Great news regarding this controversial development!!

Contractors will likely lose thousands of dollars and investors may also lose substantial funds and it is not just the developer that is at fault for this debacle. The Superintendent of Real Estate did not enforce the legislation that requires developments to have all the approvals in place before any marketing is allowed. In addition, the loophole that the developer tried to use to market the RV lot leases needs to be closed through an amendment to the legislation.

SEAS is very appreciative of the legal efforts that the Columbia-Shuswap Regional District made to result in this decision. We now look forward to working with all interested parties to see this property purchased and added to Roderick Haig-Brown Park.

West Beach receivership confirmed

By Barb Brouwer – Salmon Arm Observer

http://www.saobserver.net/news/138087048.html
(use this link to see the illustration of the proposed RV development)

Published: January 26, 2012

Developer Mike Rink’s dream of a $30-million resort at West Beach Village on Shuswap Lake has come to an end.

The chance several Shuswap trades will be able to recoup losses in the neighbourhood of $750,000 has also waned. Instead, the receiver will take control and the lender will try to sell the property.

Protected by the courts until the end of this month, Rink’s company New Recreations Ltd. has chosen not to ask for an extension.

But Rink’s lawyer Andrew Prior, said this morning that it’s too early to speculate what might happen in the upcoming months.

Earlier this month, a Supreme Court judge ruled that storage sheds used to market the sale of RV sites are not consistent with previous use when the site was known as the Cottonwoods Campground.

“What that meant in a nutshell was they could not sell RV lots on this project, so the entire basis for their project collapses,” says David McMillan, a Kamloops lawyer representing the local trades. “They have now notified all parties they are not gonna play for another stay.”

McMillan says, in turn, the primary lender, Mission Creek Mortgages, has taken over the project, having applied for the appointment of a receiver.  “New Recreations is out; they’ve lost the project,” says McMillan. “Mission Creek will foreclose.”  McMillan says Mission Creek gave notice of foreclosure in the fall of 2010, but New Recreations sought and received court protection under the Company Creditor Arrangement Act.

“What will happen this year, is the receiver will attempt to operate the property in much the way it was operated previously,” says McMillan of the popular Cottonwoods Campground. “It will revert to a summer campground-RV type of operation, but the receiver and the lender will try to sell the entire thing and recoup what will turn out to be pennies on the dollar for them.”

McMillan says Mission Creek loaned New Recreations about $20 million, all based on the selling of the RV lots to make the operation worth $30 million. “New Recreations paid about $5 million and they paid too much because they paid for it in the belief this grandiose project would be a success,” he says.

McMillan says typically the mortgage company gets priority and all other liens are wiped out. “They never believed there would be anything, but they had to keep their foot in the door and monitor how the process worked out,” says McMillan of his clients. “I gave them that dose of bitter medicine a long time ago. Their prospects remain very slim, probably non-existent. Those trades could ask the question, where was the CSRD when they were talked into this place.”

While he agrees with the regional district’s determination the sheds were non-conforming, and believe his clients have little legal recourse with the CSRD, he wonders why the position wasn’t taken four years ago, when the project began.

Columbia Shuswap Regional District CAO Charles Hamilton disagrees with McMillan’s take on responsibility. “I simply dismiss those observations out of hand – that’s quite a reach to try to assign culpability to the CSRD…  Even if they had come to us, do you think it would have prevented the trades from taking these jobs?” he asks. “Is there some kind of obligation on the part of the CSRD to provide some warranty and guarantee to the ability of a developer to meet his obligations? I think not.”

In terms of the demise of the West Beach Village project, Hamilton says CSRD’s reaction is more muted than some. “We certainly don’t like to see failed development, it doesn’t send the right signals,” he says. “On the other hand, we felt we were put in a precarious situation where we felt development permits were required and our bylaws were simply being ignored.”

As a result, Hamilton says the regional district was left with no other option than to seek clarity through the courts.

