Lawyers for Climate Action NZ Inc v Climate Change Commission - [2025] NZCA 80
Date of Judgment
28 March 2025
Decision
Lawyers for Climate Action NZ Inc v Climate Change Commission (PDF 920 KB)
Summary
Judicial review — Climate Change Commission — error of logic — statutory purpose — error in law — unreasonableness
Appeal dismissed. No order as to costs.
Lawyers for Climate Action NZ Inc (LCANZI) applied in the High Court for judicial review of advice given by He Pou a Rangi | the Climate Change Commission (the Commission) to the Minister of Climate Change (the Minister). The Commission provided advice for the purpose of setting the first three emissions budgets under the Climate Change Response Act 2002 (the Act) (Budgets Advice), and advice on whether New Zealand’s then current nationally determined contribution (NDC) was compatible with contributing to the global effort under the Paris Agreement to limit global average temperature increase to 1.5ºC above pre‑industrial levels (the 1.5ºC goal) (NDC Advice).
LCANZI said the NDC Advice was based on a logical or mathematical error, because the Commission compared the level of New Zealand’s international commitment (using gross-net accounting) with modelling carried out by the Intergovernmental Panel on Climate Change (IPCC) in a 2018 report (using net‑net accounting). In relation to the Budgets Advice, LCANZI said that the Commission had misinterpreted the statutory purpose as it did not consider whether the budgets were consistent with the 1.5ºC goal, and mischaracterised mandatory statutory considerations; the Commission had recommended the use of modified activity‑based (MAB) accounting to measure progress towards meeting emissions budgets and the target for emissions reduction by 2050 under the Act (the 2050 target), when the Act mandated land‑based accounting as used in New Zealand’s Greenhouse Gas Inventory; and the Budgets Advice was irrational and unreasonable.
The High Court dismissed the application. In relation to the NDC Advice, the Judge held the Commission did not make a logical or mathematical error because it had intended to use the IPCC modelling as an indirect comparator, and that approach — as well as the availability of other approaches — was understood by the Minister. In relation to the Budgets Advice, the Judge held that the Commission had not misinterpreted the statutory purpose as it correctly understood the need to have regard to mandatory relevant considerations, which it did not mischaracterise, with the 2050 target and the 1.5ºC goal in mind. The legislation empowered the Commission to give advice on the appropriate accounting methodology to measure progress and did not mandate land-based accounting. The Commission’s advice was not irrational and unreasonable: the reasoning and materials underlying the NDC advice and recommendation of MAB accounting supported its choices. The legislation did not require that the advice put New Zealand on track to reduce its domestic net emissions in line with the IPCC’s modelling. The Commission’s reasoning and the material on which it was based justified its advice, and no error in that reasoning or the material was shown.
LCANZI appeals to this Court on the basis that the Judge erred in her conclusions on each of those grounds. The Commission supports the judgment on other grounds, submitting the Commission’s advice is not amenable to judicial review, or in the alternative the scope for review is narrow; extensive evidence filed by LCANZI should have been excluded; and a more exacting standard of review than Wednesbury unreasonableness should not have been applied. The final ground is also supported by the Minister.
Issue one: was the Commission’s advice amenable to judicial review? Held: yes. A statutory power of decision is defined expansively under s 4 of the Judicial Review Procedure Act 2016 and should be given a liberal interpretation. The Commission has a critical role in achieving the purposes of the Act, and its central role in managing New Zealand’s response to climate change cannot be overemphasized. The Commission’s advice on the emissions budgets is not just one factor among many to be taken into account, and its central importance means it falls within the ambit of a statutory power of decision. The fact the Minister may depart from the advice does not immunise the advice from review.
Issue two: was LCANZI’s evidence admissible? Held: the admissibility issue will not affect the substantive outcome, but much of the evidence was not admissible. Some of the evidence was substantially helpful to gain an adequate and necessary understanding of complex technical issues. However, much of the evidence was not substantially helpful in determining the advice’s lawfulness, including because it provided information readily understandable to a layperson, evidence on general and uncontentious topics, and covered personal beliefs.
