The English High Court has determined that the Australia-based company BHP Mining is liable for the catastrophic collapse of the Fundão Dam in Brazil, which resulted in the country’s worst environmental disaster. The ruling, announced on Friday, comes nearly a decade after the dam failure in 2015, which claimed the lives of 19 individuals.
In her judgment, Justice Finola O’Farrell stated that the dam’s collapse was reasonably foreseeable. The court dismissed arguments from BHP’s defense team claiming the incident was a “sudden and unexpected” occurrence. Evidence presented in court indicated that signs of distress had emerged over a year prior to the disaster, including seepage and cracking. A thorough stability analysis at the time would have revealed an unacceptably high risk of collapse.
Significance of the Ruling
This landmark decision is particularly significant as it applies Brazilian environmental law in an English court. The case faced substantial legal hurdles, with BHP previously arguing that the UK lawsuit constituted an “abuse of process” and duplicated ongoing legal proceedings in Brazil. The court ultimately overcame these challenges.
Justice O’Farrell clarified that under Brazilian law, BHP’s operations fell within the definition of a “polluter” under its strict liability regime, as outlined in Article 3, IV of the Brazilian Environmental Law. This law imposes responsibility for environmental harm regardless of fault. The court adopted a broad, multifactorial test established by Brazilian jurisprudence, indicating that responsibility extends not only to the direct operator but also to those who finance or benefit from the activity.
The court referenced case law from Brazil’s Superior Court of Justice, suggesting that factors such as control over the operation, risk creation, and economic benefits are critical in assigning liability.
Impact on Multinational Corporations
This ruling sets a significant precedent for holding multinational corporations accountable in their home jurisdictions for environmental disasters stemming from overseas operations. BHP owns half of Samarco, the Brazilian company that managed the iron ore mine where the dam ruptured. The collapse resulted in the release of massive quantities of mine waste into the Doce River in southeastern Brazil, enough to fill approximately 13,000 Olympic-size swimming pools.
The environmental consequences were severe. A report from the Wilson Center indicated that biodiversity in the Doce River was drastically affected, with approximately 29,000 fish carcasses collected following the disaster. This disruption impacted the local food chain, leading to starvation among bird populations reliant on fish as a primary food source. Furthermore, about 80 percent of the native vegetation in the area was destroyed. Brazilian prosecutors have estimated the socio-environmental damage caused by the dam’s collapse to be between 37.6 billion and 60.6 billion reais.
Prior to this ruling, BHP executives had faced homicide charges related to the deaths of 21 individuals, although these proceedings were later suspended. The High Court’s decision may reignite discussions regarding corporate responsibility and environmental stewardship among multinational enterprises operating in vulnerable regions. As the legal ramifications unfold, the case highlights the ongoing need for rigorous oversight and accountability in the management of environmental risks.
