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Collins v. Blair (8/9/2002) sp-5606
Collins v. Blair (8/9/2002) sp-5606
Notice: This opinion is subject to correction before
publication in the Pacific Reporter. Readers are
requested to bring errors to the attention of the Clerk
of the Appellate Courts, 303 K Street, Anchorage,
Alaska 99501, phone (907) 264-0608, fax (907) 264-0878.
THE SUPREME COURT OF THE STATE OF ALASKA
RALPH COLLINS, CORNELIA )
COLLINS, RONALD COLLINS, and )
ERIC W. COLLINS, )
) Supreme Court No. S-9810
Appellants, )
) Superior Court No.
v. ) 3AN-96-7333 CI
)
ANDREW BLAIR, TRINA M. BLAIR, )
RICKY BLAIR, and F/V PREDATOR, )
INC., ) O P I
N I O N
)
Appellees. ) [No. 5606 - August
9, 2002]
________________________________)
Appeal from the Superior Court of the State
of Alaska, Third Judicial District,
Anchorage, Michael L. Wolverton, Judge.
Appearances: Melvin M. Stephens, II, Kodiak,
for Appellants. Paul D. Kelly, Kelly &
Patterson, Anchorage, for Appellees.
Before: Fabe, Chief Justice, Matthews,
Eastaugh, Bryner, and Carpeneti, Justices.
CARPENETI, Justice.
I. INTRODUCTION
I. Andy Blair and Ralph Collins began their business
relationship in 1987 when Blair chartered Collinss boat. Blair
bought the boat two years later, along with an undetermined
interest in prospective fishing rights. A dispute over these
fishing rights arose in 1994 and the parties entered into a joint
venture, forming a closely held corporation. After more problems
with fishing rights and a general deterioration in the
relationship, Blair petitioned the court for an involuntary
dissolution of the corporation. The court dissolved the
corporation and ordered a distribution of assets that followed a
proposal submitted by Blair. Collins appeals from this order.
Because the trial courts factual findings are not clearly
erroneous, we affirm the order of dissolution. However, because
Blair used corporate funds to pay both corporate and personal
legal bills, we reverse the superior courts order awarding
attorneys fees and remand for an allocation between corporate and
personal services.
II. FACTS AND PROCEEDINGS
A. Facts
In 1987 Andy Blair chartered the F/V Milky Way from
Ralph Collins. Included in the charter was an option to purchase
the vessel (option agreement). Paragraph 21 of the option
provided for the transfer of fishing rights for halibut and/or
black cod (sablefish) if a limited entry permit system were
instituted by federal authorities.1 In 1989, when Blair
purchased the F/V Milky Way from Collins, the purchase agreement
referred to the option agreement as being the entire agreement of
the parties, regardless of any collateral, prior, or
contemporaneous agreements.
In 1995 the federal government adopted a program to
regulate the halibut and black cod fisheries in Alaska through an
Individual Fishing Quota (IFQ) system. To implement the IFQ
program, applications were sent to each vessel owner or charterer
who had a fishing history in the qualified fisheries for each of
the years 1984 through 1990. Blair received an application for
the F/V Milky Way for the years 1988 to 1990. Collins received
an application for the F/V Milky Way that covered the years 1984
through 1987. The National Marine Fisheries Service (NMFS)
awarded IFQs based on the F/V Milky Ways catch to Blair (based on
his catch from 1988 to 1990) and to Collins (based on his catch
from 1984 to1987).
As paragraph 21 of the option agreement provided for
the transfer of the F/V Milky Ways fishing rights, the court
found at trial that there was conflict between Blair and Collins
over the pre-1988 quota shares allocated to the F/V Milky Way
under the IFQ program. Blair contacted attorney Joe Sullivan to
determine the best way to recover the pre-1988 shares to which he
felt he was entitled. Sullivan suggested that, rather than
contest his claim through expensive litigation, Blair pursue a
joint venture with Collins.
In 1994 Blair and Collins entered into an agreement to
begin a joint venture. The agreement, an intent to purchase
drafted and signed without counsel, stated that Collins intended
to purchase a 50% interest in the F/V Milky Way and that Collins
and Blair were to combine their halibut and sablefish shares.
