Climate Change and the Legal Sector

Aathira Prakash provides an overview of climate change and its links with the legal sector, delving into both the impacts on litigation and how courts have played their role in environmental safeguarding. 

This year will forever be branded with the scorching red mark of COVID-19- the pandemic that forced us to scurry indoors. Amidst all this urgency, issues that persisted prior to the emergence of coronavirus seem to have taken a backseat in current event headlines. With the installation of the Climate Clock in Manhattan’s Union Square, we are once again reminded of the looming devastation brought by climate change. With rising awareness on the issue by customers, employees, and corporation combined with government policies and targets the legal sector should brace itself for impact.

Litigation Trends

According to a report on global trends in climate change litigation, there were 20 climate change related cases in early 2000. The following years saw a dramatic increase with close to 160 cases being recorded in 2016. Legal risks in this area are mostly linked with issues like consumer rights, duty of care obligations, governmental responsibility, and human rights but can span multiple practice areas. In the UK, for example, the government plans to set up a new requirement for pension schemes to disclose how they are managing climate risks for their savers.

Consumer Rights

In 2015, over a million Volkswagen vehicles in England and Wales were recalled for having defeat devices. Under the Consumer Protection from Unfair Trading Regulations 2008, claimants can receive up to 100% of the purchase. Many customers were set to gain compensation, an action potentially totalling up to £10.2 billion. More recently, Daimler AG, the parent company to Mercedes-Benz are set to pay $1.5 billion in the US to settle accusation that defeat devices were installed to their vehicles to fraudulently pass emissions tests thus violating environmental laws. Dieselgate, as it has come to be known, has been estimated to have caused over 50 premature deaths between 2008 and 2015 in the US due to the excess pollution caused by the defeat devices.

Human Rights

Many climate risks related cases are being argued through a human rights lens. Recently, young activists in Portugal called for 33 countries to commit to emission cuts to safeguard their wellbeing. This was following the streak of wildfires in Portugal in 2017 that resulted in over 200 casualties. Their crowd funded lawsuit with the European Court of Human Rights asks for the countries listed to be under a legal binding obligation to meet the goal set by the Paris Agreement. The suit relies on Articles 2, 8 and 9 of the European Convention on Human Rights – protecting the right to life, privacy, and to not experience discrimination.

Using Courts Against Governments

With more awareness on environmental risks and the impact, citizens have been pressuring governments to issue more climate friendly policies. A farmer in Karachi, Pakistan, challenged the government’s alleged failure to curb air pollution. As a result, the High Court decided that the government must disclose its plans to address the problem in the country. Now, Pakistan has installed air quality monitors. Factories have also been urged to add air cleaning filters to smoke-emitting chimneys.

In the UK, plans to expand Heathrow airport was ruled illegal by the court of appeal. They reasoned that ministers failed to take into account the impact of adding a third runway to the airport would have on climate change. Additionally, these plans ran counter to their commitments regarding the climate crisis.

Client Care

Climate lawsuits against companies are rising and law firms have the obligation to advice clients on related risks. Most notably, in 2015 Mark Carney, the Governor of the Bank of England gave a speech titled the ‘Tragedy of the Horizon’s’ where he outlined the three ways in which climate change affects financial stability. Physical risks like storms and floods, transition risks associated with the transition to a low carbon economy, and liability risks are serious considerations that lawyers need to highlight to corporate clients.

40 signatories to the Paris Agreement mentioned carbon tax and cap-and-trade schemes as a part of their plan to tackle global warming. This in combination with national policies on climate change impose great costs on companies. With the shift towards a low-carbon economy, other areas of businesses are opening up as well. This would be in the interest of clients as acclimating to a climate-resilient future early would give them an advantage over competitors. Clients need to be guided through the various national and international policies on climate-resilience in order to avoid litigation risks.

Case study

Clyde & Co is global firm that focuses on five main sectors: insurance, energy, trade & commodities, infrastructure and transport. The firm found that climate risks were present across all these sectors. In response, they established a cross-disciplinary team on climate resilience. The team is headed by Nigel Brooks, a partner at the firm, and aims to provide guidance on climate related risks and regulations. Additionally, they have set up a “Resilience Hub” online to provide reports and articles providing further guidance on related issues.

~ Aathira Prakash, The Student Lawyer