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Oil and Gas: Supreme Court of Canada Rules That Environmental Liability Follows The Company

And in this case, the borrower/trustee in bankruptcy. Provincial regulations govern, so the company’s liability to remediate well sites continues beyond even insolvency.

The Supreme Court overturned Alberta Court of Appeal’s earlier finding that liabilities didn’t follow the company under bankruptcy law (that’s no longer the law of Canada/Alberta). The policy at play here is that environmental liability is not a form of money debt per se, so the bankruptcy laws don’t wipe it out.

See full case report for Orphan Well Association v. Grant Thornton LLP.

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