Legal Update for Energy Lawyers - January 2023

This newsletter provides general information and is not intended to be comprehensive or to provide specific legal advice. Professional advice appropriate to a specific situation should always be sought.

Contents: 

1. Court of Appeal decision on limitation periods relating to service contracts
2. Nigeria renews its bid to overturn an $11bn arbitration award at London's High Court 
3. UK government and the NSEC sign memorandum of understanding on offshore renewable energy
4. Courts clarify extent of powers in respect of documents on personal devices
5. High Court ruling on unintentional waiver of privilege
6. ECJ affirms the right of every person to know to whom their personal data has been disclosed
7. Sri Lanka preparing to issue oil & gas exploration licences
8. Hong Kong introduces new success fees regime

1. Court of Appeal decision on limitation periods relating to service contracts

In  Consulting Concepts International Inc v Consumer Protection Association (Saudi Arabia) [2022] EWCA Civ 1699, the London Court of Appeal has struck out a £50 million claim on the basis that it was time barred. The Court held that a cause of action for payment of services accrues when the work is completed, not the date for payment set out in an invoice or agreement between the parties, unless there are clear words or a “special term” that provide otherwise. The general rule was not displaced by a term providing that invoices would be issued “within 90 days”. This is an important decision to bear in mind when considering if and when to take action for the recovery of sums due in respect of services performed. It also serves as a reminder that if parties to an agreement wish to displace the general rule on limitation, they should do so in clear and express terms.

2. Nigeria renews its bid to overturn an $11bn arbitration award at London's High Court

Nigeria has commenced appeal proceedings in the High Court in London to overturn an $11bn sum ($6.6bn award plus accrued interest over a decade) awarded to Process & Industrial Development (P&ID), an offshore engineering and project management company. Nigeria seeks to overturn the award on grounds of bribery and corruption, claiming that P&ID never intended the project to succeed and bribed lawyers acting for Nigeria in the arbitration. The $11bn sum amounts to more than Nigeria’s Health, Education and Justice Ministries’ budget combined.

3. UK government and the NSEC sign memorandum of understanding on offshore renewable energy

On 18 December 2022, the UK government signed a memorandum of understanding with participants of the North Seas Energy Cooperation (NSEC) (the “Memorandum”) setting out the terms of cooperation between the EU and the UK in the development of offshore renewable energy in the North Seas area. The Memorandum aims to assist the UK’s ambition of increasing offshore wind capacities to 50 GW and the EU’s objective to install at least 60 GW of offshore wind capacity. Although the agreement is non-binding, it is hoped that it will enable the parties to work together in order to achieve the sustainable development of offshore wind and to concentrate on the planning and development of specific projects. The cooperation will involve hybrid and joint projects, maritime special planning, best practises for planning respective onshore and offshore grids and information sharing on new technologies.

4. Courts clarify extent of powers in respect of documents on personal devices

It is increasingly common that documents, which are potentially relevant to a dispute, are located on the personal devices or in the personal email accounts of employees (or even ex-employees) of a party to the dispute. An issue then arises as to whether those documents are under the ‘control’, within the meaning of the English Civil Procedure Rules, of the party for the purposes of disclosure. In Republic of Mozambique v Credit Suisse & Ors, the Court confirmed that, where the employment relationship between the party and (ex-)employee is governed by English law, the English Courts will readily find that the party to the dispute has control over such documents. The Court, also, clarified the extent of its powers where the employment relationship is governed by foreign law: unless a party adduces expert evidence to the contrary, the Court may assume that the foreign law is the same as English law and the party does have control of documents on (ex-)employees’ personal devices or in personal email accounts.

5. High Court ruling on unintentional waiver of privilege

The recent case of Clements v Frisby demonstrates why references to legal advice should generally be avoided in witness statements and other documents. The High Court granted a disclosure application following the Claimant’s waiver of privilege by making reference to legal advice in a witness statement. The judge determined that privilege had been waived, but only in relation to documents that were connected to the particular transaction that was described in the witness statement. The case, which is consistent with other case law in this area, demonstrates that to the extent to which it may be advantageous to refer to privileged information for any reason, it should be described as narrowly as possible in order to lessen the scope of any prospective waiver.

6. ECJ affirms the right of every person to know to whom their personal data has been disclosed

The European Court of Justice (ECJ) recently issued a decision (RW v Österreichische Post AG) on whether Article 15(1)(c) of the GDPR extends, upon the request of the data subject, to the identification of the specific receivers to whom their personal data has been disclosed. The question was referred by the Austrian Supreme Court from an access request made by a data subject (RW) to Österreichische Post (OP). RW requested information on the specific receivers that OP had shared his data to. Only broad categories of receivers were described by OP in its reply, and RW was directed to websites where he could learn more about OP’s data sharing and the receivers in general. The ECJ affirmed that in cases where receivers of personal data have been or will be revealed, the data controller is required to give the data subject, upon request, the real names of those receivers. The data controller may only give the categories of receivers in question in cases where it is not yet possible to identify such receivers or the data controller proves that the request is obviously excessive or unwarranted.

7. Sri Lanka preparing to issue oil & gas exploration licences

The Petroleum Development Authority of Sri Lanka has identified 900 offshore blocks and is preparing to issue two-year oil and gas exploration licences to foreign firms to scout for energy resources and bring in vital investments. Seismic data collected indicates that there could be more than 1 billion barrels of oil in the Mannar Basin alone worth an estimated $260 billion. Sri Lanka’s energy minister, Kanchana Wijesekera, recently announced that he has signed a legal framework for offshore oil and gas explorations and hopes to recommence work with suitable investors on the exploration of assets in the offshore blocks identified. Under the new regulations, parties are able to sign an expression of interest for joint oil and gas exploration.

8. Hong Kong introduces new success fees regime

Hong Kong has lifted its prohibition on the use of success fee structures by lawyers in arbitrations taking place in and outside Hong Kong. New rules entered into at the end of 2022 allow parties to enter into three types of success fee arrangements: conditional fee arrangements, damages-based arrangements, and hybrid DBAs. Such arrangements must be in writing and signed by both parties.