Gutmann, Andreas

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The Ecuadorian Chevron Judgement: Blueprint for a neoconstitutional environmental law?

The Ecuadorian Chevron Judgement:Blueprint for a neoconstitutionalenvironmental law?Gastautor 2020-06-19T09:00:54Schwerpunkt „Recht und Klimawandel“ des Jungen Forums derÖsterreichischen Juristenkommission und des ClimLaw: GrazbyANDREAS GUTMANNClimate is heated by fossil fuels whose extraction often causes severedamages both to nature and humans. If the law is to save the climate, it musttherefore encompass both burning and extraction of fossils. The relationshipbetween law and climate-protection has been rather difficult. Law – it seems– does not only fail at preventing environmental destruction, it sometimeseven protects pollution. Therefore, in order to make the law more sustainable,substantial transformations are needed. The so-called Latin AmericanNeoconstitutionalism provides several useful tools for such a new green law.How such law might look like in praxis can be learned from the EcuadorianConstitutional Court’s judgement on the famous Chevron/Texaco case. Theruling lines out some innovations that might give rise to an environmental lawcapable of confronting today’s ecological threats, including climate change.BackgroundThe damages caused by the oil extraction in the Ecuadorian Amazon by Texaco andits successors since the 1960s are one of the most devastating ecological disastersthe planet has ever seen. Millions of gallons of crude and wastes were spilled. Fordecades, the Chevron saga has kept courts busy all around the globe. Recentlythe Ecuadorian Constitutional Court made its contribution to this never ending storyby rejecting a constitutional complaint filed by Chevron Corporation in which thecompany tried to turn down the obligation to pay billions of dollars to the aggrieved- 1 -parties (afectados) of the environmental disaster. Several Ecuadorian courts hadconsidered the company liable for causing severe harm to both the environmentand the indigenous and campesino population, a finding which was upheld by theSupreme Court in 2013. Shortly after the constitutional judgement was issued, thePermanent Court of Arbitration at The Hague condemned the Ecuadorian state torefrain from enforcing the judgments. I will focus on the Ecuadorian constitutionalruling, which is ground-breaking for environmental constitutional law and humanrights. Furthermore, it demonstrates the normative force of the neoconstitutionalmodel Ecuadorian Constitution which – far from merely being a “wish list” or a kindof “constitutional poetry” (“Verfassungslyrik”, here at p. 664) – forcefully aims atstrengthening human and environmental rights.Firstly, it seems appropriate to shortly sum up the Ecuadorian constitutionalbackground. In 2008, shortly after president Rafael Correa had taken office anew constitution was enacted. This constitution (Constitución de la República delEcuador, CRE) can be seen as a prime example for the so called Latin AmericanNeo-Constitutionalism, a school that has steadily gained importance since the1990s. Constitutions are considered as initiating power for a far range of social(and at least in the Ecuadorian case also ecological) transformations of the state.Neo-constitutional constitutions grant numerous social, collective, indigenousand ecological rights which are put on an equal footing with traditional liberalhuman rights. The CRE is even one step ahead for being the first constitution thatrecognizes nature as a bearer of rights. Additionally, it provides legal actions infavour of the environment (Art. 88, 71, 397 No. 1 CRE, cf. at length GuarandaMendoza) as well as very strict environmental liability rules (Art. 396 CRE et seq.).Scholars and activists have pointed out that courts often fail in implementing thisparadigm shift (e.g. Guaranda Mendoza p. 129 et seqq.) and rather bolster theneoextractivist dogma of the government. At least for the present case, this critiquemisses the point. The judgement of the Constitutional Court clearly seeks theoptimization of ecological and collective rights.The judgementThe court had to decide a so called acción extraordinaria de protección lawsuit,i.e. a constitutional remedy filed by Chevron in order to declare void the rulingswhich condemned the company paying reparations to the people affected by theenvironmental disaster. Thus, Chevron sued the Ecuadorian state, the afectados didnot directly take part in the proceedings. Since the Ecuadorian Constitutional Courtdoes not have the power to fully review the findings of lower courts, it limited itself toassess the constitutional rights which Chevron considered violated (cf. p. 55 et seq.).In accordance to that, the Court did not substantially review the alleged proceduralfraud by the victims of which Chevron blames them. On the following, I will discusssome of the core arguments provided by the Court.- 2 -Human rights and ecological damagesThe Court thoroughly discussed the agreement which releases Chevron from liabilityvis-à-vis the Ecuadorian state, signed by Ecuador and Chevron (respectively itspredecessor TexPet) in 1995 (p. 86 et seqq.). The agreement explicitly excludesprivate claims for indemnity brought forward by third parties; however, withoutspecifying whether this provision should also apply to diffuse or collective claimssuch as those of the afectados. This did not trouble the Court: in fact, the CREdoes not differentiate between individual and collective rights. The Court thereforeexplains that the agreement can only bind the parties, which are Chevron andthe Ecuadorian state (pp. 94 et seq.). The state cannot dispose of its citizen`sfundamental rights. The Court somehow constitutionalizes the victims claim bytracing it back to the fundamental right to an intact environment (cf. pp. 91 et seqq.).Chevron, a private