The fate of Jared Cowen’s contract buyout now rests in the hands of an impartial arbitrator, and that impending decision carries significant consequences for both the 25-year-old defenceman and the Toronto Maple Leafs.

It could take as long as 30 days for a ruling, per the terms of the NHL collective bargaining agreement, after the sides held a hearing in New York on Wednesday.

At issue is whether Cowen was healthy enough to have the final year of his contract bought out by the Leafs last summer. A lengthy section of the CBA is devoted to “procedures for determining fitness to play,” and they include a player’s right to pursue a second medical opinion beyond what is provided by the team.

That information, plus witness testimony and other evidence, will be taken into account by the arbitrator while rendering a decision.

For Cowen, there is $3-million in salary at stake. That represents somewhere in the neighbourhood of 25 per cent of his career NHL earnings to date – a huge amount given his injury history and diminished future earning potential.

For the Leafs, there are serious salary cap ramifications hanging in the balance.

They are currently operating about $800,000 below the $73-million upper limit, according to capfriendly.com, but that is factoring in a unique $650,000 buyout credit they received for terminating the Cowen contract.

Should the arbitrator rule that they’re unable to do that because the player was hurt, they would lose the credit while reassuming his $3.1-million cap hit this season. That’s a $3.75-million cap swing in total and would almost certainly result in the Leafs invoking long-term injury relief on one of three players – Nathan Horton, Stephane Robidas or Joffrey Lupul – to remain compliant.

Even though the LTI maneuver would offer immediate relief, it’s something the Leafs hope to avoid since it would increase the size of the cap overage penalty they’ll carry into next season because of performance bonuses expected to be earned by as many as five rookies in their current lineup.

Toronto has shown tremendous creativity with the way it has managed the salary cap the last couple seasons and only took on Cowen’s contract from Ottawa as a sweetener in the Dion Phaneuf trade on Feb. 9.

The player was immediately shut down because of issues that have bothered him dating back to a 2012 surgery repairing a torn labrum in his left hip. As Cowen explained to Sportsnet in a Feb. 25 interview, that area of his body had bothered him ever since.

“The next year (2013-14) was the tough year because I wasn’t feeling as good, the season kind of wore on me because it’s so long, so I felt worse and worse,” said Cowen. “I kind of just got used to how bad I was feeling so it didn’t even seem that bad anymore. It was the new normal.

“Then after that year I kind of had a hernia and I played the whole next year with that hernia without knowing. It hurt a lot. I couldn’t skate well, so I just had surgery last summer (in 2015).

“I’m just trying to get rid of all those symptoms I’m having but they just keep building up.”

Cowen was eventually cleared to play by team doctors and assigned to the American Hockey League on Feb. 27. He was later given permission to leave the Marlies and returned home to Saskatoon in March having never even suited up for one game with the organization.

Lou Lamoriello, the Leafs general manager, announced his intention to buy out Cowen’s contract while speaking with reporters after the Feb. 29 trade deadline.

The player was due to earn $4.5-million in salary this season and that provided Toronto favourable conditions to do so. Since Cowen is under age 26, his buyout came in at one-third of the remaining value spread over two years – giving the Leafs the rare $650,000 cap credit in 2016-17 while assuming a hit of $750,000 for 2017-18.

It is now up to the arbitrator to decide whether that holds.

With big stakes involved for the former ninth overall pick and the Leafs organization, his ruling will be final.