Hanson v. So. Side Canal Users Asso

No. 12727

I N THE SUPREME COURT O THE STATE O MONTANA F F

E M R D o H NO e t a l e , L E ASM

P l a i n t i f f s and Respondents,

S U H SIDE C N L USERS' ASSOCIATION e t a l . , OT AA

Defendants and Appellants.

Appeal from: D i s t r i c t Court of t h e Fourteenth J u d i c i a l D i s t r i c t , Honorable V i c t o r H e F a l l , Judge presiding.

Counsel of Record :

For Appellants :

Berg, Angel, Andriolo and Morgan, Bozeman, Montana Ben E. Berg, Jr. argued, Bozeman, Montana Harrison, Loendorf and Poston, Helena, Montana James To Harrison, Jr. argued, Helena, Montana

For Respondents:

Small, Cummins, Hatch and Gregory A. Jackson, Helena, Montana Floyd 0, Small argued and Carl Hatch appeared, Helena, Montana

Submitted: A p r i l 8, 1975

Decided: JUh! 1 3 1975

Filed : 3 t F : :975 3

Clerk M r . J u s t i c e Wesley C a s t l e s d e l i v e r e d t h e Opinion of t h e Court.

T h i s i s an a p p e a l by defendants South Side Canal Users' A s s o c i a t i o n and Montana S t a t e Water Conservation Board, from a judgment of t h e d i s t r i c t c o u r t , Meagher County, a d j . u d i c a t i n g p l a i n t i f f s ' r i g h t s t o w a t e r s of t h e North Fork of t h e Smith River and awarding each a p r i o r i t y d a t e of A p r i l 1, 1915. The o r i g i n a l d e c r e e a d j u d i c a t i n g w a t e r s of t h e North Fork of t h e Smith River was rendered by t h e d i s t r i c t c o u r t on August 30, 1890. A l l p l a i n t i f f s i n t h e p r e s e n t a c t i o n , except Elmer Hanson and Howard Zehntner, a r e s u c c e s s o r s i n i n t e r e s t t o t h e o r i g i n a l p a r t i e s of t h e i n i t i a l a c t i o n and own decreed r i g h t s i n t h e North Fork. Other persons having decreed r i g h t s i n t h e North Fork have n o t been j o i n e d a s p a r t i e s t o t h i s p r e s e n t a c t i o n . O October 23, 1935, t h e Montana S t a t e Water Conservation n Board f i l e d f o r r e c o r d i n t h e o f f i c e of t h e c l e r k and r e c o r d e r of Meagher County i t s d e c l a r a t i o n o f i n t e n t i o n t o s t o r e , c o n t r o l and divert " A l l unappropriated w a t e r s of North Fork of Smith River and t r i b u t a r i e s *** II Said w a t e r s w i l l be a p p r o p r i a t e d by means of Storage R e s e r v o i r , Located: Meagher County, Sec. 17 & 20, T. 10 N. R. 8. 11 Within f o u r y e a r s of t h e f i l i n g of t h a t n o t i c e , t h e S t a t e Water Conservation Board c o n s t r u c t e d t h e Sutherland Dam w i t h a c a p a c i t y of approximately 11,000 a c r e f e e t of water. After the construction of t h e dam and w i t h i n f o u r y e a r s of t h e f i l i n g of i t s d e c l a r a t i o n , t h e S t a t e Water Conservation Board a l s o completed t h e c o n s t r u c t i o n o f t h e South Side Canal. P l a i n t i f f s f i l e d t h e i r complaint i n t h e d i s t r i c t c o u r t on March 6 , 1969, and a l l e g e d t h e r e i n : 11 That e v e r s i n c e t h e making and e n t e r i n g of t h e a f o r e - mentioned d e c r e e and a d j u d i c a t i o n of water r i g h t s , a l l of t h e above-named p l a i n t i f f s and t h e i r predecessors i n i n t e r e s t have, i n t h e s p r i n g season of each y e a r , been t a k i n g and u s i n g f o r b e n e f i c i a l u s e and purposes and f o r

