Even those who strongly supported Danny Williams’ tenure as premier have to admit that on at least one or two occasions, he perhaps failed to look before he leapt.
That certainly applies to the AbitibiBowater expropriation in 2008.
There were clear mistakes — like the unintended expropriation of the Grand Falls mill property itself — and then there were the less predictable ones, such as the fact that civil, national and international judiciaries would almost single-mindedly see the province’s action as anything other than protecting the people’s interests.
Few could be so naïve as to think legal challenges were unlikely. But the zero batting average that has so far materialized demonstrates as much a gross legislative imbalance in favour of corporate rights as it does sloppy tactics on the part of the province.
The latest smackdown came last week from the Supreme Court of Canada, which essentially upheld Abitibi’s right to shirk its responsibility to clean up the environmental mess it left behind in this province.
It was the final avenue of appeal for the province after a Quebec judge earlier dismissed cleanup orders as little more than a money grab, and relegated them to mere creditor status under bankruptcy protection laws.
I’ve read the latest decision, and it really does boil down to this
one question: were the province’s cleanup orders really just a veiled demand for monetary compensation?
Personally, I find it incredible that this should be the issue.
When a creditor makes a claim against an insolvent company, there is little motive considered other than that creditor’s financial interests. No one cares what the creditor does or doesn’t do with any money he exacts.
On the other hand, a province that demands environmental cleanup is not solely concerned with the financial bottom line. Whether or not money is moved around from one coffer to another, the end result is that the cleanup is done and that the polluter pays for it.
But let’s just take the money argument on its face.
In other words, a province seeking money for something as vital as environmental remediation has no more status than a lender looking to claw back its investment. This, according to the judges, is how the law works.
The appeal courts (Quebec and Canada) both accepted the original judge’s view that monetary reimbursement was the only foreseeable outcome of the cleanup orders.
That view led Supreme Court Justice Bev McLachlan and one other judge to dissent from the majority opinion.
McLachlan disagreed with her colleagues’ assumption that monetary amounts were implicit in the orders.
Here’s part of what she wrote:
“On one of the properties, the (environment) minister did emergency remedial work and put other work out to tender. These costs can be claimed in the (insolvency) proceedings. However, with respect to the other properties, on the evidence before us, the minister has neither done the clean-up work, nor is it sufficiently certain that he or she will do so. The Province of Newfoundland and Labrador (the “Province”) retained a number of options, including requiring Abitibi to perform the remediation if it successfully emerged from the … restructuring.”
In other words, even the premise that this is a money grab is suspect.
The original Quebec judge used the unique nature of the expropriation to question the province’s motives.
In particular, he noted that a senior minister admitted remediation bills would be used to defray compensation claims from Abitibi.
But how is mitigating compensation the same as a money grab? If anything, it’s plugging a money drain.
McLachlan found legal precedence to suggest “regulatory duties owed to the public are not ‘claims’ under the Bankruptcy and Insolvency Act.”
In other words, those orders could still be in effect today, now that Abitibi is viable again.
By law, however, they can’t, because they’ve been ruled monetary and therefore dissolved along with other claims.
Some argue the province should have had the foresight to order these cleanups before the company became insolvent.
Perhaps it would have been just as wise to wait till the company emerged from its financial woes.
Peter Jackson is The Telegram’s commentary editor.