A Review of the Nigerian Energy Industry

Nigeria: 32 years after, Supreme Court finds Shell liable for oil spills

Hammer & a gavel.
Hammer & a gavel.

09 June 2015, Abuja — The Supreme Court has ordered Shell Petroleum Development Company of Nigeria Limited, SPDC, to pay four communities in Delta State N30,288,681 compensation earlier awarded against it in 1997 by the then Bendel State High Court for damages caused by oil spills linked to the company.

The communities – Obotobo, Sokebolo, Ofogbene (Ezon Burutu) and Ekeremor Zion (Ezon Ase) – had sued Shell separately in 1983 at the Bendel State High Court for compensation for series of oil spills recorded in the communities around that period.

The court consolidated the four cases in 2005.

The trial court, in a judgment delivered on May 27, 1997, held in favour of the plaintiffs and in granting damages, awarded N4,095,085 to Obotobo; N13,278,306 to Sokebolo; N7,392,589 to Ofogbene (Ezon Burutu) and N5,522,701.

Shell appealed the judgment at the Court of Appeal, Benin, an appeal the court dismissed on May 2000 for lacking in merit. Its appeal to the Supreme Court was again dismissed on Friday.

In a unanimous judgment by a panel of five justices, the Supreme Court upheld the concurrent decisions of the trial and lower court and awarded N500,00 cost against Shell and in favour of each of the communities. Justice Kumai Bayang Akaahs read the lead judgment.

On the objection to the award of damages against it, the Supreme Court upheld the conclusion of the Court of Appeal to the effect that the “direct compelling and largely un-contradicted evidence available to the learned trial judge, I am convinced that the damages awarded by the learned trial judge are not baseless or erroneous or in any event, as that offensive as the awards are amply supported by evidence.”

The apex court added that the respondents’ right to fishing in the creeks was affected and the payment of compensation was made to each of the various communities for loss of income suffered by the community members, who have a right to fish in the creeks located in the community to the exclusion of other members, who are not members of the particular community.

“The award is for the temporary loss of fishing right caused by the oil spillages. The second issue is resolved in favour of the respondents and against the appellants on the principle that the rights of common fishery in tidal waters is a public right both under the Common Law and Natural Law, and was not affected by Section 3 (10 ) of the Minerals Act, which was first enacted in 1916.”

The Supreme Court also faulted Shell’s argument that the trial court lacked the jurisdiction to hear the cases in view of the promulgation of the Admiralty Jurisdiction Decree no.59 of the1991, the Federal high Court (Amendment) Act 1991 and the Constitution (Suspension and Modification) Decree No. 107 of 1993 on the ground that the cause of action arose before the enactment of the laws.

“There is a strong leaning against the construing of a statute so as to oust or restrict the jurisdiction of the superior courts. Where a cause of action accrued before the advent of an alteration of the law governing the same, the applicable law is the one which was in operation at the time when the cause of action accrued, unless the subsequent legislation manifestly and unambiguously provides that the altered laws takes retroactive effect.

“This being the case, since the state High court had jurisdiction to entertain admiralty cases begun in 1983, it was right to proceed with the trial leading to the judgment in 1995 after the promulgation of Decree No. 107 of 1993.

“The concurrent findings of fact made by the two courts are not perverse. I find that the appeal totally lacks merit. It was fought principally on the assumption that the Admiralty jurisdiction is exclusively vested on the Federal High Court, and the consolidated suits which were commenced in 1983 before the then Bendel State High Court ought to have abated after the promulgation of the Admiralty Jurisdiction Decree No. 59 of 1991, the Federal high Court (Amendment) Decree No. 60 of 1991 and 16 of 1992 and the Constitution (Suspension and Modification) Decree No. 107 of 1993.

“This appeal is therefore dismissed in its entirety and I award costs of N500,000 to each set of respondents in the consolidated suits against the appellant,” Justice Akaahs said.

Justice John Fabiyi, Clara Ogunbiyi, Kudirat Kekere-Ekun and Chima Nweze, who were in the panel that heard the appeal, agreed with the lead judgment.

*Tobi Soniyi – Thisday

In this article

Join the Conversation