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The receiver in charge of a defunct gold mine in the Yukon is suing a Vancouver-based mine engineering firm for breach of contract and negligence.
PricewaterhouseCoopers, the receiver managing the Eagle gold mine, filed the suit Friday in the Supreme Court of British Columbia against JDS Energy and Mining.
Eagle, then owned by Victoria Gold Corp., was the site of a massive heap leach failure in 2024 that contaminated nearby rivers.
The suit alleges that JDS, which designed and built the heap leach facility at the time, is responsible for what the suit calls the “failure event.”
“JDS failed to perform its contractual and legal obligations to the applicable standard of care and those failures were the cause of the failure event,” reads the notice of civil claim.
The court documents cite the report of an independent review board of experts appointed by the Yukon government in the aftermath of the heap leach failure. That report found one of the main causes of the failure was improper drainage of a layer of ore in the heap leach pile that caused material on top to liquefy, causing a landslide.
The resulting spill sent 1.8 million tonnes of cyanide-laced tailings into the environment, contaminating waterways.
In the lawsuit, PricewaterhouseCoopers alleges JDS recommended against using a process called cement agglomeration in the heap leach pile. That process binds particles of ore together while allowing water to drain through.
The suit also claims JDS ignored the risk of stacking material on the heap leach pad year-round, which created frozen pockets within the stack, contributing to instability. And, the suit claims, JDS did not follow construction plans laid out by another company and purchased a substandard “geomembrane liner” intended to prevent contamination from leaching into the ground.
The claim seeks damages from the loss of mining operations and property damage to the site, and payments to cover legal and cleanup costs, but does not specify an amount.
None of the allegations have been tested in court.
In a written statement to CBC News on Tuesday, Yukon government spokesperson John Thompson said that any damages awarded in the suit could be used by PricewaterhouseCoopers to repay the government’s receivership loan, “and help reduce the overall cost of the receivership to taxpayers.”
Thompson says the government has agreed to provide up to $220 million in loan funding to the receiver for remediation work. Under the receivership order, the territorial government is first in line for any available funds to repay its loan.