This was the decision facing the New Zealand Supreme Court in the claim of Smith v Fonterra Co-operative Group Limited and others. Although not offering a definitive judgment on the merits of the claim, this recent appeal decision represents a landmark outcome, demonstrating the risk that emitters of greenhouse gases and their insurers face with the potential expansion of tortious liability to meet the question of climate change.

Reinstating the claim, the Court was "presently not convinced… the common law is incapable of addressing tortious aspects of climate change," and principles governing public nuisance "ought not to stand still in the face of massive environmental challenges attributable to human economic activity." 

Background

The Supreme Court was asked to address an appeal following the strike-out of an action brought by Mr Michael Smith, an elder of Ngāpuhi and Ngāti Kahu Māori tribal groups, and a climate change spokesman for a national forum of tribal leaders. The respondents to the appeal are various companies including mining and fossil fuel organisations, who are allegedly responsible for one-third of New Zealand's greenhouse gas emissions in 2020-2021.

The claim is founded on three causes of action in tort:

• Public nuisance
• Negligence
• A proposed climate damage tort

Relying upon tikanga Māori (Māori customary practices) to inform the basis for the causes of action, the respondents' material contribution to the climate crisis has damaged Mr Smith's whenua (connection to the land and environment) and moana (pathways to the ocean). This includes places of customary, cultural, historical, spiritual and nutritional significance to him and his whānau (extended family).  Interference with public rights of health, safety, convenience, peace and habitable climate systems are also alleged.

The Court of Appeal held that the tortious actions were bound to fail, and struck the claim out. The Supreme Court disagreed, reinstating the claim but emphasising that the reinstatement of the claim and allowing it to proceed to trial is not indicative of whether it will ultimately succeed.

Public nuisance

Reviewing the common law of public nuisance in detail, the Supreme Court addressed:

• whether there were actionable public rights pleaded;
• whether a requirement of independent illegality was necessary;
• if the rule of special damage was met; and
• if there was 'sufficient connection' between the pleaded harm and respondent's activities.

The Supreme Court found that the rights pleaded by Mr Smith provided a foundation for a public nuisance pleading, and the development of the tort did not require the acts or omissions by the respondents to be independently unlawful.

The Court of Appeal had held the harm suffered by Mr Smith did not sufficiently exceed the harm suffered by others in New Zealand who had suffered the same interference. The Supreme Court disagreed, stating that although "the effects of human-based climate change are ubiquitous and grave for humanity, their precise impact is distributed and different". The impact alleged by Mr Smith, including coastal inundation and detriment to his fishing and cultural interests, went "beyond a wholly common interference with public rights."

Regarding the sufficient connection requirement, it was noted that not all defendants "causing or contributing to a nuisance must be before the court." Instead, it was arguable in public nuisance that "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." Nonetheless, any defendant's actions must still amount to a substantial and unreasonable interference with public rights. The Court is clear that only some emitters will cross the threshold, and whether the respondents' actions cross that threshold in this instance will be a matter for trial.

The Supreme Court also confirmed that the trial court must consider tikanga conceptions of loss, which are neither physical nor economic, and that matters of tikanga cannot be avoided.

As the first action in nuisance was reinstated, the other two causes of actions (negligence and the proposed climate damage tort) did not meet the criteria for striking out and were unlikely to materially increase costs, court resources or court time. Therefore, those causes of actions were reinstated without further consideration of the legal principles.

Where next for climate change litigation?

This litigation, initially filed in 2020, is included in our interactive map of climate change litigation which can be found here. Developments in climate change litigation are gathering speed and with them awareness of the related issue of biodiversity risk, focusing on the direct harm we cause our environment and nature. New Zealand is one of several jurisdictions that already gives legal personhood to natural elements such as rivers and forests. How long will it be before they are recognised here? Read more on our predictions for climate change litigation here.