This case takes the exposure of these companies one step further.
In our Insurance Insights of November and December 2024, we shone a spotlight on the increasing incidence of claims against companies stemming from the human rights and environmental failings of their wider operations outside the UK.
Specifically, we highlighted:
- The increasing ease with which claims for damage and loss suffered by overseas claimants due to overseas subsidiary operations are now allowed to be brought against parent companies in the UK where the skills of specialist claimant law firms can be brought to bear.
- The liability provisions of the Corporate Sustainability Due Diligence Directive, which enable companies to be sued by those suffering as a result of failures by contractors in their supply chains
This month, we report on a recent Court of Appeal decision on the same theme that confirms and broadens the trend we highlighted.
The recent decision
The case of Limbu & others v Dyson Technology Limited, Dyson Limited and Dyson Manufacturing Sdn Bhd is a claim in the High Court. It concerns twenty-four Nepalese and Bangladeshi migrant workers who have brought claims against three companies in the Dyson group, two of which are domiciled in England and one based in Malaysia. The Claimants allege trafficking, forced labour and being subjected to exploitative and abusive working conditions, including torture, at a factory in Malaysia, which was contracted by the Dyson group to manufacture components. The Claimants allege, among other things, negligence and unjust enrichment on the part of the Defendants by virtue of the control they allegedly exercised over their supply chain.
After the case was brought, the Court was asked to decide where the proceedings should properly take place. Dyson group argued that Malaysia was the proper place for the claims rather than England, and therefore asked to Court to stay the ongoing proceedings in England. A stay was granted by the High Court but, on 13 December 2024, the Court of Appeal allowed the claimants appeal.
In essence, the Court of Appeal was of the view that many more factors than the High Court had appreciated favoured the case continuing in England. Those factors outweighed the factors that favoured the cases being heard in Malasia. In particular, the Court of Appeal stated there was a “particular need to ensure equality of arms in the conduct of litigation”. It also found that the Claimants would not be able to bring claims in the alternative forum of Malaysia due to funding issues.
Reflections
This case has not decided whether abuse took place or whether the Dyson defendants are liable for it but rather where the case should be heard. It will now continue in England where the claimants will be much more able to pursue the case than would otherwise have been the case.
For some time now, companies actually or effectively headquartered in England have been exposed to English environmental and human rights litigation brought by overseas claimants, even though the alleged harm occurred overseas as a result of overseas subsidiary operations. This case takes the exposure of these companies one step further. The proceedings allowed to continue against Dyson in England arise not out of what Dyson’s overseas subsidiary is alleged to have done but out of what a third party supplier is alleged to have done.
Claimants being allowed to bring these cases in England is one thing. Winning them is another. The progress and eventual result in this case, and the ongoing BHP and Shell cases referred to in our earlier Insights, should be closely monitored.
For further information, please contact our insurance team.
