Cause and Effect
For a restaurant, sourcing low-cost, daily-drinking wines isn't particularly difficult. However, when it comes to high-priced, hard-to-find bottles, the mere ability to secure a steady supply can significantly elevate a restaurant's value.
In particular, receiving high-end Cult Wines through direct wholesale distribution rather than through auctions is, in itself, a massive profit. In other words, Harry’s current proposal was predicated on the assumption that there would be Cult Wines available to be put up for auction in the future.
"Let's do that."
I accepted without hesitation. I didn't think there was any need to weigh the pros and cons over how many bottles of Cult Wine a restaurant would consume in a year. Seeing the skills of the lawyer Warren trusted and the one who represented Chloe’s farm, I felt this price was actually a bargain.
"Thank you. I don't think you'll be disappointed."
He wiped away some sweat and gave a faint smile.
"By the way, your younger sister must be quite the cook?"
"Of course. She’s a graduate of the CIA (The Culinary Institute of America)."
"Ah..."
The CIA, founded in 1946, is the premier culinary school in the United States. It is a private university that boasts such high prestige and authority that it is often called the Harvard of the culinary world. Even I, who didn't know much about cooking, had heard of its reputation.
"I heard that Brian previously prepared a pairing menu for a UC Davis alumni event..."
"How on earth did you hear about that?"
"There isn't much that happens in Napa Valley that I don't know about."
What kind of confidence is that...
"If you could come by and offer some advice, I would be very grateful."
"Haha..."
Warren, who had been watching from the side, chimed in.
"Did you ever put together a pairing menu?"
"Oh, yes... I just threw something together roughly."
"'Roughly'?"
Seeing Warren’s puzzled expression, Harry stepped in.
"To call it 'rough' is an understatement. From what I heard, it was quite sophisticated and high-quality. I even heard that one restaurant received very high praise after using that exact pairing. You are incredibly humble, Brian."
At those words, Warren’s eyes sparkled.
"Can I get a taste of that, too?"
"...... Maybe later."
"You must do it later. If you need to, I can call in a decent chef. Or, we can go to a restaurant of your choosing. If there's one thing I live for, it's the joy that food provides."
"Yes, yes... Anyway, thank you for helping Chloe with her case. When will everything be wrapped up?"
"I plan to finish it in two days. The more favorable the situation, the better it is to settle quickly. Unexpected variables can pop up at any time."
I couldn't agree more.
Two days later, morning. A small conference room in Lodi County.
Under the fluorescent lights, a single long table sat in the middle of the room, with four people facing each other on either side. On the left were Chloe and Harry; on the right were Jack O'Connell and his lawyer, Greg Richard. Given the circumstances, the atmosphere in the office was as cold as an arctic blast.
However, as if indifferent to the chilling atmosphere, Harry, sweating slightly, wiped his forehead with a handkerchief and slid a thick file into the center of the table.
"Let's begin."
Greg spoke first.
"Harry, we don't intend to waste time either. We both know the situation, so shall we get straight to the terms?"
Jack was sitting with his arms crossed, chewing on his lip. Chloe had her hands neatly folded on her lap, but Harry noticed the tips of her fingers trembling slightly.
"Very well. The terms for my client, Chloe Harris’s farm, remain the same as last time. We demand a priority usage right for 51% of the annual permitted pumping volume of the WS-3 Well."
As this was an expected demand, Greg responded as if he had been waiting for it.
"We cannot accept that ratio. Water rights are the right of the landowner. The well is on my client’s land, and he has borne all the maintenance and equipment costs until now."
"That is correct. Which is why we are not touching the ownership of the well itself. What we are demanding is not direct ownership, but a Pumping Easement. And that easement will be recorded as a 'right attached' to your farm’s land. As a Deed."
A Deed is a document in the United States where property-related rights are officially recorded and transferred. It’s equivalent to a property registration certificate, but in the U.S., a separate deed document is generated and recorded with the county every time a right is created.
Furthermore, an easement deed refers to a specific right to use another person's land; effectively, it meant that [a record granting priority usage rights to someone else] would remain on the land.
Greg retorted in a gruff voice.
"That’s the problem. The moment this Easement Deed is recorded at the county registrar, this land will remain as 'farmland where 51% of the water has been preempted by someone else.' Even if we try to sell the farm later, its value will drop significantly."
"Then should I assume there will be no agreement?"
At Harry’s calm question, Greg bit his lip. He had tried to bluff, but the fact that the other side was ready to walk away if they didn't like it left him feeling stifled.
"That’s why... we’ve considered up to 25%. One-fourth of the annual permitted pumping volume. Any more than that, and we can’t operate the farm."
Jack gritted his teeth and added,
"This is the maximum we can concede. Any more, and we can't farm at all."
But Harry calmly shook his head.
"My, my... that’s very different from my calculations. I understand that the wholesale price of pistachios skyrocketed by 18% in 2004 and 30% in 2005, and has maintained that high point since last year. Although a price drop is expected this year due to a good harvest, you’ve already made a fortune beyond that."
When Harry brought up the unexpected detail of the rising wholesale price of pistachios, Jack’s jaw dropped.
"No, that’s..."