In the meantime, McMillan says selling the property will be further complicated by the fact about $1 million worth of infrastructure has gone into the site he believes was bought at an inflated price. “Environmentalist can get back up on their hind legs and continue their lobbying efforts – that’s a good thing,” he says, noting his belief that the probability of the province taking over is not good. “It’s conceivable but not very likely; it’s not a good fit in terms of government priorities and objectives. Maybe the environmentalists could run it as an eco-friendly operation.”

West Beach falls into receiver’s hands

January 27, 2012

By Cam Fortems
Daily News Staff Reporter
Court protection from creditors has been lifted from the controversial West Beach development on Shuswap Lake and the project is in receivership.

But lawyers on opposite sides, acting for Mike Rink’s New Future Group and the first secured creditor, acknowledged Thursday uncertainties about what comes next.

New Future lawyer Andrew Prior, with Fraser Milner Casgrain in Vancouver, confirmed that protection from the Companies Creditors’ Arrangement Act, granted more than a year ago, has been lifted.

It was otherwise set to expire at the end of the month but New Future Group indicated it would not apply for another extension.

That allowed first creditor Mission Creek Mortgage Co. — owed more than $21 million — to have a court-ordered receiver appointed to take over West Beach. KPMG is now acting as receiver-manager of the popular campground and struggling development project beside Adams River.

Kenneth Ihas, a lawyer acting for Mission Creek, said the first mortgage holder now is in a position to foreclose.

“It is in a position to do that and it likely will,” he said.

That’s what happened at New Future Group’s half-completed Mission Hill project in Kamloops, where first creditor Harbour Mortgage foreclosed in December and is now the sole owner.

But the West Beach project is more complex, including the legal position of other creditors on title. It is not in bankruptcy and owner New Future Group retains the ability to pay off loans and gain back control.

Bankruptcy entails a declaration that assets are to be liquidated and turned over to creditors. Receivership, however, entails the business being given over to an appointed third-party firm to operate and pay back creditors.

New Future’s lawyer, Prior, said the development company remains in the picture.

“The next stage is underway. We have no idea what will come after that…. It’s not over, ‘till it’s over — and it’s not over. Anything else  is impossible to speculate about.”

Ihas called it “early days” and said Mission Creek is now preparing to rent the property for the traditional campground use in the summer.

“It will depend on how the (other) borrowers and stakeholders react,” he said of the foreclosure process.

The receivership comes about after a B.C. Supreme Court judge last week rejected a development plan based on selling 199-year leases on storage sheds, with associated rights to parking an RV at the waterfront property.

The Kamloops developer’s $100-million real estate holdings were granted protection under the Companies Creditors Arrangement Act in November 2010, in an effort to restructure.

Projects were broken down individually in a bid to make them economically viable and pay back creditors. The latest lifting of the CCAA order brings the process near to a close. Three of the largest projects failed and have been taken over by creditors.

West Beach garnered national attention in 2007 when New Future applied to rezone the former Cottonwoods Campground for a resort project beside the Adams River and its famed salmon run.

After it was turned down, Rink revamped the project to focus on the 199-year leases.

Kamloops lawyer David McMillan, who represents trades and suppliers claiming $750,000 in unpaid debts, said his clients never held out much hope for payback.

“It just means an end to the waiting and wondering. My clients were aware from the beginning that projections of the receiver relied on a house of cards and a grand vision coming true…. We were sceptical from the beginning.”

Rink could not be reached for comment.

Click here for reuse options!
Copyright 2012 Glacier Media Inc.

Good news, but the fight is not yet over. See the development lawyer’s response below this article. The next big court report is due at the end of the month, when the same judge will decide whether or not to extend the development’s bankruptcy protection.

Shuswap lease plan rejected, says lawyer
January 10, 2012
By Cam Fortems
Kamloops Daily News

A proposal by Kamloops developer Mike Rink to market leased lots and storage sheds for 165 RVs on Shuswap Lake is contrary to zoning, according to a lawyer who listened to a B.C. Supreme Court decision Tuesday.

