Michael John Smith v Fonterra Co-operative Group Ltd

• Jurisdiction: New Zealand
• Judge: Williams,Kós JJ
• Judgment Date: 07 February 2024
• Neutral Citation: [2024] NZSC 5
• Court: Supreme Court
• Docket Number: SC 149/2021

Between

Michael John Smith

Appellant

and

Fonterra Co-operative Group Limited

First Respondent

Genesis Energy Limited

Second Respondent

Dairy Holdings Limited

Third Respondent

New Zealand Steel Limited

Fourth Respondent

Z Energy Limited

Fifth Respondent

Channel Infrastructure Nz Limited

Sixth Respondent

BT Mining Limited

Seventh Respondent

[2024] NZSC 5

Court:

Winkelmann CJ, Glazebrook, Ellen France, Williams and Kós JJ

SC 149/2021

IN THE SUPREME COURT OF NEW ZEALAND

I TE KŌTI MANA NUI O AOTEAROA

Environment, Indigenous — appeal against a Court of Appeal decision which dismissed his claims against the respondent companies — emission of greenhouse gasses — effect on cultural sites — public nuisance — negligence — proposed climate system damage tort — conceptual impact tikanga may have on the framing of particular causes of action — approach to striking out claims — Climate Change Response Act 2002 — Resource Management Act 1991

Counsel:

D M Salmon KC, D A C Bullock, N R Coates and N T Sussman for Appellant

D R Kalderimis, N K Swan and T A T K Dewes for First Respondent

S J P Ladd and T M J Shiels for Second Respondent

B G Williams and J P Papps for Third Respondent

D T Broadmore and C T Ottow for Fourth Respondent

T D Smith and A M Lampitt for Fifth Respondent

A J Horne and J S Hofer for Sixth Respondent

R J Gordon and A S Dawson-Swale for Seventh Respondent

J S Cooper KC, J D Every-Palmer KC and J P Cundy for Lawyers for Climate Action NZ Incorporated as Intervener

M K Mahuika and H K Irwin-Easthope for Te Hunga Rōia Māori o Aotearoa | The Māori Law Society as Intervener

A S Butler, R A Kirkness and H Z Yang for Human Rights Commission | Te Kāhui Tika Tangata as Intervener

The appeal was allowed.

• A The appeal is allowed.

• B The appellant's claim is reinstated.

• C There is no order as to costs.

JUDGMENT OF THE COURT

REASONS

(Given by Williams and Kós JJ)

Table of Contents

	Para No
Introduction	[1]
Climate change	[13]
Statutory response to climate change	[27]
Climate Change Response Act 2002	[32]
(a) The Climate Change Commission	[36]
(b) Emissions budgets	[37]
(c) Emissions reduction plans	[38]
(d) Monitoring	[39]
(e) The Emissions Trading Scheme (ETS)	[40]
Other statutory responses	[46]
The claim	[49]
Parties	[50]
Alleged consequences of the release of GHGs into the atmosphere	[52]
Tikanga pleading	[59]
First cause of action: public nuisance	[62]
Second cause of action: negligence	[66]
Third cause of action: proposed climate system damage tort	[71]
Strike out	[73]
General principles	[74]
Our approach	[83]
Are common law actions over GHG emissions excluded by statute?	[86]
Submissions	[90]
Our assessment	[92]
Is the public nuisance claim bound to fail?	[102]
Evolution and elements of the tort	[103]
High Court and Court of Appeal	[114]
Submissions	[122]
(a) For Mr Smith	[123]
(b) For the respondents	[131]
(c) For the interveners	[140]
Our assessment	[143]
(a) The “first question”: actionable public rights tenably pleaded	[144]
(b) The “second question”: independent illegality not required	[146]
(c) The “third question”: special damage rule requires reconsideration	[148]
(d) The “fourth question”: sufficient connection, or causation	[153]
Concluding observations	[172]
What about the remaining causes of action?	[174]
Can tikanga inform the formulation of tort claims?	[177]
Submissions	[179]
Our assessment	[182]
Conclusion	[190]
Result	[192]

Introduction

1 This appeal concerns strike out of a claim in tort (comprised of three causes of action) relating to damage caused by climate change. The question is whether the plaintiff's claim should be allowed to proceed to trial, or whether, regardless of what might be proved at trial, it is bound to fail and should be struck out now.

