Nigeria: Will Ogoni, Shell Oil Spill Dispute Ever Be Resolved

An oil spill near farmland in K-Dere, Ogoniland (file photo).
20 December 2020

With over 31 years of legal battle and two judgments of the Supreme Court, will the disputes between an Ogoni community and Shell ever be resolved, Davidson Iriekpen asks

For the second time in less than two years, the Supreme Court penultimate week dismissed an application by Shell Petroleum Development Company of Nigeria Limited (SPDC) seeking to set aside a N17billion judgment given against it on January 11, 2019 over a 1970 oil spill in a community in Rivers State.

A five-man panel of the court in a unanimous ruling dismissed the Shell application as lacking merit.

Justice Centus Nweze who wrote the lead ruling in the case, marked: SC/731/2017, which was read by Justice Samuel Osuji, agreed with the respondents, Ejama-Ebubu in Tai Eleme Local Government Area of Rivers State, that Shell's application was an invitation to the court to overrule itself.

The judge said after a thorough examination of the briefs filed by parties, he elected to uphold the preliminary objection raised by the respondents (victims of the oil spill, led by Chief Isaac Osaro Agbara). He, therefore, dismissed the application and ordered parties to bear their respective costs.

The same court had, in a ruling on January 11, 2019 dismissed the appeal by Shell against an earlier decision of the Court of Appeal on a June 14, 2010 judgment of the Federal High Court, which awarded damages against the oil company for oil spill at Ejama-Ebubu.

Arguing the preliminary objection on September 22, respondents' lawyer, Lucius Nwosu (SAN), queried the jurisdiction of the Supreme Court to entertain Shell's application, which he said was intended to make the apex court sit on an appeal over its decision. Nwosu contended that Shell's application was an abuse of court process because there was no longer a pending appeal on which the court could act. He noted that, on learning about Shell's fresh application, his clients wrote the Chief Justice of Nigeria (CJN) to enquire about the status of the oil company's appeal.

According to him, in a reply, dated February 14, the CJN's response showed that Shell's appeal was spen.

"If the CJN has said the appeal is spent, how can the same appellant come and revive the spent appeal?" He asked.

The lawyer, who said his clients had taken steps to execute the judgment, added that the same Shell, which was reluctant to compensate victims of its oil spills in Nigeria, had paid about $206 million damages in similar circumstances in Mexico. He regretted that Shell was unwilling to abide by the decision of Nigeria's apex court after subjecting the victims to over 30 years of strenuous litigation in courts across the country.

The substantive suit commenced in 1991 before a Rivers State High Court sitting at Nchia Division, when the Ejama community represented by Isaac Osaro Ogbara, Victor Obari, John Oguru, Joseph Ogusu, G. O. Nnah, George Osaro, and Adanta Obelle, sued Royal Dutch Shell Plc, Netherlands, Royal Dutch Shell Plc, United Kingdom, and SPDC over alleged oil spills which occurred when Shell operated in the community in the 1970s. Judgment was entered for the sum of N6 Billion in favour of the community by the Nchia High Court. That judgment was conceded on appeal because the Supreme Court had in a sister case decided that states' high courts had no jurisdiction in oil related-matters.

The plaintiffs in 2001 refiled the suit at the Federal High Court in Port Harcourt. After listening to the submissions of the parties in the suit, the trial judge, Justice Ibrahim Buba, in his judgment in 2010, awarded N17 billion to the representatives of the Ogoni people. The court equally granted the Ogoni chiefs 25 per cent interest charge on the principal sum.

SPDC then appealed against the judgment and applied for a stay of execution of the judgment pending the appeal. As a condition for granting the stay of execution, the court required Shell's bankers, FirstBank, to provide a guarantee of the judgment sum plus interest. This condition was complied with. But Shell's appeal failed on merit because it failed to file a brief of argument in support of its appeal. Instead it claimed that it was granted leave to file an amended brief of argument, which the Court of Appeal found not to be correct.

Against the agreement reached, Shell proceeded to the Supreme Court where its new lawyers filed a fresh application asking for leave to amend the original notice of the appeal filed by Olawale Akoni (SAN) at the Port Harcourt Division of the Court of Appeal registry in order for them to argue fresh points not raised at the court below and in order for them to argue 36 additional grounds of appeal.

