In the mid 1830's Governor Alvarado appointed the Pico brothers as admistrators of the San Luis Rey Mission.
A few years later in 1842, Governor Alvarado deeded almost 90,000 acres along with the Mission's Rancho Santa Margarita Rancho to the Pico brothers. Using legally permissible but morally questionable tactics, Pio got the Indians living at
Plagued by personal debt, Pio sold Rancho Santa Margarita y Las Flores in 1864 to an English man by the name of John Forster. Forster came to Mexico on his own in his late teens from there he worked his way overland arriving in Los Angeles just as the mission lands were up for grabs. He saw an opportunity. But, to legally own land one needed to be a Mexican citizen. So Forster became a Mexican citizen, converted to Catholicism, and married the sister of the politically connected and well-known Pico brothers. Her name was Y'sidora
As Forster continued to gain wealth and prestige he became Don Juan Forster. So Pico sold the Rancho Santa Margarita y Las Flores to his brother-in-law Don Juan Forster.
Don Juan's holdings in Orange County abutted the Rancho Santa Margarita y Las Flores so his total holdings grew to well over 200,000 acres. The largest ranch in California. Don Juan added to the Pico brother's two-room adobe into an impressive hacienda. A terrible multi-year drought in the late 1860's changes in the fence laws and legal expenses incurred defending himself from a suit brought by Pio Pico, depleted Don Juan's finances. When he died in 1882 his heirs were forced to sell the ranch to pay off his debts. Don Juan's heirs sold the huge Rancho to an Irishman named Richard O'Neill backed by a silent partner James Flood.
Richard O'Neill had immigrated to America with his parents and came to California seeking his fortune in the goldfields. Like most gold miners he did not strike it rich. Instead, he went back to the family business of being a butcher. He would purchase cattle from as far away as San Diego for his shop in San Francisco for slaughter and sale.
James C. Flood another Irishman was the richest man in California at the time. Like O'Neill, he had come to California seeking his fortune in the goldfields. Like O'Neill, he failed. After owning a San Francisco saloon he became rich beyond his wildest dreams by buying and selling silver mining company stocks in the Comstock Load. Flood was seeking to diversify his holdings and thought cattle ranching would be a good way to do that. He also knew if his name was attached to the sale, the price would skyrocket. So he entered into an agreement with Richard O'Neill, the experienced but by no means wealthy butcher. O'Neill would find and purchase a ranch using his name but Flood's money. O'Neill would manage the ranch for 20 years, after which Flood would grant him 50% ownership of the property. The two sealed the deal with a simple handshake. Richard O'Neill moved his family into Forster's old hacienda and began managing the ranch.
James C. Flood died a few years later, but his son James L. Flood honored his father's handshake agreement. In 1902 the Floods and O'Neills became 50-50 partners. When Richard O'Neill died in 1908 his son Jerome took his place. This arrangement lasted until 1926 when strangely James L. Flood and Jerome O'Neill died within a day of each other. This unfortunate circumstance forced both families to address a very difficult question. Do they sell and divide the profits or keep it running as a ranch. This loggerhead continued for a number of years, so control of the ranch passed to a bank acting as conservator.
In 1942 the United States Marine Corps purchased Rancho Santa Margarita y Las Flores which included125,000 acres for $4.1 million.