Commercial Legal Expenses Policy Question ?

[Snoopy1948]

Hi all

I have a friend who owns a pub/café on a main 'A' road in a small semi-rural village.

Like all such places, he is struggling. He is the freeholder of the property ( lives there as well ) and recently he had a letter from the solicitor acting for the commercial mortgagee stating that he was over a month in arrears and could he contact him to discuss the matter on behalf of the mortgagee.

This he did and the solicitor was actually proactive with the problem, even suggesting that he request a period of 'interest only' mortgage payments to ease cash flow at this time. That we have done and waiting a response. My friend also told this solicitor that to compound the current trading problem, the local water company is about to start this very week on a 30 week minimum period of works to renew the water service for a length of 1.4 kilometres and that will clearly have a marked affect on the already poor trade.

In response to this, the solicitor suggested that if he holds a Commercial Legal Expenses policy, he should contact that insurer to see what 'eventualities' the policy may cover with regard to the planned road disruption.

Can anyone please advise if the Commercial Legal Expenses policy may cover anything here? I am assuming that he may be referring to legal expenses in making say a compensation claim against the water company for lost revenue due to the road works and disruption. But would there be any other 'insurable perils' to consider?

All advice and comments welcome

[Snoopy1948]

Re: Commercial Legal Expenses Policy Question ?

BUMPING THIS ONE UP!

[Kati]

Re: Commercial Legal Expenses Policy Question ?

[MENTION=39710]des8[/MENTION] ... any ideas??

[des8]

Re: Commercial Legal Expenses Policy Question ?

I did note this post the other day, but couldn't think of anything to add!

If these sorts of work cause disruption to existing businesses I was under the impression that the water authority automatically paid compensation.
Might be worth looking at their website to see if one needs to claim.

[Snoopy1948]

Re: Commercial Legal Expenses Policy Question ?

Thanks Des8 .

I have looked through his policy, actually with a toothcomb, and cannot find any reference to any legal expenses being covered by a claim for loss of earnings. The policy is very much essentially aimed at the policyholders own liability towards others or claims against him, both criminal and civil, for various situations ( i.e. action brought by HMRC or Customs & Excise. ).

South East Water have replied to him regarding compensation for loss of earnings that can be proven to be due to the road works and of course they want a full breakdown of weekly turnover for the last three years and during the 30 week period going forward. They speak of interim payments if the case can be proven as the works commence and proceed. Something to go forward on I guess but my friend has a hefty mortgage that needs some guarantees.

I guess the Commercial Legal Expenses Policy is not going to be of any value here but in any event we have written to the issuing company for clarification. But I have already advised him that its not looking good and in any event the annual premium is only £60.