Court of Appeal (Civil Division) — Summary of Approved Judgment

Factual and Procedural Background

This opinion concerns an application by the Defendants for permission to appeal and for expedition against a first-instance liability judgment (the Stage 1 judgment) given by Judge O'Farrell and reported at [2025] EWHC 3001 (TCC). The central event is the collapse on 5 November 2015 of a tailings dam (the Dam) in The State, which released over 40 million cubic metres of iron-ore tailings, caused liquefaction, killed 19 people, destroyed a village and caused very extensive environmental damage extending down The River and reaching The Sea two weeks later. The Respondents are numerous claimants (over 600,000) including individuals, municipalities, utilities, faith-based institutions and businesses, all asserting damages for that collapse.

The dam was owned and operated by Company A (a Brazilian company) which was jointly owned by Company B and Company C. The Defendants are the United Kingdom and Australian parent companies of Company C and related entities (referred to collectively below as the Defendants). The Stage 1 liability trial ran from October 2024 to March 2025 (50 hearing days). The trial judge delivered an extensive judgment finding for the Respondents on many issues, including strict liability, fault-based liability and limitation, and ordered that some issues proceed to a subsequent trial on quantum (the Stage 2 trial scheduled for 2027).

Procedurally, the litigation has an extended history: the claims were struck out in 2020 on jurisdiction/forum non conveniens grounds and that strike-out was reversed on appeal ([2022] EWCA Civ 951). There have been other interlocutory and appellate decisions arising in the same litigation, including a Court of Appeal decision in 2026 concerning contempt/anti-suit injunctions ([2026] EWCA Civ 294). After the Stage 1 judgment, the Defendants applied for permission to appeal; the trial judge granted permission only on a discrete costs interest point. The present Court of Appeal judgment (reasons given by Judge Fraser, with Judge Lewison agreeing) determines the Defendants' application for permission to appeal on substantive grounds and the related application for expedition.

Legal Issues Presented

1. Whether the trial judge was wrong, or whether there was a serious procedural irregularity, in finding the Defendants strictly liable as "polluters" under Article 3(IV) of the Environmental Law (Ground 1).
2. Whether the trial judge was wrong, or whether there was a serious procedural irregularity, in finding the Defendants liable under Article 186 of the Civil Code (fault-based liability) and related provisions (Ground 2).
3. Whether the trial judge erred, or committed a serious procedural irregularity, in her conclusions on the commencement and length of limitation periods under Brazilian law, specifically Article 200 of the Civil Code (suspension), Article 27 of the Consumer Defence Code (five-year period), and the 1932 Decree (public entities) (Grounds 3–5).

Arguments of the Parties

Defendants' Arguments

• The trial judge applied the wrong legal test for strict liability (arguing only operators can be direct polluters and that indirect liability required a duty of safety); alternatively, the judge committed three critical flaws in applying the multifactorial test (control, engagement with evidence on use of shareholder power, and causation standard).
• The trial judge failed to engage with the Defendants' factual and expert case across many discrete points (summarised as up to 14 factual points), amounting to a serious procedural irregularity under CPR 52.21(3)(b).
• On fault-based liability (Article 186) the Defendants argued the absence of an unlawful act/omission, absence of breach of any relevant duty or standard of care, and absence of the required causal link; they also disputed that constitutional or corporate provisions supplied the requisite duties.
• On limitation the Defendants contended the judge wrongly held that limitation was suspended until 2024 and that a five-year period applied (or that the 1932 Decree applied to public entities), and additionally argued the judge failed to engage with determinative issues.
• The Defendants sought expedition on the basis that a successful appeal on liability would make much Stage 2 preparation redundant and, if only the permitted costs interest ground proceeded, expedition thereon would serve the parties' interests given the size of costs.

Respondents' Arguments

• The trial judge's findings were supported by extensive factual and expert evidence, including geotechnical and Brazilian-law expert evidence; findings on fact and foreign law are to be treated with the usual appellate deference.
• The Defendants' submissions amounted to "island-hopping" through isolated documents and issues rather than demonstrating the trial judge reached irrational or unsupported conclusions or that there was a procedural irregularity.
• The pleading objections raised by the Defendants were considered and rejected by the trial judge; the agreed Final List of Issues and the evidence heard meant pleader-based technical objections were not decisive.
• On limitation, the judge addressed the competing expert analyses and STJ authority; the conclusions on suspension, applicable period and application of the 1932 Decree were open to her on the evidence.

