Factual and Procedural Background
The claimants, residents of remote rural communities in the Putumayo region of Colombia, initiated claims against the defendant for damages arising from environmental pollution caused by crude oil spill(s) on 11 June 2015. Their claims were based on Colombian Civil Code articles 2341 and 2356 and Decree 321/1999, alleging guardianship of a dangerous activity and negligence. It was common ground that the oil spill was caused by deliberate acts of a terrorist organisation, FARC.
The parties agreed that Colombian law governed the substantive claims pursuant to articles 4 and 7 of Regulation (EC) No.864/2007 (Rome II), retained as UK law post-Brexit. The judgment concerns two preliminary issues: whether the claims are time-barred under article 47 of Law 472 of 1998 (a Colombian group action limitation provision), and whether the legal principles averred in paragraphs 56 to 61 of the Amended Defence, relating to parent company liability under Colombian law, preclude the claims.
The defendant contended the two-year limitation period of article 47 of Law 472 applied, thus barring the claims as they were brought after 11 June 2017. The claimants argued the ten-year limitation period under article 2356 of the Civil Code applied instead and raised issues concerning the procedural or substantive nature of article 47 of Law 472 under Rome II, the characterisation of the claim as a group action, and public policy considerations under article 26 of Rome II.
The claim was issued on 30 December 2019 with initially 15 claimants, later expanded through a Group Litigation Order (GLO) to include over 270 claimants. The court made interim and final freezing orders on the defendant's assets in England and Wales. The proceedings included applications for joinder, stays, and amendments to the claim forms. Directions were given for the trial of the two preliminary issues, with the hearing limited to expert evidence on Colombian law.
Legal Issues Presented
- Whether, assuming the facts pleaded by the claimants are true, the claims are time-barred pursuant to Article 47 of Law 472 of 1998 (Preliminary Issue 1).
- Whether the legal principles averred at paragraphs 56 to 61 of the Amended Defence correctly state Colombian law and, if so, whether those principles preclude the claimants' claims under Articles 2356 or 2341 of the Colombian Civil Code (Preliminary Issue 2).
Arguments of the Parties
Claimants' Arguments
- Article 47 of Law 472 is a procedural provision excluded from the scope of Rome II under article 1(3), so the two-year limitation period does not apply.
- The claim should not be characterised as a Colombian group action subject to Law 472, but rather as an ordinary action governed by the ten-year limitation period under article 2356 of the Civil Code.
- Applying the two-year limitation period of article 47 of Law 472 would be inconsistent with English public policy under article 26 of Rome II, as it would penalise the use of English procedural mechanisms such as a GLO.
- The claimants contend they did not expressly choose to bring a Colombian group action and that the English proceedings are distinct and should not be treated as such.
- Liability of the defendant as a parent company is not precluded by Colombian law principles, as liability depends on the concrete facts of control and direction.
Defendant's Arguments
- Article 47 of Law 472 is a limitation provision within the scope of article 15(h) of Rome II and applies to the claims, barring them as time expired.
- The English proceedings should be characterised as akin to a Colombian group action, thus triggering the two-year limitation period.
- The court should respect the claimants' procedural choice if they expressly chose a group action, and the caducidad period applies accordingly.
- The application of article 47 of Law 472 is not manifestly incompatible with English public policy.
- Under Colombian law, parent companies are not liable for acts or omissions of subsidiaries except in limited exceptions (fraud or insolvency), which do not apply here, thus precluding claims against the defendant.
