Teal Jones: Domtar's contracts go with the licence after all

The hearing to approve the sale of what was left of Teal-Jones ran three days, September 8, 9 and 10, and at its close on Thursday, September 10, Justice Weatherill read an endorsement that accepted nearly all of it. The monitor's account of it runs to one paragraph. He was satisfied with the balance of the Surrey transaction but "was not prepared to transfer the Supply Contracts with Domtar and TimberWest into ResidualCo and, therefore, was not prepared to grant the RVO." He was prepared to grant the approval and vesting order for the Sumas mill, but because the two orders are linked, "it did not make sense to grant one without the other." He did not dismiss the application, and said he would make himself available if the buyer, Domtar and TimberWest reached a resolution, per the Fourth Supplement to the Twenty-Ninth Report of the Monitor, Sept. 18, 2026, para. 3.

They reached one in eight days. On September 18 he made both orders.

When the court last saw this case, the question on the table was whether a reverse vesting order could send to a shell the 2004 contracts under which Tree Farm Licence 46 supplies chips and pulplogs to Domtar and logs toward TimberWest's own obligations. The monitor's application had called the result plainly: the order "will effectively terminate certain Supply Contracts between Domtar, TimberWest and the Group. This is unfortunate, but it is also necessary to complete the Surrey Transaction," per the Amended Notice of Application, Sept. 1, 2026, Part 3, para. 19. Domtar's vice-president of fibre supply, Chris Stagg, had sworn on the first day of the hearing that if those arrangements were extinguished, "I do not believe there is any realistic way for the Howe Sound and Bayview facilities to reopen," per the Affidavit #2 of Chris Stagg, Sept. 8, 2026, para. 29. The monitor had told the court the transfer was a condition precedent for the buyer, Gillfor Manufacturing Inc., and that neither it nor the court could force Gillfor to close without it, per the Amended Notice of Application, Sept. 1, 2026, Part 3, para. 22.

The tenth amendment

The share purchase agreement between Teal Jones Holdings Ltd., Gillfor and the monitor was signed on July 17, 2026. By September 18 it had been amended ten times — on July 30, August 5, 12, 13, 19 and 26, September 3, 10 and 14, and then once more, per the Tenth Amendment to Share Purchase Agreement, Sept. 18, 2026, recitals (Fourth Supplement, App. "A"). The monitor reports that after the September 10 hearing Gillfor, Domtar and TimberWest "engaged in extensive negotiations," and that they have "reached agreement on the commercial terms for go-forward arrangements. Those terms will shortly be documented among the parties." In the meantime the buyer agreed to move the supply contracts from Excluded Contracts to Retained Contracts, per the Fourth Supplement, Sept. 18, 2026, paras. 4–5. The terms of those go-forward arrangements are not set out.

The amendment does it by replacing three schedules whole. In the September 4 consolidated agreement, the Schedule "D" list of Excluded Contracts ran to nineteen named items, and the first five were the cedar log supply, chip and residual fibre, and log supply agreements with TFL Forest Ltd. of May 6, 2004, the pulplog supply agreement with NorskeCanada of May 5, 2004 and its chip and pulplog supply agreement of July 1, 2004; the tenth was a First Rights Agreement that began with Fletcher Challenge Canada, per the Redacted Share Purchase Agreement (Consolidated), Sch. "D", items (a)(i)–(v), (x). In the replacement schedules those six head the list of Retained Contracts, and thirteen items remain excluded, per the Tenth Amendment, Sept. 18, 2026, Sch. "D"; Sch. "G", items (a)(i)–(vi).

What is still excluded is operating paper — a 2002 logging successor agreement, a market logging contract, a 2025 cleanup letter with North View Timber, a Surrey building lease, vendor service agreements, the WPM HoldCo agreement from the Louisiana sale — and the family's Second Amended and Restated Shareholders Agreement of June 27, 2023 among Thomas Darcy Jones, Richard Gerhard Jones and their holding companies. North View's main stump-to-dump replaceable contract of January 1, 2010 sits on the retained side, per the Tenth Amendment, Sept. 18, 2026, Sch. "D", items (a)(i)–(xiii); Sch. "G", item (a)(xxiii).

Its one other change, requested by counsel for the IWA — Forest Industry Pension and LTD Plans, rewords the pension plan's entry among the retained assets to "Participation in the IWA - Forest Industry Pension Plan as required under the collective agreement," per the Fourth Supplement, Sept. 18, 2026, para. 7; Tenth Amendment, Sch. "Q", item 1(c).

The monitor's recommendation followed in a sentence: the contracts' move addresses "the Court's concerns raised at the September 10 hearing," and no change to the form of the order presented on September 10 was needed, per the Fourth Supplement, Sept. 18, 2026, paras. 6, 8.

What the order says now, against what was served

Most of what changed since the August 6 draft is the answer to the province's objection that silviculture and road obligations under the Forest Act could not be expunged, reported here on September 9. The granted order defines those duties as "Provincial Regulatory Obligations," carves them out of the injunction, the retained-contracts protection and the releases, cuts the forestry liabilities from the list of claims expunged down to stumpage, rent and amounts owing to a governmental authority up to closing, and adds that the order is not an injunction against the province under the Crown Proceeding Act and that sureties stay on their bonds, per the Approval and Reverse Vesting Order, Sept. 18, 2026, paras. 2(c), 14, 15, 25, 27, 29, 31 and Sch. "D".

Paragraph 30 is the one that arrived last. Measured against the version served on September 3, it is the only substantive addition to the order: "Nothing in this Order affects claims of aboriginal rights or title or interest or treaty rights," whether arising before or after closing, proven or not, "and any duty or obligation to share information with, consult or accommodate or receive consent from any First Nation," per the Blackline of Surrey RVO against version served Sept. 3, 2026, p. 11. The Ditidaht First Nation, which says approximately one-third of TFL 46 lies within its core territory, had asked in its September 4 response that any reverse vesting order "not prejudice or restrict any consultation or accommodation obligations owing to Ditidaht," per the Application Response of Ditidaht First Nation, Sept. 4, 2026, paras. 6, 76(ii).