Maritime Scoundrels

A BRIEF ACCOUNT OF THE LAWSUITS SURROUNDING THE WINAMAC AND KATAHDIN.

In 1988 I purchased a 54 foot tugboat named WINAMAC, built in 1909. She had been extensively neglected and required two years of restoration. I sunk (literally) $93,000 into her only to see her destroyed in one minute on her maiden voyage when a drunk skipper backed into me in front of 20,000 spectators at the Vancouver B.C. Fraiserfest.

Uninsured, I spent three years battling Seaspan and Harkin towing in Vancouver courts. I mortgaged my house to pay the salvage and legal bills which exceeded CA$50,000 and finally prevailed three years later, with the ultimate cost to both Harkin Towing and Seaspan amounting to over CA$384,000!

From the time of the sinking of WINAMAC in June 1991 until the summer of 1994, I traveled throughout the Pacific Northwest and Alaska looking at perhaps 75 to 100 replacement vessels. However, it was at a local gathering of tug enthusiasts on Orcas Island over the July 4th weekend 1994, a friend told me the history of the tug KATAHDIN which was at that time tied up in a divorce and a dispute over moorage owed.

Hap and Lynda Schnase, the owners and also members of this organization, had driven the vessel under her own power to Baxter Boat Works, a small resort/boat repair yard at Obstruction Pass, Orcas Island. This was in the October 1992. Mr. Baxter surveyed the vessel in the water and presented an estimate of repairs to her decks for the approximate amount of $30,000. Hap and Lynda agreed to have the work done by Mr. Baxter and his “foster son,” Mike Sterrett (now living in Hawaii).

Hap then temporarily moved to Moses Lake to oversee a large construction project with Lynda taking care of the financial arrangements with Mr. Baxter. In Hap’s absence and over the next eight months, Lynda wrote checks totaling $57,334.61to Baxter Boatworks without receiving a receipt or inspecting the vessel. This included the Schnases’ purchases of $4705.53 worth of lumber to complete the job, however they also purchased an additional $8108.13 directly from Edensaw Woods in Port Townsend, bringing their total expenses to $65,442.74.

The vessel at this time was totally inoperable; her belowdeck’s machinery had been removed and stored around Mr. Baxter’s property. Furthermore, the entire guards, bulwarks and decks had also been removed, rendering the vessel unseaworthy.

Sensing something wrong and with Hap still absent, Lynda Schnase telephoned Dan Grinstead in Seattle and solicited his opinion on what to do. In spite of increasing financial and marital difficulties, Hap made several additional payments in early 1994 totaling $7389.02, clearing his obligations to the Baxters.

At this time (early 1994) Hap and Lynda ceased communicating and the rents at Baxter Boat Works again began to accrue. To date they had spent $72,831.26, and the tug was torn apart with open deck-beams and shrouded in blue tarps. Hap and Lynda were not the first people to put trust in the Baxters and lose money.

THE FIRST LAWSUITS AGAINST BAXTER

What follows is a brief history delving into the Baxters’ financial dealings over the past 16 years. Much of what I found out in my investigation is sketchy however a general pattern is supported by the attached affidavits and documents. The earliest dealings stem from Mr. Baxter’s own deposition admitting to two lawsuits in California. Both suits were filed in the late 1970’s and not the 60’s as claimed. These suits culminated in the Baxter’s leaving town and moving to Decatur Island. The first by Gene Meyers and Paul Ebert alleges Mr. Baxter allowed their boat to sink while under Baxter Boat Company’s supervision and construction. Mr. Baxter then stripped the boat of valuables when he was not paid for a job that he didn’t or couldn’t complete. The court allowed Mr. Baxter to be paid the sum of $2420 within seven days and to release the boat contents. The second suit was entered by Mr. Robert Simpson in May 21, 1979, which alleged “breach of contract, fraud and other reliefs” against Baxter Boat Company. This case was never tried (but was refiled until 1984); by then the Baxter’s left California (in 1979) for the San Juan Islands.

Concurrent with these events was a large construction project in which seven, 70 foot schooners were to be built. Mr. Baxter was to provide the masts and after much squabbling and bickering, the Baxter’s were asked to leave town. Two boats burned under mysterious circumstances. The only completed boat, the LIEBERSCHWAN, was trucked, not sailed up the Pacific coast to Seattle.

Mr. Baxter would like to have the public believe otherwise as he told his story to West Coast Mariner. The Baxters lived on Decatur Island until they could put together a purchase of the old Obstruction Pass Resort on the SE corner of Orcas Island. Their real estate agent, Kathy Ryan and her husband were instrumental in putting this deal together. Kathy tossed in her commission and Mike rebuilt the docks in exchange for future condominium moorage for their 60 ft. sailboat (where they raised six childrenóall under 10 years old).