Issue three: was there a mathematical or logical error in the Commission’s advice? Held: no. The Commission deliberately chose to apply the net-net modelled reductions in the IPCC’s report to New Zealand’s 2010 gross CO2 emissions and explained why. The Minister understood this. There is no reason to suppose a more ambitious NDC would have been set if the modelled reductions had been applied to New Zealand’s 2010 net CO2 emissions and adjusted to reflect value judgments. The NDC Advice did not have an inappropriate anchoring effect.
Issue four: did the Commission fail to comply with a statutory requirement to meaningfully consider what is required to meet the 1.5ºC goal and recommend budgets that are consistent with it? Held: no. The emissions budgets are intended to serve the dual purpose of the Act — the 2050 target and contributing to the 1.5ºC goal — on a plain reading of s 5W and having regard to the legislative history. However, the purpose provision is not a substantive bottom line requirement as in Trans‑Tasman Resources v Taranaki-Whanganui Conservation Board [2021] NZSC 127, [2021] 1 NZLR 801. It is not cast in absolute or clearly defined terms, and no framework or parameters are prescribed for assessing the adequacy of the envisaged contribution to the 1.5ºC goal. An increase in net emissions in a particular budget period does not mean the series of emissions budgets will not have been set with a view to contributing to the 1.5ºC goal due to the impact of the forestry sector. Contributing to the 1.5ºC goal was covered extensively in chs 4, 5 and 9 of the Commission’s advice.
Issue five: did the Commission make an error of law in using MAB accounting methodology? Held: no. The issue is whether the Commission’s obligation to advise the Minister on matters relevant to setting an emissions budget extends to the accounting methodologies to be employed. New Zealand has never set its targets or measured progress towards them on the basis of land-based accounting; activity-based accounting is consistent with the analysis informing the 2050 target; and land-based accounting is arguably ill‑suited to setting and monitoring performance because it can obscure achieved emissions reductions.
The 2050 target refers to “net accounting emissions” and the Minister is obliged to ensure that “net accounting emissions do not exceed the emissions budget for the relevant emissions budget period”. The term “net accounting emissions” is defined to include “as reported in New Zealand’s Greenhouse Gas Inventory”. The legislative history shows this expression was inserted to differentiate it from “net emissions” as used in New Zealand Greenhouse Gas Inventory reporting, and to clarify that offshore mitigation can be counted. Activity‑based accounting is used under the Kyoto Protocol and the Paris Agreement, and data relating to accounting under those international agreements is included in New Zealand’s Greenhouse Gas Inventory. The definition of “net accounting emissions” is therefore wide enough to capture emissions and removals accounted for under MAB accounting.
This interpretation serves the purposes of the Act and fits the immediate statutory context. If Parliament had mandated the use of land-based accounting, one would expect this to have been clearly stated. It is not surprising that the Commission, the independent expert body, was charged with providing this ongoing specialist advice. There is also support in the legislative history that the reference in the Act to “the rules that will apply to measure progress towards meeting emissions budgets and the 2050 target” was intended to encompass the applicable accounting methodology for land use, land-use change and forestry, as well as other accounting rules the Commission determined.
Issue six: was the Commission’s advice unreasonable? Held: no. The Court is not particularly attracted by the idea of a variable standard of review, but the standard of review does not need to be determined and should be left for a case where it matters. LCANZI’s claim is largely dependent on the other three grounds of review, and thus the overall unreasonableness claim mostly falls away. The budgets need to be understood alongside the distortions created by the forestry sector. The IPCC modelling in the 2018 report was not intended to be applied to individual countries, and the Act did not require recommending or setting budgets on that basis. It was not unreasonable or irrational to focus attention on new and enduring emissions reductions achievable in budgets periods through behavioural change driven by policy settings. This was consistent with the scheme and purposes of the Act. The claim that the Commission ought to have conducted further analyses or that choices should have been made differently go to the merits, not irrationality or unlawfulness.