company, is bound by these fundamental rights mediated byenvironmental liability law. The state has no authority to derogate this commitment(p. 98).Strict liabilityFurthermore, Chevron invokes that the lower courts applied the 1999 EnvironmentalManagement Law (Ley de Gestión Ambiental, LGA) and the principle of strict liabilityin environmental liability cases retroactively (pp. 99 et seqq.). The company`sextractive activities at the Amazon had already ceased when this law was adopted.However, Art. 43 LGA increases indemnity in environmental liability cases by10% over the real amount of damage, and therefore enables victims to claim akind of punitive damage. Additionally, the courts applied strict liability, which isnow also provided by Art. 396 CRE in environmental liability cases. Hence, itis not relevant whether Chevron acted negligently; which used to be a severelydisputed topic in former lawsuits. The Constitutional Court had to decide whetherthese newly established principles could be applied to the present case. It tried tobalance Chevron`s legitimate interest in legal security and the afectados’ interestin compensation (pp. 106 et seqq.). The latter gains further weight through the indubio pro natura principle which plays an important role within the 2008 Constitution(pp. 107 et seqq.). This principle states that in case of doubt, legal rules must beinterpreted as favourable for the environment as possible. The court holds true thatin dubio pro natura and the environmental rights granted by the constitution overrulelegal security and allow the retroactive application on legal rules in this specific case(p. 112).Apparently frightened by its own statement, the Court now tries to downplay theretroactive character of the LGA and the application of the strict liability doctrine.Strict liability in case of hazardous activities was well known by the EcuadorianCivil Code when Chevron started exploitation (pp. 114 et seq.). According to theCourt, the CRE itself does not establish strict liability but only concretizes an alreadyexisting concept (p. 115).- 3 -Continuing injusticeThe Court also uses the so-called continuing injustice argument which mightrevolutionize environmental liability law (pp. 110 et seqq.). The judges hold true thatdamages occur from the beginning of Chevron`s harmful conduct till today and mighteven aggravate over the years (p. 111). The non-reparation therefore continuouslyharms the afectados and the environment. We thus do not need to go back in timeand apply current laws retroactively for the infringements keeping on occurringright now. In dubio pro natura requires us to apply the laws which mostly favoursenvironmental protection, which in the present case are LGA and CRE. The possibleconsequences of applying the continuing injustice argument to environmental liabilitylaw can hardly be overestimated. Strictly speaking, courts in most cases had toapply the current laws, at least if the legislature takes the non-regression principle inenvironmental law seriously.Acquired rights to pollute?Chevron also finds that the lower court’s judgments impaired its legitimate faith inthe 1995 agreement and the legal norms prevailing in the times of oil exploitationat the Amazon. The company`s legitimate expectations were supposed to formso called “acquired rights” (derechos adquiridos) creating a legal position which isprotected against privation by the constitution. The court apodictically rejects thisline of arguments. So-called acquired rights cannot restrict the constitutional rightto environment. The Court’s reasoning bases on the effective realization of the rightto environment and the non-prescription of environmental liability (Art. 396 CRE; p.112). In a nutshell: “[…] nobody holds an acquired right to pollute the environment[…]” (p. 112, transl. AG). If we take this literally, consequences will be tremendous.Strictly speaking, mining concessions and the permission of industrial plants merelyconsist in granting such rights.ConclusionsWhether the constitutional judgement opens a new chapter in environmentaljurisprudence, remains to be seen. If its lines of reasoning are taken seriously, itdefinitely will. The Court undertakes promising efforts to overcome the shortcomingsof environmental liability law by strictly stressing its interdependencies with humanrights. It thereby underlines the CRE’s attempt of establishing a new understandingon human-nature relationships that is based on relationality and respect andtries to overcome the supposed dichotomy between nature and culture. Its neo-constitutional impetus is obvious since it is driven by the will to expand human andenvironmental rights as far as possible.It also remains to be seen whether the judgement will conclude the Chevron saga.The CRE’s attitude towards international arbitration is quite clear. Art. 422 para1 reads: “Treaties or international instruments where the Ecuadorian State yieldsits sovereign jurisdiction to international arbitration entities in disputes involvingcontracts or trade between the State and natural persons or legal entities cannotbe entered into.” From an Ecuadorian perspective, the last word has been spoken- 4 -since the Constitutional Court authoritatively interpreted the Constitution. Whetherinternational arbitrational law can meet with this green constitutionalism is stilldoubtful. Zitiervorschlag: Andreas Gutmann, The Ecuadorian Chevron Judgement: Blueprintfor a neoconstitutional environmental law?, JuWissBlog Nr. 92/2020 v. 19.06.2020,https://www.juwiss.de/92-2020/.Dieses Werk ist lizenziert unter einer Creative Commons Namensnennung – Nichtkommerziell – Keine Bearbeitungen 4.0 International Lizenz.- 5 -

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The Ecuadorian Chevron Judgement: Blueprint for a neoconstitutional environmental law?

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