New Brunswick

Enbridge and N.B. government hope to settle out of court

Court documents filed in the Enbridge lawsuits against the province ask the judge to delay her decision while a tentative settlement is worked on outside of court.

Delay requested in $820 million legal battle over province tearing up its contract with Enbridge

Enbridge Gas filed suit against the provincial government in 2012. (CBC)

Enbridge Gas and the New Brunswick government are negotiating a settlement to end their $820 million legal battle.

The two sides asked a judge in June to hold off on issuing a decision in the dispute until Dec. 31, so they would have time to work out a deal. 

Enbridge is suing the province for passing a law to break its contract with the natural gas company.

Court documents show McInnes Cooper, a law firm representing Enbridge, sent a fax to Justice Paulette Garnett asking her not to file her decision while negotiations are ongoing.

In 2011 the then-PC government introduced legislation to break its agreement with Enbridge and force the company to adopt a lower rate structure.

Enbridge responded with two lawsuits seeking a total of $820 million in damages. In 2014, the company also sued to force the province to pay its legal costs.

University of Toronto law professor Jonathan Rosenstein says the agreement to seek a settlement is not a surprise.

Most cases settle outside of court

Rosenstein, who specializes in complex lawsuits, said a judge can make a decision on a case at any time, but 96 to 98 per cent of all cases are settled out of court.

"This was a case that was likely to settle in any event, and it sounds like that's exactly what has happened here. … Most judges would prefer the parties craft their own solution," said Rosenstein. 

"I don't think I've ever met a judge who, in the face of that request wouldn't say take as long as you want."

Enbridge filed a $650 million claim in 2012 for breach of contract and a $176 million claim to recover money piled up in a deferral account the province has prevented Enbridge from recovering from customers, as originally agreed to.

The changes made to the franchise agreement lowered the high distribution costs to customers but Enbridge could no longer charge customers for the deferral account it relied on to pay expenses.

A spokesperson for the Attorney General's office, Katharine Sidenius, said she was unable to comment on cases that are before the courts.

Enbridge Gas was unable to comment before publication deadline.