Case of the Day: Dooh v. Royal Dutch Shell
Posted on January 15, 2016
The case of the day is Dooh v. Royal Dutch Shell plc, a recent decision of the Court of Appeal in the Hague. The decision is apparently only available in Dutch, though the link has an official press release in English describing the decision.
The facts may sound familiar. The plaintiffs were Nigerian farmers who claim they were injured by oil leakages from underground oil pipelines and an oil well in Nigeria. They are suing the Dutch parent company of Shell and Shell’s Nigerian operating company in the Netherlands, seeking damages and an order requiring remediation. For its part, Shell claims that the leakage was caused by sabotage and that therefore, it has no liability under Nigerian law, and that in any case the pollution has been adequately remediated.
According to the press release, Shell argued that there was an insufficient basis for jurisdiction in the Netherlands and that the claim against the operating company should proceed in the Nigerian courts. Hmm. I seem to recall another case in which a major international company was sued in its home forum and argued that the case really had to be heard in the country where the supposed environmental tort occurred. And in that case, as in this, there was a question about the suitability of the foreign court. The 2009 State Department report on Ecuador noted:
While the constitution [of Ecuador] provides for an independent judiciary, in practice the judiciary was at times susceptible to outside pressure and corruption. The media reported on the susceptibility of the judiciary to bribes for favorable decisions and resolution of legal cases and on judges parceling out cases to outside lawyers who wrote judicial sentences on cases before the court and sent them back to the presiding judge for signature. Judges occasionally reached decisions based on media influence or political and economic pressures.
The 2014 report on Nigeria is similar:
Although the constitution and law provide for an independent judiciary, the judicial branch remained susceptible to pressure from the executive and legislative branches and the business sector. Political leaders influenced the judiciary, particularly at the state and local levels. Understaffing, underfunding, inefficiency, and corruption prevented the judiciary from functioning adequately. Judges frequently failed to appear for trials, often because they were pursuing other sources of income or due at times to threats against them. In addition court officials often lacked the proper equipment, training, and motivation to perform their duties, with their lack of motivation primarily due to inadequate compensation.
There was a widespread perception that judges were easily bribed and that litigants could not rely on the courts to render impartial judgments. Citizens encountered long delays and alleged receiving requests from judicial officials for bribes to expedite cases or obtain favorable rulings.
Although the Ministry of Justice implemented strict requirements for education and length of service for judges at the federal and state levels, no requirements or monitoring bodies existed for judges at the local level, which resulted in corruption and the miscarriage of justice in local courts.
Now, the outcome in the Dutch case was different from the outcome in Aguinda: the Dutch court retained jurisdiction. And the cases differ in another important respect: as far as I know, Shell continues to do business in Nigeria. So it cannot simply take its chances in the Nigerian courts and then seek a second bite at the apple in recognition and enforcement proceedings elsewhere. And perhaps Shell has reason to think that the plaintiffs would not be able to pursue their case effectively in Nigeria—though I believe that’s what Chevron thought about the Lago Agrio plaintiffs’ chances in Ecuador. In any case, it’s highly surprising to me to see a major company seeking to have an environmental mass tort case moved from a well-respected court in its home country to a court that apparently has significant problems in the state where the pollution occurred.