ESG Enforcement Tracker

Key facts:

In October 2023, the High Court declined to exercise jurisdiction over claims brought by migrant workers against English and Malaysian companies within the Dyson group. The claims were based on alleged abusive employment practices by a Malaysian domiciled third party that had supply contracts with the Malaysian Dyson subsidiary.

The claimants argued that Dyson was liable for negligence and unjust enrichment and owed them a duty of care for the treatment at the factories. Dyson allegedly exerted a high degree of control over the manufacturing operations and working conditions in the factories and promulgated mandatory ESG policies and standards concerning the working and living conditions of workers in the Dyson Group supply chain.

The decision of the High Court did not address the merits of the claim as Dyson challenged the English court’s jurisdiction, and that had to be decided on first. In coming to its decision, the court applied the two-stage test in Spiliada Maritime Corporation v. Cansulex Ltd [1987] 1 AC 460.

For the first part of the test, the court found that England was not the most appropriate forum, noting that:

• the alleged torts had taken place in Malaysia;
• the governing law was Malaysian law and the issues would be decided by Malaysian judges;
• neither jurisdiction was practically convenient for all parties and there was no common language;
• there was a real risk of irreconcilable judgments if the claims were heard in either jurisdiction; and
• the Malaysian courts has sufficient case management powers to hear cases remotely.

The second stage of the test concerned whether there were special circumstances such that justice require the trial to take place in England.

The court considered that there was a real risk that the claimants would not be able to obtain representation and necessary NGO funding to pursue the claim in Malaysia. Dyson’s undertaking to partially fund the claims in Malaysia and to submit to the Malaysian courts’ jurisdiction carried weight in persuading the court that special circumstances did not apply.