i r r i g a t i o n of t h e i r l a n d s w i t h i n t h e d r a i n a g e of s a i d Smith River and i t s t r i b u t a r i e s , sub- s t a n t i a l and *** a d d i t i o n a l amounts of t h e f l o o d o r waste w a t e r s t h a t normally run and flow down s a i d s t r e a m o r s t r e a m s , over and above t h e i r t a k i n g and use of t h e i r decreed r i g h t s i n t h e normal flow of s a i d s t r e a m o r s t r e a m s ; and t h a t such a p p r o p r i a t i o n and useage of s a i d f l o o d o r waste w a t e r s by p l a i n t i f f s and t h e i r p r e d e c e s s o r s i n i n t e r e s t , have e x i s t e d and been c o n t i n u o u s , each and every y e a r s i n c e t h e time of t h e e n t r y of s a i d aforementioned d e c r e e and a d j u d i c a t i o n ; and t h a t by r e a s o n t h e r e o f , and through t h e t a k i n g and u s e of s a i d f l o o d o r waste w a t e r s , p l a i n t i f f s and t h e i r p r e d e c e s s o r s i n i n t e r e s t , have made and e s t a b l i s h e d a v a l i d a p p r o p r i a t i o n and u s e of s a i d f l o o d and w a s t e w a t e r s , d a t i n g back t o a p e r i o d p r i o r t o 1918. "That p u r s u a n t t h e r e t o , p l a i n t i f f s and t h e i r p r e d e c e s s o r s i n i n t e r e s t have c o n t i n u o u s l y used s a i d f l o o d o r waste w a t e r s i n a d d i t i o n t o t h e i r decreed r i g h t s i n t h e normal flow of s a i d s t r e a m d u r i n g t h e months of A p r i l , May, and June of each y e a r , u n t i l t h e defendant S U H SIDE C N L USERS' ASSOCIATION i n t e r r u p t e d O T AA and i n t e r f e r e d w i t h p l a i n t i f f s ' u s e t h e r e o f d u r i n g t h e p a s t two y e a r s * * *. "* * * and t h a t p l a i n t i f f s a r e a c c o r d i n g l y de- s i r o u s of o b t a i n i n g h e r e i n a supplemental d e c r e e of a d j u d i c a t i o n of t h e water r i g h t s of s a i d North F o r k - o f t h e Smith River and i t s t r i b u t a r i e s , r e c o g n i z i n g and a d o p t i n g t h e decreed r i g h t s a s e s t a b l i s h e d and e x i s t i n g under t h e aforementioned o r i g i n a l a d j u d i c a t i o n d e c r e e of 1890, t o g e t h e r w i t h any amendments t h e r e o f t o t h e p r e s e n t t i m e , and f u r t h e r a d j u d i c a t i n g and d e c r e e i n g t o t h e p l a i n - t i f f s h e r e i n a d d i t i o n a l r i g h t s i n t h e w a t e r s of s a i d s t r e a m o r streams i n t h e r e s p e c t i v e amounts a s hereinabove s e t f o r t h f o r each of s a i d p l a i n t i f f s * * *. "* * * and t h a t t o t h e e x t e n t and amount of f l o o d o r waste w a t e r s r e q u i r e d t o f i l l s a i d r e s e r v o i r , t h e p l a i n t i f f s h e r e i n r e c o g n i z e and accede t o t h e r i g h t s o f s a i d Water Conservation Board, b u t t h a t i t i s claimed and sought by p l a i n t i f f s h e r e i n t o a s s e r t and e s t a b l i s h t h e i r r e s p e c t i v e r i g h t s t o any and a l l waste o r f l o o d w a t e r s i n o r upon s a i d streams each y e a r t h a t a r e n o t r e q u i r e d f o r t h e f i l l i n g of s a i d r e s e r v o i r , and which would normally o t h e r w i s e b e l o s t t o any p r e s e n t b e n e f i c i a l u s e * * *. "*** b u t t h a t d u r i n g t h e p a s t two (2) y e a r s , s a i d defendant South Side Canal u s e r s ' A s s o c i a t i o n , has a l s o , and i n a d d i t i o n t o t h e purchased s t o r a g e w a t e r s from s a i d r e s e r v o i r , d i v e r t e d and assumed t o convey through s a i d d i t c h and c a n a l , l a r g e q u a n t i t i e s of f l o o d o r waste w a t e r s from t h e s a i d North Fork of t h e Smith R i v e r and i t s t r i b u t a r i e s , which a r e waste o r f l o o d w a t e r s of s a i d s t r e a m o r s t r e a m s , over and above t h e amounts t h e r e o f r e - q u i r e d f o r t h e purposes of t h e Montana S t a t e Water Con- s e r v a t i o n Board and i t s r e s e r v o i r hereinabove mentioned. *** "That t h e d i v e r s i o n by s a i d d e f e n d a n t , South Side Canal Users' A s s o c i a t i o n , of s a i d waste o r f l o o d w a t e r s from s a i d stream was and i s i n d e r o g a t i o n of t h e r i g h t s of each and a l l of t h e p l a i n t i f f s h e r e i n t o t h e u s e of s a i d waters * * *.