By the end of October of that year, it was apparent that Mr. Baxter was not going to follow through with his commitments and the Ryans were forced to leave the marine forgoing their deal with the Baxters. They returned to Bellingham. Kathy’s mother, Wilma Richards, wasn’t so fortunate. She put up the down payment for the resort with the Baxters pledging the monthly payments through rents/moorage. They attempted to isolate her in the end cabin, then pulled the “shortplat/default” trick on her–illegal in California but not in Washington. They failed in a court battle with Ms. Richards and the Baxters were ordered to return her money.

During this time, David Baxter got involved with a tug called the Sea Lion, owned by Mr. Earnest Kanzler, of Morro Bay, California. The tale is legend on Orcas island as Mr. Kanzler spent about two million dollars creating a sailing vessel out of a 100 ft. tug under the urging of J. Z. Knight of Yelm, Washington, who claims to channel a 25,000 year old spirit named Ramtha.

Mr. Baxter is alleged by Walter Bisset, the project accountant, to have accepted the approximate sum of $240,000 from Mr. Kanzler to fabricate masts for the tug–a project that never neared completion. Mr. Baxter claimed less than $15,000 for the three years surrounding this project to the IRS.

Another story that circulates is Mr. Baxter’s role in the salvage of the Washington State ferry, Elwa, which ran aground when the Captain deviated off-route to view his girlfriend’s house. Mr. Baxter claimed to have been the salvage expert on the project but was in fact “along for the ride” and was forcefully ordered off the Elwa’s bridge by the captain of the vessel. The vessel was dived and plugged by Mike Ryan and successfully refloated off the rocks “with Mr. Baxter confined to his quarters.”

Other affidavits speak of Mr. Baxter’s propensity to lie….but back to the story of the Katahdin:

While claiming to want the KATAHDIN removed immediately from his property, evidence points to the opposite. In conversations, Mr. Baxter has portrayed himself to me as a deeply religious person, a shipwright, a marine surveyor, and a trustworthy person whom “once I got to know, would find “a real honest person.” None of these are true. He told me he built seven 70′ schooners, one of which he sailed up the coast. He also portrayed Kitti, his wife as an attorney, which is untrue.

It was on July 20, 1994 that I telephoned Hap and Lynda Schnase at their residence on Camano Island and reached Lynda who explained that Hap and she had separated. I asked her if the KATAHDIN was for sale and she replied that she would talk to her lawyer and phone me back. She also gave me Hap’s phone number in Skapoose, Oregon. I contacted Hap there and he called me back within two days and announced that he was prepared to sell. Lynda returned my call about the first week of August and also agreed to sell. I then contacted Mr. Baxter on Orcas Island and arranged a survey.

During that call to Mr. Baxter on August 8th, I asked him how much lumber was stored on shore and he replied that there were three purchases: 1) Fir for decking worth approximately $8400; 2) Apetong (hardwood) for guards/railcaps, etc. worth about $2000; and 3) Fir for bulwarks and guards worth about $2000. He pointed out that the lumber was purchased in the spring of 1993 when prices were low (about $3.40 per board foot) and now clear air-dried fir was selling for over $5.50 per board foot. All in all, he stated that “over $11,000 was paid and that it was worth over $15,000 on today’s market.” He also stated that there was enough lumber to complete the job.

On August 12th, 1994, Mr. Malcolm Munsey, marine surveyor, and I traveled to Orcas Island and conducted a brief in-the-water survey for the purpose of possible purchase. Mr. Baxter, at that time showed us the machinery on shore and two large lumber piles. He represented the material to us as that owned by Hap and Lynda and stated that the lumber was purchased directly by Hap and Lynda from Edensaw Woods, Port Townsend, and that he possessed no receipts. All the machinery and lumber was photographed as was the KATAHDIN.

During the survey Mr. Baxter twice came down on the dock and asked Mr. Munsey if he would not tap so loud as it would bother his guests. He also stated that he wanted to be paid for past moorage and storage in the approximate sum of $3000 and wanted the vessel and machinery removed “immediately.” I returned to Seattle and first called Lynda to inquire as to possible terms. She said that this was Hap’s project and to work it out with him. I also called Dan Grinstead and solicited his opinion of the vessel’s worth. Dan said that a fair “as is-where is” price would be in the order of $10,000, considering the current state of the vessel and the potential legal entanglements.

