Vedanta Resources PLC & Anor v Lungowe & Ors

Factual and Procedural Background

Approximately 1,826 citizens from rural farming communities in The State allege that toxic discharges from a large copper mine damaged their health, livestock, and crops over a period beginning in 2005. The mine is operated by Company B; its ultimate parent, incorporated in The Country and listed on a stock exchange, is Company A. Both entities were sued in negligence and for breach of statutory duty under local environmental, mining, and public-health statutes.

Jurisdiction is the sole subject of the opinion. The Plaintiffs issued a claim form in July 2015. Company A was served within the jurisdiction of The Country; permission to serve Company B out of the jurisdiction was granted in August 2015. Both Defendants challenged jurisdiction. Judge Coulson dismissed those challenges in May 2016; the Court of Appeal affirmed in October 2017. The present appeal, treated as a single appeal by both Defendants, was heard in January 2019 before Judge Briggs and other members of the Supreme Court.

Legal Issues Presented

1. Whether suing Company A inside the EU for the purpose of anchoring jurisdiction over Company B constituted an abuse of EU law (Article 4, Recast Brussels Regulation).
2. Whether the pleaded case disclosed a “real issue to be tried” against Company A.
3. Whether The Country was “the proper place” to try the claims against Company B under the necessary or proper party gateway (CPR PD 6B §3.1).
4. Whether, if The State was otherwise the proper place, there was a real risk that the Plaintiffs could not obtain substantial justice there.

Arguments of the Parties

Defendants’ Arguments

• The claim against Company A was a device; its sole purpose was to attract jurisdiction over Company B, amounting to an abuse of EU law.
• No real triable issue existed against Company A; it neither controlled nor directed mine operations sufficiently to owe any duty of care or statutory obligation.
• All connecting factors (witnesses, events, applicable law, evidence) pointed to The State; therefore The Country was not the proper place.
• The Plaintiffs could obtain substantial justice in The State; funding and legal-resource concerns were overstated, and comity required respect for that forum.

Plaintiffs’ Arguments

• Company A exercised extensive group-wide control over environmental and safety standards and therefore arguably owed them a direct duty of care and was potentially liable under local statutes.
• They genuinely sought judgment against Company A because of concerns over Company B’s solvency; anchoring jurisdiction was not the sole purpose.
• Although The State was the location of events, parallel proceedings there and in The Country would create an unacceptable risk of irreconcilable judgments.
• Practical impossibilities of funding, the dearth of suitably resourced legal teams, and previous litigation experience showed a real risk that substantial justice could not be obtained in The State.

Table of Precedents Cited

Court's Reasoning and Analysis

Abuse of EU Law. The Court held that the Plaintiffs had a genuine, triable claim against Company A; pursuit of jurisdiction over Company B was not the “sole purpose.” Precedent shows abuse arises only where joinder is collusive and solely intended to circumvent jurisdiction rules; that threshold was not met.

Real Issue Against Company A. Applying the summary-judgment standard, Judge Briggs agreed with the lower courts that published materials, internal agreements, and evidence of group-wide environmental oversight made it “well arguable” that Company A assumed responsibility for mine operations, creating a duty of care and potential statutory liability.

Proper Place. Without the risk of inconsistent judgments, virtually every connecting factor—location of events, witnesses, documents, governing law, and convenience—favoured trial in The State. However, prior authority had treated the risk of conflicting judgments as decisive when Plaintiffs insisted on retaining the claim against an EU-domiciled anchor. The Supreme Court rejected that approach, holding that where the anchor defendant offers to submit to the foreign court, the Plaintiffs must elect: either litigate all claims abroad or accept the risk they create. Consequently, England was not the proper place.

Substantial Justice. Even though The State was technically the proper place, the Court upheld factual findings that the Plaintiffs would probably be unable to obtain substantial justice there. Extreme poverty, absence of legal aid or conditional-fee agreements, limited availability of experienced local counsel, and past litigation examples demonstrated a real, cogent risk that the claims could not be effectively prosecuted. This satisfied the “substantial justice” exception, justifying the English courts’ jurisdiction over Company B.

Holding and Implications

HOLDING: Appeal DISMISSED.

The Supreme Court affirmed English jurisdiction over both Defendants. It clarified:

• Abuse of EU law requires sole-purpose or collusive joinder.
• Parent-company liability turns on ordinary negligence principles, not a unique doctrine.
• The “proper place” test must account for an anchor defendant’s willingness to submit abroad; the risk of inconsistent judgments is not automatically decisive.
• Where factual evidence shows a real risk that Plaintiffs cannot obtain substantial justice abroad, English courts may retain jurisdiction despite stronger connecting factors elsewhere.

The ruling has significant implications for multinational corporate groups: UK-domiciled parents may still face claims in English courts arising from overseas operations, especially where access-to-justice barriers exist in the alternative forum.