BM Brazil & Ors v Sibanye BM Brazil & Anor
[2024] EWHC 2566 (Comm)
10 Oct 2024
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The Commercial Court has given judgment following a 5-week trial of liability issues in this dispute under US$1.2 billion contracts for the sale and purchase of Brazilian mining assets.
The main issue was whether the First Defendant buyer was entitled to refuse to close under the contracts, and to terminate them, on the ground that a geotechnical event (“GE”) at one of the mines constituted a Material Adverse Effect (“MAE”). The Claimant sellers disputed this and maintained that the First Defendant’s purported termination was wrongful and repudiatory, entitling the Claimants to terminate the contracts in accordance with their terms and at common law.
The Court agreed with the Claimants on this issue and granted declarations accordingly. The remaining issues in the case are quantum issues, which are due to be tried in November 2025.
The case is likely to be a leading authority on the proper construction of MAE clauses, with various authorities (both in England and in the USA) being considered and the Judge giving important guidance on how such clauses allocate risk and how materiality is assessed.
Andrew Green KC, Andrew Scott KC, and Gayatri Sarathy acted for the Claimants instructed by Rajinder Bassi and Noah Stewart-Ornstein, Kirkland & Ellis International LLP.
The judgment can be found here.