On August 15, I called Hap and after a little dickering we agreed on a tentative price of $13,500. I drafted up a sales agreement and sent it to his attorney, Mr. Al Rode, Anacortes, WA along with $2000 earnest money with a copy to Hap. Mr. Rode put this money in Hap’s trust account and sent the terms on to Lynda’s attorney, Ms. Christine Hook, in Everett. From the time of my August 12th survey visit until the present, the Baxter’s would begin to weave me into their web of financial entanglements. On one hand, I was dealing principally with Lynda who was mistrustful of both Hap and Mr.Baxter, and needed advice from her attorney at every turn. On the other hand, Mr. Baxter, sensing that I had “deep pockets” raised the moorage from $300 per month to $3000 per monthóa tenfold increase. In the two months prior to the actual sale, the Baxter’s increased their charges by over $6000 sensing that I would purchase the boat. It later became clear that the Baxter’s were actually trying to prevent the boat’s removal and even made an eleventh hour offer to try to purchase it. One offer I made to Mr. Baxter as we talked on the dock during the initial survey was that I could possibly work a deal out immediately with Hap and Lynda and pay the Baxter’s their back moorage as a demonstration of my good faith. I explained that I had just settled my lawsuit over WINAMAC and was financially prepared to pursue an immediate sale. This was undoubtedly the reason for the Baxter’s letter to the Schnases dated three days later, August 15th. In all, three letters were sent to the Schnases by the Baxters: 1.) January 6, 1994: This was written after and October-December 1993 hiatus in work (both parties agreed to cease work during the 1993 summer months) asking to either get the project going again or pay moorage. Hap responded with five checks as follows: Check #520 dated 1/21/94 for $1000 Check #521 dated 1/25/94 for $1500 Check #526 dated 2/11/94 for $2000 Check #530 dated 2/17/94 for $1000 and Check #534 dated 2/26/94 for $1889.02. 2. August 15, 1994: This was ostensibly written three days after my survey of the KATAHDIN. It demands moorage retroactive from January 1, 1994 in the amount of $2951. It also threatens to raise rents to $90/day beginning in 10 days. 3.) October 4, 1994: This letter reiterates that moorage/storage has now grown to $6419, and increasing by $2725 per month. Several weeks went by and in late September after hearing nothing from Ms. Hook I called her office and inquired as to the status of the sale. Her partner, Cynthia Long, a child advocate, advised me she would pass on the message. After several more days of no response, Al Rode supplied me with Ms. Hook’s home number and I contacted her there (September 1, 1994 @ 4:18 p.m.). She was very irate that I had called her at home and said that the “boat was going nowhere until the divorce was settled in April 1995.” I explained that the tug was not seaworthy, that Mr. Baxter had stated his concerns that the fall storms would jeopardize the vessel, and of the wisdom to move it before the winter. I also pointed out the facts that moorage was now accruing at Baxter’s arbitrary tenfold amounts and that Lynda herself had approved of a sale. By late October the fall storms were becoming more frequent and it was becoming clear that the tug must be moved before to much delay. The major hang-up was with Ms. Hook and her insistence on protecting a marital asset for Lynda. By mid-October it was apparent that a sale was imminent and I began to proceed with the logistics of towing the vessel to Seattle. On October 17th, at 8:12 p.m., I hosted a 70-minute, three-way conference call with Dave Baxter and Phil Shiveley (skipper of tug RELIABLE), at which time we discussed every aspect of removing the tug from Orcas. Included in this call and several more during this third week of October was discussion of all the weights of the lumber and machinery on shore and the logistics of removing them the following weekend by truck. Several times during these conversations Mr. Baxter would at one time be very cooperative and at others would overstate the problems facing us; in particular he stated that the freeboard was only 14″ and was in no condition to tow. From my photographs taken in August, I could see that this was clearly not the case and phoned him back a second time to check. Phil asked specifically about the currents and the best access to approach the dock, etc. We all agreed to tow at the first good weather. I was unaware that Mr. Baxter at this time called the EPA and stated to them that I would attempt to tow an unsafe vessel. He emphatically stated that the most recent storm had flooded the vessel so badly that it was listing over the freeboard and was taking on water and had almost sunk. This was clearly not the case. However we all agreed to tow at the earliest possible break in the weather after Lynda had signed off on the documents. During this time period in late September and October, Hap and I became very frustrated with Ms. Hook’s foot dragging and refusal to expedite a sale that all three parties had agreed upon. From late August until late October two events occurred that influenced Lynda’s increasing reluctance to sign the purchase and sale agreement. The first was that Mr. Baxter, while proclaiming he wanted everything removed immediately, made an offer to purchase the vessel for $10,000 (forgiving the