Rangen, Inc. v. Idaho Department of Water Resources , 159 Idaho 798 ( 2016 )

IN THE SUPREME COURT OF THE STATE OF IDAHO
Docket 42772
IN THE MATTER OF THE )
DISTRIBUTION OF WATER TO WATER )
RIGHT NOS. 36-02551 & 36-07694 )
(RANGEN, INC.) IDWR DOCKET CM-DC- )
2011-004. )
)
RANGEN, INC., )
)
Petitioner-Appellant, )
v. )
)
THE IDAHO DEPARTMENT OF WATER )
RESOURCES, GARY SPACKMAN, in )
his capacity as Director of the Idaho )
Department of Water Resources, ) Boise, December 2015 Term
FREMONT- MADISON IRRIGATION )
DISTRICT, and THE CITY OF ) 2016 Opinion No. 21
POCATELLO, )
) Filed: February 29, 2016
Respondents-Respondents, )
) Stephen W. Kenyon, Clerk
and )
)
IDAHO GROUND WATER )
APPROPRIATORS, INC., A&B )
IRRIGATION DISTRICT, BURLEY )
IRRIGATION DISTRICT, MILNER )
IRRIGATION DISTRICT, NORTH SIDE )
CANAL COMPANY, TWIN FALLS CANAL )
COMPANY, AMERICAN FALLS )
RESERVOIR DISTRICT #2, and )
MINIDOKA IRRIGATION DISTRICT, )
)
Intervenors-Respondents. )
______________________________________
Appeal from the District Court of the Fifth Judicial District of the State of Idaho,
Twin Falls County. Hon. Eric J. Wildman, District Judge.
The decision of the district court is affirmed.
Brody Law Office, PLLC, Rupert, Haemmerle Law Office, PLLC, Hailey, and
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May, Browning and May, PLLC, Boise, for appellant Rangen, Inc. Robyn M.
Brody argued.
Honorable Lawrence G. Wasden, Idaho Attorney General, Boise, for respondents
Idaho Department of Water Resources and Gary Spackman. Garrick L. Baxter
argued.
Racine Olson Nye Budge & Bailey, Chartered, Pocatello, for respondent Idaho
Ground Water Appropriators, Inc. Thomas J. Budge argued.
White & Jankowski LLP, Denver, and A. Dean Tranmer, Pocatello, for
respondent City of Pocatello. Mitra M. Pemberton argued.
Rigby, Andrus & Rigby Law, PLLC, Rexburg, for intervenor Fremont-Madison
Irrigation District.
Barker, Rosholt & Simpson, LLP, Twin Falls, for intervenors A&B Irrigation
District, Burley Irrigation District, Milner Irrigation District, North Side Canal
Company and Twin Falls Canal Company.
Fletcher Law Office, Burley, for intervenors American Falls Reservoir District #2
and Minidoka Irrigation District.
_____________________
J. JONES, Chief Justice
Appellant Rangen, Inc., initiated a contested case by filing a petition for a delivery call
before the Director of the Idaho Department of Water Resources (“IDWR”), alleging that junior
ground water pumping in the Eastern Snake Plains Aquifer (“ESPA”) was materially injuring its
water rights. Several parties intervened in the delivery call and, after extensive discovery and
communications, IDWR Director Gary Spackman (“Director”) presided over an evidentiary
hearing. The Director subsequently issued a final order and an order on reconsideration. In these
orders the Director granted Rangen a curtailment of certain junior priority ground water pumping
affecting Rangen’s water rights. The Director also interpreted the source and point of diversion
elements of Rangen’s water rights to have a scope smaller than Rangen’s actual historical use.
Rangen and intervenor Idaho Ground Water Appropriators, Inc. (“IGWA”) each filed
petitions for judicial review. The issues raised by IGWA in its petition for judicial review are not
at issue in the present proceeding. Rangen raised various issues related to the interpretation of its
water rights and the sufficiency of the evidence before the agency. Specifically, Rangen appealed
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the Director’s determinations that Rangen may divert water only from the mouth of the Martin-
Curren Tunnel and only within the ten-acre tract listed on its water right partial decrees. Rangen
also appealed the Director’s adoption of an adverse expert’s analysis and the Director’s
conclusion that junior priority ground water users are using water efficiently and without waste.
