Canadian Municipalities Increasingly Support Climate Change Litigation Against Oil and Gas Companies

Bennett Jones LLP

Bennett Jones LLP[co-author: Rebecca Taylor - Summer Student]

Vancouver City Council recently passed a motion to fund a proposed class action against various oil and gas companies to recover costs associated with climate change.

The motion follows a growing international trend whereby local governments (particularly in the United States and Europe) are commencing litigation seeking to hold fossil fuel companies responsible for the costs associated with climate change. We examined one such lawsuit brought by the City of Baltimore in our insight Win for American Energy Companies Facing Climate Change Litigation. By contrast, Canadian climate change litigation is still in its early stages, as discussed in our previous insights: Are Climate Change Claims Based on Charter Rights Justiciable? Canadian Courts Render Conflicting Decisions and Climate Change Litigation Comes to Canada.

The Vancouver City Council is the first Canadian municipal government to consider and pass a motion directing city staff to set aside up to $1 per Vancouver resident in the City's 2023 Operating Budget to fund a proposed class action lawsuit seeking to recover climate change-related costs. The motion endorses a campaign led by West Coast Environmental Law and the Georgia Straight Alliance that calls on local governments to fund class action litigation against oil and gas companies to recover the costs municipalities incur as a result of climate change. The campaign suggests these costs result primarily from burning fossil fuels and targets several large companies including British Petroleum, Chevron, Exxon Mobil, Saudi Aramco, and Shell.

Other Canadian municipalities have also passed motions to explore options for recovering climate change-related costs from oil and gas companies. The Toronto City Council approved a motion for a report canvassing the city's climate change cost implications and legal avenues for pursuing compensation for those costs. Likewise, the Victoria City Council passed a motion urging the Union of BC Municipalities (UBCM) to consider initiating a class action lawsuit to recover the costs associated with climate change from oil and gas companies. However, the UBCM has since endorsed a resolution recognizing that litigation may hinder the transition to a net-zero economy.

Climate change litigation continues to be a dynamic area. The Vancouver City Council's motion to fund a class action against oil and gas companies may signal that Canadian courts could soon be asked to rule in litigation by local governments over climate change-related costs. To date, Canadian courts have not certified any class actions related to climate change, and the Supreme Court of Canada recently dismissed an application for leave to appeal the Quebec Court of Appeal's refusal to certify a climate-change related class proceeding (discussed in our previous insight Quebec's Superior Court Leaves the Door Open to Canadian Climate Change Litigation). We continue to monitor climate change litigation trends in Canada for new developments.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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