Update on tort and human rights claims against UK parent companies based on overseas activities

February 5, 2019

Summary

The case of Lungowe and others v Vedanta Resources Plc and Konkola Copper Mines Plc has just been before the Supreme Court on the question of whether the courts of England and Wales should hear this overseas claim.  In addition, two further group claims against UK parent companies based on torts alleged to have been committed by overseas subsidiaries have been in the headlines.

Last year we wrote about four large ongoing multi claimant environmental/human rights claims in the Courts of England and Wales.

The claims had been launched notwithstanding that the claimants lived overseas, the alleged injury and damage took place overseas, and the entity alleged to be most directly connected to the injury and damage was a foreign registered company.  In each claim, the factor underpinning the launch of proceedings in the Courts of England and Wales was the inclusion (alongside the foreign registered defendant) of the UK registered parent company as a defendant.

Jurisdiction has been fiercely contested by the defendants in these cases on the basis that there is no “real issue” between the claimants and the UK registered parent company.  Their efforts have paid off in some cases, but not in others. 

One of the cases, Lungowe and others v Vedanta Resources Plc and Konkola Copper Mines Plc, has just had the jurisdiction issue considered by the Supreme Court.  The Court of Appeal had held that there was a “real issue” between the UK registered parent (Vedanta Resources Plc) and the claimants, which meant that the claim could be brought against it and its overseas subsidiary (a necessary and proper party to the claim against the parent) here.   The Supreme Court’s decision is awaited with interest.

Since we wrote last year, two more cases on the same theme (i.e. tort and human rights claims against UK parent companies based on activities of overseas subsidiaries) have been in the headlines. 

  • Judgment was given on 19 December 2018 in the High Court in the case of Kalma and others v African Minerals Limited, African Mineral (SL) Limited and Tonkolili Iron Ore (SL) Limited. This case involved a claim against a UK registered parent (African Minerals Limited) and its Sierra Leone subsidiaries in connection with alleged violence by the Sierra Leone Police towards claimants living close to the subsidiaries’ iron ore mine in Tonkolili, Sierra Leone.
  • Also, in November 2018, it was announced that the Anglo-Australian mining company, BHP Billiton is being sued in the courts of England and Wales by Brazilian claimants in the aftermath of the a dam collapse at its Samarco iron ore mine three years ago.

In the African Minerals case, there is no record of any clash over usual jurisdictional issues prior to the case coming to trial.  The jurisdiction point does not seem to have been pursued by African Minerals Limited.  In any event, the judgment of the High Court was that the claimants’ claim failed. 

The judgment makes clear that the effort involved in bringing and defending the case was very substantial indeed.  The resource and commitment required by the parties in this type of case should not be underestimated. 

There is little information as yet on the BHP Billiton matter, save that it apparently involves 240,000 Brazilian claimants.

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