The Nigerian Court of Appeal on 25 July 2017 delivered a landmark decision which has introduced some significant changes to the long-established litigation regime in Nigeria, specifically in the context of claims arising from crude oil spillage. Before this decision, it was legally permissible for litigants seeking financial compensation in Nigerian courts for injuries they allegedly suffered as a result of oil spills arising from oil facilities owned and operated by oil and gas companies to anchor their claims on common law remedies found in negligence, nuisance, trespass as well as the strict liability rule laid down in Rylands v. Fletcher.
In NAOC v Ogbu, however, the Court of Appeal overturned a decision of the Federal High Court which applied the common law principles of nuisance and the strict liability rule and found that the claim for compensation was incompetent ab initio having not been founded on the compensation regime provided by the Oil Pipelines Act. This decision, which of course is the first Nigerian decision to clearly affirm the exclusivity of the compensation provisions of the Oil Pipelines Act, provides helpful guidance as to the overall approach that should be followed in litigating oil spill claims in Nigeria, particularly as the Federal High Court, the court of first instance for determining oil spill cases, appears to have completely imbibed the far-reaching principles set out in the decision.
