The Globe and Mail reports in its Monday, Feb. 4, edition that the Supreme Court of Canada last week overturned the Court of Appeal of Alberta's decision in the Redwater legal case. The Globe's guest columnists Simon Dyer and Blake Shaffer write that the court's ruling ensures environmental cleanup costs will get priority over creditors when companies go bankrupt, a reassuring outcome for Canadian regulators and taxpayers. However, it does not resolve the challenges posed by insolvent operators. While regulators are now first in line to access bankrupt companies' remaining assets, there is no guarantee those assets will be sufficient to cover cleanup costs. Taxpayers still risk being left on the hook.
These risks are especially relevant for Alberta, because of a heavy load of industrial cleanup obligations. Until these sites get cleaned up, they pose environmental and health risks to landowners. However, the financial risk to Alberta taxpayers remains. Thankfully, the Supreme Court's decision will not make the problem worse.
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