week 4: Milieudefensie vs. Shell (part 2) Flashcards
(16 cards)
Typical features of tort law cases
- Two-party dispute:
○ Tort law usually involves a conflict between 2 individuals or private parties- All facts on table:
○ The court has access to all relevant info needed to make fair decision - Consequences are foreseeable:
The judge can assess and oversee the likely consequences of their ruling
- All facts on table:
Shell v. MD et al. :
The Hague Court of Appeal ECLI:NL:GHDHA:2024:2100
Judgement structure
**Chapter B: **
○ about CC and HR
○ Discusses that protection against dangerous CC should be considered HR
**Chapter C: **
○ Deals w indirect horizontal effect of HR
○ Examines direct effect of right to protection against dangerous CC in private relationships
**Chapter D: **
○ Focuses on EU’s climate legislation
○ Addresses how MD et al.'s claims relate to existing climate legislation
**Chapter E: **
○ Presents interim review
○ Answers the question : to what extent it can be est. on basis of Ch B-D that Shell has legal obligation to limit CO2 emissions
**Chapter F: **
○ Considers whether new investments in oil and gas violate the social standard of care and what a positive answer to that q would mean for claims of MD et al.
**Chapter G: **
○ Court discusses Shells obligations regarding scope 1 and 2
○ Will draw conclusions on the justifications of the claims of MD et al. regarding scope 1 and 2
**Chapter H: **
○ Covers Shell’s obligations w regard to scope 3
○ Will discuss whether Shell can be compelled to adhere to the avg. global reduction percentage of 45% or whether sectoral standard applicable to shell can be formulated ○ Will touch on question of the effectiveness of scope 3 claims
The Hague Court of Appeal ECLI:NL:GHDHA:2024:2100
Chapter B
B. Climate Change and Human Rights
MD et al. argues climate change threatens basic human rights, protected under the European Convention on Human Rights (ECHR):
Article 2 – Right to life: Governments must protect people from life-threatening dangers like climate change
.
Article 8 – Right to private and family life: This includes protection from environmental harm.
Courts have increasingly recognized that fighting dangerous climate change is a human rights obligation, not just in the Netherlands, but worldwide. Key examples include:
- The Urgenda case (Netherlands)
- The Klimaseniorinnen case (Switzerland)
- resolutions and reports (of bodies)
recognised worldwide that states have obligation to protect their citizens from adverse effects of dangerous CC
- ECtHR considered that: “CC one of most pressing issues of our times”
Although Primarily up to legislators and govs to take measures to minimise dangerous CC,
companies like Shell may also share responsibility. This connects to a legal idea called “indirect horizontal effect” of HR
The Hague Court of Appeal ECLI:NL:GHDHA:2024:2100
Chapter C
C. Indirect horizontal effect of Human Rights
In Dutch law fundamental rights generally do not have horizontal effect, human rights only apply between citizens and the government (vertical effect), not between private parties (horizontal effect)
However, in some cases, courts apply human rights indirectly in private relationships (like between a person and a company).
This is called the indirect horizontal effect
means courts can use human rights values to help interpret general legal duties in private law, like what’s considered proper social conduct.
Courts and laws (including EU law) support this idea using:
- UN Guiding Principles on Business and Human Rights
- OECD Guidelines for Multinational Enterprises
- Other soft law tools (non-binding but influential)
Even though human rights laws mainly target governments, they can still influence how companies are expected to behave, especially when laws are vague or missing
- such as social standard of care: defining social standard of care comes down to question of what action required of person/company
When deciding if a company (like Shell) has failed its duty of care, courts look at:
1. severity of threat of particular danger
2. How much the company contributes to creation
3. capacity to contribute to combating of danger
In summary court of appeal is of opinion that:
companies like Shell (which contribute significantly to climate problem and have within their power to contribute to combating) have obligation to reduce CO2 emissions,
even if there’s no specific public law forcing them to, because they significantly contribute to climate change and have the power to help stop it.
-> Companies like Shell have own responsibility in achieving the targets of Paris Agreement
The Hague Court of Appeal ECLI:NL:GHDHA:2024:2100
Chapter D
D. Climate legislation of the European Union
4 Key EU Directives That Affect Shell:
- EU Emissions Trading System (EU-ETS):
- operates on a cap-and-trade principle:
- Big polluters must buy permits for every tonne of CO₂ they emit.
- Goal: Encourage them to cut emissions by making it more expensive to pollute.
- EU-ETS2 (coming in 2027):
- Will expand carbon pricing to buildings and road transport.
