The Americas / All that glitters is not (black) gold: public law challenges in the context of Guyana – ensuring accountability in the context of Big Oil by Tim Prudhoe
This article reviews the wide-ranging impact of the 3 May 2023 decision (Constitutional and Administrative Division of the Guyana High Court) in (1) Collins, (2) Whyte v. [1] Environmental Protection Agency and [2] Esso Exploration and Production Guyana Ltd 2022-HC-DEM-CIV-FDA (Sandil Kissoon J).
Covering issues of legal standing and duties of disclosure – both to the public as a whole and the court specifically – as to the extent of compliance (or lack thereof) with environment permits attached to oil production – the facts smack of regulatory “capture” (that is, failure by an environmental protection agency to delivery on its statutory obligations in respect of a commercial venture from which the government indirectly receives financial benefit).
Tim Prudhoe, Attorney-at-Law, Guyana
Even if not fairly described as the refuge of scoundrels, a respondent in judicial review proceedings attacking requisite legal standing and the right of an applicant to bring judicial review proceedings at all, usually leaves the impression of a reluctance to answer the actual underlying merits of such a claim. The intended chilling effect of a dispute as to legal standing risks the backfire that inevitably results when that legal standing is found to exist.
Background
The relevant facts in Collins can be stated briefly. In May 2022, the Environmental Protection Agency (“EPA”) granted a ‘renewed’ environmental permit to Esso Exploration and Production Guyana Limited (“Esso”) authorizing oil production in the Liza 1 field in Guyana’s exclusive economic zone. Esso is an affiliate of EXXONMOBIL Corporation. One of the conditions of the renewed permit was for Esso to produce financial assurance in the form of environmental liability insurance, together with a parent company guarantee for all environmental obligations and an indemnity for the EPA and Guyana government. As is easily understood, the rationale for such a condition is protection of the State, its citizens and – crucially – the environment, of which together, those stakeholders are the present custodians for future generations. So far, so simple. However, both before and during the judicial review proceedings in Collins, the EPA refused to disclose any information in respect of compliance by Esso with this condition.
So judicial review proceedings resulted in mid-September 2022, seeking various declarations and compulsory orders. Esso was joined as an added respondent.
The judgment of 3 May 2023 made the declarations sought as to breaches (plural) of statutory duties by the EPA, of Esso’s failure to comply with the financial assurance condition, as to the nature and extent of the liability imposed on Esso itself, of the parent company guarantee and the failure to obtain industry-standard environmental liability insurance and the parent company guarantee/indemnity. In addition, a compulsory (“mandamus”) order was made that the EPA issue a statutory enforcement notice against Esso to remedy the various breaches as reflected in these declarations.
Legal standing
To get to the merits of this important challenge[1], the applicants in Collins had to survive legal standing arguments (“Issue 1” in the Judgment). The Court rejected the narrow and restrictive approach on legal standard as contended for by the respondents in their challenge. There was a similar (adverse) judicial reaction in a preliminary hearing. The breadth of the public interest litigation provision within the Judicial Review Act[2], as well as the constitutional amendment of 2003 that inserted public interest environmental protections: principles of natural capital and the entrenched right to a healthy environment[3] formed part of the basis of the challenge to legal standing failing. The applicants also argued in their submissions that the insurance and parent company guarantee are also a protection for the economy since an oil spill could harm Caribbean economies as well the environment. In finding the requisite legal standing to exist, the Judgment drew on a wide range of environmental and legal standing jurisprudence, including academic writings and caselaw from South Africa, the Caribbean (Eastern Caribbean Court of Appeal), India and England:
“…[the applicants’] application is justifiable in the public interest. The [EPA] is amenable to Judicial Review by virtue of its public function. The Applicants are not busybodies and have in these proceedings raised an issue of grave importance of national significance for the well-being of the environment, the citizens and the State enshrined, guaranteed and protected under Art. 149(j) of the Constitution”
– page 19 of the Judgment.
The stated concerns forming the basis for finding sufficient legal standing included the general lack of developed expertise in Guyana in the oil and gas sector (“…a new frontier where there is an absence of capacity, oversight, expertise, experience or an established regulatory framework”[4]).