2 The Court of Appeal considered the claim bound to fail. Differing from that Court, we consider the application of orthodox, long-settled principles governing strike out means this claim should be allowed to proceed to trial, rather than being struck out pre-emptively. As we observe later in the judgment, reinstatement of the claim and allowing it to proceed to trial is not a commentary on whether or not it will ultimately succeed.

3 The plaintiff, Mr Smith, is an elder of Ngāpuhi and Ngāti Kahu, and a climate change spokesperson for the Iwi Chairs Forum, a national forum of tribal leaders. In August 2019 he filed a statement of claim in the High Court, against the seven respondents. Each is a New Zealand company said to be involved in an industry that either emits greenhouse gases (GHGs) or supplies products which release GHGs when burned.1 Mr Smith alleges that the respondents have contributed materially to the climate crisis and have damaged, and will continue to damage, his whenua and moana, including places of customary, cultural, historical, nutritional and spiritual significance to him and his whānau.

4 Mr Smith raises three causes of action in tort: public nuisance, negligence and a proposed new tort involving a duty, cognisable at law, to cease materially contributing to: damage to the climate system; dangerous anthropogenic interference with the climate system; and the adverse effects of climate change.2 He seeks a declaration that the respondents have (individually and/or collectively) unlawfully either breached a duty owed to him or caused or contributed to a public nuisance, and have caused or will cause him loss through their activities. Injunctions also are sought requiring the respondents to produce or cause a peaking of their emissions by 2025, a particularised reduction in their emissions by the ends of 2030 and 2040 (by linear reductions in net emissions each year until those times), and zero net emissions by 2050. Alternatively, a (potentially suspended) injunction requiring the respondents to immediately cease emitting (or contributing to) net emissions is sought.3

5 A distinctive aspect of the proceeding in this Court is that Mr Smith pleads that tikanga Māori should inform the reach and content of his causes of action, this in accordance with the general proposition that tikanga should inform the common law of New Zealand generally. He does not allege that the respondents directly owed, or violated, any obligations under tikanga Māori.

6 The respondents applied to strike out the proceeding. Each broadly argued that Mr Smith's statement of claim raised no reasonably arguable cause of action. The claim related to complex policy matters best addressed by Parliament (and having been addressed by Parliament). As part of their application, the respondents filed affidavit

evidence that each is operating within the relevant statutory and regulatory requirements. That is not disputed by Mr Smith

7 In the High Court, Wylie J determined that the claims in public nuisance and negligence were not reasonably arguable and struck them out.4 He declined to strike out the claim based on the proposed climate system damage tort.

8 Mr Smith appealed and the respondents cross-appealed. The Court of Appeal struck out all three causes of action.5 Its overarching view was that: 6

… 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 co-ordination.

9 The Court nevertheless addressed each cause of action in more detail. For various reasons, the Court concluded that the causes of action in public nuisance and negligence could not be made out. In relation to the proposed climate system damage tort, the Court's view was that the “bare assertion of the existence of a new tort without any attempt to delineate its scope” was insufficient to withstand strike out “on the basis of speculation that science may evolve by the time the matter gets to trial”. 7

10 Mr Smith appeals. He submits his claim fits within the traditional role of the courts, the common law and the law of torts. As he puts it, the respondents are wronging him, and he seeks the courts' aid to have them stop. No re-invention of tort law is required. The questions raised warrant a trial and determination upon evidence.

11 The respondents submit that Mr Smith's claim requires this Court to stretch, bend and invent tort law to injunct sectors of the New Zealand economy.8 The respondents say that while the common law may be flexible, it cannot and ought not

to respond to this situation. They say climate change raises insurmountable problems for liability — particularly ones of standing and causation — where everyone both contributes to, and is adversely affected by, GHG emissions, and where it is not possible to link, evidentially, emissions to the harm suffered by plaintiffs. They say that for the law to evolve in the way advanced by Mr Smith would introduce open-ended liability for defendants and dramatically disrupt economies. They also say the courts are ill-suited to deal with a systemic problem of this nature with all the complexity entailed. Instead, it is best left to Parliament; indeed, Parliament can be seen already to have addressed the situation and settled upon a detailed and coherent legislative response

12 We also received submissions from Lawyers for Climate Action NZ Incorporated, Te Hunga Rōia Māori o Aotearoa | The Māori Law Society, and the Human Rights Commission | Te Kāhui Tika Tangata as interveners. The former aligned itself substantially with Mr Smith; the latter two made submissions on discrete issues. We...