HRH Emere Godwin Bebe Okpabi and Others (suing on behalf of themselves and the people of Ogale Community) v (1) Royal Dutch Shell Plc

JurisdictionEngland & Wales
CourtCourt of Appeal
JudgeLord Justice Simon,Lord Justice Sales
Judgment Date14 Feb 2018
Neutral Citation[2018] EWCA Civ 191
Docket NumberCase No: A1/2017/0407 and 0406

[2018] EWCA Civ 191

IN THE COURT OF APPEAL (CIVIL DIVISION)

ON APPEAL FROM THE HIGH COURT OF JUSTICE

TECHNOLOGY AND CONSTRUCTION COURT

(The Hon. Mr Justice Fraser)

Royal Courts of Justice

Strand, London, WC2A 2LL

Before:

SIR GEOFFREY VOS, CHANCELLOR OF THE HIGH COURT Lord Justice Sales

and

Lord Justice Simon

Case No: A1/2017/0407 and 0406

Between:
HRH Emere Godwin Bebe Okpabi and others (suing on behalf of themselves and the people of Ogale Community)
Appellants
and
(1) Royal Dutch Shell Plc
(2) Shell Petroleum Development Company of Nigeria Ltd
Respondents
Between:
Lucky Alame and others
Appellants
and
(1) Royal Dutch Shell Plc
(2) Shell Petroleum Development Company of Nigeria Ltd
Respondents

Mr Richard Hermer QC and Mr Edward Craven (instructed by Leigh Day) for the Appellants

Lord Goldsmith QC and Ms Sophie Lamb QC (instructed by Debevoise & Plimpton) for the Respondents

Hearing dates: 21 to 23 November 2017

Approved Judgment

Lord Justice Simon

A. Introduction

1

The claimants in these two actions seek damages arising as a result of serious, and ongoing, pollution and environmental damage caused by leaks of oil from pipelines and associated infrastructure in and around the Niger Delta for which, they contend, the 1st defendant (‘RDS’) and the 2nd defendant (‘SPDC’) are responsible.

2

The claimants are citizens of Nigeria and inhabitants of the areas affected by the oil leaks. RDS is a company incorporated in the United Kingdom and is the parent company of the Shell group of companies (‘the Shell Group’). SPDC is an exploration and production company incorporated in Nigeria, and is a subsidiary of RDS. It is the operator of a joint venture agreement between itself, the Nigeria National Petroleum Corporation, Total Exploration and Production Nigeria Ltd and Nigeria Agip Oil Company.

3

The claims against both RDS and SPDC are based on the tort of negligence under the common law of Nigeria which, for present purposes, is to be regarded as the same as the law of England and Wales. The claim against SPDC is brought also under Nigerian statutory law. The claim against RDS is brought on the basis that RDS owed the claimants a duty of care either because it controlled the operation of pipelines and infrastructure in Nigeria from which the leaks occurred or because it had assumed a direct responsibility to protect the claimants from the environmental damage caused by the leaks.

4

The claimants were able to effect service on RDS because it is registered and domiciled within the jurisdiction. Leave to serve SPDC out of the jurisdiction in Nigeria was obtained under Practice Direction 6B 3.1(3), on the basis that the claim forms had been, or would be, served on RDS within the jurisdiction, and (a) there was a real issue between the claimants and RDS which it was reasonable for the court to try; and (b) SPDC was a necessary and proper party to those claims. In this situation the party that is legitimately served within the jurisdiction on the basis of its place of incorporation or domicile is often referred to as the ‘anchor defendant’.

5

RDS applied under CPR Part 11(1) for orders declaring that the court had no jurisdiction to try the claims against it, or should not exercise such jurisdiction as it had.

6

Those applications were heard by Fraser J (‘the Judge’) in a hearing that lasted three days in the Technology and Construction Court. In a judgment, dated 26 January 2017, he concluded that there was no arguable case that RDS owed the claimants a duty of care, see Okpabi and others v. Royal Dutch Shell Plc and another [2017] EWHC 89 (TCC); and, by an order of 1 February 2017, he made the following declarations [ 1#7]:

(1) Pursuant to CPR 11(1)(a) the court did not have jurisdiction to try the claims against SPDC because there was no real issue between the claimants and RDS which it was reasonable for the court to hear.

(2) The court had jurisdiction to try the claims against RDS.

(3) However, the claimants' statements of case disclosed no reasonable ground for bringing the claim.

7

The claimants appeal against the judgment and order; and the appeal raises what might appear to be a short point: whether, to the standard required, RDS owed a duty of care to those affected by oil leaks from pipelines and associated infrastructure in the Rivers State of Nigeria.