The parties approached attorney Sullivan to prepare the paperwork
to implement their joint fishing venture. They chose to do this
through F/V Predator, Inc. (the corporation), a corporation
previously formed by Collins that was eligible to hold IFQs. The
corporation was chosen because the IFQ regulations required that
IFQ transfers be made only to an entity that existed during the
qualifying period, and the corporation met this requirement.
Collins represented that the F/V Predator (a fishing boat, not
the corporation) had companion fished with the F/V Milky Way.
The boats quota shares, Collins maintained, would therefore be
about equal.
Blair agreed to transfer his post-1988 F/V Milky Way
shares to the corporation. Collins had F/V Predator shares that
he was going to issue to the corporation. Neither party
specified how many shares he would contribute. After the
corporation received a loan from the bank, Collins purchased a
50% interest in the F/V Milky Way and the accompanying fishing
rights. The F/V Milky Way was then transferred to the newly-
formed corporation.
Blair never transferred his F/V Milky Way quota shares
to the corporation due to a dispute with NMFS over the division
of shares between his catch on the F/V Milky Way and his catch on
his other boat. Blair did, however, fish his F/V Milky Way
shares on the F/V Milky Way in 1995 and deposited all proceeds
into the corporations bank account.
When Collins had his F/V Predator shares issued to the
corporation, he became ineligible to personally receive other
quota shares (the lost shares) to which he would have been
entitled. After talking with NMFS about a way to rectify the
situation, Collins transferred to himself personally the F/V
Predator shares that had been issued to the corporation. NMFS
then issued Collins his lost shares. Collins apprised Blair of
his actions and gave him the F/V Predator shares to fish on the
F/V Milky Way. Although Blair fished the F/V Predator shares in
1995, he had Sullivan contact Collins on behalf of the
corporation and himself requesting that Collins return to the
corporation the shares Collins had withdrawn. Sullivan
eventually forced the transfer of Collinss shares back to the
corporation. Upon the return of the shares to the corporation,
NMFS revoked Collinss lost shares.
B. Proceedings
A. In September 1996 Blair filed suit in superior court
alleging that Collinss action in withdrawing the F/V Predator
shares from the corporation was a breach of Collinss fiduciary
duty. He requested an accounting and reimbursement and asked the
court to dissolve the corporation under Alaska law.2 Collins
counterclaimed alleging that Blair violated his fiduciary duty by
failing to contribute his F/V Milky Way shares to the
corporation. Collins also petitioned the court for a recission
of the option and intent to purchase agreements entered into by
Blair and Collins and the return of all assets Collins
contributed to the corporation.
Because the case involved issues of dissolution and
liquidation of a closely held corporation issues that were
complicated by IFQ contributions a special master was appointed.
In June 1998 Special Master Gregory L. White, a certified public
accountant, prepared a report that reviewed transactions,
rendered an accounting, and recommended alternate methods for
dissolution, sale, or liquidation of the corporation.
In making his recommendations on the division of
assets, Special Master White made several findings of fact. Most
importantly, he found that neither the intent to purchase
agreement nor the actual purchase of the F/V Milky Way
constituted a settlement of any claims of the parties. Although
Blairs 1987 option agreement and 1989 purchase of the F/V Milky
Way may have resulted in his acquiring the quota shares generated
by Collinss fishing on the F/V Milky Way prior to 1988, the
special master found that the joint venture was not entered into
in order to settle Blairs claims to Collinss F/V Milky Way
shares.
Special Master White also found that Blair had an
obligation to contribute approximately 50,000 pounds of halibut
shares to the corporation and that Collins did not agree to
contribute additional shares to make up the difference between
the pre-1988 F/V Milky Way shares and the F/V Predator shares
actually contributed to the corporation. The special master then
recommended that Blairs interest be redeemed by distributing
certain assets of the corporation, including the F/V Milky Way
and all its fishing rights, and that Collins be allowed to retain
100% of the stock of the corporation, including most of the
fishing rights arising from the operation of the F/V Predator.
The report also recommended that Blair be charged for his
personal legal and professional fees that had been paid by
corporate funds.