The district court affirmed the Director’s orders with respect to each of the issues that are
on appeal before the Court in the present proceeding. Rangen appealed to this Court on
substantially the same issues with substantially the same arguments.
I.
FACTUAL AND PROCEDURAL BACKGROUND
A. Rangen’s Facilities and the Eastern Snake Plains Aquifer
Rangen owns and operates a fish research and propagation facility at the head of
Billingsley Creek in the Thousand Springs area near Hagerman, Idaho. The facility includes
concrete channels for fish rearing (“raceways”), a hatch house, ponds for fish rearing and
holding, and a greenhouse. East of the Rangen facility, water emanates from several springs on
talus slopes just below a canyon rim. Water also emanates from the Martin-Curren Tunnel,
commonly referred to as the Curren Tunnel. The Curren Tunnel is a large, excavated conduit
constructed high on the canyon rim that extends 300 feet into the canyon wall.
A concrete collection box referred to as the “Farmers’ Box,” located near the mouth of
the Curren Tunnel, collects water for delivery via pipelines to Rangen and holders of senior
priority irrigation water rights. Currently, only Rangen diverts from the Farmers’ Box, but senior
priority irrigation water right holders may call for delivery of water from the Curren Tunnel in
the future. Farther down the slope is a second concrete collection box referred to as the “Rangen
Box.” Rangen diverts water from the Farmers’ Box to the Rangen Box through two plastic tubes.
Water is then diverted from the Rangen Box through a steel pipe to raceways. Water can also be
spilled out the side of the Rangen Box and returned to the talus slope. Water from the talus slope
forms the headwaters of Billingsley Creek. The main diversion for the large raceways is
downstream from the talus slope and is commonly referred to as the “Bridge Diversion.” This
diversion collects and diverts spring flows from the talus slopes, including water spilled from the
Rangen Box.
Rangen holds five water rights for the Rangen facility which were decreed through the
Snake River Basin Adjudication (“SRBA”). Rangen’s petition for delivery call alleged injury
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only to water rights nos. 36-02551 and 36-07694. Water right no. 36-02551 authorizes a
diversion of 48.54 cfs for fish propagation and has a priority date of July 13, 1962. Water right
no. 36-07694 authorizes a diversion of 26.0 cfs for fish propagation and has a priority date of
April 12, 1977. The source element for water rights nos. 36-02551 and 36-07694 is the Martin-
Curren Tunnel. The point of diversion element for these water rights is the ten-acre tract
identified as SESWNW T07S R14E S32.
The ESPA is the aquifer underlying the Eastern Snake Plain. The ESPA is about 170
miles long and 60 miles wide, and is defined as an area having a common ground water supply.
IDAPA 37.03.11.050. The ground water in the ESPA is hydraulically connected to the Snake
River and tributary springs, including the Thousand Springs area where the Curren Tunnel is
located. The ESPA is highly productive and is composed predominantly of fractured quaternary
basalt, which is generally characterized by high hydraulic conductivity. The amount of water that
discharges from the aquifer to hydraulically connected surface water sources is largely dependent
on ground water elevations and hydraulic conductance. From October 1980 through September
2008, average annual discharge from the ESPA exceeded average annual recharge by 270,000
acre-feet, which resulted in declining aquifer water levels and declining discharge to the Snake
River and tributary springs. Rangen claims that it is not receiving all of the water to which it is
entitled under its water rights because of junior ground water pumping in the ESPA.
B. Rangen’s Delivery Call
On December 13, 2011, Rangen, Inc. filed a petition for delivery call alleging that junior
priority ground water pumping in the ESPA was materially injuring its water rights and
requested that the Director distribute water in the ESPA and curtail junior priority pumping.
IGWA and a number of other parties intervened in the proceeding,1 while Pocatello and
Fremont-Madison Irrigation District were brought in as respondents.
Prior to the hearing on the delivery call, Rangen moved for partial summary judgment,
asking the Director to rule that the source of its water rights was not limited to the mouth of the
Martin-Curren Tunnel but instead extended to the greater spring complex supplying the facility.
