Choosing Scylla: climate change vs. private property in Chile’s new constitution

—Ernesto Vargas Weil, Assistant Professor, University of Chile and Associate Lecturer, University College London

Climate change is here to stay. A few weeks ago, the UN Secretary-General argued that the last report of the Intergovernmental Panel on Climate Change Working Group was ‘a code red for humanity’, urging Governments to take immediate action, especially in containing greenhouse gas emissions and deforestation. Although provisions mandating the State to protect the environment and explicitly enabling Governments to enact regulation to this end have been included in many contemporary constitutions over the last 50 years (e.g., Art. 20a of the German Basic Law, GG; or Art. 19 Nr. 8 of the Chilean Political Constitution, CPR), the Chilean constitutional assembly will probably be the first in history to gather in a scenario in which climate change is such a tangible reality.

Experience suggests that the main challenge for this type of provisions is that environmental regulation can interfere with other constitutional rights, originally developed to protect citizen from other forms of State intervention. The most apparent case is the right to private property. At times, this challenge has been seen as so acute, that in the early 1950s, during the discussions of the European Conventions of Human Rights, the British Government held that the right to private property should not be acknowledged as a human right as it would affect the UK’s national autonomy in matter of economic policy. Since then, things have changed, as governments and courts have learned how to balance policy-oriented regulation with the rights to private property. The constitutional process Chile is currently undergoing is a unique chance to re-think this tension in the context created by climate change.

Constitutions are ideological texts. As such, they reflect the moment when they were drafted, the values of their authors and the purposes they were designed to serve (Ewing 2012). In the case of the 1980 Chilean Constitution, its robust regulation of the right to private property is, to a large extend, a reaction to the 1967 land reform, its accompanying reform to the Water Law Code, and the 1970 nationalization of the American-owned cupper mining industry (see Vargas Weil 2021). This might seem a very contingent motivation, but behind it lures an old and universal problem: the allocation of scarce resources. Traditionally, this has primarily been a problem for private law. However, under the influx of the ideas of classical liberalism, modern constitutions took one fundamental decision in this regard: the State cannot arbitrarily deprive people from their property and, when this is justified, the affected person has the rights to be compensated (e.g., Fifth Amendment of the US Constitution, Art. 14(3) GG, or Art. 19 Nr. 24 (3) CPR).

However, modernity brought problems that classical liberalism could not possibly foresee. Before the industrial revolution, environmental degradation was localized and occurred slowly over many centuries. Until mid 18^th century human societies mainly lived of the energy available from the sun on a daily, weekly, monthly or seasonal basis, this is, of the ‘flow of energy’ humans were able to extract from nature through their own muscular power or that of animals. However, the technological process associated to the industrial revolution allowed societies to use the ‘stock of energy’ accumulated over much longer periods in the form of carbon and petroleum. The reliance on fossil fuel technologies over the last two centuries had a global impact on the environment. The two main consequences of this process are the deployment of the available natural resources and the unintended consequences of human action on the environment.

Over the last 50 years concerns regarding these effects have triggered worldwide reactions in the fields of ideas, politics and policy making. Frequently, the foundational values of these movements are hard to reconcile with the liberal tradition, which struggles to accommodate the idea that the limits of a finite Earth might justify restriction on production, consumption and mobility. Since the 1970s, these ideas have given rise growing environmental regulation that frequently limits the use of private property, without affecting its titularity, a phenomenon American constitutional law coined as ‘regulatory takings’.