moorage/storage, then in the approximate amount of $9000) for a total of $19,000. The second was the incredible foot dragging of Lynda’s attorney, Christine Hook, and her focus on me as a villain in Hap’s divorce. This was exacerbated by the increasing animosity between Hap and Lynda. This slowed up negotiations at my end considerably and increased the amount of Baxter’s bills, effectively bidding away my advantage to purchase. Since Hap and Lynda had neither the money nor the energy to deal with Baxter, this burden fell upon my shoulders. Time was of the essence with the winter storms approaching and the charges against the vessel increasing. Further, Hap had stated to me that because of his dealings with Baxter, that he categorically would not sell the tug to him under any circumstances. It therefore meant that I would have to convince Lynda to sell and soon. During that time I made over one hundred phone calls to all parties to try to mediate the sale in the face of Baxter’s sudden interest in charging exorbitant rents and quixotic attempts to purchase the tug. By this time Lynda admitted she “didn’t trust Baxter, then Hap and now me, and redirected all my calls to Ms. Hook. Specifically, I made 27 calls to Lynda and eleven to Ms. Hook, none of which were returned. In desperation I telephoned Lynda at a motel in Ellensburg at 11:19 p.m. on October 18th, explaining that yet another storm was approaching and that the vessel’s vulnerable condition behooved us to act quickly. She agreed to bring this up with her attorney as soon as she arrived back in Seattle, which she did. Indeed, a huge storm blew through the state that next weekend and sure enough Cynthia Long relayed the message that Lynda would finally consent to an immediate sale. This is how the final offer was structured: my initial offer to Hap and Lynda was $13,500, which Lynda had refused, saying that Baxter had now offered $10,000 plus forgiveness of the $9000 rents (for an effective price of $19,000). Cynthia Long then called me at home and informed me of this offer and that it would be in Lynda’s best interests to sell directly to Baxter. I replied that Hap would never consent to a sale to Baxter but that I would match the offer. I also agreed to four other minor conditions. Since the Schnases’ assets were controlled by the courts, I agreed to put up the money directly to Baxter and tender $10,000 to Hap and Lynda (at $5000 each). This agreement was drawn up by Al Rode and approved with minor corrections by Christine Hook to which all parties signed on October 24th, 1994. On October 26th, the next good weather break was upon us so Phil Shiveley agreed to begin driving north from Seattle in the tug RELIABLE in the late evening of October 27th. That morning a friend and I left for Anacortes, where we picked up a copy of the bill of sale and tendered Lynda’s $5000 check at Al Rode’s law office. Al also gave me two sign-off contracts (one with and one without protest) since the $9100 amount of outstanding moorage and lumber storage was now firmly disputed. We arrived at approximately 1:30 p.m. on October 27th at Baxter Boatworks. There was no one present so we briefly measured the aft decks and drove to Orcas Lumber and purchased $205.19 worth of materials to prepare the KATAHDIN for towing the next day. I then called Orcas Island Freight Lines and talked with Wayne Foster about hauling the lumber to Seattle. We agreed on an estimated cost of $1250 and I sweetened the deal by offering an extra $500 if he could complete the task by midnight the following day. He agreed to meet me there at noon and would have a forklift there by about 2 p.m., since it was across the island. We then returned to the boat to begin work making the vessel seaworthy. This was about 3 p.m. Very shortly after our return to the resort, Dave and his wife, Kitti returned and suggested we work out the finances first. At some point in this discussion, I asked Dave how much water the tug was pumping out each day and he replied over 50 gallons per week/ten gallons per day. The true amount proved to be a fraction of that. He then described the phone calls he had made to the EPA and the Coast Guard and how worried he was that the vessel might sink at his dock if towed. Again, I was puzzled why he would first be anxious to have the vessel leave and then anxious that it might be towed. From this time on, it became increasingly clear that the Baxters were actually thwarting my efforts to remove the tug and lumber. During our “tea negotiations” Mr. Baxter made a curious comment about knowing Lynda’s father back in California and how their families went “way back.” This comment curiously cropped up in another similar case I investigated involving another boat tied up at Baxter’s Boat Works and in which there is also a lawsuit ongoing. I then showed Dave and Kitti (who then told us she was a corporate attorney) the faxed copy of the bill of sale and purchase and sale agreement and told them that we intended to tow the vessel the next morning. Kitti immediately acknowledged that they indeed could not prevent us from taking the vessel but that they would hold the lumber and machinery until their bills were paid. We then began negotiating the money for past moorage/storage, which Baxter claimed at that time (October 27th) to be in the approximate sum of $9000. He then produced a letter dated October 4, 1994 showing the tenfold increase in