Nevsun and the Canadian Mining Experience

  • May 31, 2019
  • Naomi Sayers

In January 2019, the Supreme Court of Canada heard an appeal into whether a Canadian-based mining company, Nevsun Resources Ltd. (“NRL”), is liable for the action of Bisha Mining Share Company (“BMSC”), its subsidiary (see Araya v Nevsun Resources Ltd., 2017 BCCA 401 [Nevsun]). The plaintiffs, now refugees, allege that NRL utilized state and military forces to engage in torture and slave labour. The plaintiffs seek to have the action heard in British Columbia, the provincial jurisdiction for NRL. NRL argued in the lower courts that the country in which BMSC operates should hear the trial, relying on, among other things, principles of comity and highlighting the logistics of conducting a trial in Canada, when the majority of the witnesses are not in Canada. BMSC operates in the state of Eritrea, a country in Africa. 

I have previously written on a similar case, Yaiguaje v Chevron Corporation, 2018 ONCA 472 [Chevron]. The issue in Chevron was whether to pierce the corporate veil and enforce an arguably fraudulently obtained judgment against a seventh-level subsidiary of Chevron Corporation. That subsidiary operated in Canada. The SCC denied leave to appeal that decision on April 4, 2019. In the Chevron article, I agreed with the majority holding because the dissent relied on an Ontario decision that focused on a Toronto-centric business with no global operations -- the facts in Nevsun, however, were and are easily distinguishable.

In the Nevsun case, I agree with the holdings of the lower courts. While some may argue that the facts in Nevsun are similar to the Chevron, the Nevsun case presents a unique opportunity for Canadian courts to ensure Canadian corporations are living up to their corporate social responsibilities.