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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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