1' That such d i v e r s i o n and i n t e r f e r e n c e of s a i d f l o o d o r waste w a t e r s by s a i d defendant South Side Canal Users' A s s o c i a t i o n , i s w i t h o u t r i g h t , and con- t r a r y t o t h e r i g h t s of t h e p l a i n t i f f s and each of them hereinabove named by v i r t u e of t h e f a c t t h a t , a s h e r e i n - above s e t f o r t h , s a i d p l a i n t i f f s and t h e i r r e s p e c t i v e predecessors i n i n t e r e s t , have h e r e t o f o r e a p p r o p r i a t e d and e s t a b l i s h e d t h e i r r e s p e c t i v e r i g h t s t o t h e amounts o f s a i d f l o o d o r waste w a t e r s i n t h e amounts hereinabove s t a t e d , and have used and made b e n e f i c i a l u s e of such w a t e r s con- t i n u o u s l y f o r a period d a t i n g back p r i o r t o t h e year 1918, and t h a t s a i d p l a i n t i f f s , and each of them, a r e e n t i t l e d a s a g a i n s t s a i d defendant South Side Canal u s e r s ' Associa- t i o n , t o a d e c r e e a d j u d i c a t i n g t h e r i g h t s of s a i d p l a i n t i f f s , and each of them, t o p r i o r r i g h t s i n and t o t h e w a t e r s and f l o o d w a t e r s of s a i d North Fork of t h e Smith River and i t s t r i b u t a r i e s , over and above any decreed r i g h t s t h a t s a i d p l a i n t i f f s , o r any of them, o r any o t h e r p e r s o n s , may now have i n t h e u s e of t h e normal flow of s a i d stream o r streams ** *.I'

T r i a l commenced October 1 3 , 1970, b u t was continued u n t i l A p r i l 16, 1973, w h i l e t h e p a r t i e s attempted t o s e t t l e t h e i r d i f f e r - ences among themselves. I n i t s f i n d i n g s of f a c t Nos. X I V and XV, t h e d i s t r i c t c our t found t h a t p l a i n t i f f s , o r t h e i r p r e d e c e s s o r s i n i n t e r e s t , made v a l i d and complete a p p r o p r i a t i o n s of t h e w a t e r s of t h e North Fork of t h e Smith River, i n a d d i t i o n t o t h e i r r i g h t s under t h e 1890 d e c r e e ; t h a t t h e exact d a t e of any one of such a p p r o p r i a - t i o n s was n o t shown b u t i t was c l e a r t h a t none of t h e appropria- t i o n s was l a t e r than t h e y e a r 1915. He t h e r e f o r e awarded a l l p l a i n t i f f s a d d i t i o n a l water r i g h t s i n v a r i o u s q u a n t i t i e s , each w i t h an e q u a l p r i o r i t y d a t e of A p r i l 1, 1915. S e v e r a l i s s u e s were r a i s e d by defendant South Side Canal Users' A s s o c i a t i o n i n i t s appeal. While t h e Montana S t a t e Water Conservation Board f i l e d a b r i e f and argued o r a l l y , i t d i d n o t f i l e any n o t i c e of a p p e a l . W need d i s c u s s only one i s s u e : e Whether t h e evidence was s u f f i c i e n t t o support t h e f i n d i n g s o f f a c t and c o n c l u s i o n s of law e n t e r e d by t h e d i s t r i c t c o u r t ? W hold t h e e evidence does n o t support a f i n d i n g t h a t any of t h e p l a i n t i f f s made a v a l i d a d d i t i o n a l a p p r o p r i a t i o n a s of 1915 o r a t any time p r i o r t o