Appeal dismissed. No order as to costs.
Lawyers for Climate Action NZ Inc (LCANZI) applied in the High Court for judicial review of advice given by He Pou a Rangi | the Climate Change Commission (the Commission) to the Minister of Climate Change (the Minister). The Commission provided advice for the purpose of setting the first three emissions budgets under the Climate Change Response Act 2002 (the Act) (Budgets Advice), and advice on whether New Zealand’s then current nationally determined contribution (NDC) was compatible with contributing to the global effort under the Paris Agreement to limit global average temperature increase to 1.5ºC above pre‑industrial levels (the 1.5ºC goal) (NDC Advice).
LCANZI said the NDC Advice was based on a logical or mathematical error, because the Commission compared the level of New Zealand’s international commitment (using gross-net accounting) with modelling carried out by the Intergovernmental Panel on Climate Change (IPCC) in a 2018 report (using net‑net accounting). In relation to the Budgets Advice, LCANZI said that the Commission had misinterpreted the statutory purpose as it did not consider whether the budgets were consistent with the 1.5ºC goal, and mischaracterised mandatory statutory considerations; the Commission had recommended the use of modified activity‑based (MAB) accounting to measure progress towards meeting emissions budgets and the target for emissions reduction by 2050 under the Act (the 2050 target), when the Act mandated land‑based accounting as used in New Zealand’s Greenhouse Gas Inventory; and the Budgets Advice was irrational and unreasonable.
The High Court dismissed the application. In relation to the NDC Advice, the Judge held the Commission did not make a logical or mathematical error because it had intended to use the IPCC modelling as an indirect comparator, and that approach — as well as the availability of other approaches — was understood by the Minister. In relation to the Budgets Advice, the Judge held that the Commission had not misinterpreted the statutory purpose as it correctly understood the need to have regard to mandatory relevant considerations, which it did not mischaracterise, with the 2050 target and the 1.5ºC goal in mind. The legislation empowered the Commission to give advice on the appropriate accounting methodology to measure progress and did not mandate land-based accounting. The Commission’s advice was not irrational and unreasonable: the reasoning and materials underlying the NDC advice and recommendation of MAB accounting supported its choices. The legislation did not require that the advice put New Zealand on track to reduce its domestic net emissions in line with the IPCC’s modelling. The Commission’s reasoning and the material on which it was based justified its advice, and no error in that reasoning or the material was shown.
LCANZI appeals to this Court on the basis that the Judge erred in her conclusions on each of those grounds. The Commission supports the judgment on other grounds, submitting the Commission’s advice is not amenable to judicial review, or in the alternative the scope for review is narrow; extensive evidence filed by LCANZI should have been excluded; and a more exacting standard of review than Wednesbury unreasonableness should not have been applied. The final ground is also supported by the Minister.
Issue one: was the Commission’s advice amenable to judicial review? Held: yes. A statutory power of decision is defined expansively under s 4 of the Judicial Review Procedure Act 2016 and should be given a liberal interpretation. The Commission has a critical role in achieving the purposes of the Act, and its central role in managing New Zealand’s response to climate change cannot be overemphasized. The Commission’s advice on the emissions budgets is not just one factor among many to be taken into account, and its central importance means it falls within the ambit of a statutory power of decision. The fact the Minister may depart from the advice does not immunise the advice from review.
Issue two: was LCANZI’s evidence admissible? Held: the admissibility issue will not affect the substantive outcome, but much of the evidence was not admissible. Some of the evidence was substantially helpful to gain an adequate and necessary understanding of complex technical issues. However, much of the evidence was not substantially helpful in determining the advice’s lawfulness, including because it provided information readily understandable to a layperson, evidence on general and uncontentious topics, and covered personal beliefs.
