(Government Orders Requiring Shutdown of Restaurant Did Not Constitute Physical Loss of or Damage to Property at Insured Premises)
(July 2022) - In Musso & Frank Grill Co., Inc. v. Mitsui Sumitomo Ins. USA, Inc., 77 Cal.App.5th 753 (April 21, 2022), the California Second District Court of Appeal, Division One, affirmed the trial court's order sustaining the demurrer of Mitsui Sumitomo Insurance, USA, Inc. ("MSI") to a complaint for breach of contract and bad faith filed by Musso & Frank Grill Co, Inc. ("Musso & Frank"). The dispute arose out of Musso & Frank's tender of a business interruption claim arising out of government orders requiring it to shut down its restaurant due to the health emergency created by the COVID-19 virus. Musso & Frank contended that the shutdown caused it to lose the use of the premises. MSI disagreed and denied coverage of the claim based on the absence of physical loss or damage to property at the...
