The Climate Case of the Century

From Climate Etc.

by Lucas Bergkamp

On the 12th of November, the Hague Court of Appeal ruled in the “climate case of the century” that Milieudefensie (“FoE”) filed against Shell in 2019. FoE demands that Shell reduce emissions throughout the entire chain by at least 45% by 2030. The foundation “Man & Environment” (M&E) joined the case to represent the interests of Dutch citizens.

The Court of Appeal was not impressed by FoE’s “go green or go extinct” rhetoric and rejected its claims.  Nevertheless, the Court of Appeal’s ruling leaves much to be desired and did not eliminate the threat of activist NGOs launching climate cases to effect “system change,” i.e., set aside democracy, subordinate citizens and destroy the economy.

Climate science

Although M&M had offered strong rebuttals with expert reports, the Court of Appeal uncritically adopted many of FoE’s factual statements about the urgency and seriousness of the climate problem.  In doing so, the Court relied on the authority of the IPCC and the alleged “consensus” that would emerge from their reports, in particular the SPMs.

The Court not only took the IPCC reports as irrebuttable proof, but also attributed normative force to them. For example, the Court ruled that climate scientists have determined that the average temperature on earth may not rise by more than 1.5 degrees. In doing so, the Court, like the Dutch Supreme Court, ignored that science cannot set norms and that scientists are not authorized to set social standards. The Dutch judiciary’s scientistic tendency is extremely worrisome and does not bode well for future climate-related judgments.

Dangerous climate change

A case in point, the Court arrives at the alarmist conclusion that “the climate problem is the biggest problem of our time” and that the danger of climate change is great and even “life-threatening”. Based on the non-factual findings of fact and obligatory references to the Paris climate agreement, the Urgenda judgment and the Klimaseniorinnen ruling of the European Court of Human Rights, the Court confirmed a right to protection against “dangerous climate change.”

“Protection against dangerous climate change,” the Court says, “is a human right,” without any caveats or qualifications. Obviously, realizing this human right will be at the expense of all kinds of other human rights and interests, such as the right to (or interest in) reliable and affordable energy. Inevitably, the right to protection against “dangerous climate change” will harm the realization of other “sustainable development goals.” Although M&E had flagged these kinds of trade-offs extensively, the judges did not bother to deal with these implications of climate morality.

Dog whistle

This new human right must be respected not only by states, but also by large corporations, the Court found.  In civil liability law, this right translates into a duty of care for companies. According to the Court, the Paris goals require measures to reduce the demand for fossil fuels and to limit the supply of fossil fuels. Oil and gas companies should therefore consider “the negative impact on the energy transition when investing in the production of fossil fuels.”

With this line of reasoning, the judgment suggests that “saving the climate” legitimizes creeping expropriation of oil and gas companies. This dog whistle did not escape the attention of FoE’s lawyer, who has hinted at further legal proceedings to prevent the development, expansion and financing of oil and gas production, referring to forthcoming climate finance case against ING, the largest Dutch bank.

Reduction Percentage

FoE lost the case based on two lucid moments of the judges. FoE had demanded that Shell reduce scope 1, 2 and 3 emissions. With regard to scope 1 and 2, the Court of Appeal ruled that Shell had committed itself to this objective and is on track to achieve it, so that claim was rejected.

With regard to scope 3 emissions, the Court of Appeal concluded that neither the law nor climate science sets specific reduction standards for a company such as Shell. The 45% invoked by FoE, the Court found, is only an “average global reduction in all sectors” that does not apply to each country and each business sector individually. Indeed, this point had been well explained in M&E’s submissions to the Court.

In this regard, the judgment serves as a dialogue between the courts and the climate movement. Climate science therefore knows what is expected of it: set reduction standards for the oil and gas sector and the courts (at least, the Dutch courts) will enforce them.

Effectiveness

The Court of Appeal also undermined FoE’s lawsuit by finding that the reduction order sought by FoE would be ineffective. This too had been explained in detail in M&E’s expert opinions. As the Court confirmed, there is no reason to believe that a reduction obligation imposed on a specific company will have any positive effect: if Shell sells less oil and gas, other suppliers will simply take its place and any “climate gain” will be illusory.

Progressive realization

In line with the human rights theory of ‘progressive realization’, the court-made right to protection against ‘dangerous climate change’ is slowly but surely being realized. Two steps forward, one step back: first governments, then companies, then a specific reduction percentage, and then no such percentage.

This week, it was a step back, but the District Court’s verdict in first instance has already had its effect. With that verdict in hand, many other lawsuits have been launched and the climate movement has been able to persuade the European Union to oblige companies to implement a “climate transition plan” in accordance with 1.5 degrees. Judges have learned rapidly how to play the political climate game.

Threat remains

This is the first climate ruling in the Netherlands that is favourable to citizens who are suffering under the ever-rising prices of energy and other products. M&E’s intervention has had its effect, as it demonstrated for the Court that there are other interests affected by these kinds of cases and that other valid perspectives on the issues generate dramatically different conclusions. Moreover, as the main reasons for denying FoE’s claims are rather factual in nature, it will be difficult to find a good angle to appeal the ruling to the Supreme Court, which review only points of law.

A battle has been won, but the climate war will rage on. Activist NGOs will be able to derive new legal bases from the Court’s ruling for further climate cases.

NGOs for the people

To prevent that democracy is set aside and the people are subordinated to climate activists supported by the judiciary, interventions by NGOs that are sympathetic to the interests of citizens will continue to be essential. There is much enthusiasm around this idea, but the financing of the activities continues to be the biggest challenge.

All in all, the ruling of the Hague Court of Appeal is an important first step towards restoring rationality and balance in judicial decision-making in climate cases.  The rejection of the case against Shell will have ripple effects on many other climate cases throughout the world, and should cause the EU to rethink the obligation for companies to implement a climate transition plan consistent with 1.5C.

In all things climate, to use a Chinese proverb, “the journey of a thousand miles begins with one step.”