Profitable polluters should stop harming the poor, the vulnerable and future generations, court told. David Williams reports.
Northland iwi leader Mike Smith’s climate case is heading to the Supreme Court.
Smith (Ngāpuhi, Ngāti Kahu) launched legal action against seven of the country’s largest polluters and fossil fuel producers, claiming injury from their ongoing emissions.
A chain of judgments relate to a strike-out application by those companies – Fonterra, Genesis Energy, Dairy Holdings, NZ Steel, Z Energy, NZ Refining Company, and BT Mining.
In March 2020, the High Court struck out Smith’s claims of public nuisance and negligence, but allowed a new “tort” – the section of law dealing with obligations of one party to another – claiming a breach of duty, to remain live.
Then, last October, the Court of Appeal threw the whole case out, including the novel tort, saying climate change wasn’t the realm for courts but rather national regulations and international coordination.
In a decision from last Thursday, Supreme Court Justices Susan Glazebrook, Mark O’Regan and Joe Williams granted leave for the Court of Appeal judgment to be challenged.
It’s a lifeline for the case, in an emerging area of the law in New Zealand. Overseas, two of the most prominent wins for climate action have been in the Netherlands, against Royal Dutch Shell, and non-government organisation Klimaatzaak’s win against the Belgian state.
Across the Tasman, eight teens and a nun won their case over the expansion of a New South Wales coal mine in May 2021. But that decision was overturned last month, with three federal court justices saying the federal environment minister, Sussan Ley, doesn’t have a duty of care to protect young people from the climate crisis.
A date for the New Zealand Supreme Court hearing is yet to be set.
“Are they going to let the Government and polluters continue to enable this global crisis?” – Mike Smith
“I’m pleased that for the first time the courts are considering the enormity of the climate crisis,” says Smith, who is a customary owner of coastal land at Mahinepua, near Kaeo. “And pleased that the highest court in the country is now going to hear what’s indisputably the most serious issue currently facing our nation and indeed humanity.”
Smith, who co-chairs the climate portfolio within the Iwi Chairs Forum, is interested in how the court will rule. “Are they going to let the Government and polluters continue to enable this global crisis?” he asks.
Fonterra, Genesis Energy and Z responded to Newsroom’s request for comment.
In an emailed statement – which rehashes several comments made to Newsroom last year – legal director Andrew Cordner says Fonterra will continue to strongly defend its position. “What Fonterra fundamentally disagrees with is that the matters Mr Smith has raised can and should be addressed in the courts.”
Fonterra is New Zealand’s biggest company and the world’s biggest dairy exporter. It also has the dubious honour of being the country’s biggest climate polluter.
If politicians continue to set climate policy that might be construed as a win, considering the agricultural industry continues to be exempt from the emissions trading scheme, established in 2008.
Z Energy is the country’s largest seller of fossil fuels and the country’s second-worst polluter. Its sale to Australian petrol company Ampol has recently been approved by the Commerce Commission.
“We don’t think that this particular claim – being bespoke emissions reduction schemes for seven companies – is the mechanism for achieving the required urgent and effective decarbonisation of New Zealand,” Z’s general counsel and chief governance officer Debra Blackett says in an emailed statement.
The company has been excoriated for failing to live up to its climate rhetoric – for producing fat profits for shareholders while minimising investment in clean energy.
Yesterday, the company launched a nationwide ad blitz talking up its green credentials. (The shift won’t happen overnight, Z says, but it’s “focused on the future” and “ready to adapt”.)
Blackett’s statement to Newsroom said the company was “deeply committed” to “contributing to” the decarbonisation of transport, and is “acting on our commitment to getting out of the petrol business through direct and significant investment in alternative fuels”.
How large was that investment in alternative fuels in the last financial year? In a highly competitive market, Blackett laments, that’s commercially sensitive.
Genesis Energy, which runs the Huntly Power Station, is similarly keen to shift the conversation to how it will help lead the country’s transition to a “lower” carbon economy.
