Forum conveniens: Dyson ESG claim to proceed in England

The Court of Appeal has overturned the High Court's 2023 decision in Limbu and others v Dyson Technology to decline to exercise jurisdiction in a high-profile ESG supply chain claim brought by migrant workers from Nepal and Bangladesh employed at factories which manufactured Dyson components in Malaysia. 

Its ruling that the case should proceed in England demonstrates the English courts' willingness to hear supply chain claims of this nature and the high bar that jurisdictional challenges may face. It also provides important insights into the factors that English courts will consider in determining the appropriate forum for such claims.

Background

The Claimants in the proceedings are Mr Limbu and 23 other migrant workers (or their representatives) from Nepal and Bangladesh. The workers allege that they were trafficked to Malaysia where they were subjected to conditions of forced labour, exploitative and abusive working and living conditions and, in the case of some of them, detention, torture and beating, in the course of manufacturing components and parts in the supply chain for the Dyson group. 

The proceedings are brought against three entities in the Dyson Group: two domiciled in England, the third domiciled in Malaysia.  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. 

High Court decision

The proceedings were brought against the defendants in England.

The High Court ruled that England was not the most suitable forum for the claim (forum non conveniens), allowing the case to proceed in Malaysia instead (see our previous briefing here). The Court's decision was based on a two-stage test set out in The Spiliada [1987] 1 AC 460:

• Stage 1: The Court asks whether England is the natural or appropriate forum or whether there is another available forum which is clearly and distinctly more appropriate.
• Stage 2: If another forum is more appropriate, the Court asks whether there are special circumstances such that justice requires the trial to take place in England.

The High Court found that Malaysia was clearly the more appropriate forum, primarily because the alleged treatment took place there and Malaysian law was the governing law. The Court also found no special circumstances that required the trial to take place in England. 

Court of Appeal decision

The Court of Appeal disagreed, overturning the High Court's decision primarily for the following reasons: 

1. Domicile in England: The first two Dyson defendants - D1 and D2 - were domiciled in England and had been served in England as of right. The Court of Appeal considered that in reality Dyson UK was the principal protagonist and Dyson Malaysia a more minor and ancillary defendant to the claim. Presence in England is the basis for establishing the court’s jurisdiction, and domicile in England connotes a degree of permanence and allegiance to the country’s institutions, including its courts. As such, an English domiciled party can reasonably expect, and be expected, to meet claims against it in such courts in the absence of sufficient countervailing factors.
2. Key issues connected to England: The High Court's assessment that the "centre of gravity" of the case was Malaysia was incorrect. The focus of the case was more likely to be on Dyson UK’s role and activity in England (i.e. its responsibility) than where the abuse had actually occurred. The allegation of breach by Dyson UK in failing to ensure proper implementation of its policies in Malaysia, and failing to respond adequately to what was or ought to have been known about the abuse, is an allegation of a failure occurring by management in England and is alleged primarily to have occurred in England (although it will also focus to some extent on conduct in Malaysia). Relatedly, the facts (i) that litigation will be coordinated and conducted from England, and (ii) the majority of relevant documents will be in England, are significant connecting factors to England.
3. Access to funding: The fact that Dyson had offered undertakings to pay the costs of certain of the Claimants' disbursements in exchange for continuing with the proceedings in Malaysia (with any shortfall likely to be made up by NGOs) did not mean that the Claimants would have sufficient access to justice. There was a clear conflict of interest in Dyson having control over what could be funded, and other funding issues would very likely come up which fell outside the specific terms of the undertakings. In addition, there was a real risk that NGOs would not make up any shortfall in funding and a serious risk that the Claimants could not bring the case in Malaysia. All of this pointed overwhelmingly in favour of England.
4. Inequality of arms: Where there was a huge imbalance between impoverished and vulnerable claimants and well-resourced and commercially experienced defendants, and the allegations were of very serious human rights abuses, there was a particular need to ensure equality of arms in the conduct of litigation if justice was to be served. If the likelihood was that the disparity in resources means that the Claimants would be better able to secure representation on a par with that of the Defendants in England than Malaysia, that was a factor which favoured England as a more appropriate forum.
5. Multiplicity of proceedings: There would be a substantial likelihood that the English courts would succeed in avoiding, or at least very much reducing, duplication of proceedings and the risk of inconsistent judgments in light of concurrent English jurisdiction defamation proceedings (brought by Dyson in respect of a Channel 4 broadcast regarding the allegations).
6. Governing Law: The Court of Appeal did note that, all other things being equal, it would be preferable for the Malaysian court to resolve the issues on the basis that Malaysian law was the relevant governing law, especially in relation to the novel issue of the duty of care in the negligence claim (the Malaysian courts have not yet considered the UK Supreme Court decisions in Vedanta or Okpabi on duty of care, or considered their application in the context of liability for misconduct in a supply chain - a novel issue in English law as well). However, the Court of Appeal found that the need for substantial justice and the significant connections to England outweighed this consideration.

Authors: Jon Gale (Partner) and Imogen Chitty (Associate)