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PRIVATE LAW & SUSTAINABLE LIVING Getting private law back on track

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Abstract

In this presentation we explain how private law mechanism can be used to achieve the transition to a more sustainable living
PRIVATE LAW & SUSTAINABLE LIVING
Getting private law back on track
Sustainability academy Eubelius
13/7/2022
Prof. Em. L. Cornelis
Prof. Dr. Régine Feltkamp
Private law & sustainability
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13 July 2022
ØExplain our research on how private law can (and should) support the
transi6on to a (more) sustainable society
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ØDiscussion based on Q&A
PURPOSE AND AGENDA
Private law & sustainability
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13 July 2022
ØFinancial crisis 2007
G15(5-*&(50&.('/&8'152&15&8%4$9.*
ØOther disruptions
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1. OUR WAKE-UP CALL : DISRUPTIONS
Private law & sustainability
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1. OUR WAKE-UP CALL : ENDAGERED SUSTAINABLE LIVING…
13 July 2022
!To meet the needs of all within the means of the planet.
In other words, to ensure that no one falls short on life’s essen7als
(from food and housing to healthcare and poli7cal voice),
while ensuring that collec7vely we do not overshoot our pressure
on Earth’s life-suppor7ng systems, on
which we fundamentally depend such as a stable climate, fer7le
soils, and a protec7ve ozone layer"!
K. Raworth
Doughnut Economics -Seven Ways to Think Like a
21st-Century Economist (2017)
Sustainability #
Private law & sustainability
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1. OUR WAKE-UP CALL : (PRIVATE) LAW AS ROOT CAUSE
13 July 2022
ØFact 1: L-454A1-&(50&M5(5-1(.&(-3:13*2&-($2*&01284%3452&8>(8&*50(57*%&2$28(15(91.18?&
(50&'*..9*157&45&4$%&,.(5*8&
These ac0vi0es lead to excessive income and wealth accumula0on by the “happy few” causing
harm to others and the environment
ØFact 2: L-454A1-&(50&M5(5-1(. (-3:13*2&(%*&74:*%5*0&9?&(50&*5F4%-*(9.*&9?&:1%8$*&4F&
.*7(.&%$.*2&(50&1528%$A*582&&NO&8>*2*&(-3:13*2&-(5&45.?&P8>%1:*Q&8>(5)2&84&.('&(50&
R$23-*
E.g. legal personality, contracts, ownership, representa0on, liability, intellectual property, rules
governing markets and businesses, legal proceedings…
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Private law & sustainability
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1. OUR WAKE-UP CALL : (PRIVATE) LAW AS ROOT CAUSE
13 July 2022
Private law & sustainability
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1. OUR WAKE-UP CALL : (PRIVATE) LAW AS ROOT CAUSE
13 July 2022
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Le contrat hicule d’abord des risques pour l’environnement. Accord de volontés producteur
d’obliga:ons, il est l’ou:l de la poursuite des intérêts individuels. Dans une économie libérale, il
incarne l’instrument juridique obligatoire de l’échange des biens et des services. Il rend possible
l’économie de marche@ et la sociéte@ de consomma:on. Le contrat est le vecteur du
veloppement économique par excellence. En ce qu’il permet l’échange des biens et des
services nocifs pour l’environnement, la consomma:on de biens environnementaux non
renouvelables ou impliquant la pollu:on de l’environnement, il contribue àla crise écologique. Le
contrat représente aussi la technique la plus classique d’aménagement, voire de contournement
des responsabilités. Le contrat pourrait donc supposer une prise de risque environnemental
inacceptable s’il n’était pas cantonne@ aux personnes qui y ont consen:.”
Private law & sustainability
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1. OUR WAKE-UP CALL : (PRIVATE) LAW AS ROOT CAUSE
13 July 2022
ØFact 1 + Fact 2 = If economic and nancial ac4vi4es cause distor4ons
that endanger sustainability and wellbeing on our planet it is because
our legal system allows so
(Private) law and jus2ce are off track!
The good news? They can be brought back on track…
(www.lawbackontrack.org)
Private law & sustainability
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13 July 2022
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8>*&M5(5-1(.&-%1212
oLiability & human rights
oPublic order
oEconomic law
oLaw of obliga9ons & contract law
ØThe key: democra.c principles, purpose and opera.ng rules
Principle and purpose: ensure best possible and thus comparable living
condi.ons to all
Opera.ng rules : effec.ve cons.tu.onal and human rights for all
2. THE KEY TO GETTING BACK ON TRACK
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oProperty law, contract law, IP, legal personality …
Ensure that individuals, through their private ac4vi4es, do not violate the human rights and fundamental freedom of others
oVia tools to correct excesses / distor8ons / abuses / disequilibria by providing safeguards through mandatory prohibi8ons or injunc8ons => with a view to
restoring the social balance via restric8ons on the human rights and fundamental freedoms
oRestric8ons must be 1) imposed by a precise and accessible rule of law, 2) necessary in a democracy, 3) required to respond to an impera8ve social need, 4)
per8nent and propor8onate (reasonability test)
oCourts must apply the rules and tools of law in accordance with the prevailing higher norms
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3. (PRIVATE) LAW BACK ON TRACK
Private law & sustainability
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ØMost commonly thought of : liability for fault or negligence
ØOther tools?
