King John Bari-Iyiedum Berebon & Others v Shell Petroleum Development Company of Nigeria
| Jurisdiction | England & Wales |
| Judge | Mrs Justice O'Farrell DBE,Mrs Justice O'Farrell |
| Judgment Date | 12 February 2024 |
| Neutral Citation | [2024] EWHC 276 (TCC) |
| Court | King's Bench Division (Technology and Construction Court) |
| Docket Number | Case No: HT-2013-000028 |
[2024] EWHC 276 (TCC)
Mrs Justice O'Farrell DBE
Case No: HT-2013-000028
IN THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
TECHNOLOGY AND CONSTRUCTION COURT (KBD)
Royal Courts of Justice
Rolls Building
London, EC4A 1NL
Richard Hermer KC, Alistair Mackenzie & Kate Boakes (instructed by Leigh Day) for the Claimants
Lord Goldsmith KC, Dr Conway Blake, Tom Cornell & Mark McCloskey (instructed by Debevoise & Plimpton LLP) for the Defendant
Hearing dates: 23 rd & 24 th May 2023
APPROVED JUDGMENT
This judgment was handed down remotely at 10.30am on Monday 12 th February 2024 by circulation to the parties or their representatives by e-mail and by release to the National Archives.
There are two applications before the court:
i) an application by the claimants for restoration of the claims that have been the subject of an extended stay since 2014 and directions to trial;
ii) an application by the defendant, seeking an order that the claims should be struck out as provided in a consent order sealed on 15 October 2021; alternatively, pursuant to CPR 3.4(2)(a) and/or (b); or reverse summary judgment pursuant to CPR 24.2.
The Claims
These proceedings arise out of two oil spills that occurred in the vicinity of the Bodo Creek in the Gokana Local Government Area of Rivers State, Nigeria. The first incident occurred on about 28 August 2008, when erosion and rupture in the 24” Bomu-Bonny SPDC Trans-Niger Pipeline at Sivilbilagbara in the Bodo Creek caused a spillage of crude oil into the creek that continued until about October/November 2008. The second incident occurred on about 7 December 2008, when erosion and rupture on the Trans-Niger pipeline at Bodo Bia Barima area in the Bodo Creek caused an oil spillage that continued until about February 2009.
Section 11(5) of the Nigerian Oil Pipelines Act 1990 (“the OPA”) provides as follows:
“The holder of a licence shall pay compensation –
(a) to any person whose land or interest in land (whether or not it is land in respect of which the licence has been granted) is injuriously affected by the exercise of the rights conferred by the licence, for any such injurious affection not otherwise made good; and
(b) to any person suffering damage by reason of any neglect on the part of the holder or his agents, servants or workmen to protect, maintain or repair any work, structure or thing executed under the licence, for any such damage not otherwise made good; and
(c) to any person suffering damage (other than on account of his own default or on account of the malicious act of a third person) as a consequence of any breakage of or leakage from the pipeline or an ancillary installation, for any such damage not otherwise made good.
If the amount of such compensation is not agreed between any such person and the holder, it shall be fixed by a court in accordance with Part IV of this Act.”
Prior to commencement of this litigation the defendant, who operated a pipeline in the area as part of a joint venture with the Nigerian National Petroleum Corporation, admitted liability under the OPA to pay compensation in respect of the above spills.
In 2011 and 2012, 13 sets of proceedings were issued by about 15,000 claimants (acting on their own behalf and in a representative capacity for others) against the defendant, seeking compensation for the damage caused by the oil spills, including damage to the Bodo Community land and waterways and for consequential losses. In 2012, the claims were transferred to the Technology and Construction Court and thereafter case managed as group litigation, referred to as “the Bomu-Bonny Oil Pipeline Litigation”.
This claim (HT-2013-000028) was brought against the defendant by the first claimant King Felix Sunday Bebor Berebon, together with other claimants (the Regent, Labon, Chiefs, Elders and traditional rulers), on behalf of the Bodo Community, a fishing and farming community in Gokana Local Government Area, Rivers State, Nigeria, seeking compensation and/or other relief in respect of damage to community property and rights (“the New Bodo Community Claim”).
The defendant acknowledged service of the proceedings without any challenge pursuant to CPR 11, thereby submitting to this jurisdiction.
