Vardy, who is also vice-president of the Labrador West Chamber of Commerce, will file an objection with the federal court in Montreal on Sept. 28, objecting to the extension of the Companies Creditors Arrangement Act (CCAA) court proceedings with Wabush Mines.
“From the different parties we’ve been speaking to we’ve been led to believe that the judge was considering giving another extension to Cliff’s (the company that operates the mines,)” he told TC Media. “We feel that it’s gone on long enough and Cliff’s has had time to fulfill their obligations as a company.”
Vardy said he may be given the opportunity to speak directly to the judge on two occasions, to explain the impact of the Wabush Mines closure on Wabush and Labrador City. He will get to speak once as the mayor of Wabush and he hopes to speak again as the VP of the chamber.
“It gives us the chance to express to the judge how important it is that Cliff’s exits the CCAA situation and move into bankruptcy,” he said.
Vardy said there is a possibility the mines could find another operator but this process needs to move forward first.
The CCAA, the chamber explained in a memo circulated by the chamber to its membership, is designed to allow companies to restructure and come out at the end as a strong enough company to satisfy its debt and liabilities. The Act can be applied in cases where companies owe in excess of $5 million.
The protection that Cliff’s Natural Resources has because of the Act is preventing the mines, and the town, from moving forward, Vardy said.
“We feel they are misusing the CCAA process,” he said. “They’re using it to buy them time to liquidate assets. On Wednesday I’m hoping to express that to the judge.”
A special meeting of the Labrador West Chamber of Commerce is being held this Sunday, Sept. 25, to discuss the issue and get feedback and advice from the business community. The meeting for all chamber members is being held at the Tamarack Drive Professional Building at 6:30 p.m. Sunday.