Tumwater Water Documents

If you like documents, you’ll love this posting.

We don’t want to sensationalize this posting, however.  Some documents are informative, many are not.  It has taken many months to cobble together these documents.  All-in-all, there are too many people to thank for assembling this information, but you know who you are and hopefully that’s thanks enough.

File management proved to be a severe challenge, so consider this more of a document dump than an orderly, numerical library.  Feel free to save the documents in a file on your computer and peruse them at your own speed.  Use this posting to discuss your findings and perhaps this will lead us all back to our inner “Researcher” by potentially helping us figure out who got the water money and why (and then where it went!).

Work Plan

Well Parcel Modification

Well-B-Ng-Cities

PNW Title Insurance Co – Well B Ng

Water-Rights-AABWC-Amended-Petition

Union Gap Decision

Notice Of Deposit

Lacey Postage

First Amended Stip Granting Immediate Possession & Use

February 12, 2007 Gravely letter re: Water Rights

Thurston County Treasurer Receipt – prop taxes penalties interest

Transfer of Water Rights – Stormwater Support Budget

Lacey-Oly-Tum THUR0808

Lacey-Oly-Tum THUR0809

Lacey-Oly-Tum THUR0810

Lacey-Oly-Tum THUR0811

Letter requesting possession and use (Ng)

Letter to Clerk requesting transfer of funds to interest bearing account

LowerDeschutesVicinityAquifer DRAFT lowres

Mediation Brief

Order Granting Motion to Dismiss Olympia Lodge No. 1 and Sidel Canada, Inc.

Order Granting Petitioner City of Tumwater and Respondent Well B Ng’s Motion for Order to Disburse Funds

Gravley letter to Ken Ahlf re: Yelm representation

Olympia Letter To reporter Christian Hill

Water Rights Condemnation Cover Letter

Response to DRAFT order emails 10-15-07

Order Granting Petitioner City of Tumwater and Respondent Well B Ng’s Motion for Order to Disburse Funds

Order Granting Motion to Dismiss Olympia Lodge No. 1 and Sidel Canada, Inc.

Letter to Clerk requesting transfer of funds to interest bearing account

Letter requesting possession and use (Ng)

Lacey-Oly-Tum THUR0807

Lacey-Oly-Tum THUR0806

Lacey-Oly-Tum THUR0805

Lacey-Oly-Tum THUR0804

Exhibit 4 Condemned Real Property Aerial Map and Legal Description

Excpt47OreWash

Excpt39OreWash

Excpt37OreWash

Lacey-Oly-Tum THUR0802 Record of Decision – Application for Change-Transfer

Item 5c – Agreement All American Bottled Water

Interlocal Agreement

Graham & Dunn letter to Michael Hitt

Excpt21OlyTerm

City of Olympia Response to reporter Chirstian E Hill’s public records request

City of O list – railroad related

Cities – AABW – AMOUNTS

Certificate of Water Right-2

Certificate of Water Right

Certificate of Ground Water Right

Buck & Gordon letter to Timothy Dore

Brewery Water Rights Adam Gravley EMAIL chain

Brewery Water Rights – Privileged and Confidential

Brewery Water Rights – Privileged and Confidential II

brewery ROD-Mod 04 Three City DOE approval

1084350

1026393 corresponding doc 3

26540 corresponding doc 1

3824_001 Public Records Request from The Olympian

$1,516,667 Lacey payment to Thurston County

Water-Rights-AABWC-Amended-Petition

Railroad_Payment

ordinance 6394 olympia

OB_InterlocalEvaluationSTF 11-10

March 7 2006 Olympia City Council Meeting

march 7 2006 meeting minutes olympia wa

Letter to Thurston County Clerk’s Office requesting transfer of funds on deposit into an interest bearing account