In May 1999 Superior Court Judge Michael L. Wolverton
issued a decision and order dissolving the corporation. The
court found that paragraph 21 of the option agreement (calling
for the assignment of all fishing rights to Blair if a limited
entry fishing permit system was instituted) indicated that the
assignment of rights was part and parcel of the purchase price of
the vessel. The court found that when NMFS began allocating
quota shares, Collins flaunted the fact that he had been awarded
shares for his fishing of the F/V Milky Way prior to the boats
lease and sale to Blair, which shares Blair thought he was
entitled to under the option and purchase agreements.
The court found that Blair, rather than approaching
Collins in a confrontational manner and asking for a formal
settlement, proposed the joint venture as an informal settlement
of the rightful ownership of the pre-1988 F/V Milky Way fishing
rights. After trial the court found that Blair had proven his
version of the facts by a preponderance of the evidence and that
his proposed distribution of the assets was the most equitable.
The court found that neither Blair nor Sullivan acted
improperly in obtaining for the corporation the F/V Predator
shares withdrawn by Collins, and that, because Blair had not
acted improperly, he should not be charged for the legal fees
paid by the corporation. The court also found that Collins had
to account for the difference between the F/V Milky Way shares
pledged to the corporation and the F/V Predator shares actually
contributed.
As for the dissolution, the court agreed with the
masters recommendation that an equitable distribution was
warranted. The court adopted Blairs proposal for the liquidation
of the corporate assets and adopted all of the masters
recommendations for adjustments to the corporate books, with the
exception of the legal fees charged to the corporation by Blair.
After the final masters report was issued and adopted and
judgment entered, the court awarded Blair attorneys fees pursuant
to Alaska Rule of Civil Procedure 82(b)(2), increasing the award
under Rule 82(b)(3) because of the complexity of the issues,
laws, and facts in the case and Collinss unjustified violations
of his fiduciary duties.
Collins appeals from this order and award.
III. STANDARD OF REVIEW
We accept a superior courts findings of fact unless
they are clearly erroneous.3 A finding of fact is clearly
erroneous if it leaves [us] with a definite and firm conviction
on the entire record that a mistake has been made.4
Interpretation of a contract is a question of law.5
However, where extrinsic evidence is presented by the parties to
clarify a contracts meaning, that evidence points to conflicting
interpretations of the contract, and the contract is reasonably
susceptible to either meaning, the proper interpretation of the
contract becomes a question for the trier of fact.6 When an
appellant challenges the trial courts findings relating to the
intent and actions of the parties, we review those findings under
a clearly erroneous standard.7
We review an award of attorneys fees under an abuse of
discretion standard.8 A superior court abuses its discretion
when, after reviewing the whole record, we are left with a
definite and firm conviction that the trial court erred in its
ruling.9
IV. DISCUSSION
A. The Superior Courts Factual Findings Are Supported by
the Evidence and Are Therefore Not Clearly Erroneous.
In arguing that the trial court erred in setting
aside or ignoring the masters factual findings, Collins argues
that the trial court erred in substituting its own factual
findings for that of the master.10 Blair responds that whether
the trial court made clearly erroneous findings was waived by
Collins, in that Collins only challenged the trial courts setting
aside of the masters findings, not the trial courts own factual
findings. Collins counters by stating that if the trial court is
allowed to disregard the masters findings, Judge Wolvertons
findings must then be reviewed for clear error. Blairs waiver
argument is unpersuasive. Collins specifically mentions in his
brief that one of the trial courts findings was without
evidentiary support and indicates in each instance where he
argued that the trial court erred in setting aside the masters
findings that he was also challenging the trial courts findings.
Accordingly, he did not waive his challenges to Judge Wolvertons
factual findings.
The testimony at trial and during the masters
depositions was conflicting.11 In making his factual findings,
Judge Wolverton does not cite to the record. He did say,
however, that he found Blairs version of the events that
transpired between Blair and Collins to be more valid than
Collinss version. When determining whether a trial court has
made a clearly erroneous finding, [d]ue regard shall be given to
the opportunity of a trial judge to weigh the credibility of
witnesses.12 As to each of Collinss claims of erroneous findings,
there is testimony to support Judge Wolvertons findings.
1. The intent to purchase agreement reflected a settlement of a
dispute between Blair and Collins.