David McMillan, who represents suppliers and trades at West Beach, said the ruling appears to scuttle the proposal to offer 199-year leases, along with associated storage sheds for each site. “If it means what I think it means, it means the storage shed plan goes down.”

According to the West Beach website, about 20 units were pre-sold. McMillan listened Tuesday to an oral ruling by B.C. Supreme Court justice Jon Sigurdson. A written decision is expected by later this week. The ruling comes as part of the drawn-out and complex Companies’ Creditors Arrangement Act (CCAA) for the New Future Group of companies.

Rink could not be reached for comment Tuesday.

A court-ordered monitor deemed the proposed West Beach project as one of only two, along with an undeveloped parcel in Nelson, in a position to make money to pay creditors. Together, the seven New Future projects that were originally granted protection had debts well in excess of $100 million.

A court-appointed appraiser estimated last year that West Beach is worth $38 million, based on selling the RV lots for an average $140,000. A key legal part of the project was storage sheds associated with the RV pads, allowing sites to be registered at the Land Title Office.

But McMillan said Sigurdson ruled storage sheds don’t conform with the original campground zoning at the former Cottonwoods Campground. The provincial Land Title Office also refused to certify a test lease submitted to the office. “The Columbia-Shuswap Regional District will be relieved,” McMillan predicted. “Its position is vindicated.”

CSRD raised its concerns about the RV and storage shed plan with the court-ordered monitor last year. New Future Group’s lawyers asked the B.C. Supreme Court for a declaration that the plan was valid in law. It argued the project fit within a pre-existing, non-conforming use at the historical Cottonwoods Campground.

The developer moved to the RV proposal after its plan for a larger condominium resort and marina at the premier beachfront property was defeated at public hearing in 2007. But McMillan said Sigurdson ruled the storage sheds are not consistent with uses at the former campground. Nor can they be considered an accessory.

“To me it’s a huge blow to the very concept of this development,” said McMillan, whose clients, like other creditors, were relying on it to turn a profit and pay back creditors. Sigurdson did allow, however, for use of park-model trailers that would be occupied seasonally. McMillan said the Supreme Court justice determined they are in keeping with traditional uses at the former campground.

New Recreations remains under CCAA protection until at least the end of January. It had been given a recent extension in order to reach a deal with creditors based on the RV development. An appeal of Sigurdson’s decision is possible.

Shuswap conservationist Jim Cooperman believes the decision marks the end of the project. “Of course, we’re elated by the news,” said Cooperman who heads a local environmental group and has fought development at West Beach.

If Rink’s companies are not granted continued protection, the property is likely to end up in the hands of Mission Creek Mortgage, the  first creditor. Cooperman said he holds out hope the province can eventually buy the property and add it to the adjacent Roderick Haig-Brown Park. “It could easily be run as a campground.”

West Beach project still has options, developer’s lawyer insists

January 11, 2012
By Cam Fortems
Kamloops Daily News
A B.C. Supreme Court judgment that rules out storage sheds as the basis for a proposed 165-unit RV park on Shuswap Lake “is not the end of the development,” a lawyer said Wednesday. Andrew Prior, a lawyer representing developer Mike Rink’s New Future Group, said questions remain on B.C. Supreme Court justice Jon Sigurdson’s oral decision Tuesday. Written reasons will be released this week or early next week.

Lawyers will pore over those written reasons when they are released to get a better understanding of what can be developed on the parcel beside Roderick Haig-Brown park, he said. “Although we lost on the lease structures, in our view it’s not the end of the development,” Prior said. “We want to get a handle on what can go in there.”

The court decision is the latest in the saga of West Beach. Rink originally proposed a large condominium project for the former Cottonwoods Campground site at the North Shuswap. But that was turned down by the Columbia-Shuswap Regional District four years ago. The public hearing drew national attention because of the proposed resort’s location near Adams River and its famed salmon run.