- Aim: By extending carbon pricing to these sectors EU aims to promote cleaner mobility and energy use among consumers and small businesses
- Corporate Sustainability Reporting Directive (CSRD):
- Large companies must report their environmental, social, and governance (ESG) practices in detail.
- Corporate Sustainability Due Diligence Directive (CSDDD)
- Goes further than CSRD:
- Requires companies to identify, prevent, and mitigate adverse impacts on human rights and the environment throughout their global value chains
- marks shift from voluntary corporate social responsibility to enforceable legal obligations within EU
** Court Opiniom:**
Shell argued that following EU and national laws should be enough.
court disagrees:
EU laws don’t say that companies following current rules have no further responsibility.
Governments expect companies to take extra action on their own.
So, Shell still has a duty of care to reduce emissions beyond just legal minimums.
In Short:
Even though EU climate laws apply, Shell still has a broader social and legal responsibility to cut emissions. These laws influence, but do not limit, what Shell must do under the duty of care standard.
The Hague Court of Appeal ECLI:NL:GHDHA:2024:2100
Chapter E
E. Interim review (sections B-D)
previous chapters est. :
- Protection from dangerous climate change is a human right, and states must act to protect people from its effects.
- Human rights can also influence private companies, through legal standards like the social duty of care
- (social standard of care in relation to climate can be further defined through soft law such as UNGP and OECD guidelines)
EU law also places obligations on companies like Shell:
- The EU aims to cut emissions by 55% by 2030.
- measures aimed not only at MS but also at companies: Companies must take part, for example by buying emission allowances under the EU ETS.
But:
- laws and guidelines don’t cover everything.
- Following existing regulations is not enough—companies still have an additional social responsibility to reduce emissions.
- That said, just because Shell has this general duty, it doesn’t automatically mean that MD et al.’s specific demand (for a 45% emissions cut) must be accepted.
The Hague Court of Appeal ECLI:NL:GHDHA:2024:2100
Chapter F
F. New investments in oil and gas and scope 3 emissions
MD et al. argue that Shell’s climate policy goes against the goals of the Paris Agreement, :
- Shell plans to invest in new oil and gas fields, which would keep its total emissions from decreasing.
- cite UNEP and IEA reports showing that such investments are not needed if the world is serious about staying well below 2°C of warming.
-reports suggest that expanding oil and gas production conflicts with global climate goals.
However, the court is not deciding here whether Shell’s new investments violate its duty of care.
The main legal question in this case is whether Shell can be legally required to cut its emissions (Scopes 1, 2, and 3) by 45%, 35%, or 25%.
The Hague Court of Appeal ECLI:NL:GHDHA:2024:2100
Chapter G
G. Shells obligations as regards its scope 1 and 2 emissions
Shell argues there’s no reason to think it won’t meet its obligations for Scope 1 and 2 emissions.
-> Shell has committed to a 50% reduction by 2030 (compared to 2016 levels)
For the court to accept MD et al.’s claim, it would need strong evidence that Shell is likely to miss the 45% reduction target.
- But Shell has already made concrete plans and taken action, and
- MD et al. haven’t provided sufficient arguments in support of that the mere fact that Shell has previously watered down targets cannot in any event justify that finding
Conclusion:
The court finds no clear risk that Shell will fail to reduce Scope 1 and 2 emissions,
So this part of MD et al.’s claim is rejected.
The Hague Court of Appeal ECLI:NL:GHDHA:2024:2100
Chapter H
H. Shells obligations as regards its scope 3
1. . General
Courts concluded Shell must contribute to the Paris Agreement goals,
but
existing climate legislation doesn’t provide for concrete reduction rate for individual companies/industries
Climate science may offer guidelines, but they’re not legally binding on individual companies.
**
2. Can Shell Be Ordered to Cut Emissions by 45% by 2030?**
MD et al. want Shell to reduce Scope 1, 2, and 3 emissions by 45% (or 35% / 25%) by 2030, compared to 2019.
Its not in dispute b/w the parties that:
- The 45% figure is a global average, not tailored to specific companies or sectors.
- Gas causes less CO₂ than oil or coal, and Shell doesn’t deal with coal
-> If Shell replaces a coal supplier with natural gas, its emissions might go up, but global emissions might go down
- > Conclusion: A one-size-fits-all 45% target isn’t appropriate for Shell—it’s not case-specific or designed for companies like Shell.
3. Can sectoral standard for oil and gas be established
court considered whether there’s a clear emissions target for the oil and gas sector.
Many reports exist, but they’re inconsistent, use different definitions, and don’t provide solid legal grounds.
Conclusion: The court cannot base a legal order on unclear or conflicting scientific sources.