In rejecting the masters finding that the joint venture
was not a settlement of the dispute over the pre-1988 F/V Milky
Way shares, the superior court stated that [h]owever denominated,
the July, 1994 agreement had a legal force and effect which, de-
facto, settled the claims between the parties.
Blair testified at trial he had paragraph 21 of the
lease and option agreement put in so that he could guarantee his
right to fish if a limited entry system were ever implemented.
He stated that when he applied for his quota shares, he sent NMFS
the option and purchase agreements. NMFS told Blair that they
were not going to get involved in litigation over who was the
proper owner of the pre-1988 F/V Milky Way shares and that Blair
should contact an attorney. Blair then contacted attorney
Sullivan, who told him that to contest the contract would take a
great deal of time and money. Sullivan suggested that Blair try
to work it out with Collins personally.
In setting up the joint venture, Blair stated that he
thought the deal favored Collins because Blair was not going to
try to exercise his rights under the option and purchase
agreements. Under the agreement, Blair would get only 55% of the
pre-1988 F/V Milky Way shares to which he felt he was entitled.
Though Collins could get less than what he had put into the
corporation, Blair felt that the agreement was fair in light of
the option agreement. If, Blair testified, he had not gone
through with the joint venture, he feared that he would have been
caught up in litigation and therefore unable to fish. Blair
stated that the 1994 intent to purchase was a settlement before
there was an overt dispute between Collins and himself. Blairs
description of the transactions between himself and Collins
supports the trial courts finding that the intent to purchase
was, in effect, a settlement.13
2. Collins agreed to contribute additional shares in order to
make up the difference in landings between the F/V Milky Way and
the F/V Predator.
The order issued by the superior court stated that the
evidence showed that Collins represented that the F/V Predator
shares could be substituted for the F/V Milky Way shares because
Collins thought they were identical. While the superior court
did not find that Collins intentionally misrepresented the amount
of shares he was going to contribute, the fact that he was to
contribute all of his F/V Milky Way shares meant that he would
need to make up any difference that resulted from his
substitution of the F/V Predator shares.
Blair testified that the corporation was entitled,
under the agreement, to Collinss F/V Milky Way shares. Blair
testified that the F/V Predator shares were used because the F/V
Milky Way shares could not be contributed to the corporation.
The corporation was entitled to an amount equal to Collinss F/V
Milky Way shares.14
3. Blair did not agree to contribute approximately 50,000
pounds of halibut shares to the joint venture.
The superior courts decision does not indicate how many
pounds of halibut shares Blair was to contribute to the joint
venture. The special master, on the other hand, found that,
although not explicitly pointed out by the parties, it seemed
reasonable to expect that Blair would contribute approximately
50,000 pounds.
Blair testified that when he and Collins were
discussing the joint venture, they figured they would need about
100,000 pounds of halibut shares in order to succeed. He also
stated that they did not discuss how much each party was going to
contribute to the corporation. They never mentioned that each
party would contribute 50,000 pounds. Rather, they were going to
combine all of their shares together, as the intent to purchase
agreement indicated. As Blairs shares were unclear due to the
dispute with his other vessel, he could not know how many shares
he had to contribute.
4. Collinss actions to recover his lost sablefish shares were
wrongful.
1. The trial court found that Collins never explained to Blair
or attorney Sullivan his reasoning behind his withdrawal of the
pre-1988 F/V Milky Way corporate assets. The court found that
had Collins advised Blair or Sullivan of his intentions, the
relationship between the parties would not have deteriorated.
The lost shares at issue are sablefish shares from 1986
and 1987 landings on the F/V Milky Way. To qualify for sablefish
shares, a person (defined as an individual or a corporation) must
have owned or leased a vessel that caught sablefish with fixed
gear during any quota share qualifying year,15 which for these
shares would have been 1988, 1989, 1990, or part of 1991.
In his initial application, Collins asked that his
quota share be allocated to the corporations that owned the F/V
Predator and the F/V Milky Way, that is, the F/V Predator, Inc.
and the F/V Milky Way, Inc.,16 respectively. However, this
prevented Collins from receiving the lost sablefish shares: F/V
Predator, Inc. could not receive those shares because it was not
a successor in interest to the F/V Milky Way, Inc., and F/V Milky
Way, Inc. could not receive the shares because it was leasing the
vessel to Blair during the qualifying years of 1988-1991. Blair
was unable to receive the shares because he neither owned nor
leased the vessel during 1986 or 1987. Collins could not receive
the shares because he was not eligible, as the corporation owned
the F/V Milky Way. The shares, therefore, were lost.