“Irrespective of the outcome of this case, Genesis is focused on empowering New Zealand’s sustainable future,” chief corporate affairs officer Matt Osborne says in an emailed statement.
Smith’s legal team, led by Davey Salmon QC, works pro bono. It provided Newsroom with the written submissions that led to the Supreme Court granting the leave to appeal. They suggest there might be an attempt to add other big polluting companies to the case.
Many of the arguments in the submissions are technical and dense, referring to complex case law. But there are impassioned pleas seeking broader appeal.
“There is a clear moral and distributive foundation for the tort: the respondents profit from their emission of greenhouse gases, and production of fossil fuels, and in doing so externalise harm [to] others, including Mr Smith. The tort shifts responsibility for harms to those who emit, and who profit from emissions, and resolves the present externality problem in which the harms caused by the respondents are instead predominantly borne by the poor, the vulnerable and future generations.”
Numerous references are made to findings “made without hearing evidence”. A central argument to the Supreme Court, then, is that it was inappropriate for the courts to make what Smith’s legal team says is findings of fact at a strikeout hearing, without expert evidence being called.
The submissions say the High Court and Appeal Court seemed to have a misconception Smith’s case tort law can and should fix climate change. “In fact, Mr Smith’s case is that the defendants have wronged him, and he is entitled to a remedy requiring them to stop their ongoing contributions to that wrong.”
Smith points to recent Environmental Protection Authority data showing 15 companies are responsible for 75 percent of the country’s emissions. (Indeed, four companies named in his case – Fonterra, Z Energy, Genesis, and New Zealand Steel – are responsible for nearly a third.)
Adding a handful of additional defendants to the case could involve the companies “responsible for the majority of New Zealand’s emissions”. (The EPA named the country’s six worst emitters as Fonterra, Z Energy, BP, Mobil, Silver Fern Farms and Todd Corporation.)
“If such an amendment is required to survive strikeout, then it can be readily made,” the legal submissions state.
“Allowing the defendants to externalise the harms of their emissions onto him and others (and at a profit for themselves) is ineffective, inefficient and socially unjust.” – legal submissions to the Supreme Court
On Smith’s negligence claim, the Court of Appeal found no “physical or temporal proximity” between the “causative agency” – greenhouse gas emissions – and a known or readily identifiable group responsible for the harm.
The written submissions to the Supreme Court countered: “Mr Smith, as tangata whenua with land on the coast is part of a class of people that the defendants knew or ought reasonably to have known, would be harmed.”
Further, the fact the companies “have harmed many people” doesn’t make their “wrong” any less “relational”.
The court also failed to consider how the law of negligence might be modified by concepts like tikanga Māori.
One passage of the Court of Appeal judgment said courts have an important role in responding to the “exigencies of climate change” – in “supporting and enforcing the statutory scheme for climate change responses and in holding the Government to account”.
“Private litigation against a small subset of emitters, requiring them to comply with requirements that are more stringent than those imposed by statute, will not be effective to address climate change at a national level, let alone globally,” the decision said. However, developing a “parallel common law regulatory regime” would be “ineffective and inefficient, and likely to be socially unjust”.
This conclusion, Smith’s submissions state, was “inappropriate”.
“On the contrary, Mr Smith submits, allowing the defendants to externalise the harms of their emissions onto him and others (and at a profit for themselves) is ineffective, inefficient and socially unjust.”
Smith tells Newsroom that iwi – like those in Tairāwhiti and near Kaimaumau – are on the frontlines of extreme weather events fuelled by human-caused climate change.
“This is not abstract or theoretical,” he says, adding: “I’m pretty confident that what we’re doing is appropriate and urgent and necessary.”
Jurisprudence and legal thought changes, like public sentiments at any point in history, he says.
“Back in the ‘30s or ‘40s, homosexual law reform would have been unthinkable to take to court, or even to the media, but over time these things become more socially acceptable.”
Maybe climate change has found its time.
“This is the first time, I think, that cases like this have been prosecuted within the New Zealand courts. So hopefully, the alignment between the issue and the time that we’re in is aligned.”
