Calif. Appellate Court Reinstates COVID-19 Coverage Action

SAN FRANCISCO — The California Court of Appeal, 1st District, reinstated a small business’s COVID-19 coverage action, ruling that the trial court erred in sustaining the defendant insurer’s demurrer because the complaint is capable of amendment.

In a Sept. 22 opinion, the appellate panel ruled that the insured’s motion to amend its complaint should have been granted.

Tarrar Enterprises Inc. operated a utility consultant business in the San Francisco Bay area. In March 2020, Tarrar sustained loss of business income when it temporarily closed its business premises in compliance with government stay-at-home orders issued in response to the COVID-19 pandemic.