Upon the new application at the apex court, the respondents' lawyer, led by Lucius Nwosu (SAN), filed a preliminary objection. Assisted by Lawal Rabana (SAN) and others, Nwosu argued that the findings of the Court of Appeal dismissing their appeal were based on facts, adding that the law is that an appeal must arise out of the decision complained against. He stated that if the decision complained against was based on findings of fact, the constitution requires that you cannot appeal them except you first seek leave of the Court of Appeal.

The respondents' lawyer contended that since that notice of appeal at the Court of Appeal was filed without leave, it meant that the notice was incompetent and cannot be amended because it would mean putting something on nothing and expecting it to stand.

Justice Kumai Bayang Akaahs who read the ruling on behalf of other justices led by the then Chief Justice of Nigeria, Justice Walter Onnoghen, said the notice of appeal filed by the oil giant was incompetent. He said motion filed on July 16, 2018 had no leg to stand on and should not have been filed. He consequently dismissed it in its entirety.

But Justice Akaahs citing a plethora of authorities to back up his submission, held that since the notice of appeal filed by Shell sought to be amended was incompetent, no valid amendment could be effected because issues of fact or mix law and fact were raised in the original notice of appeal with leave of court.

The Supreme Court justice agreed with the submission of Shell's lawyer that an appellant who has a valid and subsisting appeal can seek the leave of court to do so, adding that in the instant case, there is no such valid notice of appeal that could be amended.

However, while the case was still pending at the apex court, sensing that Shell was using delay tactics to prevent FirstBank from paying the judgment creditors the N17 Billion judgment debt, in December 2017, the plaintiffs commenced garnishee proceedings at the Federal High Court in Owerri presided over by Justice Lewis Allagoa. They urged the CBN to pay them N122.53 billion out of FirstBank's account in its custody.

THISDAY gathered that they calculated the principal sum of N17 billion and the accrued 25 per cent interest charge per annum to arrive at the sum of N122,533,403,392. In January 2018, Justice Allagoa granted them a temporary order (garnishee nisi) ordering the CBN to pay them the sum from FirstBank's account with it.

But the CBN asked the court not to make the order absolute. The apex bank's counsel argued that compelling the CBN to pay the N122.53 billion from FirstBank's funds domiciled with it could have far-reaching consequences for Nigeria's oldest and biggest lender by assets and deposits, and a systemic impact on the rest of the financial system and wider economy.

However, Justice Inyang Ekwo of the Federal High Court in Abuja on March 2, 2020 issued an order absolute. By the order made by Justice Ekwo, the CBN Governor was to order the release of the judgment sum from the account of First Bank.

While reacting to the latest judgment of the Supreme Court, the respondents' lawyer, Nwosu hailed the court for protecting the dignity and integrity of the nation's judiciary by its decision, despite alleged moves by Shell to ridicule it.

Nwosu noted that the judgment sum, "as at today, with the interest running, is in the neighbourhood of N182 billion."

He expressed displeasure with the alleged plot by the CBN to frustrate the execution of the garnishee order absolute got against the account of First Bank by the victims/judgment creditors in their bid to execute the judgment.

But Shell in a swift reaction, disputed the amount. The oil giant said the ruling of the Supreme Court did not decide liability or the size of the award. It also denied responsibility for the oil spill in the community, insisting that it was caused by 'third parties' during the Nigerian Civil War.

It said: "This spill was caused by third parties during the Nigerian Civil War, a challenging period which resulted in significant damage to oil and gas infrastructure in the region.

"While SPDC does not accept responsibility for these spills, the affected sites in the Ebubu community were fully remediated.

"The claimants have, at their own admission in court, materially miscalculated and overstated the value of the award previously sought in this case.

"The ruling of the Supreme Court did not decide liability or the size of the award, which remains in dispute in other ongoing court proceedings.

"It is our position that any attempt to enforce payment should not be permitted. It is regrettable that the legal process in this case has focused for so long on procedural issues and not the merits of the case. We have always maintained that we are ready to defend this case based on the available facts."

From the position of Shell that the ruling of the Supreme Court did not decide liability or the size of the award, it is obvious that the case is not yet over despite several judgments. The next battle could be for the courts to determine the actual liability or the size of the award.

More From: This Day

Don't Miss

AllAfrica publishes around 800 reports a day from more than 130 news organizations and over 500 other institutions and individuals, representing a diversity of positions on every topic. We publish news and views ranging from vigorous opponents of governments to government publications and spokespersons. Publishers named above each report are responsible for their own content, which AllAfrica does not have the legal right to edit or correct.

Articles and commentaries that identify allAfrica.com as the publisher are produced or commissioned by AllAfrica. To address comments or complaints, please Contact us.