Opinion ID: 2638232
Heading Depth: 3
Heading Rank: 1

Heading: Events leading up to Old Harbor I[1]

Text: Thirteen Kodiak-area Native Corporations (joint venturers) formed the Afognak Joint Venture (Joint Venture or AJV) in 1982 in order to receive lands from the federal government, as provided in Public Law 96-487 § 1427(c) (1980): The Secretary of the Interior shall convey the surface estate on Afognak Island [as defined in an earlier section] . . . to a joint venture providing for the development of the surface estate. . . . The conveyance shall be made as soon as practicable after there has been filed with the Secretary of the Interior a duly executed joint venture agreement with provisions for sharing of and entitlements in costs and revenues of such venture as provided in this subsection [so that each corporation's land share is based on its population and acreage]. The conveyance shall not indicate the respective interests of each of the corporations in the surface estate conveyed but such interests shall be as provided in this subsection which shall be incorporated by reference into the conveyance. One of the joint venturers, Afognak Native Corporation, managed the Joint Venture. According to the Joint Venture agreement, the Joint Venture had several purposes: to receive the lands from the federal government, to develop them in the best interests of the joint venturers, and to manage fish and wildlife as required by the conveyance. The Joint Venture agreement indicated that the joint venturers intended to own the property as tenants in common and not as partners. However the Joint Venture, rather than the individual venturers, had authority to sell Joint Venture property and to determine when to distribute revenue to the venturers. The oil tanker Exxon Valdez hit Bligh Reef on March 24, 1989, spilling eleven million gallons of oil into the North Pacific; some of this oil reached Joint Venture land at some time between March 31, 1989 and the end of the summer of 1990. In April 1989 Akhiok-Kaguyak Corporation and Old Harbor Native Corporation (the Corporations) gave notice of their withdrawal from the Joint Venture. At the time of their withdrawal, the Corporations owned an undivided 18.37% interest in both the land and net assets of the Joint Venture (Old Harbor owned 12.38% and Akhiok owned 5.99%). According to the Joint Venture agreement, the Corporations immediately ceased to be members of the Joint Venture when they gave notice of their withdrawal; their land share was calculated according to values on the dates of their withdrawals and their shares of Joint Venture net assets were calculated from the last day of the month immediately preceding their withdrawal, i.e., March 31, 1989. The parties negotiated a partition of land and assets and a release, which they signed in July 1991. The release indicates that the partition agreement completely and satisfactorily fulfills all of [the Joint Venture's] obligations to the Corporations, including the accounting and payment required in § 6.01 of Exhibit C to the Joint Venture agreement: The Joint Venture shall be obligated to pay to the withdrawing joint venturer its percentage interest in the net assets [of the Joint Venture] within one year of the date of the notice of withdrawal. . . . The net assets of the Joint Venture are the assets less the liabilities of the Joint Venture excluding commercial timber, land and value of improvements computed on an accrual basis. As part of the settlement and release, Old Harbor paid $128,941 and Akhiok paid $62,429 as their shares of the Joint Venture's negative value. [2] The Joint Venture applied for Exxon spill settlement funds in 1993 from Alyeska Pipeline Service Company and later from Exxon, funds that included amounts based on the land already ceded to the Corporations. The Corporations requested a proportionate share of the settlement in 1996, but the Joint Venture denied the request. Other members of the Joint Venture who withdrew after the Joint Venture filed its Exxon claims were to receive shares of the oil spill damage claims based on their respective ownership interests in the Joint Venture. The Corporations sued the Joint Venture in September 1997, claiming a portion of the Exxon claims. [3] The superior court granted summary judgment to the Joint Venture based on the release, and the Corporations appealed. [4]