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Court of Appeal upholds AAA v Unilever judgment, declining to allow parent company liability claim

Author: Ian Jones, Freshfields Bruckhaus Deringer, Published on: 9 July 2018

The Court of Appeal has handed down its judgment in AAA & Others v Unilever PLC and Unilever Tea Kenya Limited [2018] EWCA Civ 1532, upholding the decision at first instance to strike out the claims against Unilever...The case deals with parent company liability for acts primarily associated with foreign-registered subsidiaries...The Unilever Claimants alleged that UK-registered parent company Unilever PLC (UPLC) and its Kenyan-registered subsidiary, Unilever Tea Kenya Limited (UTKL), were each liable to UTKL employees and their families for a failure to adopt adequate safeguards to protect them from the ethnic violence that erupted in Kenya following the 2007 presidential elections...

...The High Court decided...that the Claimants’ claims in negligence against UPLC did not meet the necessary threshold, since UPLC did not owe a duty of care to the Claimants in respect of the alleged failings...A unanimous Court of Appeal held...that UPLC did not owe the Claimants a duty of care in negligence and that the Claimants were therefore unable to demonstrate a properly arguable case...It held that the evidence relied upon by the Claimants failed to disclose a level of control by UPLC over UTKL’s operations that was sufficient to warrant the imposition of a duty of care...The judgment provides additional clarity regarding the difficulties to be faced by Claimants seeking to bring proceedings in the English Courts against a UK-registered company for activities occurring abroad and primarily relating to a foreign-registered subsidiary.  However, this judgment...leaves open the possibility that UK-registered companies may still be found liable in negligence in English proceedings for acts occurring overseas...

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