In a unanimous judgment, the Supreme Court of New Zealand has overturned the Court of Appeal's decision, which struck out Mr Smith's three tortious claims against seven corporate defendants (read our previous briefing here). The Supreme Court has allowed Mr Smith's claims in negligence, public nuisance, and a novel "climate system damage" tort to proceed to trial.
Recap – High Court and Court of Appeal decisions
Mr Smith is an elder of Ngāpuhi and Ngāti Kahu and the climate change spokesman for the Iwi Chairs Forum. He claims against seven corporate defendants on the basis that they are each involved either in an industry which releases greenhouse gases into the atmosphere or manufactures and supplies products which release greenhouse gases when they are used. Mr Smith seeks: (i) declarations that each defendant has unlawfully caused or contributed to public nuisance or has breached duties of care to Mr Smith; and (ii) injunctions requiring each defendant to achieve net zero emissions by 2050.
The High Court determined that Mr Smith's claims in public nuisance and negligence were not reasonably arguable and struck them out. It declined to strike out the claim based on the proposed climate system damage tort. Mr Smith appealed and the respondents cross-appealed.
The Court of Appel struck out all three causes of action. Its overarching view was that: "the magnitude of the crisis which is climate change simply cannot be appropriately or adequately addressed by common law tort claims pursued through the courts. It is quintessentially a matter that calls for a sophisticated regulatory response at a national level supported by international coordination".
Supreme Court's decision
Two preliminary points are worth noting at the outset:
- The Supreme Court was only considering whether the claims should be struck out and emphasised 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 only addressed Mr Smith's claim in nuisance (being that the defendant companies are substantially and unreasonably interfering with rights to public health, safety, comfort, convenience and peace). Having found that the nuisance claim was tenable, the Court allowed the remaining two causes of action to proceed on the basis that they would not materially add to costs, hearing time or other court resources that would be used in any event.
Perhaps most interesting about the judgment is the Supreme Court's analysis and consideration of the causation issue. Central to the Court of Appeal's conclusion that the causation aspect was not made out was the finding that: "All of the cases which have invoked this aggregation principle have involved a finite number of known contributors to the harm, all of whom were before the Court. That is no accident. It is a critical factor".
By contrast, the Supreme Court considered four authorities where defendants were found to have caused public nuisances by discharging into rivers, despite individual householders being the actual contributors to the discharge or the waterways having been polluted by numerous other non-party sources (including other industrial users). In such cases, not all of the contributing polluters were before the court, nor was it realistic to identify any meaningful finite number of known contributors.
The Supreme Court noted that, whilst the common law has not previously grappled with a crisis as all-embracing as climate change, in the 19th and early 20th centuries it had to deal with another existential crisis, albeit one of a lesser scale, when the industrial revolution dramatically enlarged the risk of accidents through the mechanisation of factories, transportation and mining. As a consequence of the long, global industrial revolution, the common law had to deal with new, widespread risk and damage caused by air and water pollution and the escape of biohazards. Climate change engages comparable complexities, albeit at a "quantum leap scale enlargement".
The Supreme Court emphasised that the principles governing public nuisance ought not to stand still in the face of massive environmental challenges attributable to human economic activity. The common law, where it is not clearly excluded, responds to challenge and change in a considered way, through trials involving the testing of evidence.
The Supreme Court concluded that it is not the case that all defendants causing or contributing to a nuisance must be before the court (or capable of being so). It is arguable that in the case of public nuisance, a defendant must take responsibility for its contribution to a common interference with public rights; its responsibility should not be contingent on the absence of co-contribution or be in effect discharged by the equivalent acts of others.
What is the significance of the decision?
Mr Smith lost at the Court of Appeal largely because the Court felt that climate change was a matter for regulators, rather than the judiciary. But the Supreme Court identified that even an extensive scheme of regulation might leave gaps and problems for other legal processes to address. The Court demonstrated that engaging with climate claims need not require extensive supervisory remedies, or the construction of a rival scheme of regulation. Indeed, the Court acknowledged that Mr Smith was hoping the claim would catalyse further private and regulatory action, rather than inserting the Court as an ongoing regulator itself. The Supreme Court suggested that even purely declaratory relief might have this effect.
The case will now return to the High Court for case management through to trial. The New Zealand Supreme Court's judgment is available here.
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