Although numerous witnesses, including members of the South Side Canal users' Association, testified that they used as much flood water as was available in the spring; that they had done so for as long as they could remember; and, that the flood waters were beneficial to their crops; the testimony of only three witnesses bore even remotely on events prior to the year 1921. Billy Smith was born in 1903 and had lived in White Sulphur Springs all his life. In 1915, he would have been 12 years of age. He testified that the decreed users had been using considerable amounts of flood waters ever since he could remember. However the earliest specific date which is mentioned in his testimony is 1925, when he started working for the Cestle Mountain Ranch. Louis Jefferson testified that he had worked on the Holmstrom ranch since 1918 and started irrigating "in the early 20's". He then testified that the ranchers in the area had been It using the flood waters ever since that time". That latter testi- mony related as much to "the early 20's" as it did to 1918. He testified the Holmstrom ranch had been using the flood waters "for the past 50 [years] that I know of." Fifty years prior to the testimony of Louis Jefferson would have been 1923. Gertrude McStravick testified that she could "remember quite clearly what happened around 1913, '14." She stated she was sure that her granduncle always used the flood waters, "Otherwise he couldn't have grown the hay he did." She stated that she "rode around the ranch in his buggy with him and it was always very wet. I I However, her testimony made no distinction between flood water and decreed water. Further, on cross-examination, she admitted that she did not know the capacity of the ditches as far back as 1913. The testimony set forth above is the sole testimony in a lengthy transcript bearing on events prior to 1921. It was clearly insufficient to support the award of 11,450 miner's inches of flood waters to the fifteen plaintiffs with a priority date prior to 1921.

Nor have p l a i n t i f f s s i n c e 1921 a c q u i r e d any r i g h t s i n t h e w a t e r s of t h e North Fork of t h e Smith R i v e r a d d i t i o n a l t o t h e i r 1890 d e c r e e d r i g h t s . I n 1921 t h e l e g i s l a t u r e e n a c t e d C h a p t e r 228, Laws o f 1921, which p r e s c r i b e d t h e method o f making a n appro- p r i a t i o n of t h e waters of an adjudicated stream. Section 4 of t h a t s t a t u t e was c o d i f i e d a s s e c t i o n 89-829, R.C.M. 1947, r e p e a l e d 1973. I n Anaconda N a t i o n a l Bank v. Johnson, 75 Mont. 401, 411, 244 P. 1 4 1 , t h i s Court h e l d t h a t method o f a p p r o p r i a t i o n o f t h e w a t e r s o f an a d j u d i c a t e d s t r e a m e x c l u s i v e a s t o a p p r o p r i a t i o n s made a f t e r t h e p a s s a g e of t h e a c t . Here, ~ l a i n t i f f s 'c o m p l a i n t d i d n o t comply w i t h t h e r e q u i r e m e n t s o f s e c t i o n 89-829, a s i t e x i s t e d a t t h e time of i t s f i l i n g . P l a i n t i f f s acknowledge t h e y have n o t followed t h e p r o c e d u r e f o r making a p p r o p r i a t i o n s s e t f o r t h i n s e c t i o n 89-829, R.C.M. 1947, b u t contend, i n s t e a d , t h a t t h e s t a t u t o r y procedure i s n o t e x c l u s i v e . That argument i s answered by t h e h o l d i n g i n Anaconda N a t i o n a l Bank. p l a i n t i f f s ' complaint w i l l n o t be construed a s t h e p e t i t i o n c a l l e d f o r by s e c t i o n 89-829. The c o m p l a i n t s o u g h t t h e a d j u d i c a t i o n o f r i g h t s which p l a i n t i f f s a l l e g e d had p r e v i o u s l y v e s t e d i n them and which w e r e , a l l e g e d l y , b e i n g w r o n g f u l l y d i v e r t e d by t h e South S i d e Canal U s e r s ' A s s o c i a t i o n . It d i d not purport t o obtain f o r plain- t i f f s any - w a t e r r i g h t w i t h a p r i o r i t y d a t e a s of t h e d a t e of new f i l i n g t h e complaint. W do n o t answer whether p l a i n t i f f s c o u l d have o b t a i n e d e a d d i t i o n a l w a t e r r i g h t s had t h e y complied w i t h s e c t i o n 89-829, R.C.M. 1947, a s i t t h e n e x i s t e d ; n o r w h e t h e r p l a i n t i f f s may a p p r o p r i a t e t h e s o - c a l l e d " f l o o d w a t e r s ' ' o f t h e North Fork o f t h e Smith R i v e r p u r s u a n t t o t h e p r e s e n t Montana Water Use A c t , s e c t i o n s 89-865, R.C.M. 1947, e t s e q . ; n o r t h e e x t e n t of t h e s t a t e ' s a p p r o p r i a t i o n s h o u l d t h e p l a i n t i f f s be s u c c e s s f u l i n making such an a p p r o p r i a t i o n . W acknowledge h e r e t h e d i s s e n t o f D i s t r i c t Judge E. e Gardner Brownlee, s i t t i n g i n p l a c e of Chief J u s t i c e James T. H a r r i s o n . F i r s t , a s we r e a d t h e r e c o r d , t h e s o u t h s i d e c a n a l was c o n s t r u c t e d

