Quebec court refuses N.L. appeal on Abitibi

The Quebec Court of Appeal refused Tuesday to hear a Newfoundland and Labrador appeal over the cleanup of a shuttered AbitibiBowater mill.

The court refused to grant leave to appeal to Newfoundland and Labrador, which has been seeking secured creditor status as AbitibiBowater restructures its affairs through bankruptcy protection.

In particular, the Newfoundland and Labrador government has wanted to ensure that AbitibiBowater pay to fix environmental problems at sites it formerly operated in the province, including a century-old mill that the company shut down last year in Grand Falls-Windsor.

The Newfoundland and Labrador government admitted earlier this year it had mistakenly expropriated that mill, although it insists that AbitibiBowater is responsible for its environmental remediation.

But Quebec Judge Clment Gascon questioned that logic in a March 31 decision, calling it "at a minimum, rather awkward" and that "some would go as far as to say that it is preposterous."

He said a cleanup order from the province to AbitibiBowater is "as unenforceable as it is unjustifiable."

In a Quebec Court of Appeal decision released Tuesday, Justice Jacques Chamberland wrote that overturning Gascon's decision could create a financial claim that gives Newfoundland and Labrador an "unfair advantage over the company's other creditors."

Chamberland said appeal proceedings would "unduly hinder" AbitibiBowater's efforts to restructure and exit creditor protection by September.