Case notes - Developments in Corporate Accountability across the Irish Sea: Okpabi v Royal Dutch Shell Plc [2021] UKSC 3

• Author: Francesca Farrington
• Pages: pp 170 - 182
• Published date: 12 January 2022
• Date: 12 January 2022

170

Developments in Corporate Accountability across

the Irish Sea: Okpabi v Royal Dutch Shell Plc

[2021] UKSC 3

FRANCESCA FARRINGTON*

I. Introduction

Okpabi v Royal Dutch Shell Plc1 (‘Okpabi ’) is the most recent instalment in a series

of United Kingdom Supreme Court (‘UKSC’) judgments that are changing the

landscape of parent company liability for the actions of subsidiaries. Okpabi follows

hot on the heels of the decision in Vedanta Resources Plc v Lungowe

2 (‘Vedanta’).

Both decisions concerned service out of jurisdiction in negligence proceedings

taken against a UK-domiciled parent company, and a non-resident subsidiary. e

Veda nta Court found, and the Okpabi Court conrmed, that the three-step test in

Caparo Industries plc v Dickman3 (‘Caparo’) is no longer applicable, as the liability

of a parent company for the activities of its subsidiaries is not a novel category

in common law negligence. Now, parent company duty of care is determined by

reference to general principles of tort law.4 Following Ved a n t a , the Court has to

consider whether ‘the parent availed itself of the opportunity to take over, intervene

in, control, supervise or advise the management of the relevant operations … of the

subsidiary.’5 Okpabi gives texture to this statement providing a non-exhaustive list

of factors to be considered when determining the extent of a parent company’s duty

of care, including management, group wide policies, control and supervision.

ere are considerable similarities between Irish and English law on the issues

considered in Okpabi, specically, the process for service out of jurisdiction, and

the concept of duty of care. As such, developments across the Irish Sea may prompt

reection within the Irish legal community. Our closest common law neighbour’s

new understanding of a parent company’s duty of care reects the transnational

character of multinational enterprises (‘MNEs’). A continued disparity on these

issues may, unintentionally, transform Ireland into a destination for MNEs seeking

* PhD Candidate at the Faculty of Law, University of Cambridge. With many thanks to the Editorial

Board for their editorial assistance, reviews and comments, and for the insightful feedback from

the anonymous reviewers. Any views or opinions expressed in this article are the personal views and

opinions of the author.

1 Okpabi v Royal Dutch Shell Plc [2021] UKSC 3.

2 Vedanta Resources Plc v Lungowe [2019] UKSC 20.

3 Caparo Industries plc v Dickman [1990] 2 AC 605.

4 Okpabi (n 1) [151].

5 Ved a n t a (n 2) [49].