Rangen also sought a ruling that it is entitled to divert water via the Bridge Diversion, despite the
fact that the structure is not within the decreed ten-acre tract. The Director ruled that Rangen is
1
A&B Irrigation District, American Falls Reservoir District #2, Burley Irrigation District, Milner Irrigation District,
Minidoka Irrigation District, North Side Canal Company and Twin Falls Canal Company (collectively the “Surface
Water Coalition”) also intervened in the proceeding.
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not authorized to divert water outside the decreed ten-acre tract, but that material issues of fact
precluded summary judgment on whether Rangen’s water rights extended to the entire spring
complex.
The Director presided over an evidentiary hearing on Rangen’s delivery call, held from
May 1 through May 16, 2013. The Director issued an order on January 29, 2014, mandating
curtailment of ground water rights bearing priority dates after July 13, 1962, with points of
diversion located both within the area of common ground water supply and west of the Great
Rift.
C. The Curtailment Order
Rangen has measured the water flows through its facility since 1966. Since 1995, Rangen
has been required by IDWR to report flow measurements annually to the watermaster of its
water district. At the hearing before the Director, parties contesting the delivery call argued that
Rangen had historically under-measured its flows and that the United States Geological Survey
(“USGS”) flow measurements were more representative of actual water flows through the
Rangen facility. In his findings of fact, the Director compared Rangen’s measurements with the
USGS measurements and concluded that Rangen’s measurements were inaccurate and resulted
in a systematic underreporting of water flows. The Director relied on testimony by Greg
Sullivan, an expert witness retained by Pocatello, who estimated that the error in Rangen’s
measurements was 15.9%, based on a comparison with USGS measurements taken between
1980 and 2012.
However, the Director found that even when applying the 15.9% margin of error, the
spring flows in the area of the Curren Tunnel declined significantly from 1966 to 2012, with the
annual flow decreasing from 32.1 cfs in 1966 to 4.4 cfs in 2011. The Director concluded that
several factors contributed to the decline in water flow to the Rangen facility, including ground
water pumping in the ESPA. The Director found this to be true even though he also found that
testimony presented at the hearing showed that the junior-priority holders were using their
appropriated water efficiently and without waste.
The technical model the Director relied on in this matter, ESPAM 2.1, simulates the
effects of ground water pumping on spring flows throughout the region, including to springs
located within a specific model cell. The Rangen model cell includes both water discharging
from the Curren Tunnel and water discharging from the other springs within the same cell.
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Rangen argued that although its partial decrees for water rights nos. 36-02551 and 36-07694 both
state that the source for the right is the Martin-Curren Tunnel, the source actually includes the
entire spring complex. The Director concluded that the source in the decree was limited to the
flow from the mouth of the Curren Tunnel. Additionally, the Director reiterated his conclusion
on summary judgment that, under the terms of the partial decrees, Rangen was not entitled to
divert water from the Bridge Diversion because it was not within the decreed point of diversion.
ESPAM 2.1 is not precise enough to differentiate between water flowing from the Curren
Tunnel and water flowing from the rest of the spring complex. Because the Director concluded
that Rangen’s water rights are limited to water diverted from the tunnel mouth, the Director
considered the historical relationship between the Curren Tunnel and the total spring complex
discharge to predict the portion of curtailed water that will accrue to the Curren Tunnel versus
the Rangen model cell as a whole. Pocatello’s expert witness Sullivan plotted data for measured
Curren Tunnel flows and total spring flows and developed a linear regression analysis. Sullivan
initially found that 75% of the curtailment benefits accruing to the model cell would accrue to
the Curren Tunnel. However, this analysis was based on Rangen’s measurements, which the
Director found were underreported by 15.9%. After accounting for this error, Sullivan’s revised
analysis showed that 63% of the curtailment benefits accruing to the model cell accrued to the
Curren Tunnel. The Director adopted Sullivan’s 63/37 regression analysis and concluded that
63% of the water that would accrue to the Rangen cell would accrue to the Curren Tunnel.
D. Proceedings on Judicial Review
IGWA, Rangen, and Pocatello sought reconsideration of the Director’s order. The
Director issued an Order on Reconsideration denying IGWA’s and the City of Pocatello’s
motions and granting in part and denying in part Rangen’s motion.