w i t h i n f o u r y e a r s of completion of t h e dam and i s n o t j u s t r e c e n t l y

built. The d i s s e n t s t a t e s t h a t we a t t e m p t t o i n t e r p r e t t h e Il words u n a p p r o p r i a t e d w a t e r s " a s meaning w a t e r s t h a t had n o t

t h e r e t o f o r e been decreed. Far from i t . W acknowledge t h a t e

p l a i n t i f f s Hanson and Zehntner do n o t own "decreed" r i g h t s b u t do have v a l i d a p p r o p r i a t i o n s . Of c o u r s e , many, many, e x i s t i n g w a t e r

r i g h t s have n o t been "decreed" b u t t h e y have been a p p r o p r i a t e d .

The judgment of t h e d i s t r i c t c o u r t i s r e v e r s e d .

Justice U

W Concur: e

/

Justices.

Hon. E . Gardner Brownlee, D i s t r i c t J u d g e , s i t t i n g f o r Chief J u s t i c e James T . H a r r i s o n , d i s s e n t i n g :

I dissent. P r i o r t o 1890 t h e P l a i n t i f f s ' p r e d e c e s s o r s i n i n t e r e s t

dug c a n a l s and took t h e w a t e r s of t h e North Fork of Smith River

and used them f o r i r r i g a t i o n purposes. O August 30, 1890 t h e n

D i s t r i c t Court from Meagher County i s s u e d a d e c r e e a d j u d i c a t i n g t h e w a t e r s of Smith R i v e r ; i n doing s o t h e D i s t r i c t Court followed t h e customary p r a c t i c e of awarding about one i n c h per a c r e of i r r i g a t e d land. T h i s p r a c t i c e took i n t o c o n s i d e r a t i o n t h e f a c t

t h a t t h e a d j u d i c a t i o n s were a c t u a l l y a p p l i c a b l e o n l y a t times

when t h e w a t e r supply was s h o r t and t h e c o u r t was a t t e m p t i n g t o spread t h e a v a i l a b l e w a t e r among a s many landowers a s p o s s i b l e .

There i s no dgubt t h a t a f t e r 1890 t h e w a t e r u s e r s on t h e North Fork of Smith R i v e r , and i n f a c t t h e w a t e r u s e r s on a l l of

