Município de Mariana v BHP Group (UK) Ltd & Anor.

Complexity, cost and the burden on court resources do not by themselves make properly arguable proceedings an abuse of process. A strike-out for proceedings which are pointless and wasteful requires a clear and claimant-specific basis for concluding that no real and legitimate advantage can result from a trial.

A stay under Regulation (EU) No 1215/2012 (Brussels Recast) requires close attention to the actual overlap with the pending third-state action. A lengthy temporary stay is not necessary where that overlap is uncertain or limited and would not materially advance the domestic claim. On forum non conveniens, the claimant need establish only a real risk of not obtaining substantial justice in the identified foreign forum.

More than 202,000 Brazilian claimants sought compensation from the English and Australian parent companies of the BHP group for losses arising from the Fundão Dam disaster. Their claims were advanced under Brazilian law.

Mr Justice Turner struck out, or alternatively stayed, the claims as an abuse of process in [2020] EWHC 2930 (TCC). In the alternative, he stayed the claim against the English company under article 34 of Regulation (EU) No 1215/2012 (Brussels Recast), stayed the claim against the Australian company on forum non conveniens grounds, and would have ordered a case-management stay.

The appeal concerned whether parallel Brazilian redress processes and litigation made the English claims abusive, required a stay, or made Brazil the clearly more appropriate forum.

1. Appeal allowed. The Court set aside the strike-out or stay and dismissed each of the defendants’ applications.

2. Unmanageability of viable proceedings is not, without more, an abuse of process. It does not show a misuse of procedure or oppressive conduct by a claimant. The judge had also been wrong to conclude at this early stage that the proceedings were irredeemably unmanageable. Group-litigation powers, including lead cases, preliminary issues and staged trials, could address the complexity.

3. Nor were the claims clearly and obviously pointless and wasteful. That assessment had to be made claimant by claimant, or by relevant category, rather than globally. The 58 institutional claimants could not, or could not fully, benefit from the Brazilian collective processes. Their claims would require determination of the defendants’ liability in England in any event. The evidence also disclosed substantial uncertainty as to the adequacy, availability and timing of redress in Brazil.

4. Forum non conveniens factors could not be used through an abuse argument to deny proceedings against the English-domiciled defendant. That would circumvent article 4 of Regulation (EU) No 1215/2012 (Brussels Recast).

5. Article 34 did not justify a stay. Article 34.1(b) asks whether the third-state action is capable in principle of producing a recognisable judgment; it does not impose a separate factual threshold that a judgment is likely. But a court’s homologation of a consensual settlement does not determine legal rights or merits and is not such a judgment. A stay under article 34.1(c) was not necessary: the potential overlap between the English claim and the 155bn CPA was uncertain and limited, while a stay could delay the English claims for many years.

6. The forum non conveniens application also failed. The realistic proposed Brazilian alternative was a new collective action. Cogent evidence established a real risk that it was unavailable in practice. The judge had wrongly required proof that substantial justice could not be obtained, rather than a real risk that it would not be, and had wrongly treated possible redress against other parties as material.

7. A case-management stay was not warranted. It would not serve the interests of justice and, as against the English-domiciled defendant, would be inconsistent with the Brussels Recast regime.

• Court of Appeal (Civil Division): Allowed the claimants’ appeal and dismissed the abuse, article 34, forum non conveniens and case-management stay applications: [2022] EWCA Civ 951 .
• High Court, Technology and Construction Court: Mr Justice Turner struck out, or alternatively stayed, the claims as an abuse of process and upheld the defendants’ alternative stay applications: [2020] EWHC 2930 (TCC) .