It might seem obvious that companies should pay for damaging property, but that wasn’t the case for years. Up to now companies in Canada were able to extract resources from land (poisoning entire ecosystems) and leave the cleanup costs to be covered by the government. Privatize the profits and socialize the costs. The Supreme Court ruled that if a company goes bankrupt then environmental expenses have to be covered before creditors get their money back.
Hopefully this discourages banks from loaning to companies that pillage and flee.
The top court ruled 5-2 to overturn the earlier ruling. In doing that, it said bankruptcy is not a licence to ignore environmental regulations, and there is no inherent conflict between federal bankruptcy laws and provincial environmental regulations.
“This is good news for landowners, taxpayers and the environment,” said Keith Wilson, a lawyer who represents landowners with oil and natural gas wells on their properties. Among his clients are those with wells sitting idle on their land for decades.
“The concept of polluter pays is alive and well in Canada.”