Lacey-Oly-Tum THUR0811-10

Lacey-Oly-Tum THUR0810-09

Lacey-Oly-Tum THUR0809-08

Lacey-Oly-Tum THUR0808-07

Lacey-Oly-Tum THUR0807-06

Lacey-Oly-Tum THUR0806-05

Lacey-Oly-Tum THUR0805-04

Lacey-Oly-Tum THUR0804-03

Lacey-Oly-Tum THUR0803-02

Lacey-Oly-Tum THUR0802-01

CR_2A_(Mediation)_Agreement

Amendment_#1_to_032008_Consulting_Agreement_-_Pacific_Goundwater_Group

03865738.001

121908_Notice_of_Deposit

111808_Staff_Report_to_City_Council_RE_Settlement_Agreement

051408_Receipt_of_Funds_from_Clerks_Office_RE_$18138.89

051408_Receipt_of_Funds_from_Clerks_Office

042208_Notice_of_Deposit_-_First_Amended_Stip_RE_Immediate_Possession

032008_Consulting_Agreement_-_Pacific_Goundwater_Group

1-Recorded_Stipulation_For_and_Judgment_And_Decree_of_Appropriation_Part1

2-Recorded_Stipulation_For_and_Judgment_And_Decree_of_Appropriation_Part2

3-Recorded_Stipulation_For_and_Judgment_And_Decree_of_Appropriation_Part3

GrahamDunn letter to 3 city attys

City of Lacey $1,516,667 payment to Thurston County 4-22-08

1-Recorded_Stipulation_For_and_Judgment_And_Decree_of_Appropriation_Part1

4-15-08-email-re-aabw-litigation

12/8-15-08-gravley-email-re-draft-workplan

10-10-07-northrup-email-re-58-million

11-11-08-gravley-email-re-herrera-consulting-contract

Status of Settlement Approval email

Legal Description email

DOE Report

Stip from Ahlf

Order Granting Immediate Use

Gravley Email re: Union Gap decision

Return flow-list of water rights

larry-smith-letter-to-scott-smith-re-well-b-ng

lindell-email-re-stip

lindell-emails-re-stip

order-granting-cities-motion-for-relief-from-stay

Capital Valley View email

Email re: foreclosure by Well B Ng of most junior of Ng deeds of trust

Decree severing water rights from former brewery prop

Railroad settlement email

email re: Capital Valley View

Ahlf email re: how to split city payments to Thurston County

City email re: dividing of funds continued

Email re: litigation guarantee from title co mentioning Well B Ng

Email re: request to transfer funds to interest bearing acct

Short email re: approval of valuation, interest, appraisal…..

County email re: payment of property taxes

Easement summary email

Mediation brief cover email

PSE easement emails

Order granting Ng group’s motion for relief from stay

Proposed Interlocal Agreement for Brewery Engineering studies email

Email re: Mailing of $1.5M checks

Email re: push-back from Ng on deal

Ng Negotiations email

Ahlf email confirming $5.3M total payment

Email cover letter re: Letter requesting possession and use (Ng)

Access across take area email

Access to remainder email

Receipt of check email

Potential amicus brief filer email

Carve out for access to remainder email

Email re: proposed order granting Ng relief from stay to foreclose

Order granting motion for determination that stay applies

Herrera Enviro consulting agmt

Email – Lacey okays railroad fee

Brewery Water rights settlement emails

Union Gap decision emails

November 13, 2008 Staff Report – Lacey

Stip for and order granting immediate possession and use

Proposed letter and stip email — Ahlf

Ahlf email re: railroad claim for attys fees

Email re: reply to motions for stay

Emails discussing public records request re: appraisals

Proposed Letter and Stipulation email

Ahlf email re: stip

Cover email re: draft Order on water rights

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14 thoughts on “Tumwater Water Documents

  1. Wow these documents are amazing and tell such a good story but I am wondering how Well B Ng got control of a property that we had the first deed on and then sold the rights to three cities that didn’t even seem to do the due diligence to find out of Barney and Well B Ng really even owned the property. Oh my this is interesting and thank you to John and the others who were willing to share these papers with us.

    • There are some very interesting documents in the Tumwater document collection that you posted on December 22.

