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England and Wales High Court (Technology and Construction Court) Decisions
You are here: BAILII >> Databases >> England and Wales High Court (Technology and Construction Court) Decisions >> King Felix Sunday Bebor Berebon & Ors v The Shell Petroleum Development Company of Nigeria Ltd  EWHC 1579 (TCC) (4 July 2017)
Cite as:  EWHC 1579 (TCC)
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QUEEN'S BENCH DIVISION
TECHNOLOGY AND CONSTRUCTION COURT
Rolls Building, Fetter Lane, London, EC4A 1NL
B e f o r e :
| King Felix Sunday Bebor Berebon & Others
|- and -
|The Shell Petroleum Development
Company of Nigeria Limited
(instructed by Leigh Day) for the Claimants
Mr Geraint Webb QC and Mr Adam Heppinstall
(instructed by Hogan Lovells International LLP) for the Defendant
Hearing Date: 16 June 2017
Crown Copyright ©
The Hon. Mr Justice Coulson :
(a) The claimants do not have the necessary title or capacity to bring these proceedings and/or Leigh Day did not have the authority to apply to lift the stay or to act for the claimants, and that therefore the application to lift the stay is a nullity. That would have the effect, says the defendant, of leaving the clean-up claim struck out pursuant to the previous Consent Orders.
(b) The claimants and/or those whom they purport to represent have (by violence and threats, and by issuing repeated injunction applications/claims in the courts in Nigeria aimed at stopping the remedial works) prevented the clean-up from going ahead. In those circumstances, the defendant says that the continuation of the clean-up claim for an injunction to require them to do those works – or damages in lieu – would be an abuse of the process of the court. In consequence, the defendant says that the stay should not be lifted.
Unhappily, the application to lift the stay, and the defendant's opposition to that application, have generated seven lever arch files of material and a total costs bill said to be in the order of £280,000. Worse still, it was the defendant's principal submission that, after all that, the application to lift the stay should be adjourned.
2. OUTLINE CHRONOLOGY
"F. In circumstances in which the issues of clean up and remediation of the Bodo Creek (as defined in accordance with paragraph 1 below) are the subject of an independent mediation led by the former Dutch Ambassador to Nigeria, the Claimants' Clean Up Claims as defined in paragraph 16 below shall be stayed and shall be struck out if not restored in accordance with paragraph 16.
G. The parties enter into and will implement this Agreement in a spirit of cooperation and good faith in the expectation that it will reduce the work that is required for the trial set down for May 2015 (the "trial") and, if possible, facilitate an early resolution of those Claims. This Agreement shall be interpreted and enforced so as to ensure that the Parties abide by the intentions and objectives, set out herein, upon which this Agreement is based."
"Claim for injunctive relief or damages in lieu of clean up and remediation
16. The Claimants shall not pursue their claims in relation to clean up and remediation of the Bodo Creek and in particular their claims for injunctive relief or damages in lieu of the same (the "Clean Up Claims") and the Clean Up Claims shall be stayed until further order and shall be struck out automatically at 4:00pm on the date two calendar years from the date of this Agreement (the "Strike Out Date"). This Agreement is subject to the Claimants being at liberty to apply to the Court to restore the Clean Up Claims for trial by 4:00pm on the date seven days prior to the Strike Out Date.
17. Save for paragraph 16 above and this paragraph 17 the Clean Up Claims shall not be subject to this Agreement."
As noted above, the Narrowing Agreement then set out an agreement by the defendant to pay substantial compensation to the claimants in respect of their other claims.
"That part of the New Bodo Community Claim relating to clean up and remediation (namely paragraphs 34 to 39 and 65 to 67 of the re-amended Particulars of Claim dated 10 July 2014 and paragraphs 21 to 27 and the first three lines of paragraph 65(1) of the Schedule of Loss dated 14 February 2014 in the New Bodo Community Claim) will be stayed until further order and shall be struck out automatically at 4:00pm on the date two calendar years from the date of the Narrowing Agreement (the "Strike Out Date"); the Claimants being at liberty to apply to the Court to restore for trial those parts of the New Bodo Community Claim that are pleaded in those paragraphs, any such an application to be issued and served by 4:00pm on the date seven days prior to the Strike Out Date." (Emphasis supplied)
"1. BMP comprising of Working Groups (including a technical Working Committee) a Steering Committee and a Plenary (general assembly/overall decision making body), will continue to cover all relevant aspects and activities related to the mediation. The Plenary reviews and endorses the proposals by the Working Groups, the overall work plan and approves the Project Director for the clean-up, remediation and restoration works.
