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Novel climate change lawsuit to proceed

Novel climate change lawsuit to proceed

Novel climate change lawsuit to proceed

Tuesday 13 February, 2024

The Supreme Court (SC) has released its long-awaited decision in Smith v Fonterra Co-Operative Group Ltd.

The appeal considered whether Mr Smith’s claim in tort, relating to damage caused by climate change, should be struck out (on the alleged basis it was bound to fail at trial). The SC unanimously allowed Mr Smith’s claim to be reinstated; it will now proceed to be heard by the High Court (HC). The SC is clear that reinstatement of the claim is not an indication on whether the claim will ultimately succeed or not.

The appellant, Mr Smith (Ngapuhi and Ngati Kahu), is the climate change spokesperson for the Iwi Chairs Forum. He issued proceedings in the HC against seven respondents: Fonterra and six other New Zealand companies, claiming they are substantial emitters of greenhouse gases, are materially contributing to climate change, and are causing damage to his whenua and sites of cultural and historical significance.

Mr Smith claimed:

  1. Public nuisance - the respondents’ greenhouse gas emissions cause Mr Smith harm and have or will interfere with public rights;
  2. Negligence - the respondents are breaching their duty to Mr Smith, and others like him, by continuing to breach their duty to take reasonable care not to operate their businesses in a way that contributes to climate change; and
  3. Climate system damage, a new tort which would require the respondents to cease contributing to climate change.

The claim was subsequently amended to include the principle of tikanga Māori, not as a separate cause of action, but to inform the court’s consideration of the issues in relation to the three causes of action.

Mr Smith sought:

  1. A Declaration that the respondents had unlawfully caused, or contributed to public duties, or breached their duties of care to Mr Smith; and
  2. Injunctions requiring the respondents to achieve zero emissions by 2050.

The respondents applied to strike out the proceedings arguing that the statement of claim raised no reasonably arguable cause of action, the claim related to policy matters best addressed by Parliament, and the respondents were all within the statutory and regulatory requirements in terms of their emissions.

The Court of Appeal (CA) upheld the HC’s striking out of the first two causes of action and allowed the respondents’ cross-appeal and struck out the third cause. The CA held that there are strong policy reasons against imposing private law duties on greenhouse gas emitters; matters of this complexity are best dealt with legislatively.

Mr Smith was granted leave to appeal to the SC. The question for consideration in the SC was whether Mr Smith’s claims are clearly untenable and should not be allowed to proceed to trial. Due to the issues raised in the appeal, a number of other organisations were also granted the right to provide submissions to the Court: Lawyers for Climate Action NZ Inc, Te Hunga Roia Māori o Aotearoa and the Human Rights Commission.

In the SC, Mr Smith argued that his claim requires the courts’ assistance to stop the wrongdoing against him. This is the traditional role of the courts and the common law. The law of tort does not require re-invention and a trial is warranted.

The respondents argued that the courts would need to “stretch, bend and invent tort law” to issue an injunction against the respondents. That although flexible, the common law should not be used in this situation as it is not possible to link emissions to the harm suffered by Mr Smith and that such claims are excluded by statue. It is for Parliament to deal with such a complex and systemic issue.

The SC held that a measured approach to a claim to strike out “is appropriate where a claim . . . is novel, but at least founded on seriously arguable non-trivial harm” and that evidence and argument should be evaluated at trial. For strike out to be appropriate, a case would always have to fail no matter its facts, the arguments or policy considerations. 

The question for the SC’s consideration, was whether it could be said that whatever the facts proved or policy arguments advanced, the public nuisance claim is bound to fail. The SC concluded no, the case was not bound to fail. The SC declined to strike out Mr Smith’s remaining two causes of action as striking them out would be unlikely to reduce the use of the court time and resources in a material way.  

The SC also confirmed that, as the loss pleaded by Mr Smith is in part tikanga-based (he is kaitiaki acting on behalf of whenua, wai and moana), the court will be required to engage with tikanga.

Whether the claim will ultimately succeed remains to be seen. In the meantime, the climate change litigation door has been opened and further claims can be expected in an effort to hold major emitters to account.

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