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Aussie expert draws roadmap to successful climate change litigation

8 Sep 2023

| Author: Reweti Kohere

Lawyers contemplating climate change litigation are being urged to use every tool at their disposal – including legislation and common law actions – to hold polluters to account.

So far, New Zealand’s courts have appeared reluctant to let climate litigation advance to trial through common law torts such as public nuisance and negligence. The wins have been rare, meaning many would-be litigants have been deterred by the prospect of protracted courtroom battles against better resourced opponents. But Dr Chris McGrath, a Queensland barrister practising in environment law, says a keep-it-simple approach could lead to more regular success.

With the Supreme Court yet to deliver judgment in the most significant climate change proceeding at present, Smith v Fonterra & Ors, there are plenty of openings to take strategic court action, he told New Zealand lawyers attending an online workshop hosted by the climate justice committee of the Commonwealth Lawyers Association.

Litigation can be thought of as ‘strategic’ when it aims to achieve a wider beneficial outcome than merely the remedy sought from the court. Of course, the proceedings must have merit and be legitimate in their own right – not an abuse of process. The wider purpose must be in addition to the underlying legitimacy of the proceedings.”

Climate change liability is widespread but largely unrealised, says McGrath, who has spent the past two decades working in climate change litigation. And as climate change litigation continues to increase, there will be more opportunities in Commonwealth countries to hold polluters to account for the extensive harm they have caused and will continue to cause.

 

‘Something seriously wrong’

One of the wider purposes of climate litigation is to address the impacts of human-induced climate change either directly or indirectly. Governments have been the initial targets, with complaints mostly based on alleged failures to do enough to meet their domestic and international commitments. Private companies have more recently appeared in the cross hairs. McGrath says common law causes of action and modern environmental and human rights laws may appear wide enough to meet the challenge. But lawyers should not assume this is the case.

“If they do not address climate change – a well-known, major threat facing human society and the environment, which will cause huge loss of life and property – there is something seriously wrong with them. Billions of people and trillions of dollars of property are already being impacted by climate change and these impacts will increase dramatically in the future.”

Lawyers should ground any potential litigation in real and specific case studies, rather than leaning on abstract theories and hypotheticals. And other perspectives should be considered: judges hearing such cases will be “smart lawyers without a background in climate science”, while opposing lawyers will most likely seek to muddy the court’s understanding and play procedural tricks to strike out any case before it gets to trial, McGrath says.

“Narrowing and avoiding disputes through negotiation and compromise are important and we should always pursue them where possible. But sometimes we need to fight, and we need courage and tenacity to do this.”

 

Simple, compelling

Webinar attendees explored McGrath’s framework of 10 issues – canvassing potential parties, best causes of action, available remedies, likely procedural obstacles and ways to “avoid being overwhelmed by a big opponent” – with reference to a potential damages claim by customary landowners in Papua New Guinea (PNG) against what the barrister claims is Australia’s largest direct climate polluter.

Located 160km east of Melbourne in the Latrobe Valley, the Loy Yang A Power Station sits next to an open-cut mine that fuels it with brown coal. The pair are Australia’s largest single source of direct scope 1 greenhouse gas emissions, averaging 18.5 MtCo2-e each year for a decade from 2012, McGrath says.. Their operator, AGL Loy Yang Pty Ltd, is a wholly owned subsidiary of energy company AGL Group. While it is possible to sue the parent, “for simplicity” the better focus would be the subsidiary, he says.

Using data for 2016, AGL Loy Yang’s direct emissions make up 0.05% of global emissions. While China’s emissions are 30%, the operator’s emissions would make it the 87th largest greenhouse gas polluter in the world if it were a country. Its emissions are larger than the annual emissions of more than 100 countries, twice the national emissions of PNG and more than 10 times those of Fiji.

“It is a simple, compelling argument to say to a judge in PNG: ‘This single company has emissions twice the entire nation of PNG. Its emissions are greater than 100 nations. Clearly, its emissions are a material contribution to climate change’,” McGrath says.

 

Reluctance

While international law cannot compel payment for loss and damage arising in a dispute between nations, lawyers could turn to a range of causes of action, including transnational liability.

Transnational climate litigation, where legal liability spans two or more domestic legal systems, is a relatively new frontier, but McGrath says its potential is immense as it can form the basis for a claim in one country against large corporate polluters in other countries. These claims are strategic because they can empower people and communities suffering from climate damage to take action in their own national courts, thereby providing access to justice.

But the law is not well-developed in New Zealand. In Smith v Fonterra & Ors, climate change activist and Iwi Chairs Forum spokesperson Michael Smith in 2020 sued seven New Zealand companies – including dairy conglomerate Fonterra and petrol retailer Z Energy – he perceived as high-emitters. Smith claimed the defendants’ actions constituted public nuisance, negligence and breach of a duty to cease contributing to climate change.

Justice Edwin Wylie threw out the first two claims but declined to strike out the third. While Smith faced “significant hurdles” in his bid to persuade the court that the duty of ceasing to contribute to climate change should for the first time be recognised, the High Court judge held that the relevant issues should be explored at trial.

The Court of Appeal in October 2021 upheld the struck-out claims and removed the novel duty cause of action, saying that tort law was not the appropriate vehicle for dealing with climate change as “every person in New Zealand – indeed, in the world – is (to varying degrees) both responsible for causing the relevant harm and the victim of that harm”.

 

Material contribution

Having granted leave to appeal in March 2022, the Supreme Court heard the case in August last year. MinterEllisonRuddWatts, which represented two of the Smith defendants, explains that common law torts traditionally require a proven causal link between a defendant’s actions and the harm suffered by the plaintiff.

“Climate change is notoriously challenging in this respect: everyone contributes to climate change, and everyone is also a victim of it, in each case to a greater or lesser extent,” Minters says. “In the context of a global climate system in which the effects of human conduct are complex and occur over generations, how can there be any realistic prospect of proving that the actions of one enterprise contributing an infinitesimally small proportion of global emissions have any effect upon a single plaintiff?”

McGrath says establishing causation starts with common sense. In the workshop example, AGL Loy Yang’s direct emissions are entering the Earth’s single atmosphere, which affects everyone, including the Carteret Island landowners. However, as the law requires a more rigorous test, a throughline in common law jurisdictions is that two or more acts which combine to cause the harm are legally causative if they materially contribute to the loss suffered.

Lawyers can best frame material contribution around a defendant company’s annual emissions compared to the national emissions of the country hearing the claim, along with the carbon budget, a tool that quantifies the cumulative amount of carbon dioxide that can be emitted into the atmosphere by human activities to hold the rise in mean global temperatures to typically less than 2 degrees Celsius to 1.5 degrees Celsius above pre-industrial levels.

McGrath says while there is ongoing debate and refinement of the concept, it is widely adopted and gives a “simple and strong” basis for establishing causation, while countering arguments that an individual project’s emissions are too trivial to concern the law.

While not directly addressing the Smith litigation, McGrath cautions against a multi-defendant suit as lawyers should limit any litigation to one corporation and one activity in a jurisdiction where judgment can be enforced. “Trying to sue multiple, large corporations or governments for multiple activities simultaneously multiplies the complexity exponentially,” he says. “You can simply be overwhelmed.”

Lawyers should lay out a pathway for the courts to follow and expect them to step up in the face of destruction. “There are people dying already. Huge amounts of people will be displaced,” he says. “Dealing with this is essential.” ■

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