Rangen and IGWA filed petitions for judicial review of the Director’s order in Idaho’s
Fifth Judicial District. The district court granted motions to intervene filed by Pocatello, the
Fremont-Madison Irrigation District, and the Surface Water Coalition and the petitions were
consolidated. The district court affirmed the Director’s order with respect to the issues raised in
this appeal. Rangen timely appealed. The district court’s dispositions of other issues in this case
were appealed separately and are not further discussed in this opinion.
II.
ISSUES PRESENTED ON APPEAL
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1. Whether the Director erred in concluding that Rangen is entitled to divert water only
from the mouth of the “Martin-Curren Tunnel” and only within the ten-acre tract
described in its partial decrees.
2. Whether there is substantial evidence to support the Director’s adoption of Sullivan’s
63/37 regression analysis.
3. Whether there is substantial evidence to support the Director’s conclusion that junior
priority ground water users are using water efficiently and without waste.
4. Whether any party is entitled to attorney fees on appeal.
III.
STANDARD OF REVIEW
In an appeal from a district court where the court was acting in its appellate capacity
under the Idaho Administrative Procedure Act (“IDAPA”), “we review the decision of the
district court to determine whether it correctly decided the issues presented to it.” Clear Springs
Foods v. Spackman, 150 Idaho 790, 797, 252 P.3d 71, 78 (2011). However, we review the
agency record independently of the district court’s decision. Spencer v. Kootenai Cnty., 145
Idaho 448, 452, 180 P.3d 487, 491 (2008). A reviewing court “defers to the agency’s findings of
fact unless they are clearly erroneous,” and “the agency’s factual determinations are binding on
the reviewing court, even when there is conflicting evidence before the agency, so long as the
determinations are supported by substantial competent evidence in the record.” A & B Irrigation
Dist. v. Idaho Dep’t of Water Res., 153 Idaho 500, 505–06, 284 P.3d 225, 230–31 (2012).
Substantial evidence is “relevant evidence that a reasonable mind might accept to support a
conclusion.” In re Idaho Dep’t of Water Res. Amended Final Order Creating Water Dist. No.
170, 148 Idaho 200, 212, 220 P.3d 318, 330 (2009) (quoting Pearl v. Bd. of Prof’l Discipline of
Idaho State Bd. of Med., 137 Idaho 107, 112, 44 P.3d 1162, 1167 (2002)). The Court is bound by
an agency’s factual determinations “even where there is conflicting evidence before the agency,
so long as the determinations are supported by substantial competent evidence in the record.”
Eddins v. City of Lewiston, 150 Idaho 30, 33, 244 P.3d 174, 177 (2010). “This Court freely
reviews questions of law.” Vickers v. Lowe, 150 Idaho 439, 442, 247 P.3d 666, 669 (2011).
The district court must affirm the agency action unless it
finds that the agency’s findings, inferences, conclusions, or decisions are:
(a) in violation of constitutional or statutory provisions;
(b) in excess of the statutory authority of the agency;
(c) made upon unlawful procedure;
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(d) not supported by substantial evidence on the record as a whole; or
(e) arbitrary, capricious, or an abuse of discretion.
I.C. § 67-5279(3); Clear Springs Foods, 150 Idaho at 796, 252 P.3d at 77. Even if one of these
conditions is met, “[a]n agency action shall be affirmed unless substantial rights of the appellant
have been prejudiced.” I.C. § 67-5279(4). “If the agency action is not affirmed, it shall be set
aside, in whole or in part, and remanded for further proceedings as necessary.” I.C. § 67-5279(3).
IV.
ANALYSIS
A. The Director did not err in concluding that Rangen is entitled to divert only
the water discharging from the mouth of the Martin-Curren Tunnel and only
within the ten-acre tract described in its partial decrees.
Rangen’s two water rights at issue in this case were adjudicated in the SRBA. The
Director concluded that, under Idaho Code section 42-1420, a decree entered in a general
adjudication such as the SRBA is conclusive as to the nature and extent of the water right.