1!ontana1s decreed s t r e a m s , continued t o u s e much more w a t e r d u r i n g t h e high w a t e r o r flood-water s e a s o n ; n e i t h e r i s t h e r e any doubt

t h a t such f l o o d w a t e r s were always put t o b e n e f i c i a l u s e . I n 1935 t h e s t a t e of llontana f i l e d a D e c l a r a t i o n of I n t e n t t o S t o r e , D i v e r t and Control t h e u n a p p r o p r i a t e d waters

of t h e North Fork of Smith River. Within f o u r y e a r s t h e r e a f t e r

t h e s t a t e b u i l t a dam and a r e s e r v o i r c a p a b l e of h o l d i n g 11,000 a c r e f e e t of w a t e r . I n t h e years following t h e construction of t h e dam t h e s t a t e always s o l d about t h r e e - f o u r t h s of t h a t s t o r e d w a t e r t o t h e P l a i n t i f f s h e r e i n , who needed and used t h a t w a t e r on t h e i r l a n d s i n a d d i t i o n t o t h e w a t e r s decreed t o them by t h e 1890 d e c r e e . T h i s f a c t a l o n e should e s t a b l i s h t h e need by t h e P l a i n t i f f s f o r w a t e r i n a d d i t i o n t o what t h e y were allowed by t h e 1890 d e c r e e , and should a l s o e s t a b l i s h t h a t t h e f l o o d w a t e r s had always been needed and put t o b e n e f i c i a l u s e . Recently t h e s t a t e b u i l t a c a n a l t o c a r r y f l o o d w a t e r s

from t h e North Fork of Smith River t o an a r e a o u t s i d e t h e Smith River d r a i n a g e . The s t a t e contended t h e y had t h e r i g h t t o do t h i s because by t h e i r 1935 D e c l a r a t i o n of I n t e n t t h e y had a c q u i r e d ownership t o a l l w a t e r s t h a t were n o t decreed by t h e 1890 d e c r e e . The P l a i n t i f f s thereupon brought t h i s a c t i o n t o

prevent t h e s t a t e from removing t h e f l o o d w a t e r s from t h e Smith River d r a i n a g e ; t h e P l a i n t i f f s contended t h a t a s f a r back a s

1890 t h e y had a p p r o p r i a t e d and had a c q u i r e d a r i g h t t o t h e u s e of t h e f l o o d w a t e r s , and t h a t t h e mere f i l i n g of a D e c l a r a t i o n of I n t e n t i o n by t h e s t a t e i n 1935 d i d n o t d e p r i v e them of t h e i r existing rights.

The m a j o r i t y o p i n i o n a t t e m p t s t o i n t e r p r e t t h e words 11 u n a p p r o p r i a t e d wa t e r s " i n t h e s t a t e ' s D e c l a r a t i o n of I n t e n t a s meaning w a t e r s t h a t had n o t t h e r e t o f o r e been decreed t o some

person. That such was n o t t h e l e g i s l a t i v e i n t e n t should be obvious from t h e e x i s t i n g f a c t s , and i s c e r t a i n l y borne o u t by

t h e r e c e n t l e g i s l a t i o n wherein t h e S t a t e L e g i s l a t u r e s t a t e d t h a t e x i s t i n g r i g h t s should be honored and t h a t decreed r i g h t s were

o n l y one of t h e means of a s c e r t a i n i n g t h e e x i s t i n g r i g h t s .

The D i s t r i c t Court h e l d i n f a v o r of the P l a i n t i f f s , and t h e D i s t r i c t Court Judge made some v e r y a c c u r a t e F i n d i n g s of

F a c t and Conclusions of Law and h e l d t h a t t h e P l a i n t i f f s had

e x i s t i n g r i g h t s t o t h e f l o o d w a t e r s of t h e Worth Fork of Smith R i v e r , which e x i s t i n g r i g h t s were i n e x c e s s of t h e decreed r i g h t s

which were a p p l i c a b l e i n t h e l a t e r i r r i g a t i n g season when t h e w a t e r supply was s h o r t .

The D i s t r i c t Court d e c r e e should be a f f i r m e d . However, i t should be modified i n two p a r t i c u l a r s :

The D i s t r i c t Court d e c r e e should be modified by g r a n t i n g t h e s t a t e a decreed r i g h t t o s t o r e 11,000 a c r e f e e t of f l o o d w a t e r s , which decreed r i g h t should be subsequent t o t h e 1890 decreed

r i g h t s , b u t p r i o r i n time t o t h e P l a i n t i f f s ' floodwater r i g h t s ;

The District Court decree should also be amended by granting to the state of Montana a decreed right to those flood- waters in excess of the floodwater rights granted to the Plaintiffs by the District Court.

Hon. E. Gardner Brownlee, District Judge, sitting for Chief Justice James T. Harrison.