Muncipio De Mariana & Others v BHP Group Plc (formerly BHP Billiton)

JurisdictionEngland & Wales
JudgeEyre
Judgment Date20 April 2020
Neutral Citation[2020] EWHC 928 (TCC)
Docket NumberCase No: EV50LV008, E50LV010, and HT-2019-LIV-00000
Date20 April 2020
CourtQueen's Bench Division (Technology and Construction Court)

[2020] EWHC 928 (TCC)

IN THE HIGH COURT OF JUSTICE

BUSINESS AND PROPERTY COURTS IN LIVERPOOL

TECHNOLOGY AND CONSTRUCTION COURT (QB)

Liverpool, Civil & Family Courts

35 Vernon Street,

Liverpool, L2 2BX.

Before:

HIS HONOUR JUDGE Eyre QC

Case No: EV50LV008, E50LV010, and HT-2019-LIV-00000

Between:
Muncipio De Mariana & Others
Claimants
and
1) BHP Group Plc (formerly BHP Billiton)
(2) BHP Billiton Brasil Ltda
(3) Samarco Mineração SA
(4) BHP International Finance Corp
(5) BHP Minerals International LLC
(6) Marcona Intl, SA
(7) BHP Group Ltd
Defendants

Nicholas Harrison and Jonathan McDonagh (instructed by SPG Law) for the Claimants

Charles Gibson QC, Nicholas Sloboda, and Veena Srirangam (instructed by Slaughter and May) for the Defendants

Hearing date: 17 th April 2020

I direct that pursuant to CPR PD 39A para 6.1 no official shorthand note shall be taken of this Judgment and that copies of this version as handed down may be treated as authentic.

HH Judge Eyre QC:

1

The First and Seventh Defendants have applied to stay these proceedings on jurisdictional grounds. That application is currently listed to be heard for seven days beginning on 8 th June 2020. The timetable for the service of evidence provides for the Defendants to serve their evidence in reply to the Claimants' evidence by 1 st May 2020. The Defendants apply for an extension of that deadline to 19 th June 2020 in light of the difficulties said to have been caused by the Covid-19 pandemic and by the measures put in place to address it. The consequence of such an extension would be the vacation of the hearing currently listed for 8 th June. The Defendants invite the court to list the matter instead for a hearing either in July 2020 or in the Michaelmas term of this year with their “strong preference” being for the latter. The Claimants accept that a very modest extension of time is appropriate but resist an extension of the period sought by the Defendants and the consequent vacation of the June hearing. If the hearing is vacated they resist the proposal of a hearing in the Autumn contending that the case should be relisted for hearing in July.

2

The hearing of the application for an extension of time was conducted remotely by way of Skype and in private pursuant to CPR PD51Y with the concurrence and cooperation of the parties. As I explained at the start of the hearing I was satisfied that a remote hearing was necessary if the application was to be determined swiftly and that it was in the interests of justice for there to be such swift determination. It was not possible to broadcast the hearing in a court room and it was necessary for the hearing to be in private to secure the proper administration of justice. I am grateful for the positive engagement by counsel and solicitors on both sides in the steps necessary to conduct the hearing in that way.

The Nature of the Proceedings .

3

The proceedings arise out of the collapse of the Fundão Dam in Brazil on 5 th November 2015. The dam was an iron ore tailings dam and the collapse released large quantities of toxic materials and contaminated water. That material entered, ultimately, the Rio Doce, causing harm along the course of that river to the Atlantic Ocean.

4

The parties are agreed as to the scale of this litigation. In earlier applications the Claimants have described the proceedings as the largest class action ever brought in England and as being of unusual scale and complexity. The Defendants have previously noted that the claims are brought on behalf of an extraordinarily large class of claimants. There are about 202,000 individual claimants together with about 530 private businesses or foundations, 25 municipalities, 15 churches and faith-based institutions and the archdiocese of Mariana, about 145 individuals from the Krenak indigenous community and 5 utility entities.

5

The Defendants are linked by way of a dual listed company structure. The Seventh Defendant is the ultimate parent company of one of the joint venture partners of the Brazilian company which owned and operated the dam. In very simplified terms the Claimants say that the Defendants are the ultimate controllers of those responsible for the operation of the dam.