In a sense that the respondents in Collins could hardly have intended, concerned members of the public in Guyana ought properly to be emboldened by the fact that legal standing is now settled law. The inevitable Notices of Appeal from the EPA and Esso have not yet been listed for hearing.. The applications for a stay by EPA and Esso were heard on 31 May 2023 and a decision is expected before 10 June 2023. Of note is that although the Notice of Appeal reserves the right to add further grounds of appeal, as presently constituted the Notice of Appeal does not challenge the finding of requisite legal standing of either of the applicants (the respondents in the appeal).
Existence and extent of any duty of disclosure on the part of the EPA
Prior to the judicial review proceedings, requests for documentation were made on behalf of the intended application in Collins to the EPA. The EPA did not respond.
In the proceedings that ensued, the right to that information was disputed by the EPA but without any confirmation (absent production of such information) that there has been compliance by Esso Guyana[5].
Between issuance of the judicial review proceedings in mid-September 2022 and the listed hearing in mid-January 2023, no evidence was produced by the EPA. As a result, such evidence was required by an order. The Court described the EPA’s approach as, in effect, inimical to the transparency, disclosure and public participation envisaged for the EPA under its founding legislation[6]. On top of that, there is the well-established duty of candour (“cards on the table” approach) in judicial review proceedings relied upon in the Applicants’ submissions[7].
These obligations were simply ignored: and for which the EPA was lambasted in the Judgment[8].
The pending appeal and the environmental protection landscape for Guyana beyond the courts
Whenever public interest litigation and big business of any kind “collide”, the inherent imbalance in resources is bound to be an issue. However, such express criticism of the EPA and Esso (the permit holder of the renewed permit) can fairly be expected to encourage others to invoke constitutional provisions in place since 2003.
Tim Prudhoe
Tim Prudhoe appears in constitutional and public law challenges across the Caribbean Region in a wide range of issues covering refugee and asylum, citizenship, business licensing and compliance by governments with international treaty obligation. He regularly leads litigation against governments, including sex-same marriage claims under protected fundamental rights and successful damages claims against the Turks and Caicos Islands Government for false imprisonment for 13 Sri Lankan clients after proceedings for habeas corpus secured their release and in which legal standing by which to bring those proceedings was opposed.
[1] Page 2 of the Judgment references “the existence of an egregious state of affairs that has engulfed the Environmental Protection Agency (EPA) in a quagmire of its own making. It has abdicated the exclusive statutory responsibilities entrusted to it by Parliament…The EPA has relegated itself to a state of laxity of enforcement and condonation compounded by a lack of vigilance thereby putting the nation [i.e., Guyana] and its people in grave potential danger of calamitous disaster…[Esso Guyana] engaged in a course of action made permissible only by the omissions of a derelict, pliant and submissive Environmental Protection Agency”.
[2] No. 10 of 2003
[3] Constitution (Amendment) No. 10 Act 2003, which repealed Article 36 (non-justiciable, aspirational, statement). Creating instead Art 149(J), Part II of the Constitution (“Protection of the Fundamental Rights and Freedoms of the Individual”).
[4] Page 22 of the Judgment, and which continues “Traditional institutions and bodies discharging public functions lack capacity and are without experienced knowledgeable or skilled personnel.”
[5] Page 11, paragraph 16 of the Judgment: “Noticeably absent from the Affidavit of Defence filed by the EPA was any reference to the fact that ESSO has compiled with its obligations…and of the existence of any such insurance, assurance or unlimited parent company guarantees.”
[6] Environmental Protection Act, No. 11 of 1996.
[7] The line of cases that include R v Lancashire County Council ex parte Huddleston [1986] 2 ALL ER, 941 at 945g, Tweed v Parades Commission for Northern Ireland [2006] UKHL 53 and the Bahamas decision of The Queen v Mitchell et al BS 2015 SC 130.
[8] Page 27 of the Judgment, “The approach of the EPA, in the course of these proceedings, was inconsistent with its mandate and statutory functions, which is one of transparency and accountability to engender trust and confidence of the citizens and members of the public on whose behalf and in whose interest it carries out its functions as a Public Authority in the public interest…The [EPA], in its filing before the Court, sought refuse in silence, concealment, avoidance and secrecy. Such conduct is nothing short of reprehensible and inconsistent with its mandate and functions.”