Rangen’s partially decreed water rights nos. 36-02551 and 36-07694 specify the source of its
water under those licenses as “MARTIN-CURREN TUNNEL[;] TRIBUTARY: BILLINGSLEY
CREEK.” Each partial decree describes the same ten-acre tract as the only authorized point of
diversion. It is undisputed that the Bridge Diversion lies outside the decreed tract. On summary
judgment, the Director concluded that Rangen’s partially decreed water rights were unambiguous
with respect to the point of diversion element and that Rangen is not authorized to divert water
outside the decreed ten-acre tract. After the evidentiary hearing, the Director concluded again
that the point of diversion element of the partial decrees was unambiguous, while also
concluding that the source element was unambiguous. Accordingly, the Director concluded that
the partial decrees limit Rangen to diverting water only from the Martin-Curren Tunnel and only
within the decreed tract. Thus, notwithstanding its historical use, Rangen is not entitled to divert
water from the entirety of the spring complex and is not entitled to divert water at the Bridge
Diversion.
Rangen contends that the Director erred in interpreting its partial decrees. It argues that
the source element in its partial decrees is ambiguous and that in the relevant context “Martin-
Curren Tunnel” refers to the entire spring complex comprised of Curren Tunnel plus the other
springs scattered across the canyon wall. Additionally, Rangen argues that it should be entitled to
divert water via the Bridge Diversion because the dam is “part of a diversion structure that lies
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partially within the [decreed] ten acre tract.”2 Rangen further contends that the doctrine of quasi-
estoppel precludes the Director from interpreting its partial decrees in a manner inconsistent with
Rangen’s historical use of water.
The Director rejected each of Rangen’s arguments. He found that the name Martin-
Curren Tunnel is not ambiguous and does not create a latent ambiguity in the partial decree. He
further found that because the SRBA decrees list the point of diversion as SESWNW Sec. 32,
T7S, R14E, Rangen is restricted to diverting water that emits from the Curren Tunnel in that ten-
acre tract. The Director additionally found that equitable estoppel is inapplicable as it may not
ordinarily be invoked against a government or public agency functioning in a sovereign or
governmental capacity.
The district court affirmed the Director’s conclusions on each of these issues, applying
substantially the same legal reasoning as the Director. The district court further found that
Rangen’s attempt to reinterpret its water rights constitutes an impermissible collateral attack on
the decrees. The district court asserted that any challenges to the facially plain language of
Rangen’s partial decrees needed to be raised in the SRBA forum. According to the district court,
allowing Rangen to contest its partial decrees outside the SRBA would undermine any certainty
or finality of those decrees. The district court also found that quasi-estoppel did not apply here
because no exigency warranted the application of the doctrine against the Director in the exercise
of his governmental functions and because Rangen had not established that the required elements
were satisfied.
1. This proceeding is not an appropriate forum to reinterpret the scope of
Rangen’s partial decrees entered in the SRBA.
By statute, “decree[s] entered in a general adjudication shall be conclusive as to the
nature and extent of all water rights in the adjudicated water system.” I.C. § 42-1420(1). In 1997,
Rangen’s water rights numbers 36-02551 and 36-07694 were adjudicated and partial decrees
were entered in the SRBA. When Rangen applied to have its water rights entered in the SRBA, it
requested identifying the source of each right as “Curran Tunnel” and describing the point of
diversion of each right as a particular forty-acre tract. Rather than recommending that Rangen’s
water rights be decreed precisely as Rangen had requested, the IDWR Director at the time
instead recommended identifying the source as “Martin-Curren Tunnel” and describing the point
2
IDWR claims that Rangen applied in February of 2014 for approval to divert water from the Bridge Diversion and
that IDWR approved the request and issued Permit 36-17002 to that effect. That permit has a priority date in 2014.
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of diversion as the ten-acre tract in which the tunnel sits. Rangen did not file an objection to the
Director’s recommendations. The presiding judge of the SRBA entered partial decrees consistent
with the Director’s recommendations. Rangen neither appealed nor moved to set aside either
partial decree in the SRBA.3
In the agency action on review here, the Director determined that
Rangen’s SRBA decrees do not identify Billingsley Creek as a source of
water and do not include a point of diversion in the SWSWNW Sec. 32,
T7S, R14E. . . . Administration must comport with the unambiguous terms
of the SRBA decrees. Because the SRBA decrees identify the source of
the water as the Curren Tunnel, Rangen is limited to only that water
discharging from the Curren Tunnel. Because the SRBA decrees list the
point of diversion as SESWNW Sec. 32, T7S, R14E, Rangen is restricted
to diverting water that emits from the Curren Tunnel in that 10-acre tract.
