Redwater Revisited – Should The Buck Stop Here?

In this Update

• on April 24, 2017, the Alberta Court of Appeal affirmed the Alberta Court of Queen's Bench's decision in Redwater Energy Corporation (Re), 2016 ABQB 278 (Redwater)
• reasons for the Redwater decision
• the issues in Redwater raise various important policy concerns regarding land owners, the public at large and the oil and gas industry
• background and significant implications of Redwater

Introduction

Nearly one year ago, the Alberta Court of Queen's Bench released its eagerly awaited decision in Redwater Energy Corporation (Re), 2016 ABQB 278 (Redwater). In that decision, Chief Justice Wittmann held that a receiver and trustee (together, a Trustee) is permitted to renounce or disclaim an insolvent debtor's interest in uneconomic licensed assets, while retaining and selling its valuable licensed assets to maximize recovery for its secured creditors  (see our previous Osler Update – Implications of the Redwater decision – Where does the