By the time of the enactment of the Chilean 1980 Constitution, this problem was well-known in comparative law, but its provisions did not address it beyond stating that ‘legislation shall be allowed to impose specific restriction on the exercise of certain rights or liberties to protect the environment’ (Art. 19 Nr. 8 (2) CPR) and that legal limitation allowed by the social function of ownership include ‘what is required for the conservation of the environmental patrimony’ (Art. 19 Nr. 24 (2) CPR). Soon after, in the 1984 Galletué con Fisco case (RDJ, T 81, N° 2), the Chilean Supreme Court was faced with a problem of these kind, granting an indemnity to the owner of a forest of araucarias -an endangered native species- who claimed that environmental regulation prohibiting the cutting of these trees has deprived its land of its economic usability. Building on this holding, the Chilean Constitutional Court later developed a doctrine that sees legal limitations that do not trigger an indemnity, as part of a same conceptual continuum as regulations that do amount to an expropriation, not because they take the property of the affected party, but because they deprive its owner from its essential attributes. This view has been heavily criticized by some Chilean constitutional law scholars for failing to conceptually separate legal limitations from expropriation, a phenomenon Professor Eduardo Alduante ironically described as Scylla and Charybdis of Chilean constitutional property law.

Aldunate’s analogy with the Odyssey points to a wider problem. In Song 12 of the Odyssey, Circe presents Odysseus which a choice: crossing the strait close to Charybdis, a sea monster that swallowes huge amounts of water only to belch them back out, creating whirlpools capable of dragging a ship underwater, or taking his chance with Scylla, a giant monster with six heads on long necks, sunk up to the waste in the water of a cave opposite side, ready to eat all living beings that dare entering in its range. Odysseus chose Scylla because, although it implied the sure sacrifice of six members of his crew, it was the only chance of saving the ship. Climate change might force governments to make equally difficult choices. That is probably why the UN Secretary-General also cared to mention that ‘the climate crisis poses enormous financial risk to investment managers, asset owners, and businesses’ and that ‘these risks should be measured, disclosed and mitigated’.

Odysseus left the choice of the men to be sacrificed to chance, but that is not an acceptable option for the modern State. The problem for a constitution is that it is not possible to establish beforehand precise criteria as to whom and to which extend should, in each case, bear the negative consequences of environmental restrictions: the actual impact of any regulation can only be appreciated in concreto. However, constitutional law can take some basic decisions as to the mechanism that will be used for such purpose. These involve, at least two questions, that are better illustrated by comparative analysis. The first is who is going to establish the compensation. In 1922 the US Supreme Court set the basis for the doctrine of ‘regulatory takings’, deciding that a regulation that ‘goes too far’ is equivalent to a taking and, therefore, should be compensated under the Takings Clause of the US Constitution (Pennsylvania Coal v. Mahon, 260 US 393). By contrast, in the 1981 Gravel Pit Case (BverfGE 58, 300) the German Federal Constitutional Court departed from doctrines previously developed by Federal Court of Justice (BGH) and the Federal Administrative Court, holding that regulation that disproportionally affects a person is simply void and that the court has no authority to transform it into an expropriation by attaching an indemnity to it, although the legislator can address the problem in advance by including a compensation in the law. The second is the reasons that justifies the compensation. The traditional understanding of the doctrine of regulatory takings is underpinned by the protection of private property. However, compensation can also be justified in other grounds, especially in avoiding the imposition of unequal public burdens on citizens, in the line of the ‘theory of special sacrifice’ (Sonderopferthoery) advanced by the BGH in the 1950s (BGHZ 6, 270).

Until now, studies regarding the place of environmental protection in Chile’s new constitution have not directly addressed this problem. However, Chilean constitutional scholarship has sustained a rich discussion on this issue over the last 20 years, frequently confronting supporters of a regulatory takings model (e.g., Arturo Fermandois) with authors arguing for a doctrine closer to a special scarifies theory (e.g. Eduardo Aldunate and Matías Guiloff). It is not apparent which path is the best for Chile, but it seems clear that the constitutional assembly should make a well-informed decision on this regard. Climate change is a too large of challenge to leave the allocation of its costs to chance or to shortsighted political opportunism.

Suggested citation: Ernesto Vargas Weil, Choosing Scylla: climate change vs. private property in Chile’s new constitution, Int’l J. Const. L. Blog, Sept. 17, 2021, at: http://www.iconnectblog.com/2021/09/choosing-scylla-climate-change-vs-private-property-in-chiles-new-constitution/