Well, it seemed a good idea at the time - legal wrangling department

Talk about chutzpah! From the Raleigh, NC News & Observer:

Pull the plug on Lake Lynn, suit demands
Kristin Wallace bought some very wet land as an investment. Eight acres of it, all underneath Lake Lynn.

The Cary woman bought the land for $12,500 last year at a public auction of property with delinquent taxes. Now she is suing to try to force the city of Raleigh or Wake County to buy the soggy land from her or drain it.

"It's extremely valuable to me," Wallace said, "dry."

City and county officials say Wallace, who started investing in real estate less than two years ago, knew the land was lake bottom when she bought it, something she doesn't dispute.

"It's bought as is," said Shelley Eason with the County Attorney's Office.

Lake Lynn was built in the 1970s to control flooding and has since been enveloped by the city. Easements from private property owners allowed the county to create the lake. It's now surrounded by apartment complexes and dog walkers, cyclists and joggers on the greenway.

Wallace's Cary-based company, Sugartree Investment Group, sued the city and county in late August seeking to remove both the water and a wooden footbridge that is part of the city's greenway system ringing the lake. The lawsuit was filed after her lawyer, H. Cliff Kirkhart of Cary, sent several letters to the city and county offering to sell the land for an unspecified amount.

Kirkhart wrote that he considers the city to be "trespassing" on the land by allowing joggers and cyclists to use the footbridge. The county, which maintains the lake itself as part of a flood-control project, is acting "malicious" by keeping the land flooded, he wrote in a complaint filed at the courthouse.

And the reason the property came up for auction in the first place:

The 8 acres weren't always submerged. They were farmland, which was converted into a lake in 1976 as part of the Crabtree Creek Flood Control Project, a county-run initiative that created several dams and lakes to hold floodwaters. Other flood-control lakes include Shelley Lake and Lake Crabtree.

In 1983, the 8 acres were bought by now-defunct Lake Lynn Development, which owned surrounding dry land that would become homes and apartments.

Lake Lynn Development eventually went out of business. In 2006 the county revenue department noticed that yearly property tax bills of $9 to $35 a year had gone unpaid for more than a decade on the two parcels, one of 6.68 acres in the middle of the lake and a 1.32-acre inlet, Eason said.

More as a housekeeping effort than anything else, the county decided to get rid of the property and put it up for auction in September 2006 as required by law to try to recoup unpaid taxes. Expecting no bids, government officials thought the land would be transferred to the city, which would pay off the back taxes.

Neither the city nor the county envisioned someone's bidding for the water-logged land, Eason said.

Wallace entered the fray in the midst of the auction and made an upset bid of $6,250 on each parcel. She won, and the sheriff's deeds for both parcels were transferred to Sugartree Investment Group.

Heh... Looks like she has them by the balls so to speak. An interesting case.