The battle for the Guejito: Pristine ranch nearly the size of Escondido is a saga of money, intentions

By: DARRYN BENNETT - Staff Writer | Saturday, March 1, 2008 10:39 PM PST ∞

RANCHO GUEJITO ---- The words Benjamin Coates penned the year he died about his beloved 23,000-acre historical ranch seem laughable today.

"I use it for myself, my family and my friends to ride over and hope to continue its ownership in such a way that it is not developed nor mixed up with money," Coates wrote in a letter dated June 18, 2004, to Gov. Arnold Schwarzenegger.

Fast forward to 2008 and the fate of Rancho Guejito is fraught with uncertainty. In fact, the only thing that does seem sure is that it's certainly mixed up with money.

Despite the vastness of the property, most people don't know the ranch exists. Few have even been allowed to see it. But beyond the unincorporated groves and pockets of housing tracts of Valley Center, past a four-mile dirt road that snakes through clusters of chaparral and rare, stately Engelmann oak, lies the legendary Guejito ---- the last intact Mexican land grant in the state.

The Guejito saga is one of a bitter dispute among monied families, an unlikely politician who vows to stave off developers who seem to be eyeing the ranch, and Coates' intensely private family, which remains vague about its plans for the vast swath of land.

Shielded from the public by a locked gate, security cameras and a protective attorney who speaks for Coates' media-wary daughter, Theodate, the ranch has been owned by a series of wealthy men, beginning with a customs agent who won the favor of a Mexican governor more than a century ago.

A gift of Pio Pico
In 1845, Jose Maria Orozco rode a horse-drawn wagon north from Old Town San Diego to what is now Valley Center to claim the 13,000-acre ranch. It was a gift from Pio Pico, the last Mexican governor of the state.

Following in the footsteps of a commander of a whaling ship in the 1800s, a San Diego County sheriff and Robert E. Lee's cousin, the late Coates was the last owner of Guejito, one piece of an impressive estate whose value is estimated at more than a billion dollars and that Theodate now controls.

Coates bought the property for $10 million in 1974. In the last 150 years, the seven owners added roughly 10,000 acres, bringing the ranch close to the size of Escondido.

The history of the ranch and the men who have owned it is a tale that has been pieced together from historical texts, property records, court documents and a series of interviews.

The rugged expanse stretches from the San Pasqual Valley north to the 4,221-foot peak of Pine Mountain near the La Jolla Indian Reservation. Meadows and mesas dot the landscape. After a good rain, gurgling streams serve as watering holes for herds of deer, packs of coyotes and the occasional bobcat.

American Indian archaeological sites, an adobe from the 1800s and a once-busy winery are landmarks on the untamed ranch, often described by environmentalists and people who have seen it as "Eden," a "crown jewel" and a "time capsule."

"It's like, welcome to yesterday," said Bob Lerner, a Valley Center historian and Coates family friend. "Mr. Coates was right when he said it's one of the most beautiful places on the face of the Earth."

The Philadelphian
Like the ranch, Coates had a certain mystique about him, people who knew him say.

"He was very difficult to get to know," Lerner said. "But he was a history buff and that's how I got to know him."

Coates was a wildly wealthy Philadelphian who earned his fortune in real estate and shipping. He was a well-traveled man who used his passport from Belize to roam among his homes in Japan, the United States and Europe. He docked a large yacht he owned for several years in the French Riviera and wrote that he regretted selling it.

"When I let her go, I was never king again," he wrote in the 2004 letter to Schwarzenegger.

Coates was a decorated Navy pilot who wrote proudly of his days searching out Nazi submarines in the Atlantic Ocean from Brazil to Africa. He wrote of royal friends in Germany and a Japanese prince he befriended at Princeton before attending law school, and he embarked on an array of entrepreneurial ventures during his 86 years, including oil wildcatting.

He owned apartments in Paris and Tokyo, the 23,000-acre Wyvis estate in Scotland, a 31-story office building on Madison Avenue in New York City, and a 2,000-acre ranch near Hemet formerly owned by actor John Wayne.

Still, those who knew him say the aging tycoon loved Guejito the most and planned to pass it down to his heirs with strict instructions that it remain unchanged.

But determining the rightful manager of Coates' estate is proving to be complicated.

For more than a year, Theodate Coates, a New York artist, has been embroiled in a legal dispute with Al Hill III, a wealthy Dallas businessman and socialite who says he considers himself Coates' "adopted son."

Trust in Hill
Hill said earlier this month he's preparing to refile for a third time a lawsuit against Theodate that will allege that her tycoon father developed such a deep respect and affinity for Hill that he wanted him to control his estate after his death because he didn't trust women, including his daughter, to manage his legacy.

Hill said the only problem is that Coates died before he got a chance to sign the papers finalizing his wishes.

A New York Supreme Court judge dismissed the case last month, saying Hill failed to show proof that any such agreement ever existed.

Hill couldn't be reached last week for more comment. And Theodate Coates doesn't grant interviews, according to Hank Rupp, the Temecula-based attorney who represented Coates for nearly 20 years and now speaks for Theodate.

Rupp says Hill's allegations are entirely without merit.

Coates befriended Hill's great-grandfather, the legendary Texas wildcatter and super-wealthy oilman H.L. Hunt, in the early 1960s after buying a home in Houston to try his luck in the oil business.

