Legal Principles and Key Points
- In the case of Allen v Gulf Oil  A.C. 1001, it was held that where a private Act of Parliament provides for the construction and operation of an oil refinery, it also confers, at least by implication, an immunity from suits for nuisance concerned with the inevitable results of operating the refinery.
Facts of the Case
- The Gulf Oil Refining Act 1965 preamble stated that in order to meet the increasing public demand for the D’s oil, it was essential that more facilities for importation and refinement of crude oil needed to be made.
- The 1965 Act stated that D intended to establish a refinery in C’s parish, and empowered D to acquire lands and construct authorised works necessary for the facilities, including jetties for tankers.
- The 1965 Act s5(1) stated D ‘may enter upon, take and use such of the lands delineated on the deposited plans…’
- While the 1965 Act s15(1) authorised the construction of certain works, it contained no provision for compensation for any damage caused.
- The 1965 Act s16 authorised the construction and use of subsidiary works (railways) and required D to make reasonable compensation for damages caused by exercise of D’s powers under that section.
- The 1965 Act contained no specification or details of the refinery which the D proposed to construct or provisions for compensating damages relating to it.
- D constructed an oil refinery and subsidiary works between C’s village and the seashore. The refiner began operations in 1967.
- Some villagers brought complaints and actions for nuisance against D. C’s action was taken as a test case.
- C’s claim alleged nuisance by noxious odours, vibrations and offensive noise levels emanated from the refiner.
- C also alleged that she and family members sustained personal injury, suffered damage and expense, and lived in fear of the refinery exploding.
- D relied on the defence of statutory authority.
- Could D rely on the defence of statutory authority, even in the absence of specifications regarding immunity from nuisance?
Held by the House of Lords
- Finding for D, that the Gulf Oil Refining Act 1965 s5 expressly/impliedly conferred statutory immunity from proceedings for any nuisance which was the inevitable result of constructing and operating an oil refinery. As such, D could rely on the 1965 Act as a defence of statutory authority.
- “It is now well settled that where Parliament by express direction or by necessary implication has authorised the construction and use of an undertaking or works, that carries with it an authority to do what is authorised with immunity from any action based on nuisance. The right of action is taken away (see Hammersmith and City Railway Co v Brand  L.R. 4 H.L. 171, 215). To this there is made the qualification, or condition, that the statutory powers are exercised without ‘negligence’- that word here being used in a special sense so as to require the undertaker, as a condition of obtaining immunity from action, to carry out the work and conduct the operation with all reasonable regard and care for the interests of other persons: (see Geddis v Proprietors of Bann Reservoir (1878) 3 App.Cas. 430). It is within the same principle that immunity from action is withheld where the terms of the statute are permissive only, in which case the powers conferred must be exercised in strict conformity with private rights” [1011F].
- C alleged that D has ‘carte blanche’ to construct the refinery itself, and therefore the intention must be that they must construct it with regard to private rights. It follows that if C or anyone else can establish nuisance, they are entitled to an injunction. This may make it impossible for the refinery to be operated, leaving D occupying land that cannot be used for other purposes.
- This is clearly an artificial reading of the text. Manchester Corporation v Farnworth  A.C. 171. held that in absence of specification (and subject to the ‘negligence’ exception) the usual rule applied. There could be ‘no action for nuisance caused by the making or doing of the thing authorised, if the nuisance is the inevitable result of the making or doing so authorised.’ This is parallel to the present case.