ØAbuse of rights
ØProhibition to deviate from public order / good morals
ØLawful object and cause of legal acts
ØFraus omnia corrumpit
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oNormal prudent and reasonable person does not cause harm to others
oBusinesses that con4nue to do business that cause ecological and climate distress (e.g. by producing or using fossil fuels that increase
CO2 emission) commit a fault, especially if they are aware of the damage caused and do not take ac4on to mi4gate it
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oViola4on of a legi4mate interest is sufficient
oAny loss whether physical, psychological / immaterial, material
oDamage must be certain, but can be future damage
J%5/%&'&-"#'K'0condi)o sine qua non *"/*3
oNot exis4ng since damage occurs anyway even if a business would adapt its business?
§Conflicts with the right to effec0ve remedy including damages
Ø“Too big to failreasoning or specula5on on the risk?
ØLiability for fault can serve as safeguard and could also be used to address market distor5ons, but may not act
preven5vely / come too late to restore the harm done
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ØGeneral principle of law prohibiting the abuse of rights
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ØBusiness activities are based on the performance of various (fundamental) rights and freedoms
=> abuse of right test can be applied
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ØPotential remedy to address excessive behaviours, although it remains a questionable
interference with the legislative powers
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ØLimita0on by the legislator: private contracts / legal acts may not deviate from rules concerning
public order / good morals or, added by case law, impera0ve law
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ØEconomic and industrial ac0vi0es are based on the successive conclusion and execu0on of
mul0ple legal acts (contracts or unilateral / collec0ve acts)
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.4;A&7,+%>,9.''>/5,/9,/&A'.7,;*+.+%&''>,:1,.*('7,/9,0*:(4),/.>'.,#O,&A',(';+(,+)&7,&A+&,5+6',&A'5,
0/774:(',&A*7,:.'+)A,+.&",P,24@4(,2/>',Q+.&",R"JL,+(",J,S22T
ØAr0cle 2 Civil Code (art. 1.3, al. 3 NCC) serves as safeguard
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ØTo be valid contracts / l egal ac ts m ust have a lawful caus e an d a law ful o bj ec t
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&A',)/%&.+)&,G,(';+(,+)&,47,)/%)(*>'>
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U.+>*+(,%+../34%;,>/3%,:1,&A',N*0.'5',2/*.&,/9,&A',7)/0',/9,:/&A,)/%>4&4/%7,+%>,/9,&A',7+%)&4/%L,
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ØLegal acts entered into by businesses to support/allow activities conducted by these
businesses knowing that they cause ecological and climate disruptions which harm health,
life and property of others, violate consitutional / human rights and fundamental freedoms
of those affected = violation of public order legislation => lawful object / lawful cause?
Supreme Court already accepted direct application of art. 12 & 23 Constitution / art. 4 ECHR in this
context (a contract denying a person a fundamental right has an unlawful cause)
Not concluding to an unlawful object/cause may lead to granting unreasonable priority to self-
determination (as expressed in the freedom to contract and to do business)
Potential applications
oContract for extraction and sale of fossil fuels / the purchase of polluting production means / production of goods through polluting
production processes; financing / insurance of polluting activities?; board / shareholder’s decisions externalising ecological damages /
approving aformentioned contracts
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ØGeneral principle of law according to which “fraud destroys everything
ØAny fraudulent act or behaviour is considered ineffec0ve
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)/%&.4:*C/%,&/,&A',')/%/51,Q)9.",'50(/15'%&L,4%).'+7',UW-T
ØFraudulent is any act or behaviour of a person who knowingly causes harm to another person
ØBusinesses that cause ecological and climate distress with their ac0vi0es (e.g. by producing or
using fossil fuels that increase CO2 emission), cannot seriously claim not to know that their
ac0vi0es harm (the human rights and fundamental freedoms of) others
ØFoC serves as safeguard, provided it is properly raised and applied (and not denatured, see 1.11
NBW)
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ØPrivate law contains several safeguards to address excesses
They originally stem from a time (1804) where democracy & human rights protection were not yet
on the agenda
Main goal of the provisions was to protect the elite against unwanted interference
Even when democracy stepped in, the courts and majority doctrine have chosen to interpret the
safeguards in a “flexible way” to support freedom of business activities (and the (neo)liberal
model)
No fundamental change is to be expected from the legislator : the Books 1 (General provisions)
and 5 (Obligations) of the new Civil Code will not bring much change
oMerely incorporation of Supreme Court jurisprudence and traditional doctrine, without assessing compliance with
higher norms on constitutional / human rights and fundamental freedoms
However the foreseen safeguards may in practice not lead to the freedom of business activities
unreasonably prevailing over the human rights & fundamental freedoms related amongst others
to the protection of security, health and life
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