2. The clean-up, remediation and restoration of the Identified Areas in BODO will be carried out in accordance with Nigerian law, by reputable contractors with proven international track record and experience with large scale clean-up, remediation and restoration works in a complex environment approved by the BMP Plenary…
4. SPDC will be responsible for the cost of clean-up, remediation and restoration of the Identified Areas under consideration, including the related bidding and contracting processes which shall be in accordance with the Joint Operating Agreement of SPDC, based on the recommendations of the Technical Working Committee and taking into account the applicable approval procedures of the relevant Nigerian authorities, including the National Petroleum Investment Management Services (NAPIMS).
5. In order to ensure that the clean-up, remediation and restoration of the Identified Areas is achieved, Bodo will grant and maintain unfettered access to SPDC, the Project Director, the Contractors and all persons performing or related to the performance of the clean-up, remediation and restoration works of the Identified Areas.
6. The day-to-day implementation of the clean-up, remediation and restoration work plan for the Identified Areas in BODO will be guided and supervised by the Project Director…"
(a) The BMI meeting minutes of 6 July 2015 set out an explanation for some of these events given by the deputy chairman of the Bodo delegation. He said that there was relative peace "until the litigation money came into the community". He said that youths were angry because no account of the money had been given to the community. In consequence, there was a massive uproar and some houses were burnt in the process.
(b) This volatile situation led directly to the prevention of the carrying out of the remedial works. The progress report for the period down to 30 September 2015 revealed that the site offices of the clean-up contractor were the subject of a physical attack by a group of 2,000 youths, who insisted that all work be stopped, that community contractors should be included in the project execution, and that there should be an increment in the wages of the youths to be engaged in the project. It was said that a meeting was necessary in the town square for the necessary explanations to be given.
(c) The BMI reported on that town hall meeting on 4 October 2015. The report revealed that, in response to the BMI chairperson's appeal to allow the clean-up to go ahead, "there was a thunderous 'NO!' from the crowd". It appeared that what the crowd wanted instead was for the money to be shared with the members of the Bodo Community. Although it was pointed out that there was no money equivalent of the remedial works to be shared out with anyone, it does not appear that this appeased the crowd.
(d) In consequence of this, on 26 October 2015, the claimants' solicitors, Leigh Day, wrote a letter addressed to 'the Bodo Community'. Amongst other things, they said:"As I explained to you in December when I told you about the settlement proposal, the clean-up part of your claim has been 'stayed' in the High Court in London. What this means is that this part of the claim has not been concluded but instead has been put on hold for a period of 2 years from October 2014. That should mean that if clean-up does not commence before October 2016, your community could instruct us to take the matter back before the British Judge.When the Dutch Ambassador to Nigeria began lobbying Shell on your behalf we felt that it would be a good idea to give that initiative an opportunity to succeed as it has a good chance of working. We understand that international contractors have been appointed. It is therefore important that the process is given a chance to succeed before we consider intervening. If we find that the clean-up is not being done to a sufficient standard we will speak with you and if the Community instructs us to we will return to court to try to force Shell to clean-up to an international standard. However, until we allow that clean-up to start we cannot assess it to see whether it is being done to an international standard so it is extremely important that the clean-up is allowed to start.I would also like to stress that there is no pot of money available for clean-up that could be shared instead of being used for clean-up. If the clean-up of the Bodo creek is prevented from going ahead then Shell can simply walk away, the British courts would very likely decide not to get involved and the Bodo creek will not be cleaned. There is no alternative to clean-up. It is therefore imperative that the clean-up is allowed to go ahead as the Bodo creeks are your and your families' future livelihood.The option to return to court is a last resort and this option will not be available to you if you do not allow the clean-up to start. I appeal to you to allow the clean-up to commence and then we can assess the situation after it has started early next year." (Emphasis supplied)
"We have already provided a detailed account of events so far in our letter dated 1 August 2016. In summary, as set out in our letter, the actions of members of the Bodo Community have included:
- Making repeated threats in respect of the personal safety of those participating in the BMI leading to visits of SPDC contractors having to be aborted and representatives of the Bodo Community in the BMI withdrawing their representation on behalf of the Bodo Community.
- Initiating law suits before the Nigerian courts to obtain injunctions to prevent clean-up under the auspices of the BMI.
- Shutting down the project sites and preventing the necessary access required to progress the clean-up.
- Refusing to honour the obligations of the Bodo Community under the Memorandum of Understanding.
- Making repeated and unreasonable demands on SPDC as preconditions to allowing clean-up to progress.
- Demanding that SPDC, instead of cleaning up and remediating the Bodo environment, distribute to the members of the Bodo Community the amount it would have spent on the exercise…
In the light of all the above, SPDC wants to avoid a situation whereby a stay is put in place for a further year but the parties find themselves in exactly the same position in 12 months' time due to further obstructions and delays caused by the activities of members of the Bodo Community or by a court injunction obtained by the Community to restrain the clean-up. Our client would like to think that, as Mr Leader asserts in his witness statement, "clean-up is now due to start imminently", but is understandably concerned that this will turn out to be another false hope given its prior experience in dealing with the Bodo Community in relation to clean-up.
