Opinion ID: 775521
Heading Depth: 1
Heading Rank: 2

Heading: facts

Text: 4 George Schmitz fished for halibut and sablefish off of the coast of Alaska in 1988 through 1990. 5 In April, 1992, Schmitz filed a Chapter 7 bankruptcy petition. At that time and for at least seven years prior, the North Pacific Fisheries Management Council, an agency of the Department of Commerce, had been considering the implementation of a quota-based fisheries management plan for halibut and sablefish caught off of the Alaskan coast. Proposed regulations to create a fishery management plan were in various stages of administrative gestation when Schmitz filed his Chapter 7 petition; however, the plan had not yet been adopted and there was no assurance that it ever would be. Schmitz did not list on his bankruptcy schedule potential fishing rights or anything to that effect. 6 On November 9, 1993, some nineteen months after Schmitz filed his bankruptcy petition, the Secretary of Commerce published the final regulations to implement the Alaska halibut and sablefish fish management plan. 58 Fed. Reg. 59,375 (Nov. 9 1993) (to be codified at 50 C.F.R. Parts 204, 672, 675 and 676). The regulations became effective on January 1, 1994. 1 Id. at 59,376. As finally implemented, the plan called for qualified fishermen to apply for and be awarded Quota Shares (QS) and Individual Fishing Quotas (IFQ), an annual catch limit applicable to future fishing, based on the total weight of a fisherman's legal landing of sablefish and halibut during the so-called qualifying years  of 1988-1990. 50 C.F.R. &#167 676.20(b) (1994). 7 In late 1993 or early 1994, QS/IFQ application forms were mailed to fishermen. Schmitz filed his QS/IFQ application in 1994. Hugh Wisner, who leased fishing vessels to Schmitz, filed a competing application. Both were given notice of the existence of the competing applications in March, 1995 and both were given an opportunity to provide additional information in support of their respective claims to the disputed fishing rights. They each submitted additional documentation. On June 14, 1995, the National Marine Fisheries Commission issued an Initial Administrative Determination  in favor of Schmitz. Wisner appealed, but the initial ruling was upheld by an appeals officer with the Office of Administrative Appeals of the National Marine Fisheries Service, Alaska Region, in October, 1996. 8 At last, in December 1996, over four and one-half years after Schmitz filed his bankruptcy petition, he was issued two QS/IFQ certificates for 41,478 units and 1,815 units of halibut, respectively. 9 In January 1997, Schmitz, with the approval of the National Marine Fisheries Service, conveyed the larger QS/IFQ to Appellant William Sliney in exchange for some crab pots. Sliney resold that QS/IFQ to a third party for $44,360.50. Schmitz sold the smaller QS/IFQ to a third party for $2,205.00. 10 In June, 1997, the bankruptcy trustee filed adversary proceedings seeking a declaration that the QS/IFQs were property of the estate, and to recover $2,205.00 from Schmitz and $44,360.50 from both Sliney and Schmitz. The trustee also sought to revoke Schmitz's bankruptcy discharge. As described by the bankruptcy judge in his thoughtful ruling on cross-motions for summary judgment, the adversary proceeding presents a close issue which the courts have rarely, if ever, addressed -the implementation of a post-petition law giving life to prepetition qualifying or enabling events. The bankruptcy judge ruled that in light of the ongoing federal activity to implement a sablefish management plan and the advanced stage in bringing that to fruition at the time Schmitz filed his bankruptcy petition -even though the plan had not yet been adopted -the IFQ/QSs were tied to Schmitz's prepetition qualifying rights from the 1988-1990 fishing seasons. The IFQ/QS rights were `rooted' in Schmitz's prebankruptcy past. The bankruptcy court accordingly granted partial summary judgment for the trustee. It held that the QS/IFQs were property of the bankruptcy estate and it revoked Schmitz's discharge. The Bankruptcy Appellate Panel (BAP) affirmed in an unpublished decision, which Sliney now appeals.