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SCC to decide on insolvent companies’ environmental liabilities

Thursday, March 22, 2018 @ 9:04 AM | By Dionysios Rossi and Lisa Hiebert

On Feb.15, 2018, the Supreme Court of Canada heard arguments in the much-discussed Redwater case (Orphan Well Association v. Grant Thornton Limited 2017 ABCA 124), which has attracted national interest since it highlights the growing tension between secured lenders and regulators over the issue of environmental liabilities, as court-appointed officers in bankruptcy and insolvency proceedings exercise their powers to disclaim certain assets for the benefit of debtor companies’ stakeholders.

Redwater Energy Corporation was an oil and gas exploration company in Alberta which ran into financial difficulties. In...