For these reasons, SPDC would only be willing to consider a further stay as you suggest on the basis of a consent order that:
1. The Claimants, on behalf of the Bodo Community, give an undertaking that:
(a) the Bodo Community will immediately 'grant and maintain unfettered access to SPDC, the Project Director, the Contractors and all person performing or related to the performance of the clean-up, remediation and restoration works of the Identified Areas' or works related thereto in accordance with clause 5 of the Memorandum of Understanding ("MoU") dated 30 April 2015, and that this access will be sustained without interruption until the completion of the three phases of the project set out at clause 7 of the MoU.
(b) the pending actions before the Nigerian Court brought by members of the Bodo Community against (i) SPDC and/or (ii) members of the Bodo Mediation Committee and/or (iii) contractors appointed under the MoU and/or (iv) Voluntary Stakeholders and Federal and State Government Agencies listed in the MoU which seek to restrain or prevent clean-up in any way will be discontinued by the Claimants in those actions by 12 December 2016 and no further attempts to prevent any clean up activities will be made by or on behalf of any members of the Bodo Community by way of legal challenges or otherwise…
2. Leigh Day gives an undertaking that they would use their best endeavours to ensure that their clients comply with the undertakings set out in 1(a) and (b) above.
3. Any breach of the above undertakings will result in the clean-up claim being struck out.
4. The clean-up claim shall be automatically struck out at 4:00pm on 15 October 2017, unless the Claimants apply before that date to show good cause why it should not be struck out, supported by written evidence as to their compliance with the terms of this order in respect of the granting and maintaining of unfettered access.
5. Parties shall bear their respective costs for this application."
3. THE APPLICATION TO LIFT THE STAY: VALIDITY
"15. The King and/or the King and Council, hold and will hold as trustees for the benefit of the Community:
(a) The Community Interest in the Community Land;
(b) The causes of action stated hereunder for damage to the Community Land and loss suffered by the Community in respect of their ownership of the Community Interest in the Community Land;
(c) The causes of action stated hereunder for compensation for damage to or loss suffered by the Community in respect of the Other Common Interests of the Community;
(d) All damages or other compensation recovered in these proceedings to be applied in accordance with the customary law of the Community or as directed by the Court pursuant to s.21 Oil Pipelines Act 1990 of Nigeria.
16. Further or alternatively the King and/or the King and Council are entitled in Nigerian substantive law to bring this action as representatives on behalf of the Community and in addition to their capacity as trustees and/or representatives, have, as members of the Community, the same common interest as other members of the Community in the Community Interest in the Community Land and the Other Common Interests of the Community."
"It is important to put on record that Leigh Day & Co has no mandate or any new brief to act or represent Bodo community in any capacity, as such should not be copied to any letter concerning Bodo people as we are still asking the law firm to give account of all its actions and inactions to Bodo people as regard all funds collected on our behalf."
That might suggest that, on the face of it, Leigh Day may not have had authority to act either now or when they made the application to lift the stay.
4. THE APPLICATION TO LIFT THE STAY: THE TEST TO BE APPLIED
(a) The claimants have the right of access to the court to have their claim properly decided and, in consequence, it could only be "in truly exceptional circumstances" that a stay would be refused;
(b) A fortiori, that would be the case here, where the stay that was applied by operation of the Consent Order was unconditional. Mr Hermer warned that, if conditions were applied to any subsequent lifting of the stay, there was a real risk of satellite litigation;
(c) He said that the more significant the case, the more exceptional should be the procedural obstacles that would prevent the lifting of the stay. He said that this was a very significant case where a conservative estimate for the cost of the remediation scheme was £300 million;
(d) Nothing could prevent the defendant from making an application to strike out if that is what it wanted to do, but the appropriate procedure was to lift the stay and then deal thereafter with any application to strike out.
"It is no longer the role of the court simply to provide a level playing-field and to referee whatever game the parties choose to play upon it. The court is concerned to ensure that judicial and court resources are appropriately and proportionately used in accordance with the requirements of justice."
In support of this more interventionist approach, Mr Webb referred to two first instance decisions of Eady J in Schellenberg v BBC  EMLR 296 and Smith v ADVFN Plc  EWHC 1797 in which the judge adopted a broad test, defined in the latter case by asking:
"Are there really genuine issues which require to be resolved or is it the case, on the other hand, that this litigation when viewed as a whole, and in its proper context, is such as to bring the administration of justice into disrepute? Is there really any legitimate or tangible advantage to be gained? …I have an obligation to ensure that the court's process is being used compatibly with the overriding objective. The court is today required to be more proactive in such matters, especially when dealing with a number of people who cannot afford legal advice to protect their best interests."
5. THE ARGUMENTS OF PRINCIPLE IN RESPECT OF OBSTRUCTION/ABUSE OF PROCESS
6. THE APPLICATION TO STRIKE OUT
7. THE WAY FORWARD