Climate clause

Green Dispute Resolution

Liam & Isobel's Clause

Liam & Isobel's Clause provides certainty that any dispute must be handled in a manner that minimises travel and reduces the use of paper. It can be used in any commercial agreement.

This is a climate clause

This clause brings climate considerations to your drafting. It is not yet net zero aligned. To align this clause with net zero, use our toolkit or join one of our events.

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Why use this?

Litigation and arbitration create considerable and unnecessary amounts of physical paperwork and printing. Paper is energy-intensive and has a significant carbon and water footprint.

Litigation and arbitration can also require significant travel commitments for parties, lawyers, witnesses and experts (generally by air). Short-haul aviation is one of the most emissions-intensive means of travel.

Liam & Isobel's Clause adapts [Toby's Clause] Avoiding Excessive Paperwork in Dispute Resolution for use in Aotearoa New Zealand.

The clause

Additional definitions

[Drafting note: Consider moving some or all of these definitions to the interpretation section, particularly if other TCLP clauses are used in the document that draws on them.]

Carbon Footprint means, in respect of a party, the amount of carbon dioxide equivalent units that will be released into the atmosphere because of the business operations of that party as determined in accordance with The Greenhouse Gas Protocol: A Corporate Accounting and Reporting Standard, Revised Edition 2015.

Carbon Neutral means, in respect of a party, the reduction and offset of the party’s Carbon Footprint on an annual basis, achieved by:

(a) first, using reasonable endeavours to reduce its Carbon Footprint; and

(b) second, offsetting its residual Carbon Footprint (for example, by purchasing (and cancelling) New Zealand units as defined in the Climate Change Response Act 2002).

Climate Change Mitigation means human intervention or efforts to reduce the sources or enhance the sinks of [GHG Emissions][greenhouse gas emissions].

Electronic Bundle means a bundle of documents for use by the parties and court or tribunal (as required) in electronic format.

[GHG Emissions means a party’s emissions of GHGs from all sources, categorised as scope 1, 2 and 3 emissions by The Greenhouse Gas Protocol: A Corporate Accounting and Reporting Standard, Revised Edition 2015.] [Drafting note: Delete if lower-case ‘greenhouse gas emissions’ term is used in this clause.]

[GHGs means the natural and anthropogenic gases which trap thermal radiation in the earth’s atmosphere and are specified in Annex A to the Kyoto Protocol to the United Nations Framework Convention on Climate Change (UNFCCC) or otherwise specified by the UNFCCC at the date of this document.] [Drafting note: Delete if lower-case ‘greenhouse gas emissions’ term is used in this clause.]

Native Trees means those species of trees which are listed as native on the website of the Department of Conservation – Te Papa Atawhai. 

 

Additional clauses 

1. Green dispute resolution 

1.1 In the event of any dispute arising out of, or in any way connected to, this document:

1.1.1 [all notices and communications between the parties will be sent by electronic means;] [Drafting note: If boilerplate clause [Arthur & Charlie’s Clause] Electronic Notices is included in the relevant document, this subparagraph 1.1.1 can be deleted]

1.1.2 the parties will use reasonable endeavours to ensure that meetings and dispute resolution processes (such as mediation and arbitration) relating to the dispute will, where reasonably practicable, be held virtually;

1.1.3 subject to paragraph 1.1 below, where reasonably practicable, electronic documents will be used in negotiations, meetings and dispute resolution processes (such as mediation and arbitration) in preference to printed documents; and

1.1.4 Electronic Bundles will be used to prepare for, and during, meetings or hearings.

1.2 The obligation under paragraph (1.1) above is subject to any party’s obligation to the contrary found in any relevant legislation, rules, court or tribunal order, procedural rule, practice direction, protocol or court guide, any direction or request from the adjudicator of the dispute, or any applicable law.

1.3 Where a paper bundle is used at any stage in a dispute, the parties must use reasonable endeavours to:

1.3.1 use [FSC-certified] [recycled] paper, non-solvent based printer ink and cardboard (non-plastic) tabs, dividers and folders; and 

1.3.2 subject to any legal obligations to retain copies and any professional confidentiality commitments, dispose of the bundle through secure recycling.

1.4 Each party will use reasonable endeavours to:

1.4.1 measure its [GHG Emissions][greenhouse gas emissions]* arising from the procedure to resolve the dispute (for example, [GHG Emissions][greenhouse gas emissions] from travel to, and accommodation at, the venue of the dispute resolution) [using a commonly accepted method of emissions measurement (such as calculators provided by Toitū Envirocare)]**; and

1.4.2 ensure that its lawyers, advisers and other third-party consultants in respect of the dispute similarly comply with paragraphs (1.1) and (1.3) above.

* [Drafting note: The second option using a non-defined term makes this clause less prescriptive and, therefore, more accessible to less sophisticated counterparties. Where it is selected, the appropriate options should be used throughout this clause.]

** [Drafting note: This language can be added where the parties are not already measuring their GHG emissions (and so are more likely to need to do so on a one-off basis). This could be useful for less sophisticated counterparties.]

[Drafting note: Select either paragraph 1.5A or 1.5B.]

[EITHER]

1.5A [Each party will, within [one month] of the resolution of any dispute:

1.5.1 contribute towards Climate Change Mitigation by offsetting its [GHG Emissions][greenhouse gas emissions] arising from the procedure to resolve the dispute (for example, by purchasing (and cancelling) New Zealand units as defined in the Climate Change Response Act 2002 or procuring the planting of Native Trees); and

1.5.2 use [best][reasonable] endeavours to procure that the party’s lawyers, advisers and other third-party consultants contribute towards Climate Change Mitigation by offsetting their [GHG Emissions][greenhouse gas emissions] arising from any air or vehicle travel arising from the procedure to resolve the dispute (for example, by purchasing (and cancelling) New Zealand units as defined in the Climate Change Response Act 2002 or procuring the planting of Native Trees).] 

[Drafting note: This option places responsibility for the offsets of advisers on the advisers themselves, encouraging them to be conscious of their own emissions.]

[OR]

1.5B [Each party will, within [one month] of resolution of any dispute, contribute towards Climate Change Mitigation by offsetting its [GHG Emissions][greenhouse gas emissions] (including those of that party’s witnesses, lawyers, advisers and other third-party consultants) arising from the procedure to resolve the dispute (for example, by purchasing (and cancelling) New Zealand units as defined in the Climate Change Response Act 2002 or procuring the planting of Native Trees).] 

[Drafting note: This option places responsibility for the offsets of advisers on the dispute parties, so is a simpler alternative.]

1.6 The obligation under paragraph (1.5) above does not apply to a party to the extent that the party has achieved a certified Carbon Neutral status in each year in which the dispute is undertaken and resolved, provided that the assessment of the party’s Carbon Footprint in the relevant years takes into account the [GHG Emissions][greenhouse gas emissions] arising from the procedure to resolve the dispute. 

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