The COVID-19 pandemic is, by all definitions, a natural disaster and a catastrophe of massive proportions. In the case of Friends of DeVito v. Wolf, recently decided by the Pennsylvania Supreme Court, several business owners and a political candidate challenged Governor Tom Wolf’s statutory authority to issue an executive order closing non-life-sustaining businesses to reduce the spread of COVID-19.
The petitioners’ argument hinged on whether the COVID-19 pandemic constituted a “disaster” under the state’s Emergency Code. Under the Emergency Code, “disaster” is defined as “[a] man-made disaster, natural disaster or war-caused disaster.” 35 Pa.C.S. § 7102. “Natural disaster” is further defined as: “Any hurricane, tornado, storm, flood, high water, wind-driven water, tidal wave, earthquake, landslide, mudslide, snowstorm, drought, fire, explosion or other catastrophe which results in substantial damage to property, hardship, suffering or possible loss of life. Id. (emphasis added).”
The court determined that “the COVID-19 pandemic is unquestionably a catastrophe that ‘results in … hardship, suffering or possible loss of life.’ ” The issue was thus whether, under the legal doctrine of ejusdem generis, a viral illness such as COVID-19 was “of the same general nature or class” as the types of catastrophes expressly listed in the definition of “natural disaster” so as to fall within the “other catastrophe” catchall. The Court held that it was. In reaching this conclusion, the Court explained that the specific disasters listed in the definition of “natural disaster” lacked commonality because some were weather related (e.g., hurricane, tornado, storm), while others were not (e.g., tidal wave, earthquake, fire, explosion). The only commonality the court found among the listed disasters was that they all involve “substantial damage to property, hardship, suffering or possible loss of life,” and the same was true of the COVID-19 pandemic. The Court interpreted the legislative intent to provide an expansive list of emergency circumstances in which the Governor would have the power to “respond to exigencies involving vulnerability and loss of life.”
While the Court’s statutory analysis could be limited to the specific definition of “natural disaster” under the Pennsylvania Emergency Code, litigants will likely try to invoke it to support arguments that the COVID-19 pandemic constitutes a “natural disaster” as that term is used in other contexts.
The holding in Friends of DeVito case has already been cited in claims for coverage under business interruption and other property-based insurance policies for losses incurred as a result of the COVID-19 pandemic.
Another context where this holding may apply is in the interpretation of force majeure clauses in agreements, particularly given the dearth of case law throughout the United States addressing this consequential issue. Force majeure is an event outside the reasonable control of a party which prevents the party from performing a contract obligation. Look for this holding to come up in arguments to be made in Pennsylvania courts in the very near future relating to the COVID-19 pandemic and force majeure clauses.
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If you have any questions as to how any of the issues mentioned above affects your business, please contact Ethan O’Shea or Mark Himsworth, members of our Business Advisory Group, at (215) 661-0400 or EOShea@HRMML.com or MHimsworth@HRMML.com, or any other member of our Team.