Background
On or around 11 February 2016, Whitehaven Coal Pty Ltd applied to the Commonwealth Minister for the Environment (Minister) to expand their Vickery Coal Project which would increase the total coal extraction from 135 to 138 million tonnes. When combusted, the additional coal extracted was estimated to produce about 100Mt of C02.The Minister is required to assess Whitehaven’s application in accordance with s130(1) and s133 of the Environmental Protection and Biodiversity Conservation Act 1999 (EPBC Act). The Applicants sought an injunction to restrain the Minister from exercising her powers under the EPBC Act. They alleged that the Minister’s powers create a statutory duty of care and that the injunction is necessary to restrain an apprehended breach of that duty.
The Applicants alleged that towards the end of this century, they will likely suffer mental or physical injury, including ill-health or death as well as economic and property loss as a result of their exposure to climatic hazards induced by increasing global surface temperatures driven by the further emission of C02. The Applicants alleged that additional emissions from the Vickery Coal Project will be significant and material to the increase. For the most part, the parties agreed that additional emissions will have an impact on the surface temperature, but, disputed the significance of the temperature increase.
Interestingly, the Applicants in the proceedings were eight Australian children who brought the proceedings as a class action on behalf of all children who ordinarily reside in Australia (Children). As a consequence of their youth, the proceedings were brought by their litigation representative Sister Marie Brigid Arthur. Importantly the Applicants did not seek damages.
Duty of Care
In considering whether this novel duty of care exists, the Court took a multi-factorial assessment, in which ‘salient features’ relevant to the appropriateness of imputing a legal duty upon the Minister were assessed and weighed. This approach is a uniquely Australian concept for the assessing of a novel duty of care.The Court noted that where the Respondent is a repository of statutory power, imposing a duty of care can raise problems that require a close examination of the terms, scope and purpose of the relevant statutory regime. Moreover, whilst the ultimate question is whether a requisite relationship exists between the statutory authority and a class of persons, the criteria for assessing whether that relationship exists is to be found in the salient features of that relationship.
Among the seventeen salient features already established under common law, the Court noted that the following were relevant for this particular case:
- the purpose to be served by the exercise of the power;
- the control over the relevant risk by the repository of the power;
- the vulnerability of the persons put at risk; and
- coherence.
The Court determined that the potential harm faced in the event of a 3°C rise in global temperatures would be catastrophic, with one million of today’s Australian children expected to suffer at least one heat-stress episode serious enough to require acute care in a hospital, thousands likely to suffer premature death from heat-stress or bushfire smoke and substantial economic loss and property damage will be experienced.
The various types of harm contended for by the Applicants depended upon there being a nexus between an increase in global average surface temperature and the increased frequency or gravity of extreme climatic events such as heatwaves or bushfires. The Court noted that while the prospective contribution to the risk of exposure to harm made by the approval of the extraction of coal may be characterised as “tiny,” the Minister’s prospective contribution is not so insignificant as to deny a real risk of harm to the Children.
The Court held that the Minister has direct control over the foreseeable risk because it is her exercise of power upon which the creation of that risk depends. Therefore, there is a direct relation between the exercise of the Minister’s power and the risk of harm to the Children resulting from the exercise of that power.
The Court ultimately held that the risk of harm to the Children was not remote, was reasonably foreseeable, and was therefore a real risk. In doing so, the Court rejected the Minister’s approach to ‘reasonable foreseeability’, which was described as amounting “to a contention that the mere possibility of a break in the causal chain will suffice to deny the reasonable foreseeability of harm,” [194] and established a duty to take reasonable care not to cause personal injury.