6

The damages sought are considerable in amount and are for a large range of losses. The claims are made by reference to Brazilian law and the Claimants say that the Defendants' liability derives from provisions of the Brazilian constitution and law which, in very bare summary, make the Defendants liable for the actions of the companies of which they were the ultimate controllers. In this case it is not just liability which will be determined pursuant to Brazilian law but that law will also govern causation and redress. The redress sought is formulated by reference to Brazilian law with provision for what, under that law, are described as patrimonial and moral damages. The nature of the claims is set out in sundry places, but, in essence, there are a number of claims made by each of the categories of claimants for a range of redress and for compensation for sundry rights of different kinds. These range from the more easily recognised categories of damages for physical harm and for loss of earnings to damages for the effect on the heritage of the Krenak community.

The Jurisdiction Challenge .

7

Court proceedings have been launched in Brazil. There have been a number of individual proceedings together with class actions of various kinds. In addition a foundation, the Renova Foundation, has been created and this provides compensation on a non-litigious basis.

8

The Defendants seek a stay of the proceedings on jurisdictional grounds. That application is brought on three bases. The first is that the Seventh Defendant, an Australian company, applies for the proceedings to be stayed against it on the basis of forum non conveniens. It contends that Brazil is an available forum which is clearly and more distinctly appropriate for the trial than the courts of England and Wales. The First Defendant is domiciled in England and is an English company so an argument based on forum non conveniens is not open to it. However, it does apply pursuant to Article 34 of the Recast Brussels Regulation for a stay on the basis that the actions before the Brazilian courts are related to these claims and give rise to a risk of irreconcilable judgments such that a stay is necessary for the proper administration of justice. Reference is made in particular to 34 sets of proceedings in Brazil and very large numbers of individual proceedings together with a class action referred to by the parties as “the 155bn CPA”. Finally, both defendants apply under CPR 3.4(2) for the claims to be struck out or stayed as an abuse of process or for them to be stayed on case management grounds under CPR3.1(2)(f) as being pointless, wasteful and duplicative of the proceedings and/or judgments in Brazil and the work of the Renova Foundation.

9

The Claimants resist the jurisdiction application. In doing so they make a number of criticisms of the approach of the Brazilian courts; the time it will take to resolve matters in Brazil; the awards in the Brazilian litigation; the capacity in general terms of the Brazilian system to provide adequate and timely redress; and the work of the Renova Foundation.

The Timetable .

10

The matter came before me on 13 th September 2019 and I gave directions for the determination of the jurisdiction issues. These provided for a four-day hearing beginning on 9 th June 2020. The Defendants' evidence was to be served by 29 th November 2019 with the Claimants' evidence in response served by 28 th February 2020 and any reply evidence from the Defendants by 17 th April 2020. The Claimants had pressed for a shorter timetable but for reasons I gave at the time I substantially adopted the timetable proposed by the Defendants while recording my view that it was a “slightly generous timetable”.

11

The timetable was subsequently modified by consent. The parties agreed that the time for the Claimants' evidence should be extended to 13 th March 2020 to take account of difficulties encountered in gathering evidence due to the Christmas and New Year holidays; the Brazilian Carnival festivities; and severe flooding in the Minas Gerais state. The time for the Defendants' evidence in reply was extended to 1 st May 2020. The Defendants say that this was on the footing that the Claimants accepted that there would be no objection to a further extension to 11 th May 2020 if that were required. The Claimants don't accept that there was an agreement to consent to such a further extension though they do accept that the parties proceeded on the footing that this would leave some limited capacity for an extension to 11 th May if that proved necessary. That difference of understanding is not of great significance for present purposes although I do note that the wording of the Claimants' solicitors' letter of 14 th February 2020 says that the Defendants are to take “comfort” from the availability of the period to 11 th May 2020. In any event it is to be noted that even before the current difficulties both sides were aware of the possibility that the time for service of the reply evidence might need to be extended to 11 th May 2020. The parties properly reflected on the likely duration of the hearing and raised concerns as to the adequacy of the four-day estimate. As a consequence the time available was extended with a view to providing for a seven-day hearing starting on 8 th June 2020 preceded by four days of pre-reading.

The Evidence as to Jurisdiction served to Date .

12

In support of the jurisdiction challenge the Defendants served three witness statements (from André Vivan de Souza, a Brazilian lawyer, and from André de Freitas, the chief executive of the Renova Foundation, and Efstathios Michael, a partner in the...

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