Case Review & Case Watch
Case Review Negligence Damages Jurisdiction Conflict of Laws Liability Nuisance Trespass
F. A. Akpan; B.M.T. Dooh; F.A. Oguru, A. Efanga; and Vereniging Milieudefensie v Royal Dutch Shell PLC (“RDS”) and Shell Petroleum Development Company of Nigeria Ltd (“SPDC”) – under three case citations for Akpan: Rb.’s-Gravenhage (vzr.) 30 January 2013, LJN BY9854.; Dooh: Rb. ’s-Gravenhage (vzr.) 30 January 2013, LJN BY9845; Oguru and Efanga Rb. ’s-Gravenhage (vzr.) 30 January 2013, LJN BY9850. In these cases, four Nigerian farmers/fishermen and Milieudefensie (the Dutch branch of Friends of the Earth) jointly brought claims against Shell Nigeria and its parent company Royal Dutch Shell in May 2008 for damages resulting from oil spills in the delta region of Nigeria. The farmers/ fishermen were from the areas of Goi, Ikot Ada Udo and Oruma which due to leaks in the oil pipeline became polluted and thus largely inhabitable. The Plaintiffs alleged that RDS and SPDC were responsible for specified oil spills that occurred in: October 2004 near the village of Goi in Ogoniland; 2005 near the village of Oruma; and in 2006 and 2007 near Ikot Ada Udo in Akwa Ibom State of Nigeria; and accordingly, jointly and severally liable for the damage suffered (and that to be suffered in future) by the Plaintiffs. Specific tortious claims included negligence, nuisance and trespass against the Plaintiffs. Jurisdiction: The court upheld its interlocutory judgement allowing it 8
jurisdiction not only over RDS (being based in The Hague) but also SPDC notwithstanding that the claims arose out of events and resulting damages that occurred in Nigeria. The court noted that “the forum non conveniens restriction no longer plays any role in today’s international private law” and that: as the claims against RDS and SPDC related to the same events (oil spills) and were on the same legal basis (i.e. tort of negligence under Nigerian law) and therefore sufficiently connected, in the absence of abuse of procedural law, the Dutch court had jurisdiction over SPDC as a joint defendant by virtue of Book 1: Article 7 of the Dutch Civil Code (“DCC”) and the circumstances justified a joint hearing for reasons of efficiency. The court dismissed the argument by the Defendants that procedural law had been abused by the Plaintiffs who sought to invoke the jurisdiction of the Dutch court by initiating claims against RDS and SPDC jointly when clearly the claims against RDS were certain to fail. The court stated that the claims against RDS could not be designated as ‘clearly certain to fail’ beforehand, because beforehand it could be argued that under certain circumstances, based on Nigerian law, the parent company of a subsidiary may be liable in tort for damage suffered as a result of the activities of that subsidiary as demonstrated in the English case of Chandler v Cape plc [2012] EWCA Civ 525, where a parent company was held as owing a direct duty of care to an employee of one of its subsidiaries. The court further opined that its jurisdiction did not cease to exist in the event that claims against the Dutch Defendant were dismissed and even if subsequently, in fact, no connection or hardly any connection would remain with the Dutch jurisdiction. Applicable law: As the alleged torts were committed in and with the resultant effects in Nigeria, the court ruled that the claims in the main action were to be substantively assessed under Nigerian law subject to the exceptions based on Dutch confl ict of law rules under Book 10: Articles 6 and 7 of the DCC i.e. where such laws would be manifestly incompatible
with Dutch public policy or special mandatory laws of The Netherlands. Decision: Regarding claims against RDS as the parent company, the court held that the special circumstances basis on which the parent company was held liable in the Chandler case were not so similar to those in this case and therefore did not apply. It held further that a sufficient duty of care by RDS in respect of the people living in the vicinity of the oil pipelines and oil facilities of SPDC had not been established so that RDS could not be held to have committed any tort of negligence against the plaintiffs. The District Court therefore, dismissed all the claims against RDS. The court further held that under Nigerian law, SPDC committed a specific tort of negligence against Akpan by insufficiently securing the wellhead in issue prior to the two oil spills in 2006 and 2007 near Ikot Ada Udo against sabotage (as the spills resulted from the opening of valves which were easily accessed). Therefore SPDC was required to compensate Akpan for the damage he suffered. The court dismissed all other claims. The court held that the claims of the other Plaintiffs against SPDC for oil spills in 2004 and 2005 could not be sustained. Applying the general rule of Nigerian law, it held that in the event of sabotage, an operator such as SPDC is not liable for damages caused by oil leak caused by sabotage which was not preventable. The cause of the October 2004 oil spill near Goi village was held to have been from a cut in the pipeline by a jagged hacksaw, while that in 2005 near Oruma village, was from a circular hole made by a drilling device; that in those instances SPDC could not have prevented the sabotage and given their adequate response to the spills, SPDC could not therefore be held to be tortuously liable.
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