UK court finds BHP liable for Brazil dam disaster
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The news: London’s High Court has ruled that mining giant BHP is liable to compensate hundreds of thousands of victims of a 2015 mine collapse in Brazil.
The numbers: Around 620,000 Brazilians were seeking more than £36 billion ($72.67 billion) through the suit for the collapse of Fundão Dam at an iron ore joint venture between Vale SA and BHP.
Vale and BHP signed a USD30 billion settlement on the disaster with Brazil in October 2024.
The context: Justice Finola O’Farrell confirmed that the dam collapse was caused by BHP’s negligence, imprudence and/or lack of skill and found “overwhelming” pre-collapse evidence that the dam was unstable and that the risk of liquefaction and collapse was foreseeable and preventable.
“The risk of collapse of the dam was foreseeable” and “BHP were negligent, imprudent and lacking in skill,” Justice O’Farrell’s ruling said. “BHP are strictly liable as polluters in respect of damage caused by the collapse,” under the environmental law but are not liable under corporate law.
The 2015 collapse was the worst environmental tragedy in the country’s history, which unleashed a torrent of mine waste that destroyed entire villages, polluted hundreds of kilometres of river and killed 19 people in the Minas Gerais and Espirito Santo states.
“Today’s ruling delivers long-overdue justice to the thousands whose lives were torn apart, and it sends an unmistakable message to multinational companies around the world: You cannot disregard your duty of care and walk away from the devastation you caused. Liability has been established. BHP is now compelled to answer for its actions and pay what is owed,” said claimant law firm’s Pogust Goodhead CEO Alicia Alinia.
“BHP confirms that the English High Court has found BHP liable under Brazilian law for the 2015 Fundão dam failure” the miner said in a statement. “Any assessment of damages will be determined in future second and third stage trials expected to complete in 2028 or 2029.”
BHP intends to appeal the decision and will continue to defend the UK group action.
BHP said that more than 610,000 people have already been compensated in Brazil, including approximately 240,000 claimants from the UK group action who have provided releases for related claims. The English High Court decision upholds the validity of these releases which should reduce the size and value of the claims in the UK group action. BHP believes the UK group action is duplicative of remediation and compensation that has already occurred in Brazil or which is available under the Brazil Agreement.
The sources: BHP, Pogust Goodhead, Bloomberg