NMFS, though, informed Collins that F/V Predator, Inc.
was a qualified person for sablefish shares as it had owned the
F/V Predator during the qualifying years and had a qualifying
landing of sablefish. To obtain his lost shares, Collins asked
NMFS to rescind the quota shares allocated to the F/V Predator,
Inc. and F/V Milky Way, Inc. and reallocate them to him
personally. As F/V Predator, Inc. was generally permitted to
receive sablefish shares, personally receiving F/V Predator
shares enabled Collins to qualify under the regulations to obtain
the previously lost F/V Milky Way 1986 and 1987 shares.
However, the problem with this solution was that
Collins was not permitted under the corporations bylaws to
unilaterally remove quota shares. NMFS thought at the time it
transferred the F/V Predator, Inc. shares to Collins that he was
the sole stockholder of the corporation. When Blair informed
NMFS of the true ownership and rights of F/V Predator, Inc., NMFS
rescinded its action. The trial courts decision, then, that
Collins acted wrongfully in removing the F/V Predator, Inc. quota
shares is supported by the evidence.
B. The Superior Court Did Not Err in Ordering the Distribution.
Collins argues that the distribution ordered in the
special masters final report does not reflect a 55:45
distribution when one considers the hard assets owned by the
corporation and who contributed them. Collins claims that there
were hard assets totaling approximately $1.6 million and that he
had contributed at least 74% of that total. In the distribution,
however, Collins received approximately $425,000, 26% of the hard
assets. Blair argues that the distribution ordered by the court
was consistent with the evidence presented at trial. Given that
the pre-1988 F/V Milky Way shares were Blairs, Blair argues that
Collins received 45% of the rights to which he had no viable
claim.
The superior court ordered the distribution of assets
according to the proposal presented by Blair. The court found
that an equitable distribution was the only sensible solution.
It adopted Blairs proposal in order to maximize the value of the
assets available for distribution and to avoid dissipation by
adverse tax consequences that may result from denominating the
result as a recission.
In Blairs liquidation proposal, Blair received 54.96%
of the corporations assets and Collins received 45.04%. This
comports with the 55:45 share of stock owned by each party.
Before the superior court, Collins did not explain what
constituted the hard assets he claimed. Without a clear
indication of the assets Collins referred to and who contributed
those assets, the trial court did not abuse its discretion in
awarding a distribution based on each partys respective stock
holdings.
C. The Superior Court Did Not Err in Finding that Blair Did Not
Violate His Fiduciary Duties.
Collins states that Blair breached the covenant of good
faith and fair dealing by intentionally deceiving Collins. He
argues that this breach was ongoing during their relationship.
Collins also argues that Blair, the majority and controlling
shareholder in the corporation, had an obligation to treat
Collins fairly. Blair argues that he acted properly in carrying
out the intent to purchase and in the best interests of the
corporation in his retrieval of the corporate quota shares
withdrawn by Collins.
Stockholders in closely held corporations owe one
another a fiduciary duty.17 The superior court found that Blair
had done nothing wrong in petitioning NMFS for the return of the
withdrawn quota shares. Given Collinss reticence in discussing
his reasons for his withdrawal of the quota shares, the court
found that, rather than breaching a fiduciary duty, Blair was
acting in the best interests of the corporation in recouping the
corporations assets. Furthermore, the court stated that Blair,
though in a dispute with NMFS over his own quota shares, fished
those shares for the benefit of the corporation the first year
and should contribute the earnings from the other years in the
final distribution.
In petitioning NMFS for the return of the withdrawn
shares, Blair made clear the corporations reasons for seeking a
return of the shares. Furthermore, the dispute with NMFS over
the proper allocation of Blairs shares is well documented. Since
the superior court ordered that Blairs failure to fish his shares
for the corporation after 1995 be accounted for in the special
masters final report, the court did not err in its decision that
Blair had not violated his fiduciary duties.
