Similarly, it would be reduced to one day, if the infected person was last on the insured premises 96 hours before the making of the order.

35.              It is important that I should clarify an aspect of my principal judgment in this context. In the course of his submissions on behalf of the defendant, counsel queried whether, on the basis of para. 181 of my principal judgment, I had intended to confine post-restriction order instances of COVID-19 to a three day period subsequent to the making of a restriction order.  I can well understand why that issue was raised in light of what I said in para. 181 of my principal judgment where I dealt with the position of the two staff members who tested positive for COVID-19, one on 27th December 2020 and the other on the following day.  At paragraph 181 of my principal judgment I said: -

"As agreed between the parties, there were two other staff members at the hotel who tested positive for COVID-19, one on 27th and the other on 28th December 2020. Both of those dates fell more than three days after the end of period 3. Having regard to the medical evidence about the duration of the incubation period, it cannot be said that those infections occurred, as a matter of probability, before the decision of the Government to enact the Amendment Regulations. Moreover, there is no evidence about the movements of the staff members concerned. It is not an agreed fact that they were confined to the hotel prior to their tests. In those circumstances, I do not believe that there is a sufficient basis to conclude, on the balance of probabilities, that they must have been infected with COVID-19 at the hotel during period 3." [7]

36.              I am sorry that this paragraph was not as clearly expressed as it should have been.  However, the fact that a defendant has returned to court seeking further guidance on the two issues identified in paras. 6 and 7 above gives me an opportunity to address the lack of clarity in para. 181 of my principal judgment. In that context, I should first draw attention to the obiter nature of the observations made in para. 181. In light of the fact that I had already concluded that the hotel manager together with one other unidentified person had contracted COVID-19 in the period prior to the making of the Third Restriction Order, it was, strictly speaking, unnecessary for me to say anything at all about the position of these two staff members. On reflection, I believe it was wrong for me to suggest that they should be excluded from consideration because their infections were only diagnosed more than three days after the Third Restriction Order was made.  In fact, both infections occurred within a five day period from the making of that order and therefore could potentially, depending on the circumstances, have been relevant for the purposes of determining whether the plaintiff was entitled to cover in respect of the restrictions imposed by the Third Restriction Order. 

37.              I also believe that it was inaccurate to suggest that it was relevant that there was no evidence that these two staff members were confined to the hotel for the period prior to their tests.  Crucially, there was no evidence that they were present at the hotel on the day the Third Restriction Order was made (in the case of the second staff member who tested positive five days after the order was made) or in the four day period prior to the making of the Order (in the case of the first staff member who tested positive four days after the making of the Order).  In those circumstances, there was no sufficient basis to conclude, on the balance of probabilities, that they must have been infected with COVID-19 while at the hotel during the relevant period prior to the making of the Third Restriction Order.  That is the finding that I should have made in para. 181 of my principal judgment.

Clarification to para. 178 of my principal judgment

38.              There is one other aspect of my principal judgment which requires clarification.  This relates to what I said in para. 178 of the judgment.  In that paragraph, I drew attention to the fact that, on the evidence before the court, the incubation period varies between three and five days but that a person could be infectious for up to 14 days before diagnosis with COVID-19 (although Dr. Roe's evidence was that a patient with COVID-19 could remain infectious for a period of 12.8 days).  At the end of para. 178, I said: -

"Dr. Roe identified in his report that a patient with COVID-19 could remain infectious for a period of 12.8 days. That means that a patient might still be infectious on Day 13. It would seem to follow that such a patient would also test positive if still infectious on Day 13. Dr. Roe also referred to technical guidance published by the WHO in June 2020 which advised an isolation period of 14 days for confirmed cases. That was why he looked at rolling periods of 14 days. A 14-day period was also accepted by Professor Horgan as the period within which the manager could have been infected. Thus, it is reasonable to conclude that, at the outside, the hotel manager must have been infected within a period of between 3 and 14 days prior to 22nd December 2020. But, it seems to me to be more likely that the infection occurred within the earlier part of that period. The 14-day period mentioned by Professor Horgan (and reflected in the WHO guidance) appears to be, very much, the outer limit."

