Expected Average Annual CERs from Registered Projects by Host Party

CLEAN DEVELOPMENT MECHANISM AND CONTRACTUAL INTERPLAY

2.13 Contract as a Risk Mitigation Mechanism

2.14.3 Cause of Action in Tortuous Liability

As stated above, there are critically four issues to be considered as possible causes for action as tort cases in relation environmental activities. Within the scope of CO2

storage it behoves on the operators and or project developers to ensure safety for the operation. In this case, the potential to bring to bear the subject for strict liability as a cause of action is in making a case for absolute duty to ensure that operation is as safe as possible.234 A case for strict liability does not necessarily depend on the amount of care taken by the defendant but the weight of evidence of abnormally dangerous activity or activities is engaged in by the defendant creating the potential for significant risk even if reasonable care is in place.235 The application of this doctrine suggests that in any such case related to CCS, if any of the activities is proven to be abnormally dangerous, the plaintiff or claimant need prove the causal connection between the activity and the injury which could prove to be problematic in most cases.236 For instance, if leakage of the stored GHG is deemed abnormally dangerous the causal link of this to the injury is enough to fulfil the test of strict

231Supra note [Ferrer A., 2006]

232Van Kirk, R. A., 1989, “The Evolution of Useful Life Statutes in the Product Liability Reform Efforts”, 1989 DUKE L.J. 1689, 1704 (1989).

233The Fairness and Constitutionality of Statute of Limitations for Toxic Tort Suits, 96 HARV.L.REV 1683 (1983).

234Black’s Law Dictionary (8th ed. 2004) (s.v. “liability)

235Boston G.W. 1999, “Strict Liability for Abnormally Dangerous Activity: The Negligence Barrier”, 36 San Diego L. Rev. 597 (1999)

236 de Figueiredo, M.A., 2007, ‘The liability of carbon dioxide storage’, PhD thesis, Massachusetts Institute of Technology, Boston, MA.(February 2007).

103 liability and the operator liable for harm. The fairness and efficiency of this cause of action is however censured for its in adequacy when discounting the contributory responsibility of the victim or plaintiff.237

The second cause of action is the doctrine of negligence. Most tort cases are centred around negligence as it covers not only the human health resulting from CCS activities like CO2 leakage but it can be used to bring a case for property and environmental damages.

Tort of negligence has the following component ingredients and its success in action is a function of proving the relevance to the case. Firstly, the existence of a duty to take care [over the storage site and operation] which was owed to him by the defendant (i.e. the CO2 storage operator), secondly, breach of such duty by the defendant which implies that the operator was involved in unreasonable conduct for instance by not having the needed monitoring procedure or safety measures in place, and thirdly resulting damage to the plaintiff as a result of the defendants breach of duty.238 Such harm could include but not limited to sub surface water contamination, physical or health harm to plaintiff, harm to property (above or subsurface). It is also crucial that a causal connection between defendant’s activities and the effect on the defendant is established. The remedial implication for the defendant if found culpable could include compensation for increased risk of future harms, medical cost, property repairs or restoration value of the property, future medical monitoring cost, and emotional injury compensation.239

The trespass cause of action is mostly in relation to interference with property, goods and person.240 The trespass claim needs to show actual intentional physical invasion of the plaintiff’s property.241 In the case of CCS operation the most likely occurrence of trespass is subsurface migration or leakage of the stored CO2 or flow of chemical solvents used during CCS operation into the adjoining subsurface or property could

237Rabin R. L., (1987), Rethinking Tort and Environmental Liability Laws: Needs and Objectives of the late 20th Century and Beyond, 24 HOUS. L. REV 27, 49 (1987)

238Keenan D., 1995, English Law, 11th ed. Published by Pitman, London

239Geistfield M., 2002, Analytics of Duty: Medical monitoring and Related Forms of

Economic Loss. 88 VA. L. REV. 1921, 1939 (2002); Goldberg J.C.P &Zipursky, B.C., 2002, Unrealised Torts, 88 VA. L. REV. 1625, 1630 (2002)

240Supra note , [Keenan, D., 1995] p. 395-397

241Smith III, G. N., 1995, “Nuisance and Trespass Claims in Environmental Litigation:

Legislative Inaction and Common Law confusion”, 36 SANTA CLARA L. REV. 39, 54 (1995)

104 be considered an act of trespass. However, trespass could also be applicable to surface forms of properties and entities in a case were the leakage of the contaminant or gases escape to the surface and cause environmental harm. This could be a result of poor geological site selection and characterisation. The likelihood of properties and aquifers242 of adjoining properties (under different ownership to the site operator or project developer) been damaged or contaminated respectively could hold a liability case against the site operator.

In practice according to Ragdales 1993, courts are generally careful “[…] in finding liability for injected fluid subsurface entries”,243 however the remedies vary from compensation in the form of diminution in value to full pay out for any damage and restoration. It must be added however that in the English law trespass to land is actionable per se but trespass to property is not normally a criminal offence.244 There is however no case reference of this that I am aware of even if it is especially within the context of this research.

Finally, the tort of nuisance could be of public or private delineation. The public nuisance is crime which requires the Attorney-General to bring a criminal proceeding to seek remedy245 as it relates for instance to obstruction of public highways, dangerous activities etc.246 However claims could be a possible private cause of action on the grounds of nuisance. Although often considered identical to the trespass claims, private nuisance would only arise if there is substantial interference of the use and enjoyment of the plaintiff’s property247 for instance the obstruction of right of way, or interference with the plaintiff’s water supply, access of air, light or support.248 An example of this in context is the Gulf Oil Corp v. Hugh (1962) in which nuisance claim was brought by the plaintiff against the defendant for contamination of private water well due to the injection of salt water for

242The term aquifer is used in this connection to describe a deep underground reservoir formed of carbonate or sandstone filled with saline water. A suitable reservoir for CO2 storage needs a caprock of low permeability. Injected CO2 will replace the water, but will also to some extent be soluble in the water. The CO2 may also react with minerals to form carbonates.

243Ragdale, T.D. 1993, “Hydraulic Fracturing: The Stealthy Subsurface Trespass”, TULSA L J. 311, 337 (1993).

244Supra note , [Keenan D., 1995] p. 395, 396

245Supra note, [Keenan D., 1995] p. 404

246Id.

247Supra note, [Smith III, G. N., 1995]

248Supra note, [Keenan D., 1995] p. 405

105 secondary recovery of oil.249 Akin to this analogy in the context of CCS could be the migration of stored or injected GHG into private ground water supply resulting in carbonation of the supply in this case interfering with the use and enjoyment of the plaintiff’s groundwater or the GHG contains a high level of other contaminants which could result in the contamination of the water supply without necessarily carbonating the water.

Remedies for nuisance could be the use of court injunction (which is a court order that forbids the party to whom it is served to take any further action as dictated by the order) to stop further operation on the site.

249 Gulf Oil Corp v. Hugh (1962), 371 P.2d 81, 82 (Okla. 1962)

106 Chapter 3

CHARACTERISTIC PROFILING OF CARBON CAPTURE AND STORAGE

In document Carbon Capture and Storage the Clean Development Mechanism : Underlying Regulatory and Risk Management Issues (Page 102-106)