Undaunted, Rink came back with a plan to develop an RV resort, based on offering 199-year leases, with an associated storage shed that could be registered at the provincial Land Title Office. While the proposal for storage sheds was rejected by both the courts and Land Title Office, Prior said Sigurdson also affirmed some rights to development.

Sigurdson ruled park-model trailers are permitted because they conform to historical and seasonal campground use at the Cottonwoods Campground site. “It’s important to know we can put 165 park-model trailers there, something the regional district was disputing,” Prior said.

Prior said Sigurdson also ruled that the seasonal period for their use is longer than the 182 days in a CSRD bylaw. In 2010, New Future Group entered protection of the Companies’ Creditors Arrangement Act when it could no longer pay bills on debts of more than $100 million on seven B.C. projects, including Mission Hill condominium complex in Kamloops.

That half-completed project off Summit Drive is now owned by a mortgage company after it foreclosed on the property. West Beach was identified early on by a court-appointed monitor as one of two projects — the other an undeveloped parcel in the Kootenays — with the best chance to pay back creditors.

The development remains under CCAA protection until at least the end of this month, when lawyers may ask for an extension in order to rethink the project and repay creditors.It has more than $20 million worth of mortgage debt and money owed to trades and suppliers.

Copyright 2012 Glacier Media Inc.

Great news:

SLIPP continues monitoring lake
By Barb Brouwer – Salmon Arm Observer
January 11, 2012
http://www.saobserver.net/news/137099583.html
SLIPP successes continue to add up, thanks in-part to funding for a comprehensive three-year water-quality monitoring program.
Early last year, four Columbia Shuswap Regional District electoral areas, the Thompson Nicola Regional District and District of Sicamous agreed to contribute funds to the Shuswap Lake Integrated Planning Process for a three-year water-quality monitoring program. The City of Salmon Arm contributed $20,000 for one year and have made a commitment to contribute another $20,000 in 2012. The District of Sicamous contributed $2,500.

“The process was a little late getting full endorsement, we had a bit of a problem getting agreement,” says CSRD Electoral Area C South Shuswap director Ted Bacigalupo. “That’s been finalized and we have $1 million in place over three years.”
The program is well on its way with a total of 18 agencies, First Nations, stakeholders and non-governmental organizations taking part in watershed-wide monitoring.

Initiatives include monthly sampling of drinking water intakes in developed areas, regular testing of swimming beaches and work to determine the influence of last year’s large salmon run on the nutrient balance, algae growth, and sockeye salmon reproduction.
No algae blooms have been observed on Shuswap or Mara Lake this year; however, any minor changes that may influence algae growth in the lake are being monitored carefully, says Sarah Evanetz, SLIPP Program manager.
The program also assesses nutrient and contaminant loadings from all tributaries into Mara and Shuswap Lakes on a bi-weekly basis.

Samples are taken in several areas of the the Shuswap River watershed to determine which area and activity delivers the bulk of nutrients or contaminants that may contribute to algae growth. This is another step to finding the causes for previous blooms.
A web-based interactive map with water quality data results and analysis will be made available to the public on the SLIPP website in early 2012.

The website, launched earlier in the year, was a key element of SLIPP’s education campaign on public safety, shoreline health and water quality. This involved more than150 people days of lake patrols on Shuswap and Mara lakes, three open public meetings in August, three Shoreline Care workshops in November with contractors, developers, real estate agents, property managers and others involved in the real estate industry.

SLIPP also initiated a Foreshore Restoration Project in co-operation with landowners whose lakefront properties were near sensitive fish habitat areas, to restore healthy shorelines by removing concrete boat launches, docks and jetties. The first phase of voluntary restorations will take place in spring 2012.

A “one-window” approach to agency reviews through FrontCounter BC has improved the development application process, and shoreline management guidelines help clarify and streamline land use decision-making. The streamlined process also helps expedite applications in areas where fish habitat is not a concern.

