Finance Minister Jim Flaherty tabled the legislation Tuesday morning.
Nadon's appointment, announced last month and confirmed by a Commons committee, has been challenged by Toronto Lawyer Rocco Galati on the grounds that Nadon does not meet the requirements to be a Supreme Court justice from Quebec.
Nadon recused himself from participating in hearing cases until the matter can be resolved — a process that could take months or even years depending on how the government chooses to address it.
With the tabling of Tuesday's second budget implementation bill, that appears to be through legislation.
The budget bill amends the Supreme Court Act to add two sub-sections, including: "For greater certainty, for the purpose of section 6, a judge is from among the advocates of the Province of Quebec if, at any time, they were an advocate of at least 10 years standing at the bar of that province."
Another sub-section includes similar language for "a province."
Asked whether the measures are retroactive and are intended to apply to Nadon, Flaherty told reporters, "You'll have to ask the justice minister."
When pressed about why he didn't know given that the measures were in his budget bill, Flaherty replied, "It's the mechanics of government."
One expert says the legislative approach makes sense in that it addresses uncertainty over whether a Federal Court judge qualifies for appointment to the Supreme Court. But there's a catch.
"I would add that it solves one problem and creates another," University of Ottawa law professor Adam Dodek said in an email to CBC News. "It should not be the subject of a budget bill but should be a self-standing bill amending the Supreme Court Act to allow for the fullest debate around the issue of qualifications for appointment to our highest court."
Quebec, which has a different system of law than the rest of Canada, is guaranteed three spots on the bench. Quebec also announced it is supporting a challenge of the appointment.