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Sharma v Minister for the Environment: A setback for climate change claimants as landmark decision is overturned on appeal

In a setback for climate change claimants, on 15 March 2022 a three-judge panel of the Full Federal Court of Australia overturned the earlier decision of the Federal Court of Australia in Sharma v Minister for the Environment,1 finding that the Minister for the Environment had no duty of care to Australian children to exercise her powers to approve the expansion of a coalmine so as to avoid the harmful effects of climate change.

 

Background 

In September 2020, eight Australian teenagers (the "Claimant Representatives") represented by their litigation guardian, an octogenarian nun, brought a class action claim (the "Claim") as representatives of all Australian children. The Claim sought to prevent the approval of the expansion of the Whitehaven coal mine in New South Wales on the grounds that, inter alia, the Minister for the Environment (the "Minister") owed a duty of care to Australian children to exercise her powers under the Environment Protection and Biodiversity Conservation Act (the "EPBC") with reasonable care so as to avoid causing harm (including personal injury or death) that would arise from emissions of carbon dioxide into the Earth's atmosphere (the "Duty of Care").

At first instance, in what was widely hailed as a landmark decision (that was handed down on 27 May 2021),2 Justice Bromberg found that: (i) the potential harm to the Australian children resulting from carbon dioxide emissions was a mandatory consideration under the EPBC; and (ii) the Duty of Care existed and was owed by the Minister (the "First Instance Judgment"). More particularly, Justice Bromberg established the Duty of Care on the basis that: (i) it was reasonably foreseeable by the Minister that a risk of harm to Australian children would flow from the extension of the mine; (ii) the Minister had direct control over that risk, as it was dependent on her approval; and (iii) Australian children are vulnerable to a real risk of harm from ‘climatic hazards'.

Despite finding in favour of the Claimant Representatives on the existence of the Duty of Care, Justice Bromberg declined to grant the injunction sought, on the basis that it had not been established that a breach of the Duty of Care was reasonably to be expected. The Minister appealed. In the interim between the First Instance Judgment and the hearing of the appeal, the Minister approved the expansion of the mine.

 

The Decision

On 15 March 2022, a three-judge panel of the Full Federal Court of Australia (the "FFC") handed down its decision on the appeal, overturning the First Instance Judgment. 

In an indication of the complexity of the questions under consideration, each of the three judges – Chief Justice Allsop, Justice Beach and Justice Wheelahan (together "the Judges") – dismissed the appeal on distinct grounds, with distinct reasoning. The FFC's decision (which contained the separate reasoning of all three Judges) ran to over 200 pages.3

The role of the courts

Chief Justice Allsop's decision focused on the interaction between the Duty of Care and policy questions, which are by their nature non-justiciable. In his view, "the posited duty throws up for consideration at the point of breach matters that are core policy questions unsuitable in their nature and character for judicial determination".4  He stated that the courts are ill-equipped and ill-informed to deal with the questions posited by the Claim if the Duty of Care is established, namely the proper policy response to climate change and the question of whether, and if so how, emissions from the mine should be taken into account in making a decision about whether to approve the expansion of the mine. This, in his view, was sufficient on its own to deny the Duty of Care.

Justice Beach considered that the question of the Duty of Care could be addressed without the consideration of such policy issues as would give rise to non-justiciability. However, in his view, Justice Blomberg should have declined to make any declaration on the Duty of Care, because it is unsatisfactory for the courts to consider the question of the existence of the Duty of Care before such time as the intertwined questions of breach, causation and damage can be considered. In other words, his view was that the existence of the Duty of Care can only properly be considered once an alleged breach has occurred. 

Considerations under the EPBC

Each of the Judges considered whether the potential harm to Australian children resulting from carbon dioxide emissions was a mandatory consideration under the EPBC, i.e., whether it was something that the Minister must take into account when deciding whether to grant approval for the mine. They all agreed that it was not. Chief Justice Allsop and Justice Wheelahan concluded that, as a result, the Duty of Care was incoherent with the EPBC, because it would go beyond the conditions set by the EPBC in a manner inconsistent with the legal and governmental framework. Justice Beach did not consider the level of incoherence to be so great as to preclude the existence of the Duty of Care. 

Alleged Errors of Fact 

At first instance, the Claimant Representatives' expert evidence on the effect of carbon dioxide emissions had gone unchallenged, in a move that was largely seen as indicative of a political environment in which countries and organisations no longer wish to be seen as denying a link between carbon dioxide emissions and climate change. Whilst both Chief Justice Allsop and Justice Beach recognized that there were some areas of the expert evidence that might have been open to challenge, they concurred that Justice Bromberg's acceptance of this uncontested evidence, and his interpretation of it, were entirely legitimate and could not be reopened on appeal. In other words, the Minister had missed her chance to contest the evidence.