D. The Superior Court Erred in Allowing Blair To Use Corporate
Funds To Pay His Personal Legal Expenses.
Collins argues that the trial court erred in reversing
the special masters decision to require Blair to pay his legal
fees, rather than allowing him to pay his fees with corporate
funds. Blair argues that the fees incurred were fees of the
corporation as they were incurred during attempts to recover
corporate assets converted by Collins and during the ensuing
litigation over the corporations accounting and liquidation.
The special master found that charging the corporation
for counsel that primarily represented Blair and attempted to
settle the dispute by having Collins contribute shares while
Blair contributed nothing was not proper, especially because
Collins was not able to charge the corporation for his legal
fees. The superior court, though, finding that neither Blair or
Sullivan had acted improperly, disagreed with the special masters
conclusion. The superior court allowed Blair to recover all of
his legal fees from the corporation.
By the time the dissolution came before the trial
court, however, many of the issues being litigated involved
Collins and Blair personally. Blair filed suit on behalf of the
corporation and himself. As Blairs actions benefitted not only
the corporation but also benefitted him personally, the trial
courts decision to allow Blair to use corporate funds to pay for
all of his legal fees was error. On remand, an allocation should
be made to determine which of Blairs fees were incurred in
pursuit of corporate goals, which the corporation shall pay, and
which were incurred in pursuit of personal goals, which Blair
shall pay.
E. The Superior Court Did Not Err in Awarding Blair Enhanced
Attorneys Fees.
The superior court ordered Collins to pay attorneys
fees totaling $37,704 to Blair under Civil Rule 82. Blair
incurred $83,782 in fees. His award, therefore, totaled 45% of
his incurred fees. Collins alleges that this award resulted in
Collins paying 90% of Blairs actual fees. As Blair paid his fees
with corporate funds, Collins argues that he (Collins) had
already contributed $37,702 towards Blairs fees.18
In awarding Blair attorneys fees, the court stated that
the award was based on the complexity of the issues, law and
facts of the case which the court has found to be one of the most
complex it has seen. Furthermore, the court stated that Collinss
conduct in removing corporate assets without justification,
violation of fiduciary duties, the failure to offer a credible
explanation of his actions constituted unreasonable conduct
within the criteria of Civil Rule 82(b)(3) justifying an enhanced
award.
As there was no money judgment awarded in this case,
attorneys fees are governed by Rule 82(b)(2). A prevailing party
is entitled to 30% of the partys fees when the case goes to
trial. The trial court justified the higher percentage award of
45% after a consideration of the factors in Rule 82(b)(3),
allowing for variance in a fee award. We have affirmed
awards of up to 75% of attorneys fees.19 As Blair was the
prevailing party, the courts findings that the law and facts were
complex and that Collins pursued unreasonable claims and defenses
in the suit supports the conclusion that an award of 45% of
Blairs fees was not an abuse of discretion. However, on remand,
this award should only be applied to those fees personally
incurred by Blair.
V. CONCLUSION
Because the trial courts findings are not clearly
erroneous, we AFFIRM its order of dissolution of the corporation.
However, because the trial court erred in allowing Blair to use
corporate funds to pay for personal legal expenses, we REMAND for
an allocation of Blairs legal fees.
_______________________________
1 Paragraph 21 states:
Limited Entry Permits:
It is agreed that if a limited entry fishing
permit system is instituted with respect to
halibut and/or black cod in Alaska, the Owner
shall assign any and all rights he may have
with respect to his usage of the vessel in
those fisheries to Charterer to enable
Charterer to obtain such limited entry
permits.
2 Alaska Statute 10.06.628 generally provides that
certain persons may seek the involuntary dissolution of an Alaska
corporation. It sets out the grounds for involuntary dissolution
and provides that certain interested persons may intervene in an
action for involuntary dissolution.
3 State, Dept of Revenue v. Merriouns, 894 P.2d 623, 625
(Alaska 1995).
4 City of Hydaburg v. Hydaburg Coop. Assn, 858 P.2d 1131,
1135 (Alaska 1993) (internal quotation marks omitted).
5 Little Susitna Constr. Co., Inc. v. Soil Processing,
Inc., 944 P.2d 20, 23 (Alaska 1997).
