Introduction
In a significant recent judgment for participants in multi-party proceedings, the Court of Appeal has handed down judgment on various case management issues in the long-running Alame & Ors v Shell environmental group litigation, emphasising the importance of parties being free to establish their case in a manner of their own choosing and the difficulties that can arise where claimants face an inequality of arms.
The action arises from environmental pollution in the Niger Delta region of Nigeria, which the claimants allege was caused by oil spills which Shell failed to prevent, mitigate or remediate. The first claim forms were issued in 2015. Since then, the claims have progressed slowly, but a Group Litigation Order was eventually made in May 2022 and various interim applications and hearings have followed (see here, for example).
Declaration 1: global claims
The claimants' losses have been expressed to be caused by one or more of ten identified spills, and/or one or more "unpublished spills". However, the claimants have thus far been unable to particularise exactly which oil spills caused which losses.
The defendants therefore contended that the claimants' case on causation was inadequately particularised. Significantly, they did not apply to strike out the claims for lack of adequate pleading on causation, but instead suggested that, as an alternative to the normal rules of proving causation, the claims should proceed on a "global claims" basis. The "global claims" principle, which originated in construction law, allows for causation to be established by showing that a loss is caused by multiple events, for all of which the defendant is responsible, even if the loss attributable to individual events cannot be identified. If a material contribution to the claimant’s loss is made by an act or event for which the defendant is not responsible, causation will not be established. That makes it an "all or nothing" approach.
The claimants made clear that the concept of "global claims" did not form any part of their case. Rather, they insisted that they intended to pursue a conventional case on causation once they had the necessary information and expert support to enable them to do so. Nevertheless, the first instance judge made a declaration that the claims should be progressed on the basis that they were "global claims".
The Court of Appeal set aside that declaration. It held that "no judge or court is entitled to require a party to establish their case by a particular method", describing the defendants' and first instance judge's approach as equivalent to forcing the claimants into a "straightjacket" and that "until the point is reached where a claim is to be dismissed or stayed, the right of a litigant to bring the claim and the freedom to determine how it intends to prove its claim should be respected in all normal circumstances".
Declaration 2: selection of lead claimants and inequality of arms
The next issue for the Court of Appeal concerned the way in which the case should proceed. The claimants argued that they needed further information from the defendants to plead their case in more detail, and that the claim should proceed by way of a trial of lead claimants. In response, the defendants said that they could not be required to provide further information until the claimants properly particularised their case, and that until the claimants identified all the spills on which they relied, it was not possible to select lead cases. At first instance, the High Court declared that the claimants' pleaded case precluded any sensible identification of lead claimants, and so refused to direct selection or trial of lead claimants. Instead, the High Court proposed to have a trial dealing with the issues of "contamination, consequences and causes".
However, noting the substantial inequality of arms between the parties, particularly in relation to access to information, the Court of Appeal took a different approach. In such circumstances, it concluded that case management issues should be informed by the overriding objective, including "the Court’s obligation to ensure that the parties are on an equal footing and can participate fully in the proceedings". Where there is significant asymmetry of information, disclosure can be "one of the most powerful tools available for achieving justice" and should not be limited only to the specific facts that claimant has already been able to plead.
While first instance courts should always be alert to fishing expeditions, here the claimants had clearly articulated the case that they wish to bring and the approach to their request for more disclosure "should be informed more by the explanations they have given about why they need the disclosure before pleading a case with full particularity than by the present state of their pleadings".
In going on to overturn the second declaration, the Court of Appeal described the case as a "paradigm example of a case which can only be progressed by reference to lead cases" and that the selection of lead cases would "concentrate the minds of the parties on the real issues in dispute." The alternative approach that had been proposed by the High Court was "a recipe for an extremely expensive and insufficiently focussed disaster".
Analysis
This decision will be welcomed by claimants to group litigation. The Court of Appeal has made it clear that, while it is for the High Court to case manage claims, it is prepared to overrule case management decisions in certain circumstances. The Court of Appeal's decisions in this case emphasise the importance of allowing claimants to run the case they choose, and of using case management powers to equalise the information and resource asymmetry that is typical when a group of claimants with relatively low-value individual claims issue proceedings against large multinational defendants.
The Court of Appeal's decision to overturn the "global claims" approach plainly sets an important precedent for claimants in complex group actions involving environmental contamination. Given the reasoning behind the Court of Appeal's decision, it was not necessary to consider the status of "global claims" in English law and whether such an approach could ever be applied to environmental law claims, nor whether such an approach would have validity under Nigerian law. However, the obvious conclusion is that unless claimants in group litigation opt to bring the claims on a "global claims" basis, they cannot be ordered to do so.
The decision to overturn the second declaration, and the guidance provided to resolve the "circular procedural wrangle" that arose in the case, is likely to have wider impact across all types of group actions. As the Court of Appeal itself acknowledged in the judgment "these battle lines are not in any sense novel in large multi-party litigation: to the contrary, they could be said to be the regular stuff of such proceedings". Claimants in group actions often find themselves in positions where an asymmetry of information exists that is preventing them from further particularising their pleadings, and this decision is clear guidance that the court should order to disclosure to help shift the informational asymmetry onto a more even balance, and that wherever possible group litigation should proceed by way of lead claimants.