Serious litigation relating to man-made climate change began in the first half of this decade. The most notable cases are in the US, where legal tradition and process lend themselves to the pursuit of new types of actions.
The litigation takes several forms. Some cases are class actions, with claimants grouping together to sue for compensation for damage allegedly caused (for instance damage caused by Hurricane Katrina, it being alleged that the ferocity of this was increased by climate change).
Some actions are more “policy” orientated; that is, the climate-change litigation is aimed at forcing mandatory legislative or corporate reductions in emissions of greenhouse gases. Non-disclosure by corporates of their climate-change emissions and risks are being looked at closely by concerned parties.
Other actions are aimed at environment regulators or public bodies to force them to exercise powers which allegedly they have but are reluctant to use.
The first wave of actions in new areas such as this take many years to work through the courts. There is an ebb and flow as the parties test the strength of their positions and arguments. These cases often entail judgments of historic importance in the highest courts. Such cases stretch and challenge existing legal principles and lawyers pour over them for decades. Climate-change litigation bears all the hallmarks that it might create such judgments.
Actions for compensation against corporate emitters of greenhouse gases would likely be through some form of tort such as nuisance and negligence (there being no contract between the parties). Corporate defendants will point to many barriers to such claims, but how successful will such defences be?
We cannot examine each of these defences in this article, but common defences are likely to include:
Can man-made climate change be proved to exist?
Is damage from climate change “foreseeable”.
The strongest defence is likely to be “causation”.
Can man-made climate change be proved to exist?
Bearing in mind the weight of scientific opinion supporting the existence of man-made climate change, few large corporates are likely to rely heavily on this as a defence. Is damage from climate change “foreseeable”?
This is a necessary legal ingredient in a claim based on negligence. While this will be a battleground, it would be hard to argue successfully that climate change, per se, was not foreseeable after, say, 1990, or at least 2000.
Rather more subtle foreseeability arguments would be raised, such as whether a particular storm strength, drought, rainfall, and so on, in a particular area was foreseeable? Notably, meteorological tools are evolving in this regard and these may erode the strength of these more subtle arguments.
Causation – the strongest defence? This would be a necessary legal ingredient for a successful claim. Corporate defendants will put the claimants to proof that, say, carbon-dioxide emitted from the defendant’s facility caused the particular damage alleged by the claimants.
After all, emissions are to atmosphere and so move and mix with other emissions, so who can say which emissions caused what damage?
This is a classic legal principle. However, some caution is advisable. This is exactly the same principle that was relied on by employers (and their insurers) in asbestos litigation. The courts ultimately provided a route around this defence, namely if the employee could show that the employer materially increased the asbestos risk.
In this regard, the danger point for the biggest emitters of greenhouse gases is that there are growing suggestions that, statistically, the vast bulk of greenhouse-gas emissions (globally) stem from a relatively small number of corporates. If this can be reliably modelled, these corporates may have cause for a little concern.
A potentially critical factor for many corporates is whether they have insurance cover for such litigation. This is a danger point. Unless there is express insurance cover, most public liability-type insurance has, since the late-1980s, contained a pollution exclusion. If the claimants are successful and the pollution exclusion applies, then the corporate will have to pick up the bill. On the other hand, if the pollution exclusion does not apply, then insurers are facing potentially very heavy losses. Clearly, a lot hangs on the application of the pollution exclusion. As a result, disputes with insurers may arise.
Conceivably, had the world’s governments arrived at a comprehensive agreement at Copenhagen, brakes might be applied to the volume and prospects of climate-change litigation.
Of course, the opposite is also conceivable, namely that climate-change litigation will be encouraged by the absence of such international agreement. The uncertainty and monetary risks surrounding this type of litigation are high. Perhaps it is time to consider putting climate-change litigation into the hat as a negotiable aspect in climate-change talks.
Perhaps, too, consideration could be given to sculpting an incentive (additional to others) to agree a programme with the corporate world for deep reductions in emissions. It is not inconceivable that, in return for corporate emitters agreeing and sticking to reductions in emissions, governments might agree to implement new legislation prohibiting climate-change litigation. The objective would be to provide certainty. Clearly, there would be many ramifications to consider, but it does have some attractions.
Penelope Warne is a partner and head of energy at international law firm CMS Cameron McKenna
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