High Court: FSPO decision regarding Covid-19 business interruption complaint set aside for ‘serious and significant’ errors

High Court: FSPO decision regarding Covid-19 business interruption complaint set aside for 'serious and significant' errors

The High Court has set aside a decision by the Financial Services and Pensions Ombudsman (FSPO) regarding a complaint against Chubb European Group SE over its handling of a business interruption claim. It was held that the decision was vitiated by “serious and significant” error by the FSPO in relation to his interpretation of the relevant insurance policy.

Delivering judgment in the case, Mr Justice Garrett Simons held that Chubb was not precluded from bringing an appeal against the FSPO decision despite the fact that the overall outcome was not adverse to Chubb. It was held that there were a number of findings that were potentially prejudicial to Chubb and, accordingly, there was an entitlement to appeal.

Further, it was said that the FSPO’s decision was deficient insofar as conclusions were reached on policy interpretation which did not accord with well-established legal principles and the FSPO failed to properly consider the submissions made by Chubb.


The dispute arose from a complaint to the FSPO by an insured company which was unsatisfied with Chubb’s handling of a business interruption claim during the Covid-19 pandemic. Chubb’s insurance policy contained an extension that provided cover for several events, including subclause (b) “the discovery of any organism likely to result in the occurrence of a Notifiable Disease at the Premises”. The FSPO also considered other aspects of the policy.

One of the principle issues which the FSPO was required to determine was whether the complainant was entitled to recover under subclause (b). In turn, this involved considering whether the insured premises has been restricted following the intervention of a public body and whether the insured was exempt from restrictions due to being an essential service.

Although the FSPO accepted that the insured was an essential service and therefore entitled to remain open, he concluded that the claim was not excluded under the policy. In reaching this decision, it was implied that the subjective views of the insured were relevant to the issue. As such, it was determined that “essential service” businesses could still meet the qualifying thresholds under the insurance policy despite not being restricted.

A second aspect of the decision related to the concept of a “notifiable disease”. It was determined that an exclusion of SARS from the list of notifiable diseases did not apply to Covid-19 (being SARS-CoV-2). Further, the FSPO also decided that the notifiable disease being found “at the premises” was “intended only in respect of the likelihood of the occurrence of the notifiable disease and not the discovery of the particular organism”.

Notwithstanding that the outcome was ultimately not adverse to Chubb, it took the view that the above interpretations of the policy were adverse to its interests. Accordingly, Chubb brought an appeal against the findings of the FSPO.

At the hearing, the FSPO argued that an appeal was limited to decisions which were adverse to a party. Since Chubb had not been subjected to an adverse outcome, it was said that it could not appeal the findings.

High Court

Mr Justice Simons began by considering the jurisdictional issue on whether Chubb could appeal the decision. The court considered section 60(3) of the FSPO Act 2017 and held that the concept of an appeal against an FSPO decision required a wider meaning. This included not only the outcome of a complaint but also the grounds for any decision.

The ordinary and natural meaning of “decision” was more than simply the outcome, the court held. Further, absurdities would arise if the statutory right of appeal was confined to appeal against outcome as it would preclude an appeal against the grounds of a decision. It would also render many appeal remedies, such as orders affirming the FSPO decision subject to modifications or amending a decision, as redundant.

Mr Justice Simons outlined that a broader meaning of “decision” was also necessary to allow access to courts, particularly where the FSPO was empowered to engage in contractual interpretation which was normally reserved for the courts. Accordingly, it was incorrect to suggest that there was a restriction on the right to appeal an FSPO decision (De Paor v. Financial Services Ombudsman [2011] IEHC 483 considered).

The court went on to consider the merits of the appeal. Mr Justice Simons recited the well-established principles of review in statutory appeals. It was noted that the threshold for a successful appeal was for the appellant to establish “serious and significant” errors (see Ulster Bank Investment Funds Ltd v. Financial Services Ombudsman [2006] IEHC 323; Orange Ltd v. Director of Telecoms (No 2) [2000] IESC 22).

It was also noted that the court would not adopt a deferential stance to an FSPO decision which was purely a matter of law (see Millar v. Financial Services Ombudsman [2015] IECA 126).

In this case, the FSPO failed to apply established legal principles governing the interpretation of contracts of insurance. For example, the finding that the subjective view of the insured was relevant to the restriction at the premises was not explained by reference to the policy terms.

The further findings were reached by assessing the specific subclause in isolation, which was contrary to the “text in context” approach determined by the Supreme Court. The FSPO failed to engage with Chubb’s arguments that the reasonable reader would understand the subclause to require actual discovery of the organism at the premises.

As such, the court held that the FSPO had committed serious and significant errors in reaching his decision. It was separately held that the FSPO had made the decision in breach of fair procedures as he failed to properly engage with various submissions made by Chubb (Balz v. An Bord Pleanála [2019] IESC 90). The court commented that it was possible for a decision-maker to fortuitously stumble upon the correct outcome without applying the proper legal principles or observing fair procedures.

Having identified the errors in the case, the court declined to undertake its own assessment of the correct meaning of the policy. Since the High Court only exercised a limited appellate jurisdiction under the FSPO Act, it was would not be appropriate to embark on a de novo consideration of the policy (see Orange Ltd v. Director of Telecoms (No 2)). The identification of error by the FSPO did not open the door for the High Court to fully consider the matter afresh, the court said.


The court set aside the decision of the FSPO and declined to consider the matter de novo. An order for remittal was not suitable where it appeared that the complaint was required to be dismissed even if the FSPO made fresh findings.

Chubb European Group SE v. Financial Services and Pensions Ombudsman [2023] IEHC 74

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