B. The claimants

8

Although there are two claims and two appeals, for present purposes the claimants and their claims can be described compendiously. The communities who are represented by the two claims either own or occupy land adjacent to the oil pipelines and infrastructure operated by SPDC from which there have been substantial discharges of crude oil as a result of oil spills, sabotage, deliberate abstraction (referred to as ‘bunkering’) and illegal crude refining of oil from SPDC's pipelines and oil infrastructure.

9

The oil has contaminated the land, swamps, groundwater and waterways; and they claim that there has been no adequate cleaning or remediation, with the consequence that the natural water sources cannot be used for drinking, agricultural, washing or recreational purposes. Between them, the two claims concern about 42,500 individuals.

C. The approach to the issue of jurisdiction

1

Initial observations

10

This appeal and the hearing before the Judge raise in stark form how the court should, and can properly be expected to, determine the issue of jurisdiction.

11

The issue was considered by Lord Neuberger of Abbotsbury in VTB Capital plc v. Nutritek International Corp [2013] 2 AC 337:

82. The first point is that hearings concerning the issue of appropriate forum should not involve masses of documents, long witness statements, detailed analysis of the issues, and long argument. It is self-defeating if, in order to determine whether an action should proceed to trial in this jurisdiction, the parties prepare for and conduct a hearing which approaches the putative trial itself, in terms of effort, time and cost. There is also a real danger that, if the hearing is an expensive and time-consuming exercise, it will be used by a richer party to wear down a poorer party, or by a party with a weak case to prevent, or at least to discourage, a party with a strong case from enforcing its rights.

83. Quite apart from this, it is simply disproportionate for parties to incur costs, often running to hundreds of thousands of pounds each, and to spend many days in court, on such a hearing. The essentially relevant factors should, in the main at any rate, be capable of being identified relatively simply and, in many respects, uncontroversially. There is little point in going into much detail: when determining such applications, the court can only form preliminary views on most of the relevant legal issues and cannot be anything like certain about which issues and what evidence will eventuate if the matter proceeds to trial.

12

In the following paragraphs Lord Neuberger referred to the number of occasions on which the courts had regretted, if not deplored, the expenditure of time, effort and financial resources on jurisdiction issues, see for example, Cherney v. Deripaska (No. 2) [2009] EWCA (Civ) 849 at [6] and [7]; Friis v. Colburn [2009] EWHC 903 (Ch) at [3] and [5]; and Alliance Bank JSC v. Aquanta Corp [2012] EWCA (Civ) 1588 at [4].

13

At [89] he referred to the court's case management powers and added:

Accordingly, judges should invoke those powers to ensure that the evidence and argument on service out and stay applications are kept within proportionate bounds and do not get out of hand.

14

In the present case, the central issue is relatively easy to state: whether the claimants are able to demonstrate (to the standard required) that RDS owed them a duty of care (in the relevant respects). For reasons that I will come to, neither the hearing of the application nor the appeal proceeded as it should.

15

Before elaborating on this point, I would note that this is not the type of case, referred to by Lord Neuberger in [82] of the VTB Capital case (above), where there was a risk that one party was seeking to wear down the other party by the deployment of superior resources. Both parties are well-resourced and neither has been diffident about introducing material that it believed would advance its case on the application and the appeal.

2

The practical issues arising on the application and appeal

16

The parties deployed a large number of witness statements and exhibits before the Judge and on this appeal.

17

At the hearing before the Judge the parties' ‘skeleton arguments’ ran to 259 pages, plus 17 additional pages of detailed criticism of the other side's case and 61 pages of post-hearing notes. RDS deployed 13 lengthy witness statements and 3 expert reports; and the claimants served 15 witness statements and 2 expert reports. The total length of the witness statements ran to over 2,000 pages of material, quite apart from the 8 files of exhibits.

18

In advance of the appeal, the claimants and defendants served further skeleton arguments and additional material running to 40 pages with the permission of Jackson LJ, and RDS served a further skeleton argument of 19 pages. Following the conclusion of the hearing the Court invited the parties to serve additional written material which they had not been able to deploy in the 3 days set aside for the hearing of the appeal. The parties took this to be an invitation to set out further lengthy written submissions much of which amounted to re-argument.

19

I mention these matters because it seems to me that the hearings of what should have been a confined issue became overburdened with paper long before the hearing of the appeal; and it is in the light of this background that the criticisms of the Judge must be seen.

20

Although I will endeavour to deal with all the relevant material, I am firmly of the...

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