Supreme Court gives Mobil leave to appeal Auckland cleanup

Supreme Court gives Mobil leave to appeal $10 mln cleanup bill for Auckland land contamination

By Fiona Rotherham

Nov. 23 (BusinessDesk) - The Supreme Court has given Mobil Oil leave to challenge a Court of Appeal decision that made it liable to pay $10 million to publicly-owned Waterfront Auckland for the cleanup of a heavily contaminated area of Wynyard Quarter in downtown Auckland.

Mobil Oil leased two properties in Auckland’s waterfront “tank farm” for more than 50 years. The land it was on was found to be heavily contaminated after it ended its leases for the two sites in 2011.

While other oil companies as previous tenants and neighbours had contributed to the problem, Waterfront Auckland claimed Mobil had to deliver the land in an uncontaminated condition at the end of its lease term. It took the oil company to the High Court at Auckland which found in Mobil’s favour but the Court of Appeal reversed that decision earlier this year, awarding a $10 million payout to the council organisation.

The Supreme Court said today when granting leave to appeal that the approved questions are did the “clean and tidy” clauses in the 1985 leases between Mobil Oil and the Auckland Waterfront Development Agency require the oil company to remediate any hydrocarbon contamination of the leased land on termination of the leases and if not, is Mobil Oil liable for the costs of remediation on the basis it breached an implied lease term not to commit waste?

If the answer to either question is yes, the court will then need to rule on whether the remediation obligation relates only to hydrocarbon contamination caused since 1985 or further back to 1925 when the contamination began.

(BusinessDesk)

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