Summary:
This case was brought by Michael John Smith (Ngāpuhi, Ngāti Kahu), who is the climate change spokesperson for a Māori development platform known as the Iwi Chairs’ Forum, and who is also the applicant in the case of Smith v. Attorney-General. In the present case, he brought proceedings against seven high-emitting companies in New Zealand who are involved in agriculture and energy sectors (namely Fonterra Co-Operative Group Ltd , Genesis Energy Ltd, Dairy Holdings Ltd, New Zealand Steel Ltd, Z Energy Ltd, Channel Infrastructure NZ Ltd and BT Mining Ltd.). He claimed that the emissions caused by these corporate actors constituted a public nuisance, acts of negligence, and a breach of a duty to cease contributing to climate change. The New Zealand courts have issued a series of decisions on this case.
On 6 March 2020, the High Court of New Zealand struck out the first two causes of action (public nuisance and acts of negligence), but allowed the third (reach of a duty to cease contributing to climate change) to proceed.
After, on 21 October 2021, the Court of Appeal dismissed Mr Smith’s appeal and upheld the cross appeal of the respondents, Mr Smith received leave to appeal to the Supreme Court on 31 March 2022. On 7 February 2024, the Supreme Court unanimously allowed Mr Smith’s appeal, and reinstated his statement of claim, and referred the case back to the High Court to proceed to trial (for more detail on the Supreme Court’s judgment, see below). After a series of procedural decisions, a substantive hearing in the case by the High Court was scheduled for April 2027.
Current state of the proceedings:
On 7 February 2024, the Supreme Court of New Zealand reinstated the two dismissed tort causes of action and remanded the case to the lower court (the High Court). It held that the public rights pleaded laid an appropriate foundation for a nuisance claim. It also held that it was premature, at this stage of the proceeding, to conclude that the common law was insufficient to address the tortious aspects of climate change. Determining whether the actions of respondents, seven high-emitting companies in New Zealand, amount to a ‘substantial and unreasonable interference’ to public rights is a fact inquiry to be analyzed according to policy factors and human rights obligations.
On remand, the interlocutory applications raised noteworthy cost questions. The sixth defendant, BT Mining, sought an order for security for costs and Mr. Smith applied for protected cost orders (PCO). Here, the court has a wide latitude of discretion. It dismisses BT Mining’s request citing, among other considerations, access to justice concerns. Regarding Mr. Smith however, the court relies on the Edwards factors: (1) whether an issue of significant general or public importance is raised; (2) whether the applicant’s stance is seriously arguable; (3) whether the applicant is genuinely impecunious; (4) the position of the respondent, including “any unjust advantage likely to accrue to it absent the order”; and (5) any reasonable alternatives to making the order.
Reluctant to grant, the court emphasized the exceptional nature of a PCO in these proceedings. Mr. Smith, however, draws on Munkara v Santos NA Barossa Pty Ltd (No 4), an Australian Federal Court decision that ordered nonparty funders, the Environmental Defense Office, to pay costs to Santos, an oil company who defeated claimants’ petition for injunctive relief in the construction of a pipeline, to remind the court of the significant chilling effect of potential costs exposure on charitable funders. The court draws a distinction between a third-party funder and a ‘pure funder’ to reason that it would be highly unlikely for a costs award to be made against one that did not seek to benefit financially from the litigation nor seek to control its course. Unsatisfactory, but absent disclosure of third-party donor(s), the court declines Mr. Smith’s PCO application in its entirety. The decision, however, is without prejudice, leaving the door open to re-application with third-party funder identification.
Suggested citation:
Smith v Fonterra Co-operative Group Ltd [2024] NZSC 5, [2024] 1 NZLR 134.
Last updated:
19 September 2025.