TORONTO (miningweekly.com) – Gold major Goldcorp on Monday revealed that a group of local Mexican landowners had threatened to sue it in Canada, despite the company saying it was already having a “constructive” dialogue with the group to reach a mutually beneficial settlement of the claim.

Goldcorp said negotiations between its subsidiary Minera Peñasquito and authorised representatives of the Cerro Gordo Ejido over land ownership of the largest Mexican gold mine were ongoing.

The company said that despite negotiations taking place under the official observation of the office of the Mexican Secretary of the Economy and involving the proper representatives of both parties, it had recently received notice from a Canadian law firm purporting to represent the Cerro Gordo Ejido, threatening to start litigation against Goldcorp in Canada concerning the same lands.

Goldcorp labelled the threat “an apparent effort to disrupt the ongoing negotiations and legal process from continuing under the auspices of the Mexican judicial system”.

Goldcorp and Minera Peñasquito had assessed the underlying allegations of the proposed litigation and believed they were baseless and without merit and vowed to vigorously defend any claim if one was filed.

The gold miner added that it believed it was in the best interests of all concerned to continue with the good-faith efforts toward a mutually beneficial settlement rather than engage in litigation in Canada that could indefinitely defer any final resolution of this matter. 

Operations at the Peñasquito mine had not been impacted.

In 2005, before Goldcorp started building the Peñasquito mine, it had negotiated an agreement with the Cerro Gordo Ejido to use of 600 ha of surface land located within the confines of the proposed Peñasquito mine site.

The terms of the agreement were based on comparable surface valuations in the region, as well as on similar agreements at Peñasquito and other Mexican mining operations.

In 2009, the Cerro Gordo Ejido started an action against Minera Peñasquito in Mexico's agrarian courts challenging the land use agreement. Following a series of legal proceedings, the agrarian courts ruled on June 18, that the land use agreement was null and ordered the land to be returned to the Cerro Gordo Ejido for payment of 2.4-million pesos.

Three separate claims were currently proceeding in the First District Court of Zacatecas, by the Cedros and Mazapil Ejidos and a local transportation union, which had resulted in the temporary and permanent suspension of the agrarian court's ruling.

Under a permanent suspension, the agrarian court's ruling was suspended pending a final determination of the Cedros Ejido's claim following appeal.

Peñasquito employs about 3 000 workers of which about 85% were from local communities. The mine generated more than 6 000 direct and indirect jobs for Mexican families.

ANOTHER CANADIAN CLAIM

In a precedent-setting ruling with national and international implications, Superior Court of Ontario Justice Carole Brown in July ruled that Hudbay could potentially be held legally responsible in Canada for alleged sexual assault and murder at a mining project formerly owned by its subsidiary in Guatemala. As a result of Brown’s ruling, the claims of 13 Mayan Guatemalans would proceed to trial in Canadian courts.

It was the first time that a Canadian court had ruled that a claim could be made against a Canadian parent corporation for negligently failing to prevent human rights abuses at its foreign mining project.

Members of the indigenous Mayan Q’eqchi’ population from El Estor had filed three related lawsuits in Ontario courts against Hudbay over the alleged killing of Adolfo Ich, the alleged sexual assault of 11 women from Lote Ocho, and the alleged shooting and paralysing of German Chub – abuses alleged to have been committed by mine company security personnel at Hudbay’s former Fenix nickel project, located near El Estor.

“As a result of this ruling, Canadian mining corporations can no longer hide behind their legal corporate structure to abdicate responsibility for human rights abuses that take place at foreign mines under their control at various locations throughout the world,” the lawyer for the 13 indigenous Mayans, Murray Klippenstein, said in a statement.

Hudbay argued in court that corporate head offices could never be held responsible for harms at their subsidiaries, no matter how involved they were in on-the-ground operations. Justice Brown disagreed and concluded that “the actions as against Hudbay and HMI should not be dismissed.”

“This judgment should be a wake-up call for Canadian mining companies,” co-counsel for the Mayans along with Klippenstein, Cory Wanless, added at the time.

This was the second significant legal victory for the Mayan plaintiffs this year. In February, Hudbay dropped its argument that the lawsuit against it should be heard in Guatemala, not Canada, after fighting over this issue for more than a year.