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Newfoundland loses legal wrangle with AbitibiBowater over clean-up

Newfoundland and Labrador’s environmental claims against insolvent AbitibiBowater Inc. have been dismissed by …

Newfoundland and Labrador’s environmental claims against insolvent AbitibiBowater Inc. have been dismissed by a Quebec judge. The province was seeking, through AbitibiBowater’s bankruptcy proceedings, to have the company pay for the clean-up of several of its former sites in Newfoundland, at an estimated cost of $200 million.
In dismissing Newfoundland and Labrador’s motion, Quebec Superior Court Justice Clement Gascon urged both sides to find “an appropriate forum” in which to settle their differences.
The Newfoundland government sought to have the environmental claims treated like claims from other creditors under the Company Creditors Arrangement Act.
Meanwhile, St. John’s Telegram newspaper reports that professional and legal fees linked to Newfoundland’s expropriation of AbitibiBowater’s rights and properties in central Newfoundland will total more than $8 million for this fiscal year.
The disclosure was made in the province’s 2010 budget estimates.