Both parties signed the contract did they not?
If it was signed under full disclosure of Hakanpaa's medical condition are the Leafs not still bound by it? Just because it's not registered doesn't mean they don't have a legal right to fullfill it. I can't imagine the NHLPA would allow Hakanpaa to get screwed out of a $3M contract he signed in good faith.
Are they really able to walk away because the GM was so stupid he signed a player too hurt to play?
1. I'm sure that part of the "terms" of the NHL SPC are that it must be registered / approved with the league to be considered valid. Otherwise, a team could sign a 17-year deal and then the player gets to sue the team when the league invalidates it.
2. Think about the logisitcs of July 1 for a moment. Money is flying around. Teams are on average, signing 3-4 players each. Players, located all over the world, agreeing to these things.
It's likely, that very few actual contracts are signed on July 1st, but rather, "handshake" agreements are made over the phone, and the actual paperwork dealt with in the day or two after when the player can get to a printer, etc. It's why you often hear "Player X has agreed to terms"
Teams also get a "medical exam" as part of the signing process... which would almost certianly allow them to back out of a contract. Not all of these guys can get in to see a team doctor on July 1. Hakanpaa presumably lives in Dallas or Finland.... Toronto's Doctor presumably lives in Toronto.
As for how this plays out, I think it's obvious that the Leafs want Hakanpaa, and there's some organizational belief that they can fix his knee. At some point over the summer, they'll get him in for a battery of tests / experts... and figure out whether they're going to put pen to paper and register the contract, or let him pursue his career with another organization.