6 Id.
7 Oaksmith v. Brusich, 774 P.2d 191, 195 (Alaska 1989).
8 Alderman v. Iditarod Props., Inc., 32 P.3d 373, 380
(Alaska 2001).
9 Id. (citing Stoshs I/M v. Fairbanks N. Star Borough, 12
P.3d 1180, 1183 (Alaska 2000)).
10 This argument is made explicitly only in regards to the
trial courts finding that the intent to purchase and purchase
agreements were a settlement of the dispute over who owned the
pre-1988 F/V Milky Way shares. The rest of Collinss arguments
are phrased in terms of the trial court error in setting aside or
ignoring the masters findings, with no reference to the trial
courts findings.
11 In making his findings of fact, Special Master White
stated that he had to reach an understanding of the facts. This
was complicated by conflicting testimony. Where Collinss and
Blairs testimony conflicted, Special Master White considered
whose explanation was more plausible given the circumstances at
the time, and knowledge of how the fishing industry operates.
12 Barios v. Brooks Range Supply, Inc., 26 P.3d 1082, 1085
(Alaska 2001).
13 At trial, Blair testified as follows:
Q: Now do you believe the deal you made that day and
the deal were talking about today [the joint
venture agreement], favored you or Mr. Collins?
A: I think it favored Mr. Collins.
Q: Why do you say that?
A: Because I wasnt exercising my the 1987 agreement,
we were combining everything together, so actually
I was yeah, thats why.
. . . .
Q: And if you hadnt made this deal, what would 1995
have looked like to you?
A: I dont think it would have been good for no, we
wouldve been tied up in conflict so [his quota
shares] wouldve been tied up.
Q: Did Mr. Collins ever ask you for a better deal
than the one that you think is described in that
intent to purchase agreement?
A: No. No.
. . . .
Q: And thats why you think this offer was fair?
A: According to our 1987 agreement . . . I think it
was fair, yes.
. . . .
A: Like I said, Ralph and I never had any dis actual
dispute because I think we we settled it in the
1994 agreement.
14 At trial, Blair testified:
Q: So you were entitled to what?
A: Milky Way shares.
Q: An amount equal to the Milky Way shares, is that
right?
A: Yes. Yeah, thats what we both talked about.
A: Well, that wed we had to put Predator shares in
the Predator, Inc. because he couldnt put Milky
Way shares in the Predator, Inc.; it wasnt
allowable, I guess.
Q: Okay.
A: So so, thats that was the big thats what they
were talking about.
Q: Was there any discussion that resolved any
question about the amount of quota shares that
would be put in in order to comply with the July 5
agreement?
A: Well, Ralph said, well, well have to put the
Predator in, but its about equal to the Milky Way
because because they fish right along side each
other for all those years. Its got about the same
amount of fish, so itll itll be the same anyway,
so no big deal.
Q: So at that point you were no longer talking about
putting in Milky Way shares into a business, you
were talking about putting Predator shares into a
business, is that right?
A: Thats correct.
Q: And the amount of shares, in your mind, was
satisfied by a representation that the Predator
shares equaled the Milky Way shares?
A: Thats correct.
Q: Correct?
A: Thats correct.
Q: And Mr. Collins was telling you how did he
explain to you that they were approximately the
same?
A: He said they fished the same years and . . . .
Q: They meaning what, please?
A: The Predator boat and the Milky Way, he owned them
both at the same time. They fished right along
side each other that they theyll have the same
amount of shares so shouldnt be a any big deal,
any problem, should be the same, should be equal.
15 50 C.F.R. 679.40(a)(2)(i) (2001).
16 Collins was the sole stockholder of F/V Milky Way, Inc.
17 Alaska Plastics, Inc. v. Coppock, 621 P.2d 270, 276
(Alaska 1980).
18 Collins argues that the funds used to pay Blairs fees
would have otherwise been distributed to him in the assets
available for distribution. Collins, therefore, would have been
entitled to 45% of the funds used by Blair, or $37,702. The
courts additional award under Rule 82 results in Collinss share
of Blairs fees totaling 90%.
19 Stevens ex rel. Park View Corp. v. Richardson, 755 P.2d
389, 396 (Alaska 1988).
