Will Carbon Majors have to pay for climate damage? Part 4 of 4

(This is Part 4 of a four part article on climate liability being published in the Lawyer's Daily, based on a lecture I gave for Osgoode Hall Law School and the York Faculty of Environmental Studies.)

As shown in Part 1 of this article, the climate crisis is already causing large financial losses, and much more is ahead. Governments and individuals will eventually face overwhelming bills. Most of the fossil fuels that are driving this crisis have been produced and sold by 103 companies, the Carbon Majors. Can they be made to pay for the resulting damage?

In Parts 2 and 3, I showed that one of the ways to make the Carbon Majors pay is to sue governments. A powerful Dutch Supreme Court decision, Urgenda v. Netherlands, has given a big boost to lawsuits by Canadian youth who seek court orders for strong climate action by our governments. When at risk of being forced to act by the courts, Canadian governments may choose to make the Carbon Majors pay instead of taxpayers. After all, that’s what they have done before. Governments have many ways to make the Carbon Majors pay for climate damage, including administrative orders under existing legislation.

Suing Carbon Majors directly

But is there a more direct route? Can the Carbon Majors be sued directly for climate damage? Noted climate leaders such as James Hansen have called for a wave of lawsuits against the highest carbon-emitting, investor-owned companies. Such cases are multiplying around the world, and are increasingly surviving preliminary challenges. 

In October, the U.S. Supreme Court allowed Baltimore, Rhode Island and Boulder County, Colorado to press ahead in state courts with civil lawsuits against more than a dozen Carbon Majors for damage from climate change. (The Carbon Majors had tried to force the cases into federal courts, which are typically more favourable to them.) Similar orders are under appeal in the County of San Mateo v. Chevron Corp. public nuisance cases. In France, several municipalities and NGOs announced a claim against Total for breaching its duty under the French Code of Commerce to use reasonable vigilance to prevent violations of human rights and environmental risks. In Germany, the Hamm Higher Regional Court is proceeding with Saul Lliuya’s claim against RWE AG for 0.5% of ice melt damage in Peru.

Avoiding summary dismissal and procedural dead-ends is significant progress. But will the plaintiffs ultimately win?

Courts rejected the first wave of climate change lawsuits against fossil fuel producers, typically on the grounds of  standing, proof of harm and causation. But the current wave could well succeed. As documented in If at First You Don't Succeed: Suing Corporations for Climate Change,  

the rapidly evolving scientific, discursive and constitutional context… generates new opportunities for judges to rethink the interpretation of existing legal and evidentiary requirements and apply them in a way that will enhance the accountability of major private carbon producers

One critical part of this context is increasingly strong evidence that climate pollution from the Carbon Majors and their products is already measurably worsening some extreme weather disasters, with major consequences for people alive today. For example, the ground-breaking Urgenda decision (see Part 2) would not have been possible without the Dutch courts’ finding of fact that climate pollution creates a real and immediate risk to the lives and well-being of many people in the Netherlands.

This triggers new legal considerations, such as international obligations to respect human rights. The link between producing fossil fuels and violating human rights will become much better established when the three-year Philippines Human Rights Commission National Inquiry on Climate Change releases its report. In December 2019, Commissioner Roberto Cadiz told COP25 that the Commissioners have made their decision: the 47 biggest Carbon Majors have violated the human rights of  Philippine citizens through their contributions to climate change, and can be held legally liable for those violations under existing Philippines civil law. Cadiz said it may also be possible to hold the companies criminally accountable “where they have been clearly proved to have engaged in acts of obstruction and willful obfuscation.”

That is another critical part of the new context: growing evidence of intentional obstruction and misinformation by the Carbon Majors. An important amicus brief in the San Mateo cases lays out evidence that the fossil fuel companies had actual knowledge of the risks of their products and had taken “proactive steps to conceal their knowledge and discredit climate science” while at the same time taking steps to protect their own assets from the impacts of climate change. 

The Tobacco Precedents

This evidence dramatically enhances the relevance of tobacco litigation precedents, especially a ground-breaking decision of the Quebec Court of Appeal in March 2019. In Imperial Tobacco Canada ltée c. Conseil québécois sur le tabac et la santé, 2019 QCCA 358, the Court ordered Canada’s tobacco companies to pay $15 billion in compensation and punitive damages for failure to warn and misinformation. 

The award was so large because tobacco companies had conspired to sell their products without informing consumers of the deadly consequences, while actively casting doubt on more accurate information. The tobacco companies attacked the credibility of science and scientists much as the Carbon Majors have done, creating doubt in the public mind through:

“[D]enial, minimization, use of partial science to assert the existence of a scientific controversy …, insistence on the weaknesses of the statistical links …, transformation of facts into opinions...” (para 545)

Thus, they successfully put off regulation, fattening their own profits, at the cost of increasing public health damage.

The Court utterly rejected the tobacco companies’ excuses that they were selling a legal product in compliance with regulations, and that everyone knew cigarettes were dangerous anyway. It condemned their:

[B]ad faith behavior, resulting from a deliberate concealment of the effects of smoking on the health of users, and then from systematic denial, minimization and trivialization of these, based in particular on the idea, cleverly but artificially maintained, of a scientific controversy and on the alleged weakness of the relations between cigarette and diseases or dependence, all coated with a misleading advertising strategy. (para 564)

To a climate expert, it all sounds depressingly familiar.

Are Carbon Majors immune?

According to the Supreme Court of Canada, foreseeability is the fundamental moral glue of tort. In the roughly 30 years that the Carbon Majors have known that their products cause climate change, those products have doubled the climate pollution of the atmosphere. In other words, they knowingly created about half of today’s climate crisis, and continue to make it worse.

That makes it plausible for Canadian courts to find the moral glue to hold the Carbon Majors liable for some of the damage they have caused. The causes of action could be varied: perhaps failure to warn when selling dangerous products, misrepresentation and deceit, as in the tobacco cases, or public nuisance or violating human rights. As ClientEarth has shown so impressively in the UK, there is lots of room for legal innovation and creativity. With our planet in peril, it is time for law to be an effective tool in the battle to save civilization.

Dianne Saxe

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