Go big or stay at home

Published on August 2, 2014

There are times when we must stand and fight, even in the face of a dire consequence. History abounds with examples of underdogs prevailing against those who would keep them down.

The court battle in Quebec over the Upper Churchill power contract is like that.

Back when the original deal was signed to develop the Upper Churchill River, Newfoundland was very much the underdog and Hydro-Québec was in charge of outcomes. The millions of dollars lost to us as a result of that one bad deal can never be recovered. But should we simply give up the fight and forget it, or should we fight to the last day to try and right an obvious wrong?

Last week, a Quebec judge ruled against our province on the Upper Churchill contract. Arguments detailing how one-sided the contract is and the need for balance were rejected by the court.

Judge Joel Silcoff used a narrow interpretation of the law to rule against us and completely rejected our lawyers’ arguments for fairness. The case was made possible only after Quebec made changes to its civil code which requires that all contracts have to be fair to all parties.

That sounds good, but defining what is fair is not as easy.

Silcoff determined that the Upper Churchill contract was fair because Hydro-Québec took all of the risk with the power development, and that risk was justification for the disproportionate benefits flowing to the main investor. In other words, he ignored the rights of the owners of the resource completely.

His final assessment was blunt: “CFLCo and Hydro-Québec got what they bargained for.”

Now comes the big question: is it time to give up the battle? After all, we’ve spent over $4 million on the court challenge, to no avail. Adding insult to injury, we also have to pay the court costs for Hydro-Québec.

Some would suggest we learn from this failed effort and leave well enough alone. The argument goes that the Upper Churchill contract wasn’t considered a bad deal when it was signed, but world events and the price of energy significantly affected the intended outcomes; no one was supposed to come out of the deal a loser. The fact that Newfoundland and Labrador found itself on the wrong end of the deal is simply bad luck and we should move on.

There is only one part of that argument I accept: that no one was supposed to come out of the Upper Churchill deal a loser. Newfoundland and Labrador and Hydro-Québec were both supposed to be winners, and that’s where fairness comes into play. Unintended consequences led to this disproportionate advantage for Quebec and there should have been redress years ago. But the federal government trembles when it comes to all things Quebec so our natural ally let us down.

Nalcor president Ed Martin made it perfectly clear after the ruling came down that they intend to pursue this further. He predicts it could end up before the Supreme Court of Canada.

Martin said they knew going in that an appeal would be launched, no matter who won or lost.

Muskrat Falls may be a continuing source of dissension, but there’s no disagreeing with his position on this. The costs of battling the Upper Churchill contract, through every court in the land if need be, are justifiable.

There are times we must stand and fight in the face of overwhelming odds, and this may be such a time. Political leaders and their cohorts have to judiciously pick their battles, and win more than they lose — I get that.

But sometimes there comes a fight which must be waged in the name of natural justice, even if the forces aligned against you are massive. This seems to be just such a fight.

Count me in.


Randy Simms is a political commentator and broadcaster. He can be reached at


Twitter: @RandyRsimms.