Injunction
In considering whether to grant an injunction, the Court accepted that it has the power to issue one against an officer of the Commonwealth. However, the Court did not grant the injunction because it was not satisfied that the restraint would not create incoherence, as it ‘may deny rather than induce the reasonable response which the duty of care requires.’ [502] Moreover, the Court noted that, with reference to the fact that harm was not imminent, it was ‘undesirable to pre-empt the Minister’s decision,’ [508] – namely that it would be far more appropriate to assess whether a breach of the duty should be restricted once the Minister has made a decision on whether she will approve the coal mine extension.Conclusion
At this stage it’s difficult to determine the “winner” in this case. Given the creation of a novel duty of care, it is very likely that the Minister will appeal the decision. In its press release to the ASX, Whitehaven Coal stated that it welcomed the decision and looks forward to receiving EBPC Approval. On the other hand Ava Princi, one of the Applicants, stated that the judgement was “both thrilling and deeply relieving”.Although he refused to grant an injunction, the judge requested that the parties consider the effect of the decision before he would confirm his declaration. One of the issues for the parties to consider is the future affect of the declaration. As the matter was run as a class action on behalf of children who reside in Australia or elsewhere, the declaration may have consequences for the whole class and any future litigation by any Australian child.
This decision is another example of the Court considering climate change in the context of applications for approval for development. However, the decision has broader implications than this.
The decision confirms that Australia is becoming an important venue for novel climate change litigation. Other recent examples include:
- In 2019, a beneficiary of the industry super fund, REST, filed a lawsuit against the fund, arguing that its failure to provide adequate information relating to its exposure to climate-related risks prevented him from making an informed judgment about the management and financial condition of the fund. On 2 November 2020 the proceedings settled, just before trial. The terms of settlement are confidential, but REST released a press statement agreeing to comply with Task Force on Climate-related Financial Disclosures (TCFD) recommendations on disclosure and risk assessment, including conducting "stress tests" on its investment portfolio. (settlement statement from REST)
- Equity Generation Lawyers, the same lawyers acting in this case have launched another class action against the Australian Commonwealth Government concerning its issue of sovereign bonds[1]. The case is still going through the early interlocutory stages and a decision is not likely until 2022.
- The claim does not seek damages but instead seeks declarations that the Commonwealth has failed to disclose the material risk that climate change presents to the bonds' value over time. An injunction preventing the promoting or issuing of bonds without providing material information related to climate change has been sought. If successful, the case may also expose financial institutions and corporates to securities class actions risk from failures to make adequate climate change disclosures in issuing documents and prospectus.
- In Gloucester Resources Limited v Minister for Planning [2019] NSWLEC 7 the Land and Environment Court refused a development consent under the Environmental Planning and Assessment Act 1979 (NSW) for a new mine, in part because of its negative effect on climate change resulting from the project’s greenhouse gas emissions.
At this stage, climate change litigation is mainly focused on the actions of the government, however it is expected that it will affect a wider proportion of Australian corporates, their directors and their insurers in the not too distant future. This is also in the context of ever-increasing requirements of and supervision by APRA and ASIC in relation to climate risk disclosure requirements.
Links
- Warning to Climate Risk Laggards
- Warnings & Opportunities for Financial Institutions in managing Climate Change Risks
- Climate Change Risk Practice
- Mandatory climate-related financial disclosures
- Climate Change Litigation – Insights into the evolving global landscape
- Climate change, governments and human rights
- Event summary: Climate change liability risk forecast to 2050
- The Urgenda judgment and its potential implications
- (AU The Guardian) Australian Court Finds Government Has Duty To Protect Young People From Climate Crisis
- (AU) 'A Duty Of Care': Australian Teenagers Take Their Climate Crisis Plea To Court
- Climate Change Litigation Update
- Students win landmark climate case. In global first, Minister has duty of care to protect young people from climate change
- (AU) Queensland Teenagers Lodge Legal Action Against Adani Coal Mine To Save Great Barrier Reef
- These Aussie Teens Have Launched A Landmark Climate Case Against The Government. Win Or Lose, It’ll Make A Difference
- (AU) Class Action To Stop Planned Coal Mine Extension Filed By Climate Action-Focused Australian Teenagers
- (AU) A Major Report Excoriated Australia’s Environment Laws. Sussan Ley’s Response Is Confused And Risky
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