High Court rules that BHP is liable for the collapse of the Fundão Dam
Public Law and Judicial Review, Cornerstone Climate
Today, the High Court handed down judgment in the first-stage trial of Municipio de Mariana v (1) BHP Group (UK) Limited (2) BHP Group Limited [2025] EWHC 3001 (TCC). The High Court found that BHP are liable under Brazilian Environmental Law and the Brazilian Civil Code for the collapse of the Fundão Dam in Brazil. The judgment can be found here.
The collapse, which occurred in November 2015, resulted in the release of approximately 40 million cubic meters of tailings from iron ore mining. The village of Bento Rodrigues was destroyed and 19 people lost their lives. The tailings polluted the River Doce system over its entire course to the sea. The collapse is widely recognised as Brazil’s biggest environmental disaster.
The dam was owned and operated by Samarco Mineração SA, a Brazilian company jointly owned by Vale S.A. and BHP Brasil Ltd. BHP Australia is the ultimate parent company of BHP Brasil, and between 2001-2022 BHP UK and BHP Australia operated together as a single economic entity under a dual listed company structure (§5).
This Case in 60 Seconds
Case: Municipio de Mariana v BHP Group (UK) Ltd & BHP Group Ltd
Court: High Court (TCC)
Issue: Whether BHP were legally responsible under Brazilian Environmental Law and the Brazilian Civil Code for the 2015 collapse of the Fundão Dam, Brazil’s largest environmental disaster.
Decision: The Court held BHP liable on both strict and fault-based grounds. The Court also rejected challenges based on standing and limitation, and identified legal principles that apply to the construction of waivers signed by some of the Claimants.
Key Finding: Although not the direct legal owner of the dam, BHP were directly or indirectly responsible for the polluting activity due to their control and operation of Samarco. Further, BHP breached their legal duty to avoid harm caused by any act or omission that was negligent, imprudent or lacking in skill. They knew or should have known about serious structural issues at the dam by August 2014. In those circumstances, it was not reasonable to continue to raise the height of the dam.
Impact: The ruling establishes BHP’s liability in respect of the environmental and human harm caused by the collapse. There is a stage two trial to establish quantum of damages.
Counsel: Hannah Taylor, instructed by Pogust Goodhead, led by Alain Choo Choy KC, Andrew Fulton KC, Nicholas Harrison, Jonathon McDonagh, Russell Hopkins, Ibar McCarthy, Grace Ferrier, Antonia Eklund, and Anisa Kassamali.
The first stage trial to establish liability was held from October 2024 – March 2025. Today, Mrs Justice O’Farrell handed down her judgment.
Strict liability: The Court found that Article 14, paragraph 1 of the Brazilian Environmental Law imposes on a polluter strict liability for damage caused to the environment and any third parties affected by the polluter’s activities (§378). A polluter is defined in Article 3, IV as a person or entity who is directly or indirectly responsible for the polluting activity. There is no fixed list of the circumstances in which responsibility for a polluting activity will be imputed to a person or entity; each case must be analysed on its particular facts. The case law of the Superior Court of Justice in Brazil indicates that it includes factors such as: (i) control over the activity; (ii) the creation of risk, participation and/or active involvement in the activity; (iii) financing the activity; and (iv) economic benefit from the activity (§380).
Applying that interpretation, the Court found that BHP was directly and/or indirectly responsible for the activity of Samarco in owning and operating the Fundão Dam, which caused the collapse (§§523, 531). This was based on factors including:
- That BHP (together with Vale) were the “ultimate owners” and “directing mind of Samarco” (§524).
- Samarco’s corporate governance structure facilitated BHP’s ability to control Samarco with Vale (§525).
- Through membership of committees and subcommittees of the Samarco Board, BHP were “involved in the activities of Samarco at every level” (§526).
- BHP “assumed responsibility for risk assessment, control, mitigation and management within the BHP Group and specifically within Samarco.” (§527)
- BHP exercised control over Samarco’s activities, including its strategy, investments, and funding arrangements (§528)
- BHP participated in and was involved in Samarco’s activities, including approving and funding projects (§529).
- BHP substantially invested in and derived substantial financial and commercial benefits from Samarco (§530).
As a consequence, BHP were strictly liable as polluters in respect of the damage caused by the collapse, pursuant to Articles 3(IV) and 14, paragraph 1 of the Environmental Law of Brazil (§1113).
Fault-based liability: The Court found that liability for omissions can derive from factors such as the creation of a risk or assumption of responsibility (§643).
The Court concluded that BHP were also liable based on fault in respect of the damage caused by the collapse, pursuant to Article 186 of the Civil Code of Brazil (§1115). The Court found that “BHP’s control of Samarco, their assumption of responsibility for risk assessment, management and control of the tailings dam, and their full participation in the tailings dam operations, gave rise to a legal duty to avoid harm caused by any act or omission that was negligent, imprudent or lacking in skill” (§801). The Court found that by August 2014, BHP knew or should have known of serious structural issues at the Dam (§803). In those circumstances BHP were negligent, imprudent, or lacking in skill in allowing the saturation of tailings and the encroachment of slimes to develop, failing to carry out the relevant studies and remediation actions, and in causing Samarco to continue to raise the height of the Dam (§806).
Limitation: The Court found that the claims were not barred by limitation (§§1117-1125).
Standing: The Court found that there was no constitutional impediment for the Municipalities to bring proceedings (§§1128).
Waivers: The scope of any waiver signed by individuals who joined compensation schemes in Brazil depends on the construction of each agreement. The Court identified the legal principles that apply to such provisions by reference to agreed sample settlement agreements (§§1126-1127).
The judgment has been widely reported in the media:
Hannah Taylor was instructed for the first stage trial by Pogust Goodhead, and was led by Alain Choo Choy KC, Andrew Fulton KC, Nicholas Harrison, Jonathon McDonagh, Russell Hopkins, Ibar McCarthy, Grace Ferrier, Antonia Eklund, and Anisa Kassamali.
