While he has not set a specific date, Justice of Appeal Rishi Persaud said that he will deliver his ruling within the next two weeks, on whether he has jurisdiction to order ExxonMobil to provide proof that it has indeed lodged a US$2 billion guarantee which is intended to indemnify Guyana against an oil spill and associated perils.
An application for proof that ExxonMobil has lodged the money as it claims, has been met with resistance by the Environ-mental Protection Agency (EPA) and the oil company, which are contending that the court lacks jurisdiction to make such an order.
During a brief hearing of the case yesterday morning, attorney for the EPA, Sanjeev Datadin, reiterated the position of his clients that it is beyond the jurisdiction of the court to order the EPA and Exxon’s affiliate—Esso Exploration and Production Guyana Limited—to produce a copy of the US$2 billion guarantee.
Datadin’s contention is that a single judge hearing a matter in the appellate court as Justice Persaud is, does not have the jurisdiction to make the order being sought by the Applicants; stating that this principle is backed by case law precedent.
Like Datadin, Senior Counsel Edward Luckhoo for Exxon/Esso argue that the inherent jurisdiction of the court to make the order such as being sought in this case, does reside in a single judge hearing the matter in chamber.
That inherent residual jurisdiction the lawyers argue is reserved to be exercised by the Full Bench of the Court of Appeal.
Senior Counsel Seenath Jairam who represents the Applicants, however, was forceful in his advancements that a single judge is clothed with jurisdiction to make the order his clients have asked for.
“You are clothed with all of the inherent jurisdiction,” Jairam told Justice Persaud in his submissions, stating that it was “ludicrous and outlandish” for anyone to submit otherwise.
He then rhetorically questioned, “How is it that a single judge of the High Court can have that jurisdiction and you, a judge of the appellate court which is higher, doesn’t.”
Following the hearing, Justice Persaud explained that given the current state of the court’s diary, he could not set a specific date when he would rule, but assured that it would be within the next two weeks.
Background
The action concerns the landmark case over an unlimited guarantee from the parent company of ExxonMobil which was filed by applicants Frederick Collins and Godfrey Whyte who had secured an historic win back in May of last year, when High Court Judge Sandil Kissoon ruled that ExxonMobil was in breach of its insurance obligation.
That judgment has since been appealed by the EPA and is pending before the Guyana Court of Appeal.
Currently engaging the attention of Justice Persaud, however, is a summons brought by Collins and Whyte, who have asked for proof that the US$2 billion guarantee has indeed been lodged with the Registrar of the High Court as ordered by Justice Kissoon. ExxonMobil has claimed it has done so.
In the decision on May 3rd last, Justice Kissoon had ordered the EPA to obtain from ExxonMobil’s subsidiary, environmental liability insurance as is customary in the petroleum industry along with an unlimited parent company guarantee to cover all costs of an oil spill, in accordance with the environmental permit issued to ExxonMobil Guyana Ltd.
Both the EPA and Exxon Guyana appealed the decision.
On June 8th, Justice Persaud granted a stay of Justice Kissoon’s order, and ordered ExxonMobil’s subsidiary to produce a guarantee for US$2 billion within a fixed timeframe instead, and stayed the requirement for insurance.
Subsequently, on July 5th, Collins and Whyte filed a Motion for an urgent hearing to vary or discharge the Order made by the learned Justice of Appeal.
In his Affidavit in Support of the Motion, Collins pointed out that as a result of the stay granted by Justice Persaud, Guyana is now on the hook for damage caused by an oil spill and warned that “The potential harm to Guyana’s economy cannot be overstated. Liability for clean-up, restoration and compensation following an oil spill, well blowout, or tanker accident, from Esso’s operations is unlimited and uncapped and could run into billions of US dollars or trillions of Guyana dollars, far exceeding the National Resource Fund and Guyana’s biggest ever annual budget, and even exceeding the amount of said fund and budget combined.”
As such, on behalf of Collins and Whyte, Melinda Janki—one of their lawyers—wrote several letters to the lawyers for the EPA and Esso requesting a copy of the US$2 billion guarantee but none was produced.
On November 1st, the summons was then filed for orders directing the EPA and Esso to produce a copy of the US$2 billion.