Table of Precedents Cited

Court's Reasoning and Analysis

Judge Fraser summarised the application and applied well-established principles governing appeals on fact and evaluation of expert evidence: appellate courts must be cautious and only interfere where a trial judge's conclusions are plainly wrong or irrational, or where there is a compelling basis to conclude a serious procedural irregularity rendered the trial unjust. The court emphasised (drawing on authorities such as FAGE, McGraddie and Volpi) that:

• Findings of fact and evaluations of expert evidence are primarily for the trial judge who has seen and heard witnesses; an appellate court ordinarily assumes the trial judge took all evidence into account even if not every document or argument is expressly cited.
• The Defendants' primary tactic—arguing the judge "failed to engage" by focusing on omitted textual references or isolated documents—amounted to impermissible "island-hopping" and amounted in substance to re‑run of trial submissions rather than demonstration of irrationality or procedural unfairness.
• Issues of foreign law (Brazilian law) are treated as questions of fact in this jurisdiction; the trial judge had the benefit of competing expert evidence on Brazilian law and was better placed than the appellate court to evaluate that evidence and linguistic/legal nuance.
• Where the Defendants accepted that success on certain critiques would require a retrial, the court noted the practical and legal difficulties of substituting appellate evaluation for the trial judge and rejected suggestions that a retrial could be conducted effectively on transcripts alone.

Applying those principles to each ground:

• Ground 1 (strict liability): the trial judge applied the multifactorial test and her findings that the Defendants were direct and/or indirect polluters were supported by evidence. The alleged "concession" by the Respondents' expert was not established on a fair reading of the evidence. The three alleged "critical flaws" (control/shareholder power, failure to engage with evidence, and causation standard) were either challenges to findings of fact or were addressed by the judge in detailed analysis of Brazilian law and STJ precedent; none amounted to a plainly wrong conclusion or a serious procedural irregularity.
• Ground 2 (fault-based liability): the judge addressed the competing experts, distinguished and preferred aspects of different experts' evidence where appropriate, considered causation and corporate-law arguments and rejected the Defendants' contentions; the audit and risk‑management pleading objections were considered and dismissed as pleaded or not causing prejudice, and the judge's factual conclusions were properly open to her.
• Grounds 3–5 (limitation): the judge analysed the Brazilian law authorities and expert evidence and reached conclusions on suspension, the applicable limitation period and the application of the 1932 Decree to public entities. The Court of Appeal found no basis to treat those findings as unjust or plainly wrong and rejected the contention that the brevity of some parts of the reasoning showed failure to engage.

On expedition, because the trial judge had already granted permission on a single costs interest point, the Court accepted that expedition of that discrete ground would assist parties given the substantial costs at stake and the imminence of Stage 2; accordingly expedition was ordered for the single permitted ground of appeal.

Holding and Implications

HOLDING: The Court refused permission to appeal on each substantive ground raised by the Defendants (Ground 1 — strict liability; Ground 2 — fault-based liability; and Grounds 3–5 — limitation). The Court ordered expedition of the single ground of appeal already permitted by the trial judge (the costs interest point).

Implications:

• Direct effect: the trial judge's Stage 1 liability findings for the Respondents remain in place; the Defendants have only a single permitted appeal ground to proceed (a discrete costs interest issue), and that appeal was ordered to be expedited.
• Procedural principle: the judgment reinforces appellate deference to trial judges on findings of fact and expert evaluation (especially where foreign law is treated as fact and the trial judge has seen the witnesses), and cautions against attempting to found appellate review on selective examination of documents or omission from the written judgment.
• No new precedent: the Court applied established principles (as cited) rather than creating novel legal tests; the decision declines to disturb a detailed trial judge's fact‑based findings and therefore does not set new substantive law on strict liability, fault or limitation beyond its application of existing authority.