This judgment is the latest development in proceedings which began in 2015 concerning environmental damage caused by oil spillages in Nigeria.
Background
The claims are from a group of residents from two villages, Billie and Ogale, situated near to the Niger Delta, who are the ‘Claimants‘. The Shell Petroleum Development Company of Nigeria Limited, a subsidiary of UK company Shell plc (together ‘Shell‘) has operated oil pipelines in this area for many years.
It is alleged that years of oil spills have left the Claimants without clean water to drink, unable to fish from the affected waters and with reduced agricultural productivity, all due to the ongoing contamination.
The Claimants advanced various claims, including under Nigerian statutory and constitutional law, as well as under tort claims like negligence, nuisance, and trespass. They allege that Shell failed to prevent, mitigate and remediate oil damage and contamination coming from its pipelines and associated infrastructure.
Shell’s defence
Shell have mounted a robust defence to these claims, which have taken many years to work through. Shell’s defence was that the contamination was caused by events for which is not liable, namely spills caused by theft and illegal refining by third parties. They also argued that much of the alleged damage was now effectively time barred under Nigeria’s five-year statute of limitations.
The harder the conflict, the more glorious the triumph.”
Thomas Paine
Evidential impasse
Whilst a few of the Claimants have been able to successfully show that a particular spill has directly led to the contamination which has caused them loss, this direct link is only demonstrable in a small number of the cases. This has led to an “evidential impasse” where the Claimants required more information from Shell to make their case, and Shell has wanted more detailed claims before providing that information.
Global or lead claim
Due to the scale of the case and the evidential issues noted above, it had to be decided how to group the Claimants together.
Global claims refer to “all or nothing” claims for a single amount which cover multiple alleged causes of loss, not divided into specific amounts for each cause. However, in a case of environmental contamination such as this, this approach is more difficult to apply, as there can be a number of events caused by a number of different factors, including third party acts.
Lead claims are where a single claim or small number of claims are selected to represent a larger group of cases, usually because they contain the key issues of fact or law which are common to the majority of the claims. These lead claims are tried first, testing out the key issues early on. The outcome of the lead claim then informs the approach to the remaining claims, which might follow the lead if has been successful or be amended as necessary or even settled. It was decided that the ‘lead claim’ approach would be the most efficient way of proceeding in this matter.
Victory belongs to the most persevering.”
Napoleon Bonaparte
Legacy pollution
The judge found that where Shell had failed to clean up pollution from an older spill, the continued presence of the oil could be regarded as an ongoing breach. Further, the involvement of a third party will not automatically excuse Shell from responsibility, and they could be liable if they had failed to take reasonable steps to prevent this kind of interference.
However, these are findings on preliminary issues of law, and do not mean that Shell has trespassed by not cleaning up such legacy pollution, merely that it is a possibility that this could be found, but it will need to be demonstrated on the facts at trial. Nevertheless, it opens the door to the tort of trespass being a way of addressing legacy pollution through a private law claim.
This case also represents a significant development in cases of legacy pollution caused by a multinational corporation. The position previously in Jalla and another v Shell International Trading and Shipping Co Ltd and another [2023] UKSC 16 suggested that corporations could not be held liable if the claimants failed to make their claim within the relevant limitation period. Here, however, the judge ruled that the Claimants will not necessarily be prevented from bringing claims due to the passage of time.
Parent companies
The judgment confirms that Shell, as the UK-based parent company, can be sued for harms caused by their subsidiaries, if they exercised control over those operations, or were negligent in failing to supervise them. This follows the precedent set in Okpabi v Royal Dutch Shell [2021] UKSC 3.
Human Rights
It was recognised that environmental damage on this scale could trigger the constitutional right to life under Nigerian law. It was noted that “knowledge about the impact of environmental harm has moved on such that there is now a greater readiness to see polluting activities as capable of engaging the right to life”. This acknowledges that environmental damage is no longer just a local or regulatory matter but carries with it much broader implications. However, whilst this seemed to be the “direction of travel” for the Nigerian Supreme Court, it was still for them, and not an English court, to undertake such legal developments.
Expert Evidence
The judge praised the “expertly drafted, interesting and comprehensive” submissions which she received from the various experts who had assisted in this case. This once again demonstrates the value of highly experienced and knowledgeable experts in complex trials.
Next Steps
This decision seems to have limited Shell’s ability to avoid a trial, which now looks set to take place in 2027. Notably, in terms of defining corporate accountability, it means that companies might not be able to use the passage of time or third-party intervention to try to absolve them from responsibility. Further the Claimants allege that Shell employees might themselves have been involved in these illegal activities, a claim they will have the opportunity to provide evidence for at the trial.
Whilst the outcome of the trial is unknown, it seems clear that this case could represent a new direction for how similar claims will be managed going forward.
Full name of the case: (1) Alame and others, (2) Chief Minapakama and others, (3) Okpabi and others, (4) Ejire Awala and others, (5) Okochi Nwoko Ododo and Others v (1) Shell PLC (formerly known as Royal Dutch Shell Plc), (2) The Shell Petroleum Development Company of Nigeria Ltd.
Link: Alame & Ors v Shell PLC & Anor [2024] EWCA Civ 1500 (06 December 2024)
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