CANADA Trends and Developments Contributed by: Laura Bevan, Craig Ferris KC, Anna Paczkowski and Catherine Whitehead, Lawson Lundell LLP
the soil would not meet the previously supplied compositional specifications if it failed to test what it knew was an organic and changing sub- stance”. In considering how “express” an agreement must be to oust an implied statutory condition, the majority explained that there is no require- ment for “magic words”, but rather that the par- ties have “expressly and unambiguously used language that signals their intention to override the statute”. In the commercial context of this contract, where Pine Valley “chose not to test or approve the product before delivery simply because it need- ed the soil fast”, it was not unfair to refuse to find Earthco liable for Pine Valley’s “expensive but calculated mistake”. In dissent, Justice Côté would have upheld what the majority described as the Court of Appeal’s “exacting review” of the language in the exclu- sion clauses, reasoning “[a]n exclusion clause is not an express agreement under Section 53 with regard to a particular implied condition if inter- preting it as such requires deviating from the text of the contract and asking what the surrounding circumstances would deem the parties to have written, instead of interpreting the meaning of the words actually used by the parties”. Contracting parties should allocate risk carefully and be aware of the overriding commercial pur- pose of an agreement when contracting out of statutory protections. While the search for the parties’ objective intentions remains the order of the day post the Sattva case, Earthco is a good reminder that “[l]anguage that explicitly, clearly and directly ousts a protection that the legisla- ture has presumptively bestowed on a party to a contract is an optimal way to ensure the par-
ties’ mutual objectives are being carried out. As a drafting technique, it is the gold standard for contractual certainty and its presence is to be encouraged”.
No Common Law “Super Priority” for Environmental Remediation Claims
In the Qualex case, the Alberta Court of Appeal considered whether a private litigant had a common law “super priority” claim on the basis that environmental remediation damages rank “above any other claim, right or charge against the land”. The plaintiff Qualex alleged chemical contami- nants had migrated onto its land from neigh- bouring lands owned by the defendant, 12-10 Capital. Qualex sued for damages and a court order directing, amongst other things, that 12-10 Capital pay all future costs associated with remediating Qualex’s lands and obtaining a remediation certificate pursuant to Section 117 of Alberta’s Environmental Protection and Enhancement Act. Qualex applied for an attachment order under Section 17 of the Civil Enforcement Act (the “CEA”) to prohibit 12-10 Capital from dealing with any sale proceeds to a maximum amount, arguing 12-10 Capital had no assets apart from lands and there would be no surplus available to pay any amount found to be owing to Qualex after payments to 12-10 Capital’s mortgagees. Qualex also sought to amend its claim to seek a declaration that 12-10 Capital’s “remediation obligations” to Qualex be paid from any sales proceeds in priority to amounts owed to all other creditors, including secured creditors and regis- tered mortgagees. The test for an attachment order under Section 17 of the CEA required Qualex to satisfy the
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