High Court blocks Shell oil deal

The High Court in London has blocked an agreement between the oil giant Shell and the UK law firm CW Law in relation to over 7,000 claims of Nigerians, which the Marble Arch based law firm claimed it represented, in a dispute over oil spills in Nigeria.

Mr. Justice Akenhead, the President of the Technological and Construction Court blocked the deal and upheld an injunction against CW Law which prevents them, or anyone representing them, to make contact the people of Bodo in furtherance of the settlement agreement. 

The judge made it clear that Leigh Day are proceeding with the case to trial in the High Court next year and that many thousands of claimants are entitled to damages under the Oil Pipelines Act which could be substantial. 

In the verdict, the judge also said there may have already been a major breach of an existing interim injunction against CW Law.  He said that Leigh Day had strong evidence that representatives of CW Law had breached the order by continuing to seek to sign up claimants whilst the order was in place.  

Leigh Day now has 3 working days to set out to the Court which breaches of the order they would seek contempt proceedings on. CW Law will have 10 working days to respond and provide full evidence of the instructions they have from claimants to represent them.

CW Law was accused, by law firm Leigh Day, of unlawfully entering into settlement talks with Shell Petroleum Development Company (SPDC) on behalf of many villagers of Bodo, in the Niger Delta, who they didn’t represent and who were not clients of the firm.

The settlement agreement between CW Law and Shell, given as evidence in Court yesterday, sought to settle the claims for £150 each with an additional £390 per claimant going into a Trust.  The Agreement also included an incentivized costs structure for CW Law which would see them paid more, by Shell, the more claimants it signed up to the scheme.

With a population of 14,000 people, the great majority of the villagers are represented by London based law firm Leigh Day in one of the largest environmental legal cases in history following two massive oil spills in 2008 from pipelines operated by oil giant Shell.

Leigh Day has spent 3 years gathering witness statements and verifying its list of clients on the ground, in Nigeria, to fight the case against Shell in the UK Courts.

In August 2014 Leigh Day learned that SPDC had entered into a settlement with CW Law, English Solicitors, who claimed to represent 7,400 of the villagers.

Leigh Day, visited Bodo and spoke to the Chairman of the Council of Chiefs & Elders in Bodo, the Chiefs of the Council and the Village Heads of the 35 villages that make up Bodo and confirmed that they had not heard of CW Law or the Nigerian lawyers Egbegi & Co, who claimed to be working with CW Law.

Speaking after the judgment, the Senior Partner of Leigh Day, Martyn Day, said:

"We are very pleased that the Judge agreed to block the deal between Shell and CW Law as far as our clients are concerned. 

"This paltry deal may have been lucrative to the lawyers involved but it would have meant peanuts ‎for those of our clients caught by it. The Bodo Creek is damaged for decades to come. We will only resolve the claims when Shell is prepared to pay properly for the damage it has caused."

BACKGROUND

Shell is accused of two leaks from its pipelines in 2008/09, which devastated the environment surrounding the community of Bodo*, in Gokana Local Government Area, Rivers State, Nigeria.

Bodo is a fishing town. It sits in the midst of 90 sq km of mangroves swamps and channels, which are the perfect breeding ground for fish and shellfish.

The Bodo community is a rural coastal settlement consisting of 31,000 people who live in 35 villages.  The majority of its inhabitants are subsistence fishermen and farmers. Until the two 2008 spills Bodo was a relatively prosperous town based on fishing.  According to Leigh Day, the spills have destroyed the fishing industry.

Expert evidence indicates 1,000 hectares of mangroves have been destroyed by the spills and a further 5,000 hectares have been impacted.

The United Nations, Amnesty International and the Nigerian government have all expressed deep disappointment with Shell’s lack of action in the region.  Impoverished local fishermen have been left without a source of income, and have received no compensation.

The Ogoni fishing and farming communities have accused Shell of applying different standards to clean-ups in Nigeria compared with the rest of the world. Amnesty has described the oil spill investigations 'a fiasco’.

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