Inside Track: Planning, Environment & Sustainability - In the media, In practice and courts, Cases and Legislation - Real Estate and Construction

In Short

The Situation: A climate action group commenced
legal proceedings seeking to compel an Australian environmental
protection regulator to develop instruments aimed at combatting
climate change in Australia’s most populous state of New South
Wales (“NSW”).

The Decision: In a landmark decision, Chief
Judge Preston of the NSW Land and Environment Court held that the
NSW Environment Protection Authority (“EPA”) had not
discharged its duty to develop environmental quality objectives,
guidelines and policies to ensure environment protection from
climate change, and ordered the EPA to develop such instruments
going forward.

Looking Ahead: The decision is the latest in a
series of Australian and international cases which have found that
regulators and government decision-makers owe positive duties to
address climate change.

The Facts

In April 2020, a climate action group called Bushfire Survivors
for Climate Action Incorporated (“BSCA”) filed civil
enforcement proceedings against the EPA in the NSW Land and
Environment Court.

BSCA sought an order in the nature of mandamus to compel the EPA
to perform its statutory duty under s 9(1)(a) of the Protection
of the Environment Administration Act 1991
(NSW) (“POEA
Act”). One of the requirements of the POEA Act is that the EPA
perform particular tasks in relation to the quality of the
environment. Specifically, s 9(1)(a) requires the EPA to
“develop environmental quality objectives, guidelines and
policies to ensure environment protection”.

BSCA’s primary argument was that climate change poses a
significant and “existential” threat to the environment
and the EPA had failed in its statutory duty to develop quality
objectives, guidelines or policies to protect the State’s
environment from climate change.

In making these arguments, BSCA relied on expert evidence given
by the former Chief Scientist of Australia, Professor Penny
Sackett, and on reports published by the Intergovernmental Panel on
Climate Change (“IPCC”), including the recently released
Climate Change 2021: The Physical Science
Basis. Contribution of Working Group 1 to the Sixth Assessment
Report
. Notably, the EPA did not challenge the evidence of
Professor Sackett, including her analysis of the causes of climate
change and its consequences. The parties’ agreed statement of
facts accepted that:

  • Anthropogenic greenhouse gas emissions have caused or
    contributed to an increase in the frequency of extreme heat events
    in Australia;

  • The climate of New South Wales is changing due to global
    warming; and

  • If there is a 1.5-2.0°C temperature rise, the risk of
    widespread impacts on the most vulnerable will rise from moderate
    towards high.

In contesting the claim, the regulator submitted that there is
nothing it can do to “ensure” that the state’s
environment will be protected from climate change, as climate
change is a global problem which cannot be meaningfully addressed
without multiple local actions to mitigate greenhouse gas emissions
by sources and remove greenhouse gases by sinks.

The Decision

Chief Judge Preston’s key finding in Bushfire Survivors
for Climate Action Incorporated v Environment Protection
Authority
[2021] NSWLEC 92 is that the EPA’s duty
under s 9(1)(a) requires the regulator to develop environmental
quality objectives, guidelines and policies to ensure environment
protection from climate change. Notably, his Honour held that the
duty does not require such instruments to address the topic of
climate change at the level of specificity claimed by BSCA (i.e.,
to regulate and reduce greenhouse gas emissions consistent with
limiting global temperature rise to 1.5°C above pre-industrial
levels). Further, the Court emphasised that the duty is
not to ensure environment protection itself. Rather,
ensuring environment protection is the norm and the end towards
which, the EPA is required to develop environmental quality
objectives, guidelines and policies. In reaching this conclusion,
the Chief Judge held that the evidence before the Court established
that, at present in New South Wales, “the threat to the
environment of climate change is of sufficiently great magnitude
and sufficiently great impact as to be one against which the
environment needs to be protected”.

The Court found that the EPA had not fulfilled its statutory
duty as it was unable to point to any document which, in the
Court’s view, amounted to an “instrument” developed
by the EPA under s 9(1)(a) to ensure protection of the environment
in NSW from climate change. Of the seven documents relied on by the
EPA for this purpose, two of them had not been developed by the
EPA, and the other five did not ensure environment protection from
climate change as, broadly speaking, the content of those materials
was purely aspirational or descriptive and lacked detail as to the
measures, approaches or tools to be used to reduce greenhouse gas
emissions.

Having found that the EPA had not discharged its statutory duty,
his Honour issued a mandamus to compel the EPA to develop quality
objectives, guidelines and policies to ensure environment
protection from climate change.

Ramifications

The decision marks the first time an Australian Court has
ordered a regulator to take significant action in respect of
climate change. We anticipate that the development will increase
the pressure on Australian legislators and regulators alike to
implement reforms to reduce greenhouse gas emissions which,
inevitably, will impact the way that business is done in
Australia.

Notably, the BSCA decision was delivered on the same day that an
unprecedented claim was filed in the Federal Court of Australia by
the Environmental Defender’s Office (which also represented
BSCA) against one of Australia’s largest gas producers, Santos
Limited. As noted in our recent Alert, the claim alleges, among other things,
misleading or deceptive conduct in respect of representations made
as to “clean energy”, and of having a clear and credible
road map to reach net zero emissions by 2040 which includes
reliance on carbon capture storage technology.

The BSCA decision also follows the recent decision of the Federal Court in
Sharma v Minister for the Environment [2021] FCA 560 in
which the Court ruled that, in determining whether to approve a
coal mine development, the Federal Minister for the Environment
owed a duty of care to Australian children to protect them from
harms caused by climate change.

Three Key Takeaways

  1. The primary environmental regulator for NSW, the EPA, has been
    found to be in breach of its statutory duty and, consequently,
    ordered by the Chief Judge of the Land and Environment Court to
    develop environmental quality objectives, guidelines and policies
    to ensure environment protection from climate change.

  2. The decision is the latest in a series of Australian and
    international cases to hold that regulators and government
    decision-makers owe positive duties to seek to reduce the harms of
    climate change.

  3. In light of this growing body of case law, businesses with an
    Australian presence, particularly those in emissions-intensive
    sectors, should be aware that regulatory reforms are likely to
    follow in the wake of such decisions and these reforms may well
    impact the way they conduct their business in Australia in the
    future.

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