Estate of Lea K. Hillgren, Deceased, Mark Hillgren, Executor - Page 16

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          was not posted until after decedent’s death.  It was the practice           
          of decedent and Hillgren to post the opening entries on their               
          accounting books anywhere from 6 to 8 months after the start of             
          the year.  As a result, the opening entries for LKHP were not               
          made until after decedent’s death.  Also, the balance sheets,               
          ledgers, and check registers that represented the financial                 
          information of LKHP were actually maintained under the name of              
          Sea Shell.                                                                  
               After the formation of LKHP, leases were executed on the               
          LKHP properties in the name of Sea Shell.  Also after the                   
          formation, all contracts that were entered into for maintenance             
          and improvement of the LKHP properties, as well as all bills that           
          were received, were in names other than that of LKHP.  On                   
          March 12, 1997, a check was issued under the name of Sea Shell to           
          pay property taxes for various properties including Manzanita and           
          Enterprise.  On May 22, 1998, Sea Shell also paid for landlord’s            
          insurance on the Manzanita property.                                        
               After the formation of LKHP, Nordica completed refinancing             
          of its properties.  During the loan application process, it was             
          represented to a mortgage broker, Walker Mortgage, and a lender,            
          Homesteader’s Life Co., that decedent owned and controlled all of           
          the LKHP properties.  No mention was made to either the mortgage            
          broker or the lender that the properties were restricted by the             
          BLA or that they were owned by LKHP.  The disclosure was not made           

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Last modified: May 25, 2011