Business and Human Rights Symposium: Third Party Human Rights Harms and the Duty of Care

[Jindan-Karena Mann is a PhD Researcher at the University of Amsterdam and Nicky Touw is a PhD Researcher at the Open University of the Netherlands.]

The North Mara gold mine in Tanzania has been under scrutiny for many years now. Reports paint a picture of ongoing corruption, environmental harms, and human rights violations, including the excessive use of force by private security and police forces working with the mining company. In 2013 a group of twelve individuals filed a lawsuit against Acacia Mining (formerly African Barrick Gold Plc) and North Mara Gold Mine Ltd in the High Court of London, alleging complicity in attacks by police against the local residents around the North Mara mine that resulted in deaths and injuries. The case was settled out of court without the company admitting liability. While the companies promised to undertake efforts to change the situation, the resulting grievance mechanism that they set up has been criticised, and human rights violations have continued.

In 2020, another case was initiated in UK courts against the companies currently operating the mine, for among other things the killing of a 9-year-old girl by a mining vehicle driven by the police, as well as for the harm caused by tear gas attacks during the same incident.  

Taking the alleged human rights abuses at the North Mara gold mine as an example, this blog examines secondary liability in civil litigation and the way in which recent cases have clarified the law on the duty of care. In particular, it asks: in light of the emerging UK case law on the parent company duty of care, can a company be held liable in negligence for human rights violations committed by non-subsidiary third parties such as State security forces that operate on its behalf or in support of its operations?

Recent case law on the duty of care

Advocates working in the business and human rights context have long lamented that it is difficult to hold companies liable for acts of third parties, even when it appears that human rights abuses committed by others are closely linked to their business activity. Recently however, UK courts have rendered several noteworthy decisions on parent company liability for acts of their subsidiaries that resulted in human rights harms, including Vedanta v Lungowe and Okpabi v Royal Dutch Shell.

In 2019, the Supreme Court in Vedanta held that a parent company could owe a duty of care to the human rights victims of its subsidiary. Importantly, the court held that a parent company’s duty of care arises not from its status vis-à-vis its subsidiary, but instead hinges on “the extent to which, and the way in which, the parent availed itself of the opportunity to take over, intervene in, control, supervise or advise the management of the relevant operations […] of the subsidiary” (para. 49). In 2021 in Okpabi, the Supreme Court clarified that while legal control may provide the starting point for the analysis, the crux of the issue is whether the parent company acted as a de facto manager over the activity that gave rise to the harm, regardless of who maintained de jure control (para. 147).

UK courts have been less inclined to assign liability to parent companies when human rights abuses are committed by or arise from the acts of a third party other than a subsidiary. For example, in 2018 in Kadie Kalma v African Minerals, the High Court of Justice declined to hold several mining companies liable in negligence for grave human rights abuses committed by the Sierra Leonian police force, which engaged in the oppression of local protests against the mine.The first instance judgement in Kalma was rendered in 2018, before the Vedanta case was affirmed by the Supreme Court. The Court of Appeal in Kalma, however, issued its decision afterwards, yet did not turn to Vedanta for guidance. This may be owed in part to the fact that, as the Court of Appeal noted, “[t]he existence of a direct duty of care in this case was never at the forefront of the appellants’ pleaded case, nor was it during the trial. Indeed, […] the appellants’ written opening at the trial accepted that the establishment of a duty in these sorts of circumstances was an ‘ambitious proposition’” (para. 110), and therefore the plaintiffs likely did not argue for the application of the Vedanta principle.   

However, we argue that the Vedanta doctrine could have been appropriately raised. The court in Vedanta is clear that its status as a parent company is not what creates the duty of care of a parent company over actions committed by its subsidiary. Instead, it is a factual analysis of whether and to what extent the company took over, intervened, controlled, supervised or advised the third party. The Court of Appeal’s failure to consider the Vedanta standard in Kalma points to the potential creation of an arbitrary discrepancy in the way the duty of care is defined, based on whether the third party is a subsidiary or not. We argue that because the Vedanta and Okpabi precedents are based on de facto control rather than de jure status, the principle should be extended beyond the context of a parent-subsidiary relationship, to also cover, for instance, close working relationships between companies and security forces or local police. So, when a similar degree of de facto control is exerted over an independent (non-subsidiary) entity that is directly engaging in the harmful conduct, a duty of care should arguably arise in a similar manner.

Does a Company Owe a Duty of Care to Victims of Violence committed by State Security Forces?

While other causes of action exist in relation to third party complicity, pleading negligence has certain advantages for the claimants. Unlike other potential modes of liability such as accessory or procurement liability, it does not require a showing of intent. Taking the Vedanta and Okpabi precedents as a starting point, we ponder whether a company could owe a duty of care for acts of a non-subsidiary third parties. As Vedanta and Okpabi confirm, the existence of a duty of care is a factual test. Here, we employ the facts of the North Mara mine situation as an example of how mining companies and local security forces interact, in order to examine what such control, intervention, supervision, or advice might look like, and the possible existence of a duty of care in such contexts.

The company operating the North Mara mine concluded a Memorandum of Understanding (the MoU) with the Tanzania Police Force for “providing community policing services and maintain law and order in and around the North Mara Gold Mine”. Although the language of the MoU tries to limit the responsibility of the company over the actions of the police, especially in light of the fact that the police are an entity of the sovereign State of Tanzania, it also lays out a high degree of support and supervision by the company for activities around the mine.

The MoU outlines the company’s supervision, oversight, and control over the police in the following ways: the company provides fuel, money, accommodation, and meals to police working around the mine; claims a right to information vis-à-vis the police; imposes regular reporting duties on the police; approves the list of police members who will receive assistance; claims the right to suggest to the police to remove officers from the mining site in case of reasonable suspicions of breaches of the MoU; and reserves the right to refuse certain members of the police to work for them. 

Furthermore, the mining company established an internal grievance mechanism in an effort to address alleged harms—including human rights violations—caused by the company or its contractors at the mine, which suggests that the company avails itself to taking some responsibility for such harms. By establishing a grievance mechanism, the company holds itself out as able to intervene when human rights harms occur. This further supports a conclusion that the company is taking de facto control over the human rights compliance of its partners.

Of course, we realize that conclusions on the existence of a duty of care cannot be drawn on the existence of the MoU and grievance mechanism alone. Only a factual assessment of how the company actually exerted de facto control over the police, as well as how it responded to allegations of human rights harms, will provide full answers. However, given that the company may have “availed itself of the opportunity to take over, intervene in, control, supervise or advise” the Tanzanian police force, courts should recall the precedents set in Vedanta and Okpabi, and consider whether the company operating the North Mara mine owes a duty of care to victims of police actions taken in and around the mines.

Conclusion 

Recent clarifications of UK negligence law may provide a potential avenue for redress against companies involved in violence by security and police forces, if UK courts decide to treat other third-party relations similar to how subsidiaries are viewed. Based on the Vedanta and Okpabi precedents they should, especially when viewed in light of the facts suggesting control, oversight, and intervention. The existence of a duty of care between the company and the security forces should not, in any situation, be dismissed prima facie, but should be based on a factual assessment of the situation. The facts about the North Mara mine indicate that a situation of factual control, supervision, and oversight may exist, and it could be an opportunity for the courts to further elaborate on the limits of secondary liability.