On review, the district court concluded that if Rangen disagreed with how its water rights were
recommended and ultimately decreed, it had an opportunity and responsibility to voice its
concerns in the appropriate forum—the SRBA. The district court reasoned that this was
necessary because the SRBA is a forum where all parties to the adjudication would have been
afforded appropriate notice of Rangen’s arguments and been given the opportunity to respond.
One purpose of the SRBA is “to establish . . . a uniform description for surface water
rights, ground water rights and water rights which include storage.” I.C. § 42-1427. “Conjunctive
management of ground water and surface water rights is one of the main reasons for the
commencement of the Snake River Basin Adjudication.” A & B Irrigation Dist. v. Idaho
Conservation League, 131 Idaho 411, 422, 958 P.2d 568, 579 (1997) (quoting 1994 INTERIM
LEG. COMM. REP. ON THE SNAKE RIVER BASIN ADJUDICATION 36–37 (1994)). The quoted
Committee Report continued: “The SRBA should determine the ultimate source of the ground
and surface water rights being adjudicated. This legal determination must be made in the SRBA
. . . If the SRBA proceeds and these issues are not addressed, a major objective for the
adjudication will not have been served.” Id. Further, as the district court in the present case held,
allowing a party to contest a partial decree outside of the SRBA would undermine any certainty
or finality of the partial decree.
3
Rangen did move to file a late claim in the SRBA on April 19, 2013—more than fifteen years after its partial
decrees were entered. Rangen’s motion was denied as untimely, given that the deadline to file late claims in the
SRBA lapsed January 13, 2013.
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Rangen argues that it is disputing the Director’s interpretation of the partial decrees rather
than the partial decrees themselves. But this is a distinction without a difference. Any
interpretation of Rangen’s partial decrees that is inconsistent with their plain language would
necessarily impact the certainty and finality of SRBA judgments and, therefore, requests for such
interpretations needed to be made in the SRBA itself.
The district court found that Rangen’s argument was based on the idea that the decrees do
not accurately reflect its historical beneficial use. The court held that this argument was an
impermissible collateral attack on the decrees. This Court agrees and affirms the district court’s
holding that Rangen’s partial decrees entitle it to divert only that water emanating from the
Martin-Curren Tunnel and only within the decreed ten-acre tract. If Rangen wanted its water
rights to be interpreted differently, it should have timely asserted that in the SRBA.
2. Rangen is not entitled to divert water via the Bridge Diversion.
Rangen asserts that it should be permitted to use the Bridge Diversion because it is part of
a diversion structure that lies mostly within the ten-acre tract described in the partial decrees.
More specifically, Rangen argues that the Farmers’ Box, Rangen Box and the Bridge Diversion
are all integral parts of the same diversion structure. Rangen also seems to argue that it was
required to identify the single ten-acre tract nearest to the point of diversion. The district court
found that the Bridge Diversion is a separate and distinct diversion structure that is not
physically connected to the Farmers’ Box or the Rangen Box. Rangen’s arguments on appeal
here mirror its arguments before the district court.
Rangen offers no authority supporting the proposition that physically separate and
distinct diversion structures may be regarded as components of a larger diversion structure.
Absent citation to any such authority, this Court rejects the concept of diversion structure that
Rangen urges. Logically, if separate and distinct individual diversion structures in different tracts
were treated as a single diversion structure, any water right holder could claim an entitlement to
divert water in any tract, as long as at least one component of one diversion structure were sited
in a decreed tract. This approach would render the point of diversion element of a water right
meaningless.