"Jack O'Connell, you have already seen significant profits. How much of that would the costs incurred by water usage actually be? A few percent? And you’re saying you can’t operate the farm with 51%? As far as I’m concerned, the only interpretation is that you don’t want to reach an agreement."
Watching Greg struggle and Jack agonize while biting his lip, Chloe was deeply impressed by Harry. He spoke without a hint of excitement, almost as if he were bored, yet the other side was completely at a loss.
"You can’t expect the harvest and wholesale price of pistachios to remain good forever."
"Hmm... You have a very different standard than we do. And I cannot understand why you speak as if a massive loss is guaranteed every year."
"What if it isn't guaranteed?"
"The annual permitted pumping volume of the WS-3 well is registered with the NSJWCD at 300 acre-feet. Therefore, the 51% we requested would be about 153 acre-feet. To restore the groundwater contamination damage to my client’s farm and maintain pear cultivation in the long term, we need at least 100 acre-feet per year."
"So?"
"What we are asking of the farm is not a cap, but priority. If the actual usage is less than 100, the O'Connell farm can use the remainder as it is. I must point out that speaking as if an annual loss is guaranteed can be very misleading to a third party."
Jack swallowed hard.
"Then, what if a situation comes where we need to use 200?"
"That would be a problem, then. But in that case, couldn't you just pay us and purchase the water?"
He said it as if it were no big deal, but for Jack, it was maddening. It meant he would have to pay someone else for the water that came up through a well he had dug on his own land.
"Ha, hahaha..."
Ignoring Jack, who burst into a hollow laugh, Greg spoke.
"I understand fully. However, 51% is, no matter how I think about it, excessive. An adjustment is needed. Please consider that pistachios are a water-intensive crop."
Since it seemed like it wouldn't work, the initial aggressive stance was gone, and he immediately folded. Harry glanced at Chloe. He was checking her intention, and Chloe gave a slight nod.
Seeing that, Harry looked back at Greg and said,
"Very well. You should consider yourselves lucky that my client is very merciful. I will adjust it to 40%."
Though he thought it was a relief, Greg tried to negotiate again.
"I appreciate it, but just a little more..."
Before he could finish, Harry declared in a heavy voice,
"40%. I have conceded enough. There is no room for further negotiation."
At the attitude that trying to adjust any further would be futile, Greg looked at Jack. It meant there were only two choices left: accept the offer or go all the way to a lawsuit.
Jack closed his eyes for a moment, then opened them and gave a bitter smile.
"Damn it... I have no choice. Let’s do it."
For the first time, a faint smile appeared on Harry’s lips.
"Excellent. Then please sign the documents I have prepared. One Pre-Litigation Settlement Agreement, and one Pumping Easement & Water Use Agreement. These agreements will be registered with the Lodi County and San Joaquin County Recorder’s Office."
Jack and Greg, who had expected to reach an agreement here anyway, were satisfied with the 40% figure and signed the agreement, and Chloe also signed it, satisfied in her own way.
For her, she felt relieved that rather than fighting to the death for 51%, she had secured water resources for a potential drought while reducing the elements that would cause the other party to hold a grudge. She considered this a mutually satisfactory condition.
Moreover, since she had secured a massive amount of water resources, the value of her land had risen significantly. It had become land with a permanent water usage right attached.
After the agreement was finished, while in the car returning to the office with Harry, Chloe said,
"Thank you. Thanks to you, things were resolved well."
"It was my job."
Harry, who had managed to squeeze his body into the driver's seat, was surprisingly a good driver.
"But how do we check the irrigation volume of the O'Connell farm?"
"There are a few methods. One is to place a circular chart recorder on the wall of the pump room to record the water flow in real-time. If you put this recorder inside bulletproof glass and have the key held by a designated notary and yourself, the other party won't be able to cheat."
"Ah..."
"Another is The Power Audit. Instead of measuring water usage, we check the power consumption. To pull water from deep underground, you have to run a massive industrial pump, which requires a tremendous amount of electricity."
"Wow! So electricity usage equals water usage?"
"Exactly. Since tampering with flow meters is common, checking power consumption is much more precise. From now on, Chloe, you and your descendants will be able to monitor the O'Connell farm's water usage like the back of your hand."
"That’s amazing. How should I pay the fees?"
"No, that’s not necessary. Someone else has already paid on your behalf."
"Oh? I want to pay... Could I just return it and pay you myself?"
Watching Chloe, who spoke with sincere firmness, Harry looked at her as if she were a novelty.
"You seem to be close with them, so is there any need for that?"
"I’ve already received a lot of help. And I am a farm owner. I was taught that I should handle my own business."
Harry, slightly impressed, gave a deep smile.
"I see. However, what I wanted wasn't money, but something else. Wine. I’ve received something more valuable to me than money, so there is no reason to charge additional fees."
Chloe, roughly guessing the meaning, twitched her lips.
"I’m in debt again."
"In life, it’s only natural to receive help from someone. The important thing is what you do after receiving that help. Whether you forget the help you received, or whether you live diligently to repay it. Usually, that’s where life paths diverge."
He grinned with eyes that were barely visible due to his thick eyelids. For some reason, his words felt deeply meaningful to Chloe.