Hello & welcome taimoor !
No, at the moment you can't use a 16GB card with CHDK on your SD870.
For the SD870 the card MUST be bootable, that's the only way CHDK runs on this type of cameras (DryOS operating system, such cameras have not the "firmware update" method to start CHDK).
The multipartition feature (for SD cards bigger than 4GB, the cam switches the partition after booting) is not available for SD870 yet, so the maximum size for a SD card usable with CHDK is limited to 4GB, formated with FAT16 filesystem.