      One truly amazing document is the Litigation Guarantee. There appears to be three duplicate copies of the Litigation Guarantee in the collection: the first document, “Work Plan,” the third document, “Well-B-Ng Cities,” and the fourth document, “PNW Title Insurance – Well B Ng.”

      As background for the non-lawyers, a litigation guarantee is a type of title insurance. When an attorney files a case concerning the title to a piece of real property, it is very important to name all of the persons or entities that have an interest in the property as defendants. If you miss one, you might have to start all over. To protect against missing a party, an attorney can buy a litigation guarantee from a title company. The title company issues the document, an insurance policy, and it lists everyone who has any interest in the property. In a way, it is like a malpractice policy for the case.

      The litigation guarantee in the document collection is dated April 14, 2008. That is the date for the report of the chain of title. The premium was $820.00, the coverage was $250,000, and the named insureds were the Cities of Olympia, Tumwater, Lacey, and their attorneys Graham & Dunn PC.

      The litigation Guarantee reflects the following, as of April 14, 2008:

      There is a first deed of trust dated January 16, 1996 from Pabst Brewing Company to 4 or 5 beneficiaries, including Falstaff Brewing, General Brewing, and Pearl Brewing. The amount of the first deed of trust was $15,000,000.

      The first deed of trust was amended and modified by a document recorded October 8, 1996, and then amended and modified again by a document recorded February 25, 1998. The details of the amendment and modification are not revealed in the Litigation Guarantee, but it is reasonable to assume that the amendment and modification related to increases in the underlying secured obligation.

      There is no reconveyance of this first deed of trust.

      There is a second deed of trust dated March 29, 2004. It is from All American Bottled Water to R.E. Loans, LLC. The amount of the second deed of trust is $18,500,000.

      The second deed of trust was amended and modified by a document recorded July 13, 2004. The details of the amendment and modification are not revealed in the Litigation Guarantee, but we know from other documents that the amendment and modification related to an increase in the underlying secured obligation by an additional $10,000,000.

      There is a third deed of trust dated March 29, 2004. It is from All American Bottled Water to Pensco Trust Co., Custodian for the Benefit of Barney Ng. This is one of Barney Ng’s pension accounts. The amount of the second deed of trust is $1,850,000.

      This third deed of trust was made subordinate to the R.E. Loans second deed of trust by a document recorded July 13, 2004, but there is no indication that the third deed of trust was amended or modified.

      There is a fourth deed of trust dated March 29, 2004. It is from All American Bottled Water to Barney Ng, as an individual. The amount of the second deed of trust is $2,000,000.

      This fourth deed of trust was made subordinate to the R.E. Loans second deed of trust by a document recorded July 13, 2004, but there is no indication that the fourth deed of trust was amended or modified.

      We know that it was the fourth deed of trust that Barney Ng used to foreclose on the property. He formed Well B Ng, a Delaware LLC, on July 10, 2006, and assigned the Barney Ng fourth deed of trust to it. Well B Ng foreclosed and took title to a portion of the property with the wells.

      What does all of this mean? From everything that I have read, I thought that the R.E. Loans note and deed of trust was a purchase money loan to buy the property. If so, the $18,500,000 from the R.E. Loans note and deed of trust would have wiped out the $15,000,000 Pabst note and deed of trust and also wiped out any additional amount in the amended and modified notes and deeds of trust. The R.E. Loans deed of trust would have been a first, not a second. If the litigation report is correct, however, then L. Eric Whetstone, All American Bottled Water Corporation, took all of the R.E. Loans money and never paid off the first, leaving R.E. Loans with a second.

      If this is true, then this transaction is further evidence confirming Equitatus’s January 5, 2011, post in which he states that the Ngs and Horwitz were only interested in the deal and never interested in protecting the investors. And it affirms his statement that there was a “total lack of simple due diligence
on the part of the Ng’s to find out who they were really loaning the money to.”

