Supreme Court decision: AbitibiBowater not responsible for environmental cleanup costs in Newfoundland and Labrador
The Supreme Court of Canada has sided with AbitibiBowater (now Resolute Forest Products) over the environmental cleanup of its operations in Newfoundland and Labrador, including the former Grand Falls-Windsor mill.
AbitibiBowater/Resolute Forest Products will not be responsible for any environmental clean-up in the the province.
AbitibiBowater (and its predecessor companies) operated in Newfoundland for over 100 years. In 2008, AbitibiBowater announced it was closing the Grand Falls-Windsor mill, the last of its operations in the province.
The province expropriated the assets of the company to secure the timber and water assets, but argued AbitibiBowater should still be responsible for the environmental cleanup costs. There are 5 sites in Newfoundland that require environmental clean-up, including the Grand Falls – Windsor mill site. 3 of the sites were expropriated by the province.
The clean-up cost is estimated to be between $50-100 million.
AbitibiBowater was under creditor protection in 2009-2010. The province wanted the Supreme Court to decide it a company’s environmental contamination responsibilities were extinguished under the Companies’ Creditors Arrangement Act like a commercial debt.
The Supreme Court ruled 7-2 against the province.
Read the Ruling:
Newfoundland and Labrador v. AbitibiBowater Inc. 2012 SCC 67
Read media coverage:
N.L. loses Abitibi case in Canada’s top court (CBC)
Canada’s top court says province can’t force insolvent company to clean up contamination (National Post)
AbitibiBowater wins Canada case on environmental cleanup costs (Reuters)
Supreme Court sides with Abitibi in environmental cleanup case (Globe and Mail)
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