Smith v Fonterra: A Climate Change Litigation Development
The Supreme Court of New Zealand recently overturned strike-out decisions to allow climate change claims (involving a new climate tort) to proceed to trial.
Background
In 2022, Michael Smith, a Māori tribal elder and the climate change spokesman for the Iwi Chairs Forum, a national forum of tribal leaders, brought proceedings against seven corporate defendants, alleging that they were collectively responsible for one-third of New Zealand’s greenhouse gas emissions in 2020-2021.
Mr Smith sought a declaration that the seven defendants unlawfully breached a duty owed to him and/or caused or contributed to a public nuisance, and have caused him loss or will cause him loss through their activities.Amongst other claims, Mr Smith alleged that rising sea levels would result in damage to his family land due to physical erosion, the loss of economic value, and the loss of sites of cultural and spiritual significance. Injunctions were also sought requesting a cessation or reduction of emissions. The case pleaded the following causes of action:
- public nuisance;
- negligence; and
- a new climate tort imposing a duty “to cease materially contributing to damage to the climate system, dangerous anthropogenic interference with the climate system, and the adverse effects of climate change through their emission of greenhouse gases into the atmosphere“.
In 2020, the High Court struck out the first and second causes of action on the basis that they were not reasonably arguable, though it declined to strike out the claim based on the proposed climate system damage tort. Mr Smith and the respondents cross-appealed, and in 2021, the Court of Appeal struck out all three causes of action, stating that climate change requires a “sophisticated regulatory response” and “cannot be appropriately or adequately addressed by common law tort claims“.
The Supreme Court’s Decision
The Supreme Court overturned the Court of Appeal’s decision and ruled that all three causes of action could proceed to trial. However, the ruling only considered whether the claim should be struck out and observed that “a refusal to strike out a cause of action is not a commentary on whether or not the claim ultimately will succeed.“
The Supreme Court disagreed with the Court of Appeal’s comments about the suitability of common law tort claims to address climate change. The Supreme Court drew a comparison with the industrial revolution where common law evolved due to the increased risk of (i) accidents, (ii) air and water pollution, and (iii) the escape of biohazards. The ruling notes that climate change engages comparable complexities, “albeit at a quantum leap scale enlargement.“
Commentary
The Supreme Court’s decision to allow the case to proceed to trial says little about its eventual merit. It is also worth noting that part of Mr Smith’s case relied on tikanga (Māori custom), meaning that any trial judgment may be less relevant in other jurisdictions. However, the judgment is a key development as it recognises an arguable possibility for existing torts (in this case, public nuisance and negligence) to be used to challenge corporations’ actions that adversely affect the environment. Further, it allows for the development of a completely novel tort in response to climate change. It is possible that other jurisdictions will follow, seeing a broader evolution in the common law. The potential impact of this new tort is significant, but it must first be tested, which as the Supreme Court observed, is more appropriately done “in the fertile fields of trial, not on the barren rocks of a strike out application.“