Establishing the Duty of Care 

The Judges considered each of the elements or factors relevant to the establishment of the Duty of Care. Each concluded that the Duty of Care failed because one or more of those elements or factors had not been established in the required manner. 

Reasonable foreseeability: Chief Justice Allsop and Justice Beach both agreed with Justice Bromberg that it would be reasonably foreseeable to the Minister that a risk of harm to Australian children would flow from the expansion of the mine, in that the Minister could foresee that even a tiny increase in carbon dioxide emissions could contribute to such harm. Justice Wheelahan, however, was unconvinced that the approval of the mine would be a reasonably foreseeable cause of personal injury to the Claimant Representatives "as the concept of causation is understood for the purposes of the common law tort of negligence".5 In particular, he concluded that the decision by the Minister to approve the expansion of the mine would result in a contribution to an increased risk of harm, but not necessarily a risk of contribution to the harm itself. 

Control: Chief Justice Allsop concluded that whilst the Minister has almost exclusive control over the risk created by the approval of the mine, she does not have sufficient control to establish the Duty of Care, because she does not have control over the harm (being worldwide global climate catastrophe). The risk of this harm is capable of being mitigated by "countless others around the world".6 Justice Wheelahan concurred that the Minister's mere control over the approval of the mine was insufficient in the absence of control over the harm. Justice Beach adopted a narrower interpretation of control, considering the question to be limited to whether the Minister has control over the emissions from the mine. He concluded that such control was undeniable, as the party being granted approval is to be expected to act in line with that approval.

Vulnerability: Chief Justice Allsop and Justice Beach concluded that Justice Bromberg's findings were inadequate to characterize Australian children as vulnerable in the relevant sense, which is special vulnerability.  Chief Justice Allsop based his conclusion on his view that Australian children have no reliance on the Minister that is different to other Australians. Justice Beach considered that only some Australian children would be especially vulnerable in the relevant sense, and therefore vulnerability could not be established for the class. 

Nature of the Relationship: Chief Justice Allsop and Justice Beach found that the nature of the relationship between the Minister and Australian children was not sufficiently direct or proximate to establish the Duty of Care. Chief Justice Allsop based his reasoning on the nature of the relationship as one of the government and governed. Justice Beach focused on the lack of any physical, temporal or relational closeness between the Minister and the harm that might be suffered by Australian children. In particular, he noted that: (i) the harm may not occur for several decades; (ii) members of the class reside throughout Australia, whilst the mine is located in a local area; and (iii) there are many other actors in the causal chain between the approval by the Minister and the harm.

Indeterminacy: Justice Beach concluded that indeterminacy was fatal to the Duty of Care in the context of "rolling events potentially causing damage where there is no meaningful limit on how many [Australian children] would suffer harm and how many times they will be so harmed, when that damage will occur over the next century or so, and the extent of such damage".7 Chief Justice Allsop followed similar reasoning, but placed additional emphasis on the lack of proportionality between the tiny contribution to the increased risk of harm, the lack of control over that harm, and liability for all damage ongoing into the future.

 

Comment 

The decision of the FFC will doubtless be seen as a stumbling block for climate change claimants. Not only did the Judges reject the novel Duty of Care, but their decision highlights key questions of justiciability, causation and foreseeability of harm, which have been largely absent from, or have received positive judicial treatment in, recent decisions of the European courts. In particular, the decision highlights the issue of ‘non-justiciability'. This block to courts' consideration of climate change claims has also been a hot topic in climate change litigations brought in the U.S. and elsewhere in the world.

However, climate change claimants will take some positives from the decision. First, the Claimant Representatives have indicated their intention to appeal. Second, the Judges made specific reference to the need for reform of the law, leaving the door open for the elements necessary to establish a duty of care to be evolved by the Australian High Court. Third, Justice Beach was expressly open to future claims by one or more Australian children at a time when harm can be established, and all three Judges indicated that they would hear further submissions on the question of whether it is appropriate that an estoppel should arise from their judgment. 

 

1 Sharma v Minister for the Environment, [2021] FCA 560 and FCA 774.
2 ibid.
3 Not all of the Judges addressed every argument or element of the Duty of Care in detail. In some cases, the relevant Judge chose either not to address an argument or element of the Duty of Care at all, to address it only in passing, or to rely on the reasoning of the other Judges. 
4 Sharma v Minister for the Environment, [2022] FCAFC 35, at [7].
5 ibid, at [886]. 
6 ibid, at [335]. 
7 ibid, at [745]. 

 

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