In the recent case Smith v. Fonterra, 1 the Supreme Court of New Zealand allowed an appeal in a private law climate change action, permitting the appellant's tort claims to proceed and rejecting the respondent corporations' arguments that the causes of action were doomed to fail.
This is an important case for those interested in climate change litigation. New Zealand's top court found that the New Zealand common law may indeed be flexible enough to accommodate new forms of claims targeted at private entities alleged to be contributing to the complex issue of climate change. Whether these causes of action will succeed at trial is not yet known, but in Smith, the Supreme Court was not willing to strike them at a preliminary stage.
This result is likely to embolden climate activists worldwide in pursuing new and creative forms of private law relief, or in arguing that existing private law causes of action can be repurposed to respond to climate change.
In Smith, the plaintiff, Michael John Smith, a Māori elder and climate change spokesperson for a national forum of tribal leaders, commenced a proceeding against seven New Zealand companies in a range of sectors including energy, mining and others fueled primarily by combustion of coal and fossil fuels. The seven companies are alleged to be collectively responsible for more than one-third of New Zealand's greenhouse gas emissions. Mr. Smith raised three tort claims: public nuisance, negligence, and a proposed new tort based in a private duty in relation to climate change. Mr. Smith sought declarations with respect to the tort claims and injunctions requiring the companies to reduce emissions within a prescribed time frame or alternatively, immediately cease emitting net emissions.
The respondent companies applied to strike out Mr. Smith's claims, arguing that his pleadings disclosed no reasonable cause of action. The New Zealand High Court struck the claims in public nuisance and negligence and let the novel tort claim stand. The Court of Appeal then struck out all three causes of action, finding that "the magnitude of the crisis which is climate change simply cannot be appropriately or adequately addressed by common law claims pursued through the courts," and that rather the matter called for a "sophisticated regulatory response at a national level supported by international co-operation."
On appeal, the Supreme Court took a capacious view of the common law's ability to respond to harms caused in connection with climate change. For example, the Supreme Court rejected the defendant corporations' argument that common law actions over greenhouse gas emissions were excluded by the relevant statutory scheme; it found that New Zealand's Parliament had "left a pathway open for the common law to operate, develop and evolve [...] amid a statutory landscape that does not displace the common law." Similarly, with respect to public nuisance, the Supreme Court wrote that "[t]he common law must develop, if at all, in the fertile fields of trial, not on the barren rocks of a strike out application." As a result, the Supreme Court allowed Mr. Smith's claims to proceed to trial, where they would be tested on the strength of the evidence.
Mr. Smith also pleaded that tikanga Māori — Māori customary law — should inform the content of his causes of action. In this regard, the Supreme Court accepted that Mr. Smith's pleaded losses were in part based in tikanga, such that any trial court would necessarily be required to engage with tikanga in determining Mr. Smith's claims. The Supreme Court acknowledged "tikanga was the first law of New Zealand, and it will continue to influence New Zealand's distinctive common law". The Supreme Court noted that a trial court would need to consider tikanga conceptions of loss that were "neither physical nor economic". Those interested in climate change litigation and Indigenous legal issues will want to follow how this aspect of Mr. Smith's claim unfolds, as it may have relevance in other jurisdictions that draw on legal pluralism.
Finally, it is important to understand that Smith was a pleadings case, not a substantive determination of Mr. Smith's claims. The Supreme Court found that it could strike out Mr. Smith's pleading only if it did not disclose a reasonable cause of action —to meet this standard, a claim must be "so untenable it cannot succeed". For the purpose of deciding this type of application, the pleaded facts (harm to land and other interests) are assumed to be true. Thus, the result before the Supreme Court does not mean that Mr. Smith will ultimately succeed in his claims against the respondent corporations.
Although there has been no substantive determination, the case is an important moment in climate change litigation, marking an apex court's unwillingness to find, at least at the pleadings stage, that the common law cannot respond to novel issues raised by the climate crisis.
Footnote
1. [2024] NZSC 5.
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