  2. Robert,

    You know I am not as bright as Barney but look
    what I found?

    http://www.houblon.net/spip.php?article3527

    L. Eric Whetstone was a crook, he finally found
    a fellow greedy crook to loan him $24 million of
    our dollars.

    The best thing you could say is that there was a
    total lack of due dilligence on RE Loans part in
    these deals, or they just didn’t care (dare) to know
    as long as they got their 3-5% commission and management fees.

    • The next very interesting Tumwater document is the Order Granting Petitioner City of Tumwater and Respondent Well B Ng’s Motion for Order to Disburse Funds in Thurston County Superior Court Case No. 06-2-00310-9. The order is dated and signed August 1, 2008.

      This is the background. Three cities, Olympia, Lacey, and Tumwater sued to obtain certain water rights. Before filing suit, their attorney obtained a Litigation Guarantee. (see my last post) The Litigation Guarantee reflected that the owner of the water rights was Well B Ng, LLC. As part of the cities acquiring possession of those rights from Well B Ng, the successor in interest to Barney Ng (see my last post), the cities deposited $4,550,000 as the predicted just compensation for the taking of the water rights. That April 22, 2008, document is in the document collection as “Notice of Deposit.”

      The amount of deposit was reported in a stipulation filed with the court on April 18, 2008. The stipulation is in the document collection as: “First Amended Stip Granting Immediate Possession & Use.” The stipulation was signed by the counsel for the three cities, Larry Smith, of the firm Graham & Dunn, and by Scott Smith, of the firm Riddell Williams PS.

      Below Scott Smith’s signature, it states: “Attorneys for Respondents Well B Ng, Barney Ng, R.E. Loans, LLC, and Pensco Trust Company, Custodian for the benefit of Barney Ng.”

      This is amazing. Since R.E. Loans had a deed of trust superior (second) to the Barney Ng deed of trust (fourth), there was an obvious conflict of interest between R.E. Loans, LLC, and Barney Ng as to who had the right to claim the compensation for the water rights. But both parties had the same legal counsel.

      Moving on with the story, the next order is dated May 9, 2008. It is attached to a document in the collection titled: “Letter to Clerk requesting transfer of funds to interest bearing account.” According to this order, “Order Granting Well B Ng’s Motion for Disbursement of Funds,” the Thurston County Treasurer received $18,138.89 for unpaid property taxes, and the court withheld $87,306.37 for the City of Tumwater’s claim for unpaid surface water management services. The remainder of the $4,550,000 deposit, that is, $4,444,554.74, was disbursed to Well B Ng by a deposit into “The Trust Account of Riddell Williams, P.S.”

      The May 9, 2008, order was not approved as to form by Larry Smith, of the firm Graham & Dunn, the attorney for the three cities. It was unnecessary.

      The August 1, 2008, order mentioned at the start of this post concerned the disbursement of the money withheld for the City of Tumwater. According to that order, the City of Tumwater accepted $80,522.07 as payment in full for its unpaid surface water management services. The rest of the withheld money went to Well B Ng.

      Larry Smith, of the firm Graham & Dunn, the attorney for the three cities, signed off on that order and above his name it states: “Petitioners (the three cities) do not object to disbursement to Well B Ng but take no position with regard to proper distribution.”

      This is why some of us love Larry Smith. He must have fully appreciated the fact that Riddell Williams was facilitating the misdirection of the payment for the water rights away from their client, R.E. Loans, LLC, and to their other client, Well B Ng. That is, Larry Smith smelled a rat; the distribution appeared to be improper. So Larry Smith just covered his firm’s reputation, clearly and pointedly removing his firm from any criticism, by noting we “take no position with regard to proper distribution.”

      This set of documents fully supports Equitatus’s recent comment: “The best thing you could say is that there was a
 total lack of due diligence on RE Loans part in
these deals.” Or, “Walter, Kelly, and Bruce did not care about the investors, or the investors’ rights, by letting Barney Ng’s attorney represent the investors.”

