Mobil Oil New Zealand has been ordered to pay NZ$10 million to decontaminate an area of Wynyard Quarter, on Auckland’s waterfront.
The oil company had leased two properties on the waterfront for a storage terminal for more than 50 years.
But when Mobil’s lease for the two sites expired in 2011, it was found the land they were on had been heavily contaminated. While it was established the company was not solely responsible for contamination to the land – other oil companies had also contributed to its condition – Auckland Waterfront Development Agency (known as Waterfront Auckland) claimed Mobil had to deliver the land in an “uncontaminated condition” at the end of its lease term.
Waterfront Auckland is a Council-controlled organisation and the successor in title to the Auckland Harbour Board. It is developing the land for mixed residential and commercial uses that are sensitive, as the original heavy industrial uses were not, to pollution.
It took the oil company to the High Court at Auckland, where it was decided that if Mobil was liable, and so has to pay the public organisation $10 million in damages.
“We declare that Mobil NZ breached the repair obligation in the 1985 tenancies by failing on termination to remediate hydrocarbon contamination of the land caused by Mobil NZ and its predecessor companies in the Mobil Group since their occupancy began in 1925. The parties having agreed that the cost of such remediation is $10 million, judgment may be entered for that sum,” said Justices Ellen France and Forrest Miller, two of the three presiding High Court judges.
The third, Justice Rhys Harrison, agreed with his two colleagues to allow the appeal, but said he would have remitted the matter back to the High Court for further evidence to determine questions of causation and quantum.