Table of Precedents Cited
| Precedent |
Rule or Principle Cited For |
Application by the Court |
| Wall v Mutuelle de Poitiers Assurances [2014] EWCA Civ 138 |
Clarified that rules on evidence and procedure fall outside Rome II's substantive scope under article 1(3). |
Supported the claimants' submission that procedural matters such as evidence are governed by lex fori and excluded from Rome II. |
| Actavis UK Ltd & ors v Eli Lilly and Co [2015] EWCA Civ 555 |
Held that conditions for applying for declarations of non-infringement are procedural and governed by lex fori under article 1(3). |
Emphasised the distinction between substantive and procedural rules under Rome II and supported a narrow interpretation of article 1(3). |
| Vilca v Xstrata Ltd [2018] EWHC 27 (QB) |
Applied foreign limitation law and considered when limitation periods are interrupted under foreign law. |
Illustrated the application of foreign limitation rules in English proceedings and the requirement for compliance with foreign procedural steps to interrupt limitation. |
| KMG International NV v Chen [2019] EWHC 2389 (Comm) |
Held that article 15 of Rome II should be construed broadly, including limitation rules, and article 1(3) narrowly. |
Supported application of foreign limitation rules under Rome II and rejected broad exclusion of such rules as procedural. |
| Pandya v Intersalonika General Insurance Co SA [2020] EWHC 273 (QB) |
Confirmed that foreign limitation periods governed by article 15(h) apply and rejected claimants' attempt to treat service as procedural under article 1(3). |
Reinforced the broad scope of article 15(h) and narrow scope of article 1(3) exceptions. |
| Johnson v Berentzen [2021] EWHC 1042 (QB) |
Followed Pandya and KMG in applying foreign limitation periods under Rome II. |
Rejected arguments that procedural law of forum governed service for limitation purposes. |
| Iraqi Civilians v Ministry of Defence (No.2) [2016] 1 WLR 2001 |
Explained the process of transposition in applying foreign limitation laws in English proceedings. |
Guided the court to assess foreign limitation laws by reference to facts relevant to English proceedings rather than hypothetical foreign proceedings. |
| Lloyd v Google [2022] AC 1217 |
Discussed differences between opt-in and opt-out group actions in the context of class/group litigation. |
Informed the court’s view on the significant differences between Colombian opt-out group actions and the opt-in GLO procedure used here. |
| Lungowe v Vedanta Resources plc [2020] AC 1045 |
Considered the spectrum of parental control and potential liability within multinational groups. |
Supported the proposition that Colombian law permits a range of control models affecting liability assessments. |
| Begun v Maran [2021] EWCA Civ 326 |
Set a high threshold for refusing to apply foreign limitation rules on public policy grounds under article 26 of Rome II. |
Supported the court’s conclusion that the two-year limitation period of article 47 of Law 472 was not manifestly incompatible with English public policy. |
Court's Reasoning and Analysis
The court first analysed the scope of Rome II, focusing on the interplay between article 1(3) excluding evidence and procedure and article 15(h) including rules of prescription and limitation. The court concluded that article 15(h) should be construed broadly to encompass both substantive and procedural limitation rules, including the caducidad in article 47 of Law 472. The defendant was correct that article 47 is a Colombian limitation rule within Rome II’s scope, regardless of whether it is characterised as procedural or substantive.
Turning to whether the English proceedings should be treated as a Colombian group action subject to article 47’s two-year limitation, the court rejected a binary approach. It emphasised that the claimants did not expressly choose to bring a Colombian group action under Law 472. Instead, the claimants brought an English group litigation claim under CPR procedures, which is neither a Colombian group action nor an ordinary action. Applying Colombian law principles, the court found that the claimants would have had the option to bring either type of action, but did not choose the group action route. The court held that the claim should not be treated as a Colombian group action for limitation purposes and thus the two-year caducidad period does not apply.
On the public policy issue, the court held that even if article 47 applied, the threshold for disapplication under article 26 of Rome II is high. A two-year limitation period is not manifestly incompatible with English public policy, and no such incompatibility arose here.
Regarding Preliminary Issue 2, the court accepted that the defendant’s averments correctly state Colombian law on parent company liability. Colombian law recognises the separate legal personality of parent companies and subsidiaries, with limited exceptions for fraud or insolvency that do not apply here. The court found that these principles do not preclude the claimants’ claims under articles 2341 and 2356 of the Civil Code, as liability depends on concrete facts. The claimants’ pleaded case alleges direct involvement and control by the defendant, which could give rise to liability. The court preferred the claimants’ expert evidence on this issue.
Holding and Implications
The court's final decision is as follows:
Preliminary Issue 1: The claims are not time-barred pursuant to article 47 of Law 472 of 1998 because this English action is not to be treated as a Colombian group action subject to that provision. The ten-year limitation period under article 2356 of the Colombian Civil Code applies instead.
Preliminary Issue 2: The legal principles averred in paragraphs 56 to 61 of the Amended Defence correctly state Colombian law, but they do not preclude the claimants’ claims under articles 2341 or 2356 of the Colombian Civil Code. Liability depends on the facts, and the defendant has not established that the claims are barred as a matter of law.
Implications: The claims may proceed in English courts governed substantively by Colombian law, applying the longer limitation period. The decision clarifies the application of Rome II to foreign limitation rules and the characterisation of foreign procedural devices in English proceedings. No new precedent is set beyond the application of existing principles to the facts of this case.