moorage/storage. It alluded to the earlier letter dated August 15th which he did not produce for us. I asked him if he had a copy I could have and he gave me that one with an original signature. I claimed that $2725 per month for the past two months was exorbitant and would not stand in court. I then offered to split the difference between the approximate $4000 that was due (calculating his own figures through the next day) and the approximate $9000 he was seeking and offered him the sum of $7000 by personal check. (Minutes earlier they had agreed to take my personal check.) Kitti immediately refused saying that we wouldn’t get a stick of lumber unless the entire $9144 was paid, their calculations through the end of the month of October. I reminded them that it was only the 27th and we had trucks coming to pick up the lumber the next day at noon and therefore we would owe them only $8784, (subtracting three days). Figuring to expedite the removal of the lumber and machinery with the least amount of hassle, I agreed under protest and asked Dave how he wanted the check made out. I made out the check as he directed but before I tendered it we discussed the cost of future storage/moorage if the vessel or all the lumber could not be removed on schedule. They were currently asking for $35/day for the vessel and $50/day for the storage, and then agreed to future storage of the lumber for $15/day. Then Kitti interjected that the lower amount would begin only after November 1, and that I would have to pay the higher rate until for four more days. She further stated that the daily rent would climb from $85/day to $90/day in two weeks. I exclaimed that this didn’t show good faith on their part; that we were here with tugboats, trucks, and money and hopefully would meet their expectations by the end of the next day. I then pushed the check across their dining table along with the contract of release under protest. Kitti read the contract and immediately said she wouldn’t sign under protest. It was at this point that she rescinded their $15/day offer for future storage. I felt that they were not only extorting money by increasing the moorage/storage by a factor of ten but now they were trying to wring out three more days of charges. Kitti handed the contract back across the table and said they wouldn’t accept my offer of $8784. Since neither of us could know the exact time that the materials would be removed from the resort, I then offered to pay in full when we loaded the lumber the next day, to which they agreed. They countered that they would no longer accept a personal check. Then Mr. Baxter interjected that I would never see the drawings or measurements (called a storyboard) for the bulwarks and that it would cost me $2000 to have a shipwright reconstruct them. We walked to the door at which time Mr. Baxter also informed me that if we didn’t like these amounts that he had yet another set of books going even further back in his dealings with the Schnases that showed even more money due. He also mentioned that he had strained his back barring the engine over (as a favor to Hap) and that he could” lien against the boat years down the road.” We parted less than amicably and returned to the task of loading the plywood onto the vessel, my manila folder and check in hand. After loading the plywood we cached the brown manila envelope in the Katahdin’s galley and drove into town to seek dinner. After dinner and before leaving Eastsound, I called Wayne Foster at Orcas Island Freight Lines to ensure that he would be there the next day around noon as we had earlier agreed upon. He informed me that Baxter had just called him and said that I “had no money” and not to bother with removing the lumber and machinery the next day. I told him the gist of our dealings with the Baxters and informed him that I was prepared to pay him that evening in cash if he so desired. He said he would meet us the next day as planned. We then called the tug RELIABLE in Seattle and informed Phil that the weather was OK to tow and would expect him about 8 a.m. the next morning. Phil left about 10 p.m. The next morning we woke at 4:30 am and began the quiet projects such as cutting down the tarps and transferring the wood around the decks. At dawn Mr. Baxter came down and informed me that the Coast Guard would be there by 8 am. I informed Mr. Baxter that by 8 am we hopefully would be in Guemes Channel. I then asked him where the power was and he replied that it was only supplied during “business hours.” He then presented me with a ‘post-it’ notice of the moorage/storage amount, which included another day’s rent as I had calculated on the basis of a 31-day month. The new amount was $8964. Before leaving he said that he would only accept a cashier’s check. Shortly thereafter, Mr. Baxter came back down the dock with a coffeepot and a bag of cookies and offered us “breakfast” which we accepted. Six feet of kelp had grown on the bottom of the tug, and needed to be removed. He was very “folksy” and seemed out of character and even lent me a spud to shave the bottom of the hull. I again asked him about getting power as it was past 8 am and he explained that the power cord was 220 volts. As we talked on the dock, Kitti hailed us that the Coast Guard was on the phone and would like to talk to Mr. Baxter and myself. I walked up to the phone in Dave’s shop and talked with MST2 White (with Dave present) where officer