Rangen’s argument that when it applied for its water rights in the SRBA it was required
to list the single nearest ten-acre tract is also unavailing. The IDWR rule in effect at the time
required an applicant to describe the location of the point of diversion to the nearest forty-acre
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tract, while encouraging description to the nearest ten-acre tract “if that description is reasonably
available.” IDAPA 37.03.01.060.05.d.i. (7-1-93). The rule also provided that a water right holder
could file multiple claims if it wanted to register multiple points of diversion. IDAPA
37.03.01.060.05.d.iii. (7-1-93). Thus, there was no requirement that Rangen’s partial decrees be
entered listing a single ten-acre tract as the point of diversion. Because the Bridge Diversion lies
outside the specified point of diversion in its partial decrees, the water rights at issue here do not
entitle Rangen to divert water via the Bridge Diversion.
3. Rangen has not established an ambiguity in its partial decrees.
Even if this were an appropriate forum to litigate the interpretation of Rangen’s partial
decrees, Rangen has not established a latent ambiguity sufficient to warrant reversal of the
Director’s conclusion regarding the source elements of its partial decrees.
Idaho courts interpret water decrees using the same interpretation rules that apply to
contracts. A & B Irrigation Dist., 153 Idaho at 523, 284 P.3d at 248. “Whether an ambiguity
exists in a legal instrument is a question of law, over which this Court exercises free review.”
Knipe Land Co. v. Robertson, 151 Idaho 449, 455, 259 P.3d 595, 601 (2011). Ambiguity may be
either patent or latent. Id. “A latent ambiguity exists where an instrument is clear on its face, but
loses that clarity when applied to the facts as they exist.” Id. Idaho law permits “[f]irst, the
introduction of extrinsic evidence to show that the latent ambiguity actually existed; and, second,
the introduction of extrinsic evidence to explain what was intended by the ambiguous statement.”
Snoderly v. Bower, 30 Idaho 484, 487, 166 P. 265, 265 (1917). Interpreting an ambiguous term is
an issue of fact. Knipe Land Co., 151 Idaho at 455, 259 P.3d at 601 (citing Potlatch Educ. Ass’n
v. Potlatch School Dist. No. 285, 148 Idaho 630, 633, 226 P.3d 1277, 1280 (2010)).
Rangen argues that the terms “Martin-Curren Tunnel,” “Curran Tunnel,” and “Curran
Spring(s)” are used interchangeably to describe the actual tunnel structure as well as the springs
that emanate from the pipe and the talus slope below it. Rangen cites the testimony of its former
long-term employee Lynn Babbington in support of this proposition.4 Rangen also cites the
testimony of another Rangen employee, Lonny Tate, who asked counsel to “classify ‘the Curren
Tunnel’” when asked about it on cross-examination. Rangen suggests this indicates that
4
In response to the question “[w]hat did you understand was the Curren Tunnel?” Babbington responded:
the Curren Tunnel was the – up on the hillside, a tunnel there. But it was known to me to be all of
the – all of the water up there. Whether it be called Curren Tunnel or head of Billingsley Creek or
Curren Springs, they were all – all meant the same thing. It was the -- all the springs that was a
source to the hatchery.
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clarification was necessary because of a latent ambiguity. Finally, Rangen refers to the back file
for its 1977 water right license number 36-07694. The first page of the license specifies the
source of the right as “springs tributary to Billingsley Creek” and the second page includes an
annotation indicating “[s]ource known locally as Curran Tunnel.” In the “source” field, Rangen’s
contemporaneous application for the 1977 water right had “underground springs” typewritten
and “Curran Tunnel” handwritten above it. Rangen concludes that this evidence establishes a
latent ambiguity, and it asserts in subsequent argument that the evidence in the record requires
resolving the ambiguity in its favor. Intervenor IGWA suggests that “underground springs” can
reasonably describe the tunnel because it is a human-made conduit bringing water to the surface
from underground springs but that it cannot reasonably describe the other springs on the canyon
wall because those are above-ground springs and not “underground springs.”
In rejecting Rangen’s ambiguity arguments, the Director relied on hearing testimony
from Frank Erwin, who has served for sixteen years as the watermaster in the water district in
which Rangen sits. Erwin, who was in a position to know whether the term “Martin-Curren
Tunnel” had more than one meaning, distinguished “Curren Tunnel” from “Curren Spring” and
displayed no confusion or uncertainty regarding what each term referenced. The Director also
noted that if Rangen truly believed that Martin-Curren Tunnel was the common name for the
entire spring complex, Rangen should have sought and had its water right decreed with
additional points of diversion because the entire spring complex stretches over at least two ten-
acre tracts. Ultimately, the Director concluded that the name Martin-Curren Tunnel is not
ambiguous and does not create a latent ambiguity in Rangen’s partial decrees.
