Texaco Panama Incorporation V. Shell Petroleum Development Corporation Of Nigeria Limited (2002)

LAWGLOBAL HUB Lead Judgment Report

A. KALGO, J.S.C.

On the 27th of January, 1994, the appellant as plaintiff, took out a writ of summons in the Federal High Court in Lagos, in which it claimed $5,780,442.88 (five million, seven hundred and eighty thousand, four hundred and forty two dollars eighty-eight cents) against the respondent for negligence sustained by its oil tanker M.V. Star Tulsa when berthing at the respondent’s inshore oil terminal at Bonny.

Pleadings were filed in court and settled between the parties. Thereafter the respondent orally raised the issue of the absence of pre-trial notice and limitation of time in relation to the whole action which were fully averred in paragraph 17 of the respondent’s amended statement of defence. The learned trial Chief Judge having observed that these are all issues of law touching on the jurisdiction of the court, quite correctly in my view, granted the application to argue the points before proceeding to trial. On the 23rd of September, 1996, counsel for both parties addressed the trial court on the point and ruling was reserved. In a considered ruling delivered on 3rd June 1997, the trial Chief Judge (Belgore C.J) found that the appellant’s action was statute barred and he dismissed it. The appellant appealed to the Court of Appeal and the appeal was also dismissed. He now appealed to this court on two grounds. In this court, both parties filed their respective briefs which they also exchanged.

The learned counsel for the appellant raised three issues for the determination of this court in his brief. They are:

1. “Whether the provisions of the Oil Terminal Dues Act apply to oil terminals other than those established, described, delimited, named and contemplated in the Act.
2. Whether the court was right to hold that the action was barred by limitation’ of time without evidence on any single element of that plea.
3. Whether want of pre-action notice to the defendant was fatal to the action.

For the respondent, only two issues were formulated and they read thus:-

1 “Whether the learned Justices of Appeal were right in holding that Oil Terminal Dues Act Cap. 339 Laws of the Federation; 1990 ed. applies to the respondent.

2. Whether the appellant’s claim could be sustained in view of the Oil Terminal Dues Act

I have examined the grounds of appeal filed by the appellant in this court and I am satisfied that the three issues for determination formulated by the appellant in this appeal were properly distilled from those grounds I shall consider them for the purpose of this appeal. It is significant to observe that this case did not go to trial but determined by the trial court after hearing arguments of the learned counsel for the parties on issues of law relating thereto. The learned counsel for the appellant did not in this court or the Court of Appeal challenge the procedure adopted by the learned trial Chief Judge in dealing with the case and I shall say nothing about it in this judgment.

I now proceed to consider the issues for determination set forth by the appellant in his brief.

The first issue asked the question whether the provisions of the Oil Terminal Dues Act apply to oil terminals other than those described in the Act itself. It is common ground that the respondent is popularly called Bonny Inshore terminal. It is no doubt a private oil terminal operated as a commercial venture by the respondent. Therefore in order to answer the question asked in this issue, it is absolutely necessary to examine the relevant provisions of the Oil Terminal Dues Act. Cap., 339 Laws of the Federation of Nigeria, 1990. If the answer to this question is in the affirmative, all reference to other relevant Acts or Laws e.g. the Ports Act or the Petroleum Resources Act, affecting oil terminals, is automatic.

I will start by looking at section 1(1) of the Oil Terminal Dues Act (hereinafter referred to as “OTDA”) which states:

“As from the date of commencement of this Act, terminal dues may be levied, subject to the provisions of this Act and the Ports Act, on any ship evacuating oil at any oil terminal and in respect of any services or facilities provided under this Act”. (italics mine) This section explains fully the purpose for which the Act was passed. It is for the purpose of levying and payment of terminal dues on any ship evacuating oil at any oil terminal in any port in Nigeria in respect of services provided at that port. The Act makes no distinction between a public or private terminal provided that the terminal is used for the evacuation of oil and the relevant services are provided there, but this is subject to the provisions of the OTDA and the Ports Act. (Cap. 361 of 1990 Laws of the Federation of Nigeria).

My next port of call here, is section 3 of OTDA, which is very important in my respectful view not only in respect of this issue but also in the outcome of the whole case. Section 3 provides:

“Subject to the provisions of this Act, the provisions of the Ports Act specified in column 1 of the First Schedule of this Act shall apply in relation to any oil terminal and to the extent mentioned in column 3 of the Schedule as they apply in relation to a port or any approaches thereto and as if reference in that Act to “a port or any approaches thereto” were reference to an ‘oil terminal or any area within which the terminal is situated’.” (italics mine)

This section makes it clear that certain provisions of the Port Act are applicable either in whole or in part to all oil terminals. These include certain immunities and limitations in that Act which ordinarily apply to the Nigerian Ports Authority.