An application to stay proceedings by one of the mining companies involved in the mammoth group litigation over a Brazilian dam collapse has been refused.
Brazilian iron ore mining company Vale SA applied under section 9 of the Arbitration Act 1996 to stay the Part 20 proceedings brought against it by multinational mining giant BHP. Vale relied on an arbitration clause, 11.1, within an agreement with BHP Brasil.
The companies are defendants in a group compensation claim being brought in London over the 2015 collapse of the Fundão dam, in Minas Gerais, Brazil. The collapse and flood killed 19 people, destroyed villages and had a ‘widespread impact’ on individuals and communities, the claimants say.
The dam was owned and operated by Samarco Mineração, a joint venture between BHP and Vale. BHP and Vale deny any liability.
Mr Justice Waksman said he failed to see Vale’s argument that unless its ‘wide interpretation’ of the clause prevailed ‘there is a danger of disputes which fall outside [the clause] ending up in some kind of “black hole” or “no man’s land”’. The judgment said: ‘If a dispute is not caught by Clause 11.1, it will be dealt with by the court. The only reason why Vale posits a no-man’s land is because it has already concluded that access to the court is limited to specific performance, which is wrong, in my view.’
The judge added that ’Vale also relies upon a very wide interpretation of the clause as a whole, to the effect that any dispute arising out of the relationship between the shareholders was arbitrable. It has to be recognised at the outset that this claimed interpretation bears no relation at all to the words of Clause 11.1.’
The section 9 application was dismissed on its merits.
