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Irish Times: Shell faces 1m costs after ending action

Mary Carolan,
Published: Apr 19, 2007

Shell E&P Ireland is facing a legal costs bill of more than 1 million after the High Court yesterday agreed to allow it end its long-running legal action against four opponents of the controversial Corrib gas pipeline.

The court allowed the company to discontinue its action on certain conditions, including that the company pay most of the legal costs of the defendants.

However, counterclaims by some residents against the company and the State which challenge the validity of ministerial consents for the pipeline are to continue.

The court is also to consider whether the residents are entitled to seek damages against Shell over what they allege was an improperly obtained April 2005 injunction restraining interference with the pipeline route.

Ms Justice Mary Laffoy yesterday delivered her reserved judgment on a number of applications related to the legal row over the pipeline.

These were an application by Shell to discontinue its action against four Rossport residents – Philip McGrath, James Brendan Philbin, Willie Corduff and BrId McGarry; an application by the State for directions as to how counterclaims brought by the defendants should be tried in court and several applications relating to discovery of documents.

Shell had asked that its proceedings be discontinued without having to meet the legal costs of the defendants or, alternatively, that the costs issues be reserved to the trial of the defendants’ counterclaims. The company said its action aimed at restraining interference with the pipeline was no longer necessary given a series of events which had occurred since the dispute erupted in 2005 and particularly in light of the company’s acceptance of the recommendation of mediator Peter Cassells that the route of the pipeline be modified.

The company also said it would not be relying on compulsory acquisition orders made over the defendants’ lands and that it intended to seek new orders relating to the modified pipeline route only if it could not get agreement from affected landowners. Ms Justice Laffoy said she had no doubt the company should be allowed discontinue the claim, subject to terms.

The defendants’ entitlement to seek an inquiry relating to whether damages were payable to them from Shell arising from the defence claim that the injunctions secured by Shell against them in 2005 were improperly obtained was not affected by discontinuance of Shell’s claim, she added.

The judge said she unreservedly condemned the behaviour of Mr McGrath, Mr Philbin and Mr Corduff in refusing to purge their contempt after having been jailed for 94 days in 2005 for refusing to obey court orders restraining interference with the pipeline.

However, Shell was effectively asking the court not to grant costs to the defendants as punishment for this contempt, the judge said.

She was not satisfied such an outcome would render justice, as Shell was unilaterally seeking to abandon its claim without the substantive issues between the sides having been determined. She also granted an additional three weeks from yesterday for discovery of documents in the case.

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