THE MANAGING DIRECTOR of the Dublin venue Lemon and Duke has told the High Court that he was given direct assurances from insurer FBD that its policy covered losses caused by Covid-19.

Noel Anderson, who is also a vice chairperson of the Licenced Vintners Association, told the court that he specifically switched the company’s insurer to FBD in early March of this year after he became concerned about the virus.

Despite being initially being relieved to get insurance which he thought would cover Covid-19, Anderson said he was left “outraged” after FBD informed him in April that the policy did not cover business losses caused by the pandemic.

He was giving evidence before Mr Justice Denis McDonald in the second week of test cases brought by four pubs arising out of FBD’s refusal to indemnify them for the disruption to their businesses due to Covid-19.

In reply to his counsel Michael Cush SC, Anderson said he first became concerned about the impact of Covid-19 in February.

He said others believed he was overreacting and “stone mad”, telling him that there was “a million to one chance the pubs would be closed”.

But he claimed that people “win the lotto at big odds” and made enquiries to see if the premises’ previous insurance policy would cover losses in the event of business being closed due to the spread of the virus.

When he discovered the previous policy did not cover Covid-19, Anderson said another publican told him that FBD’s policy appeared to provide coverage for the pandemic, which led him to contact the insurer.

Anderson, whose partners in the venue include Irish rugby players Sean O’Brien, brothers Dave and Rob Kearney, and Jamie Heaslip, said he spoke to FBD representatives in early March and was the insurer was “covering coronavirus” for pubs.

He explained that he was clear that he wanted cover wages, losses and rent if a lockdown occurred, and claimed FBD were under “no misapprehension” as to what he was seeking.

‘Sleepless nights’

After receiving assurances that the policy covered business disruption caused by Covid-19, Anderson moved the venue’s insurance to FBD, which he said was a relief after he had suffered “sleepless nights”.

He claimed that the policy in relation to the Lemon and Duke, which is currently trading as a restaurant only, covered losses up to €3.2m.

The Government later decided to close the pubs on 15 March.

A subsequent meeting between representatives of the LVA with senior FBD staff, including its CEO Fiona Muldoon, took place two days later on St Patrick’s Day.

Anderson told the court that following that meeting, he believed that FBD would “renege on their agreement to provide publicans with business interruption cover”.

In April, he said he was formally told by FBD that it would not provide coverage for the bar. He told the court that he was astonished by this, and that he felt the insurer’s attitude was “disingenuous, and completely dishonourable”.

Direct questions

Under cross examination from Remy Farrell SC for FBD, Anderson said that getting assurances that the venue’s insurance policy covered any closure arising out of Covid-19 was always to fore of his mind when he discussed becoming a customer of FBD.

Anderson said that he had asked “very direct questions” and sought “very direct answers” from FBD’s representatives over its Covid-19 coverage.

“I just want what is rightfully owed” he added.

Also giving evidence was Christopher Kelly, whose group of companies owns 11 pubs and employs 300 people, the majority of whom he said were laid off due to the pandemic.

In reply to his counsel James Doherty SC, Kelly said his businesses had over many years paid FBD €3m for insurance, and had only made claims of approximately €300,000.

He said he had a good relationship with the insurer, and had declined to switch insurers because other policies did not cover scenarios including the outbreak of disease.

Kelly told the court that as far as he was concerned, the words contained in the policy meant that his businesses were covered for the losses caused by the impact of Covid-19.

As all the criteria had been met, he said that FBD should have paid out.

“We should not have to be here today” he said.

He also spoke of his concerns for his employees within the group, adding that he had a grown employee with young children come to him “in tears” over fears they could not pay their mortgage.

Breach of contract

Actions against FBD have been taken by Dublin bars Aberken, trading as Sinnotts Bar, Hyper Trust Ltd, trading as The Leopardstown Inn, and Inn on Hibernian Way Ltd trading as Lemon and Duke.

A fourth action is being taken by Leinster Overview Concepts Ltd, which trades as Sean’s Bar, in Athlone, Co Westmeath.

That company claims that insurance policies taken out with FBD specify that it is entitled to have consequential losses covered by what it claims is an insurable risk.

The company also claims that the insurer is in breach of contract.

The publicans claim the insurance policies taken out with FBD have a clause that states the pub owners will be indemnified if their premises are closed by order of authorities if there are “outbreaks of contagious or infectious diseases on the premises or within 25 miles of same”.

FBD disputes that claim and says the closures did not occur as a result of an outbreak of disease at the premises or areas where the pubs are located.

The hearing continues.

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