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ARTICLE · 27 DECEMBER 2012

Supreme Court Rules On The Status Of Environmental Clean-Up Orders Under The CCAA

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The Supreme Court of Canada has released its ruling in Newfoundland and Labrador v. AbitibiBowater Inc.

CanadaEnvironment
William McNaughton
William McNaughton
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The Supreme Court of Canada has released its ruling in Newfoundland and Labrador v. AbitibiBowater Inc.

AbitibiBowater Inc. ("Abitibi") operated in the Province of Newfoundland and Labrador (the "Province") for nearly a century. In a period of financial distress, Abitibi closed its last paper mill in the Province and filed for insolvency protection, obtaining a stay of proceedings under the Companies' Creditors Arrangement Act, R.S.C. 1985, c. C-36 ("CCAA") in 2008. While Abitibi was no longer present in the Province, the environmental contamination at its former sites remained.

The Province issued five clean up orders against Abitibi, arguing that these environmental protection orders were not "provable claims" that were compromisable under the CCAA regime. The Court considered s. 11.8(9) of the CCAA which states:

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