Issue three: was there a mathematical or logical error in the Commission’s advice? Held: no. The Commission deliberately chose to apply the net-net modelled reductions in the IPCC’s report to New Zealand’s 2010 gross CO2 emissions and explained why. The Minister understood this. There is no reason to suppose a more ambitious NDC would have been set if the modelled reductions had been applied to New Zealand’s 2010 net CO2 emissions and adjusted to reflect value judgments. The NDC Advice did not have an inappropriate anchoring effect.
Issue four: did the Commission fail to comply with a statutory requirement to meaningfully consider what is required to meet the 1.5ºC goal and recommend budgets that are consistent with it? Held: no. The emissions budgets are intended to serve the dual purpose of the Act — the 2050 target and contributing to the 1.5ºC goal — on a plain reading of s 5W and having regard to the legislative history. However, the purpose provision is not a substantive bottom line requirement as in Trans‑Tasman Resources v Taranaki-Whanganui Conservation Board [2021] NZSC 127, [2021] 1 NZLR 801. It is not cast in absolute or clearly defined terms, and no framework or parameters are prescribed for assessing the adequacy of the envisaged contribution to the 1.5ºC goal. An increase in net emissions in a particular budget period does not mean the series of emissions budgets will not have been set with a view to contributing to the 1.5ºC goal due to the impact of the forestry sector. Contributing to the 1.5ºC goal was covered extensively in chs 4, 5 and 9 of the Commission’s advice.
Issue five: did the Commission make an error of law in using MAB accounting methodology? Held: no. The issue is whether the Commission’s obligation to advise the Minister on matters relevant to setting an emissions budget extends to the accounting methodologies to be employed. New Zealand has never set its targets or measured progress towards them on the basis of land-based accounting; activity-based accounting is consistent with the analysis informing the 2050 target; and land-based accounting is arguably ill‑suited to setting and monitoring performance because it can obscure achieved emissions reductions.
The 2050 target refers to “net accounting emissions” and the Minister is obliged to ensure that “net accounting emissions do not exceed the emissions budget for the relevant emissions budget period”. The term “net accounting emissions” is defined to include “as reported in New Zealand’s Greenhouse Gas Inventory”. The legislative history shows this expression was inserted to differentiate it from “net emissions” as used in New Zealand Greenhouse Gas Inventory reporting, and to clarify that offshore mitigation can be counted. Activity‑based accounting is used under the Kyoto Protocol and the Paris Agreement, and data relating to accounting under those international agreements is included in New Zealand’s Greenhouse Gas Inventory. The definition of “net accounting emissions” is therefore wide enough to capture emissions and removals accounted for under MAB accounting.
This interpretation serves the purposes of the Act and fits the immediate statutory context. If Parliament had mandated the use of land-based accounting, one would expect this to have been clearly stated. It is not surprising that the Commission, the independent expert body, was charged with providing this ongoing specialist advice. There is also support in the legislative history that the reference in the Act to “the rules that will apply to measure progress towards meeting emissions budgets and the 2050 target” was intended to encompass the applicable accounting methodology for land use, land-use change and forestry, as well as other accounting rules the Commission determined.
Issue six: was the Commission’s advice unreasonable? Held: no. The Court is not particularly attracted by the idea of a variable standard of review, but the standard of review does not need to be determined and should be left for a case where it matters. LCANZI’s claim is largely dependent on the other three grounds of review, and thus the overall unreasonableness claim mostly falls away. The budgets need to be understood alongside the distortions created by the forestry sector. The IPCC modelling in the 2018 report was not intended to be applied to individual countries, and the Act did not require recommending or setting budgets on that basis. It was not unreasonable or irrational to focus attention on new and enduring emissions reductions achievable in budgets periods through behavioural change driven by policy settings. This was consistent with the scheme and purposes of the Act. The claim that the Commission ought to have conducted further analyses or that choices should have been made differently go to the merits, not irrationality or unlawfulness.