A crucial tax ruling that will determine the fate of the Port Hawkesbury paper mill is imminent, according to the mill's court-appointed restructuring officer.

"We're expected to believe it will be coming very shortly, within days," Peter Wedlake told reporters at the Halifax law courts Monday.

"We were all hoping that by the middle of the month we would have the ruling, it's very pivotal," he said.

The idled paper mill is poised to emerge from a year of creditor protection.

On Monday, the mill was before a judge seeking orders sanctioning a restructuring plan approved by NewPage creditors last month.

Pacific West Commercial Corporation is prepared to pay $33 million for the mill and has already started to rehire workers, but the restart hinges on federal government approval of a complicated tax arrangement.

"The deal hasn't closed yet. We're still waiting for the Canada Revenue Agency advanced tax ruling," Wedlake said.

Pacific West wants to use $1 billion of accumulated losses by the previous owner against its taxes.

Nova Scotia Power would become a 30 per cent owner in the mill and get paid in tax free dividends.

Wedlake said much depends on the ruling.

"If it's not what the parties wanted, particularly the purchaser, I think we're going to have to recaucus to see where we go from there."

Nova Scotia supreme court Justice John Murphy refused to approve the order Monday, sanctioning the plan of compromise and arrangement that was presented to him.

Murphy said he was uneasy with the broad releases it gave the those involved in the creditor protection process.

"I'm not going to take away an as yet unidentified parties right to make a claim," Murphy said.

A re-drafted order is expected to be submitted to the judge this week.

Archie MacLachlan, a representative of the Communications, Energy and Papers Workers, was in court to watch the proceedings, which stalled.

"It's disappointing but it's proceeding. Sometimes the closer you get to the end, the slower things go," MacLachlan said.