Is a Multinational Corporation your Neighbor? They are if you live in Germany. Neighborly Relations Offers Hope for Climate Litigation.

Nestled in the Cordillera Blanca region of the Peruvian Andes, there’s a community of small-scale farmers and mountain guides. One of those mountain guides is Saúl Luciano Lluiya, who is living in the projected path of an outburst flood. In 2015, Saúl became the face of a groundbreaking lawsuit against RWE AG, a multinational energy company, in the Upper Court of Hamm, Germany. 

The Andes mountains, the largest mountain chain in the world and origin of the Amazon River, has experienced substantial glacial retreat, as glaciers have begun to melt faster than new snow and ice have time to accumulate thanks to climate change. This leaves communities in the Andes facing the near-term threat of increased flooding and the long-term threat of water scarcity. 

As a mountain guide, Saúl has watched the glaciers retreat. He worries about the possibility of his home being swept away by floods as a nearby lake has rapidly grown. He felt a sense of responsibility to take action. So, he initiated legal action with Germanwatch, a German NGO fighting for climate justice.

Photo: Saúl Luciano Lluiya speaking to a crowd in Germany. Credits: Wikimedia.

The lawsuit claims that RWE has contributed to the concentration of CO2 by burning coal in their power plants. This has exacerbated climate change and glacial retreat around the world. But RWE is hardly the only company burning coal globally. The challenge in this case was connecting RWE’s actions with Saúl. 

How would Saúl’s lawyers do this? Well, Walker-Crawford, an advisor on the case, provided an in-depth examination of the legal argument crafted in Saúl’s favor. Saúl’s lawyers argue that Saúl and RWE AG are neighbors. 

As a legal norm, experts define neighbors as those who are able to act on one another. Walker-Crawford notes that this differs slightly from the physical definition of neighbors. For example, neighbors might bake cookies for each other or build a fence high to separate their yards. We don’t have to like our neighbors but we do have to respect them and their property. But, people and entities can act upon others and their property even if they don’t share property lines. 

Saúl’s preliminary hearing against RWE relied on rethinking the role of legal neighborly relations as the climate crisis looms. 

Walker-Crawford argued that we all live at the bottom of the atmosphere and, right now, face potential harmful impacts. So, under German law and the legal norm of neighborly relations, we all are neighbors. This time, though, the neighbor causing the harm is a multinational corporation. 

This indirect neighborly relation between Saúl and RWE was made under Germany’s Civil Code Section 1004. This Section states that if a person causes harm or risk to another’s property, the person with property at risk can sue the other and force them to remove the risk. Since RWE is based out of Germany, Germanwatch argued that RWE has the responsibility to remove the risk of Saúl’s home flooding. 

Not surprisingly, RWE questioned the validity of the connection between their actions and the flood risk Saúl faces. After all, RWE is a company based on another continent. They aren’t operating near Saúl. And, they aren’t the only polluter who could be exacerbating the flood risk Saúl faces. Why is RWE, specifically, responsible?  

To make the case, Saúl’s lawyers responded with scientific evidence. In 2014, the Carbon Majors Report quantified the emissions of individual companies globally and found that RWE was responsible for 0.47% of global industrial emissions as of 2010. 

Protecting Saul’s community is expensive. Removing the flood risk will require building a new dam and drainage system which are projected to cost US$4 million. Saúl’s lawyers argue that RWE should contribute $18,000 toward the cause — 0.47% of the $4 million. 

In 2017, the Upper State Court in Hamm, Germany ruled in favor of Saúl. The lawsuit has a solid legal foundation based in neighborly relations. 

How can multinational corporations be held accountable for their impact on the climate? This ruling offers hope. 

Reimagining the old legal norm of neighborly relations allows for the legal system to see the “neighborhood” as the entire planet. This new framework allows for any greenhouse gas emitters to be held responsible under neighborly relation laws if the plaintiff has been adversely affected by climate change. 

This legal argument has yet to be tried beyond the preliminary hearing. As of today, expert reports have been submitted and reviewed. After both parties submit written arguments, the Higher Regional Court of Hamm will set a date for the hearing. 

Reimagining old legal norms is necessary in dealing with the climate crisis. If the courts rule in Saúl’s favor at trial, there will be precedent binding multinational corporations to neighborly relations in Germany. Not only will large corporations face accountability but people just like Saúl will be able to take a sigh of relief for their community and the environment.

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