  3. It seems as though there is plenty of blame to spread. Walter, Kelly and Bruce turned a blind eye and allowed Barney unabated access to the hen house. Barney had no These same types of conflicts seem to exist in Reno, coincidentally, which points to Tumwater not being the outlier it appeared to be at the onset. Barney appeared to extract cash at every available opportunity and nobody called him on it. You would think one of the B-3 would step up to the plate. So – why didn’t they?

    p.s. Thank you to Mr. Brower for his expert insight.

  4. John,

    What amazes me is that this is the second case of a large loan where the borrower turns out to be a real crook. (See my posting above) All of their past crimes were easily discoverable at the time. What due diligence did Barney do? Nothing or worse yet he knew and they were just scratching each other back.

    I understand from a source that Walter and Kelly just accepted these deals from Barney at face value without doing and any investigation at all.

    • This is my third post on this topic. I paused the story at August 2008. At that time, the three cities had deposited $4,550,000 with the court clerk for the payment of just compensation for the water rights, which had ben completely disbursed. Well B Ng (Barney Ng) had received $4,444,554.74 of that amount. The lawsuit, however, was still pending.

      The only remaining issue was exactly how much more money did Barney Ng want for the water rights in order for him to settle the case and agree to a dismissal. He was in the driver’s seat. If the cities did not pay more, they would have to go to trial. A trial date was set for January 2009.

      A mediation was held on Thursday, November 6, 2008. The mediator was Judge Terrence Carroll Jr. In preparation for the mediation, the cities’ attorney, Larry J. Smith, sent a three-page mediation brief to the Judge. This document is in the document collection as “Mediation Brief.”

      As an aside, in California, mediations and all the documents involved in mediation are confidential. I assume the same rule applies in Washington.

      The mediation brief explains the past history of the brewery, the condemnation of the water rights by the cities, and the cities appraisal of those rights at $4,550,000. The brief also explains that Barney Ng had not supplied an appraisal to the cities and that the cities were essentially bargaining against themselves.

      The mediation was held and the case settled. The cities agreed to pay an additional $750,000. The total payment for the water rights was therefore $5,300,000 of which $5,194,554.74 went to Well B Ng. The settlement agreement is in the document collection as “cr_2a_mediation_agreement, dated November 6, 2008.”

      The November 6, 2008, settlement agreement is signed by Barney Ng and Scott Smith, the attorney representing R.E. Loans, Well B Ng, and Barney Ng.

      Each of the three cities needed to approve each of their additional $250,000 payment. Confirmation of the settlement and the additional payment went before the City Council of the City of Olympia on November 18, 2008. The staff report for the agenda item is in the document collection as “111808_staff_report_to_city_council_re_settlement_agreement.”

      The staff summed up the problem facing the cities as follows: “The alternative to settlement is to proceed to trial in January. A trial would create the risk of a jury assigning a value greater than the settlement amount to the land and water rights. In addition, due to the complex nature of the valuation issues presented in this action, the costs of a trial could exceed two hundred thousand dollars. Staff believes the additional payment needed to settle the condemnation action is reasonable in light of the risks and costs associated with proceeding to trial.”

      The settlement was approved by all three cities. Well B Ng received $5,194,554.74, and as far as we know from this document collection, R.E. Loans received nothing.

      What does all of this mean to you, the investor? That will be my next post.

  5. I worked at the olympia brewery under Mr. Whetstones wants. He ripped off loads of local companies by never paying his bills. His security company never got paid. They quit. He couldn’t even pay the brewery personal he kept on either. I also witnessed multiple conversation of dubious nature take place when others weren’t looking. I have also heard about the horse racing breeding ranch in philly. What a shame/ I have met this man and talked with him many times. Hes a smuck. He ripped of Rosenberg construction out of Oregon for millions in unpaid work. I also had access to many documents, written letters and messages all concerning the business bull shit. You should have seen it. I watched it from the beginning to the end. He basically stole money from the lenders and services from anyone. I knew something was wrong before others admitted it back in 2006. To many things just didnt fit right or made you ask questions. Anyway hope people stay away from this ass. Heard he just got arrested in NC for shoplifting. Always a crook it seems

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