Illinois Appellate Court, Second District Rules For Insurer In Covid-19 Business Interruption Case – Joins Unanimous Appellate Precedent Nationwide Finding No Coverage For Covid-19 BI Claims
Sweet Berry Café, Inc. v. Society Insurance, Inc., 2022 IL App (2d) 210088
¶ 1 In this insurance coverage case, plaintiff, Sweet Berry Café, Inc. (Café), sought a declaration that its commercial property insurance policy with defendant, Society Insurance, Inc. (Society), covered business income losses it suffered due to the COVID-19 pandemic and the Governor’s executive orders, which restricted in-person dining, but not carryout or delivery services, at restaurants and similar establishments. The trial court entered judgment on the pleadings (735 ILCS 5/615(e) (West 2020)) in Society’s favor. Café appeals, arguing that (1) the policy’s coverage under the “Business Income” and “Extra Expense” provisions for “direct physical loss of or damage to Covered Property” includes losses due to the pandemic and the orders and (2) the “Ordinance or Law” exclusion does not preclude coverage, because it applies in limited situations and, in any event, proclamations or executive orders are neither laws nor ordinances. We hold that neither the presence of the virus at Café’s premises nor the pandemic-triggered executive orders that barred in-person dining at restaurants constitute “direct physical loss of or damage to” Café’s property. Given that we conclude that there was no coverage, we need not reach Café’s argument concerning the ordinance or law exclusion. Affirmed.