Hill met Coates when he was 18 years old and says he's trying to honor his mentor's dying wishes that Guejito remain pristine. He's asking the court to rule him the manager of Coates' estate ---- including Guejito ---- and assess monetary damages against Theodate for usurping control.

Avoiding conflict
Hill's spokesman, a prominent Texas-based attorney named William Brewer III, said Hill told Theodate that he wouldn't have sued her if she were honoring her late father.

"He told her, 'Protect and preserve (the ranch) as were your father's wishes and we will have no problems,' " he said in a phone interview this month.

Brewer speaks with a disarming Southern drawl. He says Hill would leave the mostly pristine ranch as it is, unblighted by development and thick with rolling hills, creeks, valleys and craggy mountains.

"He made a promise because (Guejito) is such an important part of Mr. Coates' legacy, and what Mr. Coates feared most in leaving his estate is that (Theodate) would sell it to developers," Brewer said. "(Hill) didn't need a job."

Hill has also filed a separate lawsuit in the country of Liechtenstein, where Coates placed his holdings in a 100-year trust in 1986.

The ownership of Rancho Guejito is complex.

The ranch continues to be managed from New York and is directly owned by the Rodney Co., the firm Rupp represents. Before his death, Coates had placed his properties in the trust under the laws of Liechtenstein, with cousin Thomas Fisher as trustee.

Fisher later resigned as trustee and appointed Theodate in his place, a move that contradicts the terms of the trust, according to Hill's allegations in the lawsuit.

The lawsuit also says that Coates gave "specific instructions that Rancho Guejito never be sold," but that his daughter "has already made inquiries into the prospects for subdividing this property."

That's where San Diego County Supervisor Bill Horn enters the story.

Strange bedfellows
Horn said last week he feels like he's been betrayed by Coates' heirs after years of "protecting" Coates from county zoning changes that could have threatened the preservation of the ranch.

"I believe Coates had an honest, heartfelt commitment to keep the ranch pristine," he said."I supported him in that."

It's a surprising position for Horn to take.

"I'm a property rights advocate," he said. "This is the first time in my life I've become a green champion, but to let (the ranch) go would be like shooting the last buffalo. It's too important to the county, the whole state really."

Horn's passion for the land he once rode a horse across with Coates has won him an unlikely ally in Dan Silver.

It's not surprising that Silver wants to preserve Guejito.

After all, he's an avid environmentalist and president of the Endangered Habitats League. Now he and Horn, often on opposite sides of such debates, are working together to find the money to buy Guejito ---- if they can convince Theodate to sell.

"Silver and I need to go to D.C. and look for some big money to buy this thing with," Horn said.

Horn said Coates' heirs "reassured" him over a lamb chops luncheon several years ago at the hacienda home Coates built on the southern end of Guejito that they shared the late owner's commitment.

But not long after the luncheon, Valley Center residents saw surveyors hanging around the ranch, and Rupp sent a letter to the Escondido City Council proposing they annex Guejito, suggesting a medical research facility or university could be erected on the working cattle ranch.

"There they were trying to subdivide (the ranch) and nobody bothered to tell me about it," Horn said. "I was baffled."

Meanwhile, Rupp has consistently told the North County Times that the Coates family intends to protect the value of the Rancho Guejito property and that there are no plans to build homes on it or sell it.

Still, Horn and Silver said they have their doubts.

"Well I know if they try to develop I'll be there tugging the other way on that rope," Horn said.

In addition to the annexation request, the most recent addition to the ranch, a 100-acre parcel named Rockwood Ranch purchased by the Rodney Co. for $3.37 million last year, sparked rumors that Coates' heirs were preparing to develop the land. The property connects the ranch to Highway 78 and could serve as the site of a future road, preservationists worry.

Also, papers filed with the county Department of Planning and Land Use in 2005 include a map of "preliminary potential development areas" totaling 7,300 acres. However, county planning officials said that additional plans have not been submitted.

Rupp has said in previous interviews that for now, Theodate is no more interested in selling the land to conservationists than she is to developers. Furthermore, Rupp has said the Coateses have protected the land for more than 30 years.

Silver said he does commend the family for its stewardship, but that he'd just like a chance to negotiate with Theodate.

"I'd welcome the opportunity to sit down and talk with (the owners) and try to understand their goals for the ranch," he said this week.

He said he doesn't know what would be a fair selling price, but that money isn't the issue anyway.

"The issue is the family aren't willing sellers'" Silver said. "It's too bad because to turn the land over for preservation would be a wonderful legacy for the (Coates) family."

Contact staff writer Darryn Bennett at (760) 740-5420 or dmbennett@nctimes.com.

Who's who in the Guejito saga

Benjamin Coates: A wealthy businessman who bought Rancho Guejito for $10 million in 1974 after the state failed to purchase it for a park. He died in 2004 at age 86.

Theodate Coates: Benjamin Coates' daughter who lives in New York and currently manages her father's empire.

Hank Rupp: The attorney who represented Benjamin Coates for nearly two decades and now speaks for Theodate.

Al Hill III: The Dallas investor and great-grandson of legendary Texas oil tycoon H.L. Hunt, who contends that he, not Theodate, is the rightful manager of Coates' estate.

William Brewer III: The Texas-based attorney who represents Hill in his suit against Theodate Coates.

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