In AAA and others v Unilever Plc and another1, the English High Court considered the circumstances in which a UK domiciled company may face liability for actions largely attributable to a foreign domiciled subsidiary.
The court struck out the two claims against the UK-incorporated parent company, Unilever, concerning alleged liability for negligence for acts of violence committed by third parties against employees and local residents on a Kenyan tea plantation during disorder following the Kenyan presidential election in 2007. The claims were struck out on the basis that they were bound to fail due to an insufficient legal and factual connection with England and Wales. The claimants sought to rely upon the existence of a duty of care owned to them in negligence by Unilever. In seeking to establish that the existence of such a duty would be fair just and reasonable (per the “Caparo” test), the claimants relied upon Chandler v Cape2, in which it was held that a parent company could owe a duty of care in negligence due to its “assumption of responsibility” for the acts of a subsidiary.
The court has some discretion to allow a claim in these circumstances, where it is in the interests of justice to do so, for example where there is no possibility of redress for the claimant elsewhere. However, the judgment serves as a reminder of the difficulties that claimants will face in seeking to bring proceedings against foreign domiciled companies in the English courts where there is no connection with England and Wales. The judge held that it is unlikely that there will be the requisite connection, either legal or factual, in respect of claims against a foreign domiciled defendant, where neither the claimants, nor the location of the wrong doing and damage, are in England.
The claimants have been given permission to appeal.