Case comment on Minister for the Environment v Sharma [2022] FCAFC 35

When Justice Bromberg of the Australian Federal Court² found the Environment Minister owed Australian children a duty of care when acting under environmental protection legislation³ to approve the extension of a coal mine, there was a strong interest not only from climate advocates but also from climate advocates public interest lawyers.

This was the legal takeaway: 

The Minister, when making decisions under that law, must take reasonable care to avoid causing personal injury or death to all people in Australia under 18 years of age arising from the emissions of carbon dioxide into the Earth’s atmosphere from the combustion of the coal.

The decision was a landmark decision following an ambitious claim.

However, on 14 March 2022, the Full Federal Court of Australia overturned it on appeal, unanimously holding that the duty should not be imposed upon the Minister.

This decision was a devastating setback for the activists who brought the proceedings.

On the other side, some Members of Parliament heralded the decision as a return to sanity, claiming that finding a duty of care was a ludicrous intervention by the judiciary in government business.

But did the Full Federal Court of Australia reach this view by the same road? Not entirely.

Differing judgments

Although they unanimously believed that the primary judge was wrong in finding a duty of care, their approaches and reasoning differed.

This is important because where judges either reach opposing views on legal principles or characterise the law so differently that it leads to different conclusions, the law remains unsettled.

Is there a clear and binding ratio decidendi from Minister for the Environment v Sharma?

Key features for a novel duty of care

The case provides a rich analysis of the key elements that one ought to consider in establishing a duty of care in such a novel scenario as well as how and in what sequence those factors ought to be considered.

If the relationship between the plaintiff and defendant does not fall into an established category from previous case law, it is novel. Determining a novel duty of care involves considering a range of features. Those 17 key features are listed in the NSW Supreme Court decision of Caltex Refineries (Qld) Pty Limited v Stavar⁴, an asbestos case. Asbestos cases have historically provided fertile ground for novel duty of care cases.

Those key features include:

1. the foreseeability of harm;
2. the nature of the harm alleged;
3. the degree and nature of control able to be exercised by the defendant to avoid harm;
4. the degree of vulnerability of the plaintiff to harm from the defendant’s conduct, including the capacity and reasonable expectation of a plaintiff to take steps to protect itself;
5. the degree of reliance by the plaintiff upon the defendant;
6. any assumption of responsibility by the defendant;
7. the proximity or nearness in a physical, temporal or relational sense of the plaintiff to the defendant;
8. the existence or otherwise of a category of relationship between the defendant and the plaintiff or a person closely connected with the plaintiff;
9. the nature of the activity undertaken by the defendant;
10. the nature or the degree of the hazard or danger liable to be caused by the defendant’s conduct or the activity or substance controlled by the defendant;
11. knowledge (either actual or constructive) by the defendant that the conduct will cause harm to the plaintiff;
12. any potential indeterminacy of liability;
13. the nature and consequences of any action that can be taken to avoid the harm to the plaintiff;
14. the extent of imposition on the autonomy or freedom of individuals, including the right to pursue one’s own interests;
15. the existence of conflicting duties arising from other principles of law or statute;
16. consistency with the terms, scope and purpose of any statute relevant to the existence of a duty;
17. and the desirability of, and in some circumstances, need for conformance and coherence in the structure and fabric of the common law.

Competing ratios

The judgment of the Full Court includes three separate lengthy judgments. Perhaps unsurprisingly, given the number of key features, some competing ratios emerge. Some involve merely different ‘emphases’ on the same formula. Still, on some legal points, such as ‘high policy-making,’ the judges’ characterisation of existing law differs to the point of supporting opposing conclusions (Beach J compared to Allsop CJ and Wheelahan J).

Stages to establishing a tort

Broadly speaking, there are four stages to establishing a tort:

1. Duty of care: The relationship between the defendant and the plaintiff must have a temporal, physical or economic dimension that puts the plaintiff in the defendant’s mind.
2. Breach: The defendant failed to meet their obligation to the plaintiff and therefore put the plaintiff in harm’s way.
3. Causation: The plaintiff must show a causal link between the tortfeasor’s act or failure to act and the harm. Sometimes, as in this case, it will involve establishing a chain of causation.
4. Nature and degree of the harm: The harm must be reasonably foreseeable for the tortfeasor (in this case, the Minister).

The focus of this claim

Technically, this case only related to the first stage. However, it is clear that the primary judge, Justice Bromberg, considered the other elements in finding a duty of care. His Honour considered evidence that might typically be considered under causation or harm to establish the first stage of there being a duty. For example, the risk, magnitude and foreseeability o physical harm to these Australian children caused by rising emissions supported his conclusion that a duty of care existed.

On appeal, Justice Beach interestingly said (in obiter) that the primary judge ought to have refused to make a declaration purely on the subject of whether a duty existed, noting that the elements were interconnected.

What is the correct starting point for analysis?

Chief Justice Allsop was also critical of the primary judge’s approach. On the one hand, his Honour found that Justice Bromberg had started in the wrong place (with harm, not the statute) to determine the existence of a duty. His Honour explains at para 131 that

The primary judge commenced with reasonable foreseeability of harm. … At J[191], his Honour considered that the common shared circumstances of the Children, being their age and thus temporal connection to particular harms, their location and thus geographical connection to particular harms enabled the finding that events induced by climate change expose each of the children to a real risk of harm.