-> Therefore, however much Shell may be required to do to combating dangerous CC available figures do not provide the court w sufficient support to oblige Shell to reduce CO2 emissions by a certain percentage in 2030, as claimed by MD et al.
4. Would a Scope 3 Emissions Order Be Effective?
MD et al. want Shell to cut Scope 3 emissions (from products sold).
Shell could reduce Scope 3 by selling fewer fossil fuels, but:
It’s not proven that this would actually reduce global CO₂, since buyers might just go elsewhere.
Conclusion: The proposed order is not effective, so MD et al. have no legal interest in that claim.
5. Conclusion
Shell may have a duty to help fight climate change, including Scope 3 emissions.
But the court won’t order a fixed % reduction because:
The 45% figure doesn’t apply uniformly across sectors/countries.
No clear standard exists for oil and gas.
And there’s no proof the proposed action would be effective.
Result:
→ MD et al.’s claims regarding Scope 3 emissions are rejected.
Debate : Climate Change is HR issue
Affects so many areas that influence quality of life (right to life), growing body of case law that supports this
□ Agriculture, ecosystems, environment
Intergenerational equity argument: affects future generations who are not yet alive and have not contributed to issue
□ Counterargument: don’t have life yet, no personhood, not alive yet, no right to life -> difficult to argue human rights of people not yet alive
Small island nations: most at risk, often times smallest emitters, disproportionately affected - they also have a right to life, land, culture all intertwined w HR
Debate: Human Rights protecting Climate Change have indirect effect in horizontal relations (companies to individuals)
Agree:
□ HR law meaningless if it only applies to states
□ Indirect effect: Falls in hands of state to give permits to emit - Climate change is HR issue, companies main entities directly contributing to CC
Disagree:
□ Difficult to ask a private entity for human rights, very big request to ask company to ensure HR as it’s not necessarily responsible
□ States bound by HR, companies not: goes too far to bind companies, if companies can be held responsible for guaranteeing HR can be hard to then not also extend it toward individuals - If we elevate private entity to standard of obligations of states, we rank them at level as states
Debate: Companies have duty of care that is independent from public law legislation (civil court can demand more from the company than what is currently required in public law)
The requirements of public law have been democratically agreed upon, but court found that civil courts can go further
Example: intermarital rape case - started being ruled against before it actually became legal, ECtHR ruled it is illegal based on this case law practice
NL asbestos example: ruled against asbestos , clear that court ruling has effect unlike CC, -> can go further
Monist states can go further because international treaties can be brought to national courts
Court of appeal also found - Part 2: court of appeal questions the effectiveness of MD’s claim
- Leading to the conclusion that MD has no sufficient interest (Ex.: 3.303 DCC)
(if shell reduces, other companies may fill gap in market)
Debate: No imminent threat for Scope 1 and 2
Agree:
- Shell established goal of reducing emissions by …, goes far beyond MD’s claim (even more ambitious than what is asked of them), shell committed to this goal in publications
-> Not enough evidence that Shell will not keep up with obligations and climate plans
- Past actions of shell cannot justify imminent threat - Shell promised to do a lot of things -> No immanent threat
Disagree:
- Past actions justify current need: Shell has historically adjusted targets, and willingness to disregard climate targets in business advantages
- Targets not binging, they can adjust
-> There is imminent threat
injunction needed to ensure compliance
Debate: No percentage (45%, 35%, 25%)
Agree:
- Percentages mentioned by MD must be seen as global commitment not just shell
- Court cannot require specific percentage for a specific company or specific sector (oil and gas sector) - Not up to court of appeal to appoint a certain percentage if there is no consensus on specific percentage
Disagree:
- Through data analysis biggest emitters can be found and emissions can be compared - reduction percentage can be established
- Would set precedent for future cases and not having percentage would set precedent for future cases to not have percentage (big case first in this field, influential, other cases can use this case to fall back on to not have a specific percentage) - Would be possible for court to appoint at least bear minimum percentage to which companies can be held accountable
Debate: The (in)effectiveness of the ruling (no sufficient interest in the claim)
Agree:
- Lack of specific legal obligation, imposing specific target lacked legal basis, Paris goal is global not to specific companies
- Enforcement problematic - Even if shell would reduce, overall impact on global emissions limited because other companies may not reduce
Disagree:
- Sufficient interest because effectiveness - if shell stops buying companies would have to find new buyer
- Even if effect small, any reduction still positive and still has effect - Has an indirect deterrent effect: would show other companies that emissions bad - Court in this case set a very high bar for standard to prove effectiveness in comparison to other tort cases
