Município de Mariana v BHP Group (UK) Ltd: Liability and risk

In 2015 the Fundão Dam in Brazil collapsed leaving catastrophic environmental impacts, human tragedy and swathe of legal proceedings in its wake. On 14 November 2025, Judgment in the First Stage Trial of Municipio de Mariana v BHP Group (UK) Ltd, which focused on liability, was handed down by the English High Court.

It was largely in favour of the claimants. The legal landscape may change again as the Judgment is subject to an appeal, but we take a look at some key takeaways from the case as it currently stands.

Background to the proceedings 

The Fundão Dam was owned and operated by a Brazilian company, Samarco Mineração SA (“Samarco”), which pursuant to a joint venture agreement, was jointly owned by Vale S.A (“Vale”) and BHP Brasil Ltd (“BHP Brasil”) each with 50% shares. The ultimate owner of BHP Brasil was BHP Group Limited (“BHP Australia”).

These proceedings have been brought by 600,000 Brazilian claimants, ranging from individuals to municipalities, against BHP Australia and BHP Group (UK) Limited which operated as a single economic entity under a dual-listed structure during the relevant time (together “BHP”). Each claimant is seeking compensation as a result of the environmental damage caused by the collapse.

Stage Two of the Trial, dealing with quantum is currently listed for October 2026, though this date could be affected by the appeal. 

The Court’s analysis of liability

The cause of the collapse was foreseeable. The Court reached this conclusion on the basis that:

• Design flaws, inadequate internal drainage and poor operation decision when using the dam had led to liquefaction of the tailings which formed the structural portion of the dam.
• It was well known in the industry that liquefaction could cause a tailings dam to collapse, if certain circumstances existed, regardless of the trigger. Those circumstances were present in the dam prior to collapse.
• The collapse could have been averted had the guiding principles for tailing dams, which had formed the basis of reports and recommendations in relation to the dam been followed.
• It was imprudent to continue raising the dam without proper written analysis of the stability as there were clear signs of structural deterioration. 

BHP were strictly liable as polluters under Brazilian Environmental Law. The Court reached this conclusion on the basis that whilst Samarco was the legal owner of the dam, by virtue of the company structure BHP (jointly with Vale) were the owners and controlling mind of Samarco. BHP had assumed responsibility for Samarco's risk assessment, control, mitigation and management and had planned and carried out financial and technical audits of its operations from at least 2013. Therefore, BHP were directly and/or indirectly responsible for the actions of Samarco which ultimately led to the collapse.

BHP was also found liable for fault-based liability under the Brazilian Civil Code. Their control of Samarco and their assumption of responsibility for the risk assessment, management and control of the dam and full participation in its operations gave rise to a legal duty to avoid harm caused by any negligent, act or omission. By August 2014, BHP knew or ought to have known of the serious structural issues threatening the dam, that it could not withstand an increase in its height, and that collapse could be imminent.

In those circumstances, BHP was negligent, imprudent and/or lacking in skill when it allowed the saturation of the tailings, failing to carry out studies and recommended remediations and in causing Samarco to continue to raise the height of the dam.

The Court also considered:

• Whether the claims were extinguished by limitation. They were not, the Court determined that the claim forms issued in England contained enough detail to stop time running under Brazilian law.
• Whether there was a constitutional impediment stopping municipalities from bringing proceedings in the English Court. The Court determined there was not.
• Whether BHP were in breach of their duties and responsibilities as a controlling shareholder in Samarco by reason of abuse of power. The Court determined they were not. 

Finally, the Court outlined the relevant legal principles that would be considered when reviewing some pre-existing settlement agreements at a later stage. 

Key reminders

Parent company liability 

Whilst it was Brazilian law considered by the Court, the analysis provided by the Court when concluding that BHP was strictly liable outlines considerations which could be relevant to an assessment of parent company control.

It is important for parent companies to bear in mind that the more control and involvement it has with its subsidiaries the greater the likelihood of its liability as established by English Case law. It is important therefore that companies implement and manage clear strategies for oversight and risk management.

Managing risk 

The judgment acts as a warning to companies within this industry and wider sector as to the risks faced if engineering advice is ignored or not acted upon and as a result a failure occurs causing damage. The courts will scrutinise what a company knew or ought to have known when considering whether it has met the standard imposed on it. 

It is important therefore that companies implement clear frameworks for oversight and risk management. To discuss these implications further, speak to our specialist governance, risk and compliance team for more insight.