Brazilian claimants who voted to change their legal representation in the ongoing Mariana dam litigation – dumping class action firm Pogust Goodhead to instruct Bailey Glasser International - had no contractual right to do so, the High Court heard yesterday.
Before the substantive two-day hearing began, Mr Justice Waksman dismissed a privacy application brought by Sa’ad Hossain KC, for the claimant committee. Waksman said there was ‘no case of privacy’ in respect of committee members. He would deal with documents which the committee argues are confidential on a ‘wait and see basis’: if the documents are referred to, the judge ‘will have to make a decision at that time’.
Alan Maclean KC, for Pogust Goodhead (trading as PGMBM Law Ltd), told the court that the committee did not have authority to terminate the collective conditional fee agreements (CCFAs) or litigation management agreements (LMAs) with Pogust Goodhead.
He added: ‘Even if everything else I say was wrong, the committee and its lawyers have dropped its coin down a very expensive well. If this termination [happens], the claimants lose a number of protections… [they] are liable for costs which together we estimate at £2 billion.’
‘On [the committee’s] own case, this committee has dropped all of its clients down a £2bn financial hole.’
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Maclean told the court the committee lacked authority and was in breach of both the LMAs and CFAs. The committee could ‘only do anything’ through members voting, Maclean said, adding: ‘The committee only has power to act if the committee members comply with their contractual obligations.'
In written submissions, Maclean said: ‘The true position is that the committee has purported to terminate contracts when it had no power to do so, without any proper cause, and in circumstances where it appears to have placed the financial interests of BGI and/or any new funder ahead of the interests of the underlying clients it claims to represent – exposing the victims of the Mariana disaster to collective personal liability estimated to be in excess of £2bn, and jeopardising a 22-week second stage trial on causation, quantum and remoteness that is currently listed to commence in the Mariana proceedings on 6 April 2027.
‘The best interests of the victims should be paramount – not the confected contractual constructions of those who would seek to profit at their expense.’
The hearing continues.