Also on the slate for 2012 is a recreation management survey and public outreach initiative that will contribute to a comprehensive recreation vision for the Shuswap watershed, says Evanetz. “More SLIPP activities have been delivered in 2011 than ever before and a solid foundation has been established for advancing SLIPP’s goals in years to come,” she says.

Meanwhile, Bacigalupo, who was recently re-elected to the CSRD board and is chair for a one-year term, says the SLIPP program has made progress in dealing with another major issue – greywater.

“Waterway Houseboat Co. has already stepped on-board with that issue. All their new houseboats will contain greywater from all washers and hot tubs,” he says, noting greywater in the company’s new houseboats will be fully contained. “Showers and kitchen sinks are not yet contained, but hot tubs and washers were the issues of biggest concern.”
Overall, Bacigalupo says he is pleased with the collaboration between all the inter-government agencies and local governments that have stepped on board.

“We’ve got to make the commitment, verbally, morally and financially,” he says, noting SLIPP has removed the burden of protecting and enhancing the watershed from local government. “In my opinion, the SLIPP process has become the envy of a lot of other local governments.”

SmartCentres drops legal challenge

By Martha Wickett – Salmon Arm Observer

January 04, 2012

Salmon Arm Shopping Centres Ltd. has stopped its federal court case aimed at preventing information in the possession of Fisheries and Oceans Canada from being made public.

In August 2010, Warren Bell, president of Wa:ter (Wetland Alliance: The Ecological Response), submitted an Access to Information request for information from 1997 to 2009 related to the depositing of fill on properties at the site of the planned SmartCentres development at the west end of Salmon Arm.

He told the Observer that fill had been placed by previous owners on what was once an oxbow of the Salmon River, and so he and his group were curious what discussions took place with Fisheries and Oceans Canada prior to and following the fill replacement.

Fisheries and Oceans Canada was prepared to release the files, but Salmon Arm Shopping Centres consented to the release of only some of them. The company subsequently launched the court action versus the Attorney General of Canada and the Information Commissioner to block the release. It stated in court documents that the balance should not be disclosed because they do not relate to the request and could do probable harm to the company’s interests.

Part of the reason given was that they “would prejudice the applicant’s competitive position for a municipal land use rezoning process concerning the property.”

On Nov. 18, after months of legal dealings that included more than 60 letters, applications, affidavits, certificates, motions and orders filed with the Federal Court of Canada​, Salmon Arm Shopping Centres gave notice that it was discontinuing its case.

Bell finds the date significant.

“On the exact day that the (municipal) election campaign ended, SmartCentres withdrew their application for a judicial review… The timing of their withdrawal of the application is quite significant in my mind,” he said, noting it would have been the last time information would have been brought forth involving SmartCentres and Fisheries and Oceans Canada prior to the vote.

One possibility, he surmised, was “to keep any potentially damaging information out of the public view until the municipal election was over.”

“SmartCentres played a very active role in the election in Salmon Arm,” he added, by suggesting who people vote for and by posting entries on Facebook during the campaign promoting the development.

Nathan Hildebrand, SmartCentre’s land development manager, told the Observer in an email that legal processes, not the municipal election, were the driving reason behind the date the case was discontinued.

“Salmon Arm Shopping Centres Ltd decided to discontinue the federal court case involving the FOI (freedom of information) request after discussions with and advice from our lawyers. Although we still do not agree with the position of the Department of Fisheries and Oceans regarding the release of information that was not relevant to the original FOI request, we have weighed the costs associated with the next steps of the application and have made a business decision not to proceed. The timing of our decision was driven by the appropriate legal processes surrounding the FOI application.”

Salmon Arm Shopping Centres Limited, Inc. is one of the owners of property at the site of the planned shopping centre and is one of a group of affiliated entities operating under the trade name SmartCentres.

Bell has not yet received the information requested, which he is expecting will be about a 1000-page digital file.