The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Rubis (Bahamas) bid to overturn a $159,450 damages award after fuel leaks from one of its gas stations contaminated a Marathon resident’s home was yesterday cleared to proceed to a final appeal hearing.

The London-based Privy Council, the highest court in the Bahamian judicial system, rejected an earlier Court of Appeal verdict that the petroleum products supplier and wholesaler had no ability to “appeal as of right” following the latter’s ruling which cut the damages awarded to Lillian Antoniette Russell by 77 percent - from $692,825 to $159,450.

Had the Privy Council delivered an alternative verdict, Rubis (Bahamas) would not have been able to mount a final effort to overturn the Court of Appeal verdict. However, the London-based law lords have now cleared all obstacles to doing so and will hear the oil major’s substantive case as a result of yesterday’s ruling.

The Court of Appeal had rejected Rubis (Bahamas) final bid to challenge on the basis that legal precedent established it only had “an appeal as of right” if the case involved a claim for ‘liquidated damages’. These are damages that are fixed, such as a clause in a contract, which are payable if a party breaches its terms.

However, Ms Russell’s claim was for ‘unliquidated damages’ - meaning that the amount of compensation had not been pre-determined. Recalling the background to the dispute, the Privy Council verdict delivered yesterday noted that it stemmed from her claim “for damage to her property allegedly caused by fuel leaks from tanks at an adjacent petrol service station owned by Rubis”.

This would have been the company’s Robinson Road and Old Fire Trail Road gas station, and the Privy Council added: “At first instance [the Supreme Court], the claim succeeded in relation to leaks occurring in 1994 and 2012-2013, and damages of $692,825.14 were awarded.

“On appeal it was held that Rubis was only liable for the 2012-2013 leak and the damages were reduced to $159,450. Rubis seeks to appeal on liability, causation and quantum.... Ms Russell owns one property in a housing subdivision in Nassau, which is situated across from a petrol service station owned by Rubis since 2012, separated by a roadway.

“Rubis purchased the service station from Texaco Bahamas and then leased it to Fiorente Management and Investment. Ms Russell commenced these proceedings in March 2015. In her statement of claim she alleged that leaked petrochemical products had migrated from the service station to her property, and had contaminated the soil and water table there,” the Privy Council continued.

“In relation to the 1994 leak, the claim was brought against Rubis for negligence on the basis that Texaco had failed to remediate her property, and that Rubis assumed Texaco’s liabilities when it acquired Texaco’s assets. Claims were also made for trespass and nuisance.

“In relation to the 2012-2013 leak, a claim in negligence was made on the basis that Rubis had failed adequately to inspect, maintain and repair the fuel equipment at the service station. Claims were also made for trespass, nuisance and liability.”

The Supreme Court found in an April 14, 2022, verdict that both leaks had occurred, caused damage and reduced the value of Ms Russell’s property. Finding that Rubis was liable for the leak, it awarded $692,825 to her consisting of $250,000 for “loss of amenity value”; $439,375 for the “cost of remedial work” and $3,450 for testing and appraisal costs.

This, though, was reduced to $159,450 by the Court of Appeal which dismissed the claim in relation to the 1994 leak but upheld Ms Russell’s damages claim for the 2012-2013 incident. It awarded $25,000 “for loss of amenity”; $131,000 for reduction in value of her property; and special damages worth $3,450.

Rubis (Bahamas) then launched its final appeal. The Privy Council, in analysing section 23 of The Bahamas’ Court of Appeal Act, which deals with a party’s right to appeal, described some of the wording as “unique” to this nation.

Aidan Casey KC, representing Rubis (Bahamas), argued that the “correct approach” to the [$4,000] value threshold in the same section 23 was “not to look at the claim originally made, but rather to consider the value of the appeal to the appellant. In the present case, the value of the appeal to Rubis is $159,450, being the damages awarded by the Court of Appeal. That far exceeds the value threshold of $4,000”.

The Privy Council, in agreement, ruled that Rubis (Bahamas) does have a right to appeal the Court of Appeal verdict under section 23. “The Court of Appeal was wrong to focus on the claim originally made rather than the judgment being appealed. That judgment is for a precise, quantified sum,” it determined.

“The fact that the claim originally made was for unliquidated damages is irrelevant. That claim is now merged in a judgment for a liquidated amount. There is no difficulty in identifying or valuing the amount at stake for Rubis on the appeal. It is the judgment sum of $159,450. 

“That is sufficient to dispose of the preliminary issue.... This is an appeal against a judgment for $159,450. For the purpose of the appeal that is ‘the amount sought to be recovered’. The value threshold under section 23 of the Court of Appeal Act of $4,000 is therefore satisfied. The applicant has an appeal as of right and the full appeal will follow on a date to be fixed.”