Catarina Oliveira da Silva & Ors v Brazil Iron Limited & Anor

On an application under Civil Procedure Rules 1998 Part 11, the defendant must show that another available forum is clearly and distinctly more appropriate. Even where the foreign forum has the stronger connection, jurisdiction should be retained where cogent evidence establishes a real risk that substantial justice cannot be obtained there.

Funding difficulties may constitute such a risk where the claims are complex, individually modest, brought by numerous claimants of limited means, and require substantial expert and legal work. Defendant undertakings to fund expert assistance may be inadequate where they create conflicts, invite disputes about necessity and reasonableness, or leave future costs uncovered.

One hundred and three Brazilian claimants brought claims under Brazilian law against two English-domiciled companies connected with an iron ore mine in Bahia. They alleged environmental damage, property damage, personal injury and intimidation arising from mining operations controlled by the defendants.

The defendants applied under Civil Procedure Rules 1998 Part 11 for a declaration that Brazil was the proper forum and for a stay. The claimants cross-applied concerning the admissibility of evidence. The central issues were whether Brazil had the more real and substantial connection with the dispute and whether there was a real risk that the claimants could not obtain substantial justice there.

1. Outcome. The defendants’ forum application was dismissed. Brazil had the stronger overall connection with the claims, but the claimants established a real risk that substantial justice would not be obtained there.
2. Applicable approach. Applying Spiliada Maritime v Cansulex [1987] AC 460, the court considered whether Brazil was an available forum that was clearly and distinctly more appropriate for the interests of the parties and the ends of justice. The exercise was holistic. Connecting factors included the governing law, the location of the alleged wrongdoing and harm, the parties and witnesses, evidence, convenience, expense and the risk of inconsistent judgments. The court also gave proper weight to the defendants’ English domicile and service as of right, and to the English control issue.
3. Stage two. The claims’ principal factual subject matter, applicable law, regulatory framework, witnesses and evidence were in Brazil. Nevertheless, the claims were relatively modest in value, involved 103 claimants of limited means living in a remote area, and were likely to require complex, lengthy litigation and expert evidence. Brazilian damages-based fee arrangements imposed an effective cap on lawyers’ recovery. Legal aid would not meet all relevant costs, particularly those of technical assistants. The evidence therefore established a real risk that suitable representation would not be found.
4. Undertakings. The proposed undertaking to fund technical assistants did not remove the risk. Following Limbu v Dyson Technology Ltd [2024] EWCA Civ 1564, such arrangements could create conflicts, cause disputes and delay, require waiver of privilege, and fail to cover later or unforeseen work. The remaining undertakings did not address the fundamental economic viability problem.
5. The result was consistent with the exceptional approach in Connelly v RTZ Corp Plc [1998] AC 854, Lubbe v Cape Plc [2000] 1 WLR 1545 and Lungowe v Vedanta Resources Plc [2019] UKSC 20. The evidence did not criticise the integrity of the Brazilian courts or establish delay as independently decisive.