White reported to me that he had received a report from the owner of Lieberhaven Resort, Dave Baxter, that the KATAHDIN was listing and spreading an oil sheen around the vessel when the bilge pumps operated. I explained that the bilge pumps had been disconnected for probably a week due to lack of electricity and probably before that time, as there were dry rags in the bilge. Dave was smirking at the termination of the call. It was then that I realized that he had no intentions of letting us take the vessel or releasing the lumber/machinery. Since our arrival he had done everything to the contrary. About 8:30 am the tug RELIABLE arrived and I apprised Phil Shively of the situation and to prepare the vessel for immediate departure. He stated that the Coast Guard had contacted him via radio and questioned the seaworthiness of KATAHDIN and that he was to report back before beginning the tow. Approximately 45 minutes later Mr. Baxter yelled down the dock that the sheriff had arrived and wanted to talk with me. Sheriff Ray Clever met me on the dock and asked me for my version of the conflict and a bill of sale. As I began recalling the frustrating events of the prior evening, we walked first to my vehicle, but after not finding the manila folder went back to the tug and searched the galley where I had left it the night before. I searched for it there and again could not find the manila folder. Again, sheriff Clever and I returned to my vehicle (parked in the county property adjacent to the resort) and searched under every seat and throughout the car. We couldn’t find it. Another search of the tug came up empty handed. We returned to the sheriff and explained that the bill of sale was in a manila envelope left on the vessel the night before but could not be found. I offered to have Al Rode return to the island with another copy. Sheriff Clever said it was OK and that he would return to the Baxters’ house and try to broker release of the vessel and lumber, etc. Meanwhile I phoned my bank in Seattle and cancelled the check I had written out the night before. Soon after, I took the sheriff through the lumber inventory and explained what we were trying to accomplish. The main lumber pile was surrounded with two or three smaller (16′ variety) boats on trailers which Baxter earlier claimed would take him days and a special truck/trailer hitch to move. At that time sheriff Clever explained the arrangements he had brokered: that the Baxters now wanted money wired directly to their account at Key Bank in Eastsound. Shortly thereafter Baxter joined us in the backyard and insisted that he was entitled to 10% of the lumber, which was a boatyard’s customary take. I explained that he had earlier said that the lumber was handled entirely by Hap and Lynda and further was already paid for in full. Then he began to change his story again to include that actually some of the pile was his from other purchases and he had just stacked his lumber on top. When I asked him to be specific, he identified in front of the sheriff that the top three or four courses were his (all the 4″ X 6″ and smaller). Sheriff Clever informed us that he had to return to Eastsound and would be happy to escort me to the bank. Before leaving the resort I called Al Rode in Anacortes who recommended against a direct money transfer and offered to take a water taxi out to Orcas with a new bill of sale and help arbritrate yet again. Meanwhile the KATAHDIN was ready to tow. I drove to Key Bank in Eastsound to complete Baxter’s new demands. We talked with both Barbara and Candace at Key Bank of Eastsound and explained our dilemma. Since we knew that Al Rode was enroute to the island, I suggested that Candace (who knew Kitti personally) to call the Baxter’s and ask if cash would be acceptable. Candace called Dave and he agreed to accept cash. We called Seattle and had $10,000 wired which took most of our lunchtime, and almost broke the bank at Eastsound. After lunch we picked up the cash and drove back to Lieberhaven resort. We stopped just short of the entrance and separated out $8964 and put it in an envelope which I kept in my front pocket. The balance was to be used for a down payment on the trucking. Soon after we arrived, Al Rode also arrived and talked with the Baxters. (By then, relations had deteriorated between myself and the Baxters) Al then met with me outside and we walked through the yard where the machinery/lumber was stored. He explained that the best solution was to take what lumber that Baxter would release and sue in small claims court for the balance. I asked Al how much Baxter had identified to him as being his (Baxter’s) and Al estimated about 10-30%. Kelly then noted that three of the 150 to 200lb. Apetong planks (2″ x 12″ x 22′) had been removed during our lunch absence. I took a photo at that time wondering how a person with a bad back could lift such a heavy timber. Then both Dave and Kitty joined Al and I in the rear of the yard near the lumber piles as Wayne Foster arrived and wanted to look at the lumber. I removed some tarps on the large lumber pile for a better look. Wayne had a forklift ready to be transported to the site but was hesitant to commit his equipment until Baxter was willing to move the smaller boats surrounding the lumber. Mr. Baxter claimed that the boats, which were about 16′ to 20′ in length, were not his and he was not authorized to move them. Further, he stated