A Claim Under the Pipelines Act Must Be For Compensation And Not Damages

An aggrieved person under the Oil Pipelines Act[1] who has a complaint on damages caused must comply strictly with the provisions of the Act and the claim must be for compensation and not damages or any other relief. This is the decision of the Court of Appeal, Port Harcourt Division in Appeal No. CA/PH/387/11: Nigerian Agip Oil Company Ltd v Mr Onyemaechi Ogbu delivered on Tuesday the 25th day of July 2017.

It is common for persons who are allegedly affected by oil prospecting activities or oil spills to bring actions claiming specific damages for their destroyed properties (like fishing nets, fish ponds, economic trees and so on) and loss of revenue from them.  In addition, general damages are usually claimed for pollution of land, desecration of juju shrine[2] and so forth. These claims are no doubt derived from the common law doctrines of negligence, nuisance, tress pass, strict liability and Ryland v Fletcher.

However, in NAOC v Ogbu, the Court of Appeal stated that where a statute has been provided for certain actions, resort must be had to the statute and not to common law remedies.[3] The Pipelines Act having superseded the common law remedies, all actions therefore connected with or pertaining to damage or injury as a result of oil exploration, production, installation and related activities must comply strictly with the Oil Pipelines Act, which made provision only for compensation to be paid to an aggrieved person and not for any other claims.[4] In interpreting the relevant section of the Act the Court of Appeal said:

The Oil Pipelines Act in the plenitude of its preamble and section 11 thereof has clearly shown that every claim appertaining damage from oil installation or ancillary installation injurious affection on land or interest in land … may only be made under the Act. It is for compensation. It shall not be for damages as claimed.[5]

Consequently, every other claim that is not for compensation is incompetent and the court will not have jurisdiction to entertain it since the court cannot confer jurisdiction by taking cognizance of a course of action not denoted. The effect therefore is that such action will be struck out.

 

 
[1] Cap O7 LFN 2004
[2] These general damages were claimed in NAOC v Ogbu
[3] See also Harka Air Services (Nig) Ltd v Keazor (2011) 13 NWLR (Pt1264) 320 at 344
[4] Section 11 of the Oil Pipelines Act
[5] Page 29 of the judgment

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