Brighton and Hove Albion is one of seven Premier League football clubs bringing claims against their insurers totalling almost £100 million over losses that they allegedly suffered during the coronavirus pandemic.
The other top-flight teams tackling their insurers in a High Court fixture are Arsenal, Liverpool, Tottenham Hotspur, Aston Villa, West Ham and Crystal Palace.
They are seeking bigger payouts under their insurance policies because some games were suspended games and others played behind closed doors during the covid pandemic.
Insurers have already made interim payments of £2.5 million to each club but are fighting the push for greater sums.
Their dispute centred around the scope and limits of business interruption insurance contracts, a judge was told.
Leicester City, who were relegated to the Championship last season, are also involved in the early-stage legal action being brought against insurers Allianz, Aviva, CNA, Liberty Mutual, MS Amlin and Zurich.
A brief preliminary hearing before Judge Sir Richard Jacobs, known as Mr Justice Jacobs, over the linked legal challenges was held in London today Thursday (12 October).
The hearing was scheduled before a trial expected to last one to two weeks at a later date.
The judge disclosed that he was an Arsenal season ticket holder but said that he did not think that it would affect his ability to hear the case.
Barrister Andrew Green submitted written arguments on behalf of the football clubs that are bringing their claims through a number of commercial entities.
They said that they had “suffered significant losses caused by interruption or interference to their businesses as a result of decisions taken by the football authorities and government in response to covid-19”.
He said that the claims, which were issued in May 2022, were for “loss of revenue” and “the costs of continuing to operate”.
They related to “lost ticket revenue as a result of the suspension of professional football matches or the playing of those matches ‘behind closed doors’”.
Mr Green said that clubs had also claimed for “loss of revenue suffered as a result of government measures restricting non-matchday retail and hospitality as well as loss of revenue from events at stadiums, eg, concerts, not taking place as a result of the UK government’s ban on mass gatherings”.
The barrister said that insurers were wrong to argue that the alleged losses should be grouped together under a “single occurrence” of government decisions to stop support for mass gatherings on Monday 16 March 2020 or to impose the first lockdown on Monday 23 March 2020.
Alistair Schaff, for the insurers, said in written arguments that the total value of all claims on figures provided so far was £98,666,697.
He said that each club’s insurance policy limited claims in relation to “notifiable diseases” to £2.5 million for “any one single business interruption loss”. This entitled them to one payment over the decisions taken in March 2020.
But the clubs have attributed their losses to 22 decisions by the government and footballing authorities, claiming that they were owed multiple payouts, Mr Schaff added.
The barrister said that an issue in the case was how the clubs’ losses in the 2019-20 and 2020-21 seasons were linked to decisions by the authorities.
This included whether some later losses were “the causative run-off of the original first wave lockdown cases/measures” or were the result of a “second wave” of cases on or around Wednesday 9 September 2020 when insurance contracts had expired.
The principles will be the focus of a first-stage trial over the claims, with the question of how much money clubs may be entitled to left until a second future trial.
The legal proceedings come in the wake of a 2021 Supreme Court ruling in a landmark £1.2 billion legal battle over the ability of businesses to claim on insurance for coronavirus-related disruption.
The UK’s highest court “substantially allowed” an appeal brought by the Financial Conduct Authority in a test case said potentially to affect around 370,000 businesses over the wording of business interruption insurance policies.
Some insurers had argued that policies did not cover the covid-19 pandemic, but the city watchdog said that the Supreme Court ruling “decisively removes many of the roadblocks to claims by policyholders”.
