Opinion ID: 2638232
Heading Depth: 3
Heading Rank: 2

Heading: Summary of Old Harbor I

Text: In Old Harbor I we reversed the superior court's grant of summary judgment to the Joint Venture and remanded the case for further proceedings. [5] In Old Harbor I we held that the members of the Joint Venture continued to owe each other a fiduciary duty during the period between the Corporations' withdrawal in late April 1989 and the partition in July 1991. During that time, we held, the Joint Venture stood in the position of a trustee with respect to the Venture's assets because the Corporations were no longer members of the Joint Venture but were joint owners of the assets. [6] The Joint Venture's fiduciary duty included a duty of disclosure regarding the status of the Exxon claim. [7] We also held that there was a genuine issue of material fact as to whether the parties made a mutual mistake of fact when they omitted the Exxon claim from the accounting of the Joint Venture's assets during the partition. [8] The three elements of mutual mistake of fact meriting reformation are: (1) the mistake relates to a basic assumption of the contract; (2) the mistake has a material effect on the agreed exchange; and (3) the party seeking relief does not bear the risk of mistake. [9] Regarding the first element, we concluded that the alleged mistake related to a basic assumption of the contract, since the settlement agreement's goal was to resolve all of the [Joint Venture] and [the Corporations'] rights arising from [the Corporations'] withdrawal from the Joint Venture, which included rights to the Exxon claim. [10] For the second element, we concluded that the mistake was material to the transaction. [11] For the third, we stated that nothing in the settlement agreement transferred the risk of a mutual mistake to the Corporations. . . . [12] Since we were reviewing summary judgment to the Joint Venture, we viewed all the evidence in the light most favorable to the Corporations. That included Old Harbor's evidence that it expected as early as February 1990 to receive about twelve percent of the Exxon claim and Akhiok's evidence that the Joint Venture never informed it during the partition negotiations that it intended to retain all of the Exxon claims. [13] In Old Harbor I we noted that the trial court had not made a finding of fact regarding the date of accrual of the Exxon claim. [14] Therefore, it was impossible to determine whether the Joint Venture's duty to disclose the Exxon claim arose before or after the Corporations' withdrawal from the Joint Venture. However, we held that regardless of when the Exxon claim arose, the Joint Venture's fiduciary duty of disclosure continued until partition, and the Joint Venture had a duty to inform the Corporations of the status of the claim. [15] We also noted that in light of this holding we did not need to resolve a further factual conflict between the parties: They both claimed to own the land at the time the claims accrued, the Corporations as tenants in common with other joint venturers, and the Joint Venture as sole title holder. [16] Consequently, the questions for the superior court on remand were: (1) Given the existence of a duty to disclose the status of the Exxon claim up until the July 1991 partition, did the Joint Venture discharge it? (2) Given the parties' failure to address the Exxon claim in the partition agreement, did the parties make a mutual mistake of fact meriting reformation of the agreement?