that it would take a 3/4-ton pick-up with a special trailer hitch that he didn’t have. Wayne Foster wanted the materials to be palletized prior to moving. Al had asked Baxter if he could produce any receipts for lumber and Mr. Baxter brought out a very detailed packet of receipts that he had used to charge the Schnases (but which the Schnases had never received.) He said he wanted to inventory the lumber and to “count and measure every stick which would take two or three days.” He then brought up his bad back again and said he’d have to hire someone to help him with the inventory. He restated his “right” to keep 10% of the lumber which was a “boatyard custom” when it was ordered by the yard. I stated again that he had earlier admitted that he “had nothing whatsoever” to do with ordering the lumber; that it had been entirely Hap and Lynda’s efforts.” To date, Baxter had insisted on 1) a tenfold storage increase for the lumber; 2) a 10% cut off the top of the order and 3) an additional 10%-30% was also his from private purchases; all contadictory to what he had told Malcolm Munsey (surveyor) and me on August 12th. Frustrated by his continued stalling and denial of access, I displayed the large roll of cash (the $8964) in front of the Baxters, Al Rode, and Wayne Foster and told them that if they didn’t accept it that I would see them in court and they would get only a fraction. Kitti screamed “we don’t want your goddamn money.” I made an oblique comparison of Kitti with a walrus (Odobenidae rosmarus) and dialogue degenerated into a yelling match with the Baxters ordering me off their property. I called them thieves for stealing the lumber and the disappearance of the manila envelope the night before. Al convinced me to wait in the county lot and he would try to reconstruct a method to remove the lumber. Wayne Foster left with his trucks empty. Al told me when he was through negotiating with the Baxters that they had agreed to release the lumber the following week after the small boats were removed and the material was palletized. I told Al that if he combined Baxter’s exorbitant moorage/storage and the estimate from Wayne for trucking ($2400) and he could actually free the materials, I would deposit money in his trust account for that purpose. With that tacit agreement, we left the island with at least the vessel liberated. Except for one occasion on April 5, 1995 to photograph the condition of the lumber and machinery, I have not been on the island. I left everything in Al’s hands, which proved to be equally fruitless. Al Rode contacted a trucker in Conway, Washington named “Hurk” Handcock who ran an auction house and owned several trucks and equipment sufficient to recover items such as we had on the island. He went over to the island during that week and bid the moving/trucking at $2700. Al Rode informed me of the bid and asked me to wire $13,100 to cover expenses, which I did. Upon returning to Seattle I telephoned Lynda Schnase (on October 29th at 10:49 am) and informed her that we had towed the vessel safely to Seattle and that it was located at Fisherman’s Terminal. She asked if she could come down and pick up her dishes, etc. that we had agreed to in our purchase and sale agreement. Strangely, two days later when I tried to clear up the title and transfer the documents Lynda and her attorney Hook refused to return my phone calls. The day after the KATAHDIN was towed to Seattle, Saturday, October 29th, the Baxters called Lynda and told her that she had sold the boat too cheaply, that it was an insult to their work and in particular, that I was in “cahoots” with Hap and would sell the boat back to him. The Baxters also made about five phone calls to Charlie Moore of Edensaw Lumber Company and told him not to release Hap’s receipts to me. It later became known that Charlie Moore’s partner was married to Baxters daughter. I took Charlie to court to get the documents. The following week, November 3, 1994, Hap agreed to come drive up from Oregon and accompany Al to try to recover the lumber. Hap stopped at my house and picked up my office copy machine along with extra paper, toner, and a 100′ extension cord) to make copies of the receipts that Baxter had finally shown us the weekend before. I was not present at this confrontation, however I called three times to the Baxters to discuss progress with Al. By the third call at 2:02 p.m., Dave told me sarcastically that Al and Hap had “just left” and he just couldn’t understand why. Later that evening in Seattle, Hap explained the events of the day and how Baxter had again blocked attempts at removal by complaining about his “bad back” and that Lynda on the advice of her attorney, had refused to sign off for release of the lumber. Baxter had wanted to preserve his right to sue the Schnases for his back and Lynda wanted completely out of any liability. As a result of Baxter playing against Lynda’s fears of future litigation with false claims about his back, this second attempt to remove the lumber ended in an expensive stalemate, with Hurk billing the Schnases for $2700. We soon learned that Lynda had not only refused to sign off with the Baxters on this aborted November 3rd effort, but was now rescinding the entire sale; citing information that only the Baxters could have provided her. Legal events unfolded that week that convinced us that the Baxters had phoned Lynda and coerced her into rescinding the sale. As