ABLawg

In this case Justice Bruce McDonald ruled that a joint operator may be entitled to a constructive trust remedy over the assets of an operator, where the operator is in receipt of production revenues attributable to the joint operator and where the operator fails to preserve an amount representing those monies in its commingled bank account. As a result, the joint operator was allowed to take priority over the interests of both secured and unsecured creditors.

When Does a “Participant” Earn Under the Terms of a Farmout and Participation Agreement?

By Nigel Bankes

On October 9, 2008

In Contracts, Oil & Gas

Case Considered: Solara Exploration Ltd v. Richmount Petroleum Ltd., 2008 ABQB 596

PDF Version: When does a “participant” earn under the terms of a farmout and participation agreement?

In this decision Justice Sheilah Martin concluded that a participant in a farmout and participation agreement did not earn an interest in the farmout property when it elected to go non-consent on an operation to frac a particular formation, even when that operation was proposed after the parties had already installed a well head, outlet valve and production tubing. However, Justice Martin went on to hold that the farmor was estopped from denying that the participant had earned in the circumstances of the particular case. The decision is an important one for several reasons. It is a first decision on the definition of “completion” in the 1990 CAPL operating procedure, but it also serves to draw attention to the vulnerability of a “participant” in a farmout and participation agreement, especially where the farmor (as here) is wearing multiple hats and serving as both farmor and as operator for the purposes of the test well to which the participant is contributing. The case also highlights some of the difficulties associated with borrowing definitions from other agreements.

Water management planning and the Crown’s duty to consult and accommodate

By Nigel Bankes

On October 8, 2008

In Aboriginal, Administrative Law, Constitutional, Water Law

Cases Considered: Tsuu T’ina First Nation v. Alberta, 2008 ABQB 547

PDF Version: Water management planning and the Crown’s duty to consult and accommodate

*Thanks to Christina Smith and Monique Passelac-Ross for comments on an earlier draft.

Alberta’s new Water Act (R.S.A. 2000, c. W-3) calls for the development of water management plans (Part 2(1) of the Act). Once adopted, a water management plan will guide decision-making within the area of the plan on a range of matters, including the issuance and transfer of water licences. Because of concerns that the waters in parts of the South Saskatchewan River Basin (SSRB) were already over-allocated, the Government put a priority on developing a plan for the SSRB. The first phase of the plan was approved in June 2002 and the second and final phase was approved by Cabinet in August 2006 (http://environment.alberta.ca/documents/SSRB_Plan_Phase2.pdf).

Is Proof of Irreparable Harm to the Plaintiff or Proof of Wilful Delay by the Defendant Required to Defeat an Application to Set Aside Default Judgment?

By Jonnette Watson Hamilton

On October 6, 2008

In Civil Procedure

Cases Considered: Alberta v. Fjeld, 2008 ABQB 558

PDF Version: Is Proof of Irreparable Harm to the Plaintiff or Proof of Wilful Delay by the Defendant Required to Defeat an Application to Set Aside Default Judgment?

Some debtors seem to think they can avoid being held accountable for money they owe if they refuse to answer the phone, or pick up registered mail, or accept documents being served upon them. They act as if, by mimicking the proverbial ostrich and hiding their head in the sand at the first hint of collection efforts, they will be able to make their debts go away. The taxpayers of Alberta should be pleased to know that the ostrich approach did not work in the case of Alberta v. Fjeld. Ignoring collection efforts merely resulted in the provincial government obtaining an easy default judgment against Rhonda Fjeld, which was upheld by a Master in Chambers, Rod Wacowich, and then, on appeal, by Mr. Justice Keith Yamauchi of the Court of Queen’s Bench.

Lawyers, Clients, Parties and the Right to Counsel

By Jennifer Koshan

On October 3, 2008

In Constitutional, Criminal

Cases Considered: R. v. Karmis, 2008 ABQB 525

PDF Version: Lawyers, Clients, Parties and the Right to Counsel

The right to counsel is a revered constitutional right in Canada, but casting aside the understandings of this right that derive from American television shows, what does it really mean? Does it include, for example, the right to retain counsel of one’s own choosing? What if the proposed lawyer was present at the scene of the alleged crime, although not an actual witness to the events? This was the scenario in R. v. Karmis, where a man accused of assault causing bodily harm sought to hire a lawyer who happened to be present at the party where the alleged events occurred.

When is a Non-Operator Entitled to a Constructive Trust over the Operator’s Own Assets?

When Does a “Participant” Earn Under the Terms of a Farmout and Participation Agreement?

Water management planning and the Crown’s duty to consult and accommodate

Is Proof of Irreparable Harm to the Plaintiff or Proof of Wilful Delay by the Defendant Required to Defeat an Application to Set Aside Default Judgment?

Lawyers, Clients, Parties and the Right to Counsel