The district court agreed with the Director, finding that the term “Martin-Curren Tunnel”
refers to a specific, identifiable and known diversion structure located within the ten-acre
authorized point of diversion of Rangen’s two senior water rights. The court observed that the
record establishes there is only one tunnel to which the term “Martin-Curren Tunnel” can
possibly apply. The court further stated that “tunnel” could not conceivably refer to the entire
spring complex because such an interpretation would offend the common meaning and
understanding of the term “tunnel.”
The reasoning of the Director and the district court is well-taken. The term “Martin-
Curren Tunnel” does not lose clarity when applied to the facts in the record before the Court.
Indeed, as the district court noted, adopting Rangen’s perspective would render its partial decrees
13
less, rather than more, clear. Therefore, Rangen has not presented sufficient evidence to establish
the existence of a latent ambiguity in the partial decrees.
We affirm the district court’s determination that Rangen is limited to divert water only
from the mouth of the Martin-Curren Tunnel itself and only within its decreed tract.
4. The doctrine of quasi-estoppel does not preclude the Director from
interpreting Rangen’s partial decrees to allow diversion of only the water
emanating from the mouth of the Martin-Curren Tunnel.
Rangen argues that quasi-estoppel precludes the Director from determining that the
source elements of its partial decrees limit its rights to only the water flowing from the mouth of
the Martin-Curren Tunnel. The Director and the district court each found that quasi-estoppel
does not apply in this case. As this Court has previously stated,
[Q]uasi-estoppel prevents a party from asserting a right, to the detriment
of another party, which is inconsistent with a position previously taken.
This doctrine applies when: (1) the offending party took a different
position than his or her original position, and (2) either (a) the offending
party gained an advantage or caused a disadvantage to the other party; (b)
the other party was induced to change positions; or (c) it would be
unconscionable to permit the offending party to maintain an inconsistent
position from one he or she has already derived a benefit or acquiesced in.
Estoppel theories generally present mixed questions of law and fact.
Because mixed questions of law and fact are primarily questions of law,
this Court exercises free review.
Allen v. Reynolds, 145 Idaho 807, 812, 186 P.3d 663, 668 (2008) (citations and internal quotation
marks omitted). Quasi-estoppel does not apply in the present case, both because there are no
exigent circumstances justifying applying the doctrine against a state agency exercising a
governmental function and because Rangen has not established that the elements of quasi-
estoppel are satisfied.
Rangen cites no cases where this Court has applied quasi-estoppel against a government
entity carrying out its sovereign functions. Indeed, the Court has held that quasi-estoppel may not
“be applied against the state in matters affecting its governmental or sovereign functions.” Floyd
v. Bd. of Comm’rs of Bonneville Cnty., 137 Idaho 718, 727, 52 P.3d 863, 872 (2002). However,
the Court has previously left open the possibility that quasi-estoppel could apply against a
government entity in exigent circumstances. See, e.g., Terrazas v. Blaine Cnty. ex rel. Bd. Of
Comm’rs, 147 Idaho 193, 200–201, 207 P.3d 169, 176–177 (2009); Sprenger, Grubb & Assocs.,
Inc. v. City of Hailey, 127 Idaho 576, 583, 903 P.2d 741, 748 (1995); Boise City v. Wilkinson, 16
14
Idaho 150, 177, 102 P. 148, 157 (1909). These cases do not express whether quasi-estoppel
might apply even where the government action at issue relates to a sovereign or governmental
function. Nor do the cases disclose what constitutes an exigent circumstance warranting the
application of the doctrine against the government. The Court expresses no opinion on these
questions at this time.
Idaho Code section 42-602 requires the Director to “distribute water in water districts in
accordance with the prior appropriation doctrine.” In the present case, that statutory obligation
required the Director to interpret Rangen’s partial decrees, which he dutifully did. Rangen has
failed to articulate any exigent circumstances justifying the application of quasi-estoppel against
IDWR or the Director. Accordingly, we decline in this case to extend the doctrine