39.              Looking, again, at what I said in that passage, I did not express myself clearly when  I suggested that it was more likely that the manager's infection occurred within the "earlier part" of the 3 to 14 day period mentioned in the penultimate sentence.  What I should have said was that it was more likely that the infection occurred within the three to five day period (which was the usual incubation period) rather than in the earlier part of that period.  As I observed in the last sentence in that passage, the 14 day period mentioned by Professor Horgan (who, with Dr. Roe gave evidence on behalf of the defendant) appear to me to be very much at the outer limit of the period during which a person might be infectious with COVID-19. However, the fact that the period during which a person may be infectious with COVID-19 appears to me to give rise to one final issue which I ought, at least, to identify in this judgment namely whether there is scope for a claim to be made in respect of persons first diagnosed with COVID-19 more than five days after the making of a restriction order.

Is there scope for a claim to be made in respect of persons first diagnosed more than 5 days after the making of a restriction order?

40.              For the reasons discussed in paras. 31 to 34 above, I am of opinion that a valid claim might be made in respect of persons who fall within the categories identified in paras. 33 and 34. Those cases arise in light of the usual incubation period for COVID-19 which means that cases of the disease may occur before it can be diagnosed. As a consequence, it may be possible for a policyholder to show that a case diagnosed after a restriction order has been made has, in fact, occurred prior to the making of the order. But that begs the question whether it might be possible for a policyholder to make a claim in respect of a person who is shown to have been diagnosed with COVID-19 at a later point than five days after the making of a restriction order. There is one obvious example namely where it takes some time for a test result to be delivered. For example, it was sometimes the case that the results of PCR testing were subject to delays. In such event, one would obviously take the date of the test rather than the date of the result as the relevant date for the purposes of this exercise.

41.              There is a less obvious answer in other cases. The most that can be said, as a matter of principle, is that, because of the possibility that some people may be infectious for up to 14 days, one could not rule out the potential for a case to be made based on that longer period. Consider, for example, a diagnosis of a COVID-19 in a person who was present on the insured premises (say) one day before the making of a restriction order but was not diagnosed until (say) 13 days after the making of the order. Taking that hypothetical example, suppose the person was displaying symptoms of COVID-19 during the whole of the 13 day period after the making of the restriction order but, because of scarcity of available testing at the time, was not tested until the last day of that period which resulted in a positive diagnosis. It might well be that in such circumstances, a claim could be made. But the policyholder would need to substantiate the claim by appropriate evidence of the existence of symptoms pointing to a COVID-19 infection. Given the evidence about the usual incubation period, a test result on Day 13 would plainly not be sufficient on its own.

The order to be made

42.              In light of the matters discussed above, it seems to me that, in addition to the orders contemplated in my principal judgment, declarations should be made to the following effect:

(a)   A declaration reflecting the finding made by me in para. 25 above; and

(b)   A declaration reflecting the findings made by me in paras. 33 and 34 above.

43.              I do not think that there is any need to make formal orders in relation to the balance of the matters addressed in this judgment but, if the parties wish me to do so, I will consider anything they wish to say. I will leave it to the parties to discuss the precise form of the declarations to be made but I will direct the parties to submit an agreed form of words to the Commercial Court Registrar by email within 28 days from the date of delivery of this judgment following which I will, if satisfied with the form of orders proposed, make the necessary orders to give effect to this judgment. If the parties are unable to agree on the form of the declarations to be made, their respective suggestions as to the form of the declarations and the correspondence between them should be submitted by them to the Registrar within the same period following which I will myself determine the terms of the orders to be made.

44.              As I understand it, the parties have reached an agreement in relation to costs such that no order is required from the Court in relation to that issue.



[1] These periods of restriction should not be confused with Periods 1 to 3 addressed in my principal judgment. Periods 1 to 3 were concerned with the situation in the lead up to the making of the three restriction orders and were addressed in the evidence of an infections diseases expert, Professor Mallon, who was called as a witness by the plaintiff.

[2] Again, the extent of the restrictions varied from time to time but those variations are not immediately relevant.

[3] The end date of that period is not relevant for present purposes.

[4] While this is a convenient way to describe the order for the purposes of this judgment, it should be noted that there were, in fact, a great many more statutory instruments made prior to the making of this Order.

[5] i.e. to argue against the proposition advanced by the defendant.

[6] See the discussion with counsel on Day 5 at p. 75

[7] It should be noted that period 3 was one of the three periods addressed by Prof. Mallon in his evidence. It related to the period leading up to the making of the Third Restriction Order.


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