The Chief Justice found that considering the risk of harm and reasonable foreseeability of harm dominated the primary judge’s approach⁵ to understanding the plaintiff and defendant’s relationship. Instead, Chief Justice surmised that the starting point must be the relationship established by the relevant provisions of the statute:

One must begin with the relationship. This is to be found in the statute properly construed and understood in its context.  The nature of the posited duty, its scope and content, must be addressed to understand the nature of the issues to be thrown up at the point of breach.  It is against this context that relevant salient features are to be addressed.

His Honour expresses that those key features of novel duty of care cannot be considered separately but together to avoid abstract analysis that is ‘divorced from context.’⁶ His Honour continues at para 211:

With respect, the primary judge did not utilise the salient features enumerated in Stavar as an analytical tool in this way.  His Honour did not examine, through this perspective, the existing relationship of the Minister to the Children, within the context of her statutory function, bearing in mind her position as Minister, and the broader constitutional and legal context within which the dispute emerged.  Rather, his Honour examined the salient features as individual considerations containing elements of the construction of the duty, leaving to the end of the analysis, almost as a miscellaneous consideration, fundamental considerations of the nature of the issues raised if the duty with its identified scope and content were imposed.

There may be further commentary on whether this criticism was fair, given Justice Bromberg did consider the relevant statutory provisions and was entitled to consider evidence about harm. Arguably, Justice Bromberg merely landed at a different destination due to a different consideration of the facts and a weighting on the magnitude of the harm versus Chief Justice Allsop’s concern with justiciability.

Moreover, it could be argued that Chief Justice Allsop erred in elevating the statutory provisions (as one key feature) to be an all-encompassing analytical frame. Indeed, the Chief Justice would later emphasise that the key features must be considered together at the outset.

Treatment of “policy questions”; justiciability

When Chief Justice Allsop argued that the primary judge ought to have considered all the key features of a novel duty from the outset, really, he was concerned with the lack of emphasis the primary judge gave to the question of justiciability, which arguably comes under the key feature of “coherence and conformance in the structure and fabric of common law.” Chief Justice Allsop’s judgment expounds on to explain the basis for excising high policy questions from judicial decision-making.

The second judge, Justice Beach disagreed with Chief Justice Allsop on this element – sharing the primary judge’s view that “policy questions” could be further considered at the breach stage, stating in para 633:

In my view, where the Minister may create a danger by exercising her statutory power in favour of approving a project, policy is no answer to denying the duty unless the Act itself makes such policy questions so fundamental to the exercise of statutory power that such a conclusion is compelling. I am not so compelled to find here.

Justice Beach also took a different approach to formulate the law on “policy questions” and the appropriate division of responsibilities between the judiciary and executive. His Honour found this case fitted the scenario “where there has been an exercise of a statutory power which has created or exacerbated a risk of harm,”⁷ remarking:

The question is whether there was a duty of care in the exercise of such a power to take into account that risk and to contemplate the interests of persons in the position of the plaintiff in that regard.  In that scenario, questions such as policy and incoherency although relevant may have lesser significance.

His Honour clarified that this case, in his view, involved “the positive exercise to approve” an extension of a coal mine “which is said to give rise to the risk of harm.”⁸ Justice Beach concludes that “while there is a modicum of incoherency, I do not consider that this is a strong feature against recognising a duty of care, particularly in a third scenario case as I identified at the outset.” [609] By this remark, Justice Beach says that the “policy questions” concern is more irrelevant where a minister exacerbates harm through positive action rather than a failure to act.

The third and final judge, Justice Wheelahan, concurred with Chief Justice Allsop that this case was ‘sliding’ into complex policy matters, but unlike the Chief Justice, it wasn’t the pre-eminent question. So, it is clear that although some political and media commentators sought to paint this as a clear win against future public interest actions against Ministers, it wasn’t.

Conclusion

Across the Full Federal Court judgments, there was agreement on tort being an evolving area of law.

Chief Justice Allsop referred to tort evolving with modern societal standards at para 206:

Taxonomy and definition play their part, but ultimately the law of negligence concerns itself with the protection of certain human interests against certain types of human (mis)conduct where it is reasonable and in accordance with standards of the day to impose a duty that may lead to personal responsibility for compensation to a person harmed by the (mis)conduct.

Chief Justice Allsop outlined that deciding on tort cases heavily relied on close examination of the facts, relevant legislation, legal policy, and principle drawn from case law.⁹ The other judgments were consistent with this approach.

Where it started to become more complicated was their approach to sequencing, considering and weighting different features for a novel duty of care.

While this Insight doesn’t have the space to exhaustively analyse the judges’ reasoning for areas of coherence and incoherence, it can be said that this case does not provide a clear view of the way to sequence or weight key factors to determine if a novel duty of care exists. The law is still developing. Moreover, where the facts of future cases differ, a very different outcome could be possible – for example:

• the class of claimants is more able to be defined and limited in number (i.e., ascertainable), and therefore indeterminacy of liability is not such an issue
• there is greater closeness and directness between the Minister’s act and the likelihood of harm
• the Minister’s contribution to the harm is proportionally greater
• the legislation in question gives rise to a duty of care to avoid that particular injury more obviously
• harm has already occurred.

---

¹ Minister for the Environment v Sharma [2022] FCAFC 35
² Sharma by her litigation representative Sister Marie Brigid Arthur v Minister for the
Environment [2021] FCA 560. Available at
https://www.judgments.fedcourt.gov.au/judgments/Judgments/fca/single/2021/2021fca0560
³ Environment Protection and Biodiversity Conservation Act 1999 (Cth) (EPBC Act)

⁴ [2009] NSWCA 258

⁵ [146]
⁶ [211]

⁷ [356] 
⁸ [361]

⁹ [207]