a result of Baxter’s interference, Hook filed a restraining order claiming breach of contract by me in the Seattle courts (the wrong district) which was subsequently received via my attorney but never served. In this restraining order Lynda admits that her decision to rescind was based on a change of mind over the value of the vessel; an idea put into her mind by both Dave and Kitti Baxter during this phone conversation on October 29th. The Baxters also mailed to Hook a letter written by Hap (dated July 30, 1994, before any knowledge by me of the KATAHDIN) asking Dave Baxter to value the vessel at around $10,000 for his divorce purposes. Lynda confused this letter with a conspiracy between Hap and me; an event historically impossible. Lynda also stated in her affidavit, (and again in our deposition of her) that Baxter had told her that Hap and I were “partners” and that he was prepared to “offer testimony” to this effect. This fact was also admitted in our deposition of Baxter, where he admitted calling Lynda and telling her that Hap and I were partners. Lynda used the work “cahoots” in her deposition. Except for mutual cooperation in effecting the sale of the tug, Hap and I have never been in “cahoots” nor have we ever had any agreement between us conspiring against Lynda. The result of this mess was that I had purchased the vessel (during a brief storm-free window of good weather) with facsimile contracts, while Baxter continued to drive a wedge between Lynda and Hap Schnase and me to thwart the removal of the lumber. This enabled Baxter to continue to charge his tenfold rents. Meanwhile, I was paying moorage in Seattle ($432 per month) for a boat that I could not take clear title to. I launched a lawsuit charging Lynda for breach of contract and specific performance for not forwarding signatures to Al Rode as clearly stated in Hook’s letter. Lynda (with Hook’s urging) frankly decided to keep the vessel as a bargaining chip in her upcoming divorce with Hap after I had moved it to safe harbor in Seattle at great expense to me. My legal costs with Lynda mushroomed to over $14,000 just to convert her facsimile signature to ink. I finally settled with Lynda with a pot-sweetener of $1000 on the courthouse steps. Her pledged in court to help me recover the materials on Baxter’s property; which she failed to do. Kim Marine finally received the signed bill of sale from Lynda on April 11th, three weeks late, which put Lynda in her second breach. After taking legal possession of the KATAHDIN, I threatened Mr. Baxter with a lawsuit and made no less than three more offers to settle for the arbitrary figure of $9000 just to “settle the matter,” and get on with the lengthy restoration process. Of course, Baxter has kept increasing the rents which now total $14,913.00 as of February 95. By March, Mr. Baxter was sued and through his attorney, Ms. Christine Kenady, they agreed to an arbitration hearing. Mr. Baxter insisted that we try this pro se that is, without attorneys. An attorney was selected in Bellingham, WA to act as “judge” and we sent all materials to him by May 1995. About a week before the hearing (scheduled for July 1995), Mr. Baxter noted that there might be a conflict of interest as this judge had done legal work for the firm that landed at the dock adjacent to his property and that this “might be a conflict of interest.” We switched to another judge and finally on to a third when time conflicts interfered. Finally Mr. Will Roehl agreed to hear the case and a firm date in August 1995 was set up at the Bellingham courthouse. As a result of this trial, all charges were dropped on both sides and I only had to pay the original $3000+ moorage. Further, Mr. Baxter was ordered to turn over all materials as I had asked, and would be fined $100/day if he didn’t comply. A time was set to remove everything and we showed up with our trucks (the third attempt). I had hired several people to remove the items but I was not allowed on the property due to the animosity between me and the Baxters. We did not receive the required amount of the Edensaw lumber (clear fir planking)ówe were shortened five planks or 154 board feet which had been initially miscounted. When we returned the next morning to remove everything from the roadside, the five planks had been removed into the Baxters woodshop and he was nowhere to be found. After legal haggling and another summoning of the Sheriff, we left without the materials and I proceeded back to court to enforce the $100/day fine which ultimately amounted to over $10,000. In order to weasel out of this one, Mr. Baxter obtained an affidavit, signed by Charlie Moore of Edensaw Lumber Company in Port Townsend,(his son in law’s partner) stating that Mr. Baxter was such a good customer that he routinely gave him an extra 5% free lumber and that was obviously why the Baxters kept the lumber. In essence, Charlie Moore of Edensaw lumber became a partner in this ongoing theft by perjuring himself. The court required the Baxters to pay me $8.00 per board foot for the missing lumber which I deducted from Baxter’s moorage Such are the events in dealing with David and Kitti Baxter of Orcas Island and Charlie Moore of Edensaw Lumber Company, Port Townsend. The tug has since been restored and is currently being used as live-aboard, part-time tow vessel, and floating dental clinic in Alaska.

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