On 20 June 2014, Akenhead J handed down a judgment which resolved a variety of preliminary issues between the parties, reported at [2014] EWHC 1973 (TCC), including the following:
i) Under Nigerian law the common law has been superseded by the OPA in respect of the financial remedies available for land injuriously affected and for damage caused by neglect in the protection, maintenance and operation of the licensed pipelines or caused by a breakage or leakage of such pipelines (with specified exceptions) (at [64]–[69]).
ii) Once the court is seised of the compensation claim, it has all the powers of the court which have not been withdrawn or limited by the OPA, including the power to grant injunctive relief (at [65]).
iii) The defendant would not be liable under the OPA in respect of damage caused by illegal bunkering or illegal refining unless it neglected to protect, maintain or repair the pipeline (at [92]–[93]).
iv) The amount of compensation recoverable under the OPA in relation to damage arising from oil spills may be assessed by reference to the diminution in value of the land and/or interests in land which have been damaged and/or the loss of the amenity value of that land or interests therein and/or consequential loss (at [152]).
Following the judgment on preliminary issues, the New Bodo Community Claim was amended to reflect those findings in the Re-Amended Particulars of Claim. The amended claims were limited to the defendant's liability pursuant to section 11 of the OPA as set out in paragraph 51 of the pleading. The claimants alleged that as a result of the two oil spills, marine life within the Bodo Creek was devastated, mangroves were destroyed and farmland along the coastal areas was contaminated, affecting farm production and yields due to toxicity of the soil and groundwater.
At paragraph 64, the claimants sought compensation for the environmental damage to community land, loss of amenity and other consequential losses suffered by the Bodo Community, as set out in the Master Schedule of Loss.
Further, the claimants claimed a mandatory injunction requiring the defendant to carry out clean-up and remediation of the impacted land and waterways, alternatively damages in lieu:
“34. The Claimants aver that following the eventual inspections and clamping of the oil spills by the Defendant, no clean up or remediation has been undertaken by the Defendant to restore the impacted creeks, waterways and land to their pre-spill state or to the condition as required by Nigerian law.
…
39. Accordingly, in respect of the said oil spills it is averred that:
a. The two oil spills resulted from erosion and rupture (“equipment failure”) to oil pipelines operated by the Defendant.
b. The Defendant was provided with prompt notice of the said oil spills and failed to repair the said ruptures expeditiously, to take any/any adequate measures to reduce the flow of the oil and to take any/any adequate measures to contain the spread of oil.
c. The rate of flow of oil from the first spill was in the region of 3,900 barrels of oil for at least 72 days totalling approximately 280,000 barrels of oil. The rate of oil flow from the second spill was at least as large as the first spill and continued for 75 days.
d. The Bodo creek was environmentally sound prior to the said oil spills. The first oil spill extended to most areas within the Bodo creek and to neighbouring communities. The second oil spill added to and compounded the environmental damage which had already been caused by the first oil spill.
e. Once the Defendant had capped the ruptures to the said oil pipelines, it failed to carry out any/any adequate clean up and remediation to restore the impacted land, creeks and waterways to their pre-spill condition as required under Nigerian law.
…
65. In order to put the Community into its position prior to the spill extensive clean up and remediation is required in general terms this would require:
a. An intensive clean-up of oil spilled into the Bodo creek, including the collection of free-floating, cleaning of oiled intertidal sediments, and cleaning of mangroves;
b. An environmental remediation programme, including mangrove restoration and replanting in impacted areas;
c. Fisheries rehabilitation, including restocking native fish populations through aquaculture production;
d. Re-establishment and management of protected areas, including the designation of new mangrove protected areas.
66. It is averred in light of Defendant's history of poor clean up and remediation practice that the Court should award damages in lieu of the Defendant itself undertaking clean up and remediation …
67. Alternatively the Claimants seek a mandatory order that the Defendant carry out an appropriate clean-up and remediation of the impacted land and waterways.”
In its Re-Amended Defence, the defendant admitted that the 2008 oil spills caused environmental damage in Bodo and admitted liability to pay compensation in accordance with the OPA but disputed the extent of such damage. Further, it pleaded that the claims were an abuse of process having regard to ongoing proceedings in the Nigerian courts and denied liability for damage caused by third-party acts, such as illegal bunkering or oil refining.
In respect of the clean-up and remediation claim, the defendant pleaded the following at paragraph 12.1 of the Re-Amended Defence:
“(a) It is denied that the members of the...
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