Infinity Reliance Ltd (t/a My 1st Years) v Heath Crawford Ltd

The claimant (“Infinity”) is an online retailer. As “My 1st Years”, it sells personalised gifts for babies and children—clothes, toys, blankets and the like. When an order is placed, the goods need to be brought from storage, and then personalised for the buyer, such as by embroidering the child’s name. Because of this, Infinity cannot simply use a third-party logistics company to pick, pack, and post its orders. It needs to arrange space in the warehouse where its staff can personalise the goods before they are despatched.

In 2021, it was using space in a warehouse in Northampton. The warehouse was owned and operated by a logistics company called Cygnia. Infinity paid Cygnia for much of the logistics work. It had space in the warehouse where its staff could add the personal touches to the goods before they were sent out.

Infinity had thrived during Covid and its lockdowns. As the country came out of lockdown in April 2021, it remained to be seen how far it would be able to maintain that growth.

In May 2021, there was a fire at Cygnia’s warehouse. Infinity could not use the warehouse any more. Its business was interrupted and it lost sales until it was able to find suitable alternative premises, and fit them out. That took time, and it cost money. Infinity lost many millions of pounds of sales, and spent more than £2 million to fit out new premises.

Infinity had insurance cover, including cover for business interruption (“BI”). Its insurance broker, since late 2018, had been the defendant, Heath Crawford Ltd (“Heath Crawford”). Heath Crawford advised Infinity to buy a commercial combined policy from Aviva plc. The policy included BI cover. When the fire damaged the warehouse, the most recent policy had been renewed at the start of November 2020.