Court cancels $600K award over Giant Mine equipment delay

The NWT’s court of appeal has cancelled an award of more than $600,000 to a drilling company in a fight related to contamination at the Giant Mine site.

McCaw North Drilling and Blasting Ltd was awarded almost $700,000 in a dispute with Clark Builders six months ago. This week, a three-judge panel decided the earlier judge had misinterpreted a contract at the heart of the case.

Giant Mine, on Yellowknife’s doorstep, is contaminated with 237,000 tonnes of arsenic trioxide – a toxic byproduct of the gold mining method used at the site for decades. The arsenic trioxide lies buried in underground chambers.

In 2013, McCaw was contracted by Clark Builders, which at the time oversaw cleanup work at Giant Mine, to perform drilling at the site.

The court case stemmed from a months-long delay in developing adequate procedures to decontaminate McCaw’s equipment.

McCaw contended the delay was financially damaging to the company and was the fault of Clark Builders, which should have drawn up procedures for everyone to follow.

The judge at the time, Supreme Court Justice Shannon Smallwood, agreed. She ordered Clark Builders to pay $612,940 related to the delay.

However, the NWT Court of Appeal – in the form of Justices Peter Martin, Frans Slatter, and Frederica Schutz – ruled Smallwood had reached that decision by relying on “generic clauses in the standard form contract” between Clark and McCaw, without referring to “the specific provisions of the contract respecting decontamination.”

The panel said those specific provisions actually made it the responsibility of McCaw, at least in part, to make sure decontamination procedures were developed.

Therefore, the appeal judges argued, McCaw could not receive damages for a delay if McCaw itself should have been developing procedures in a timely fashion.

An award of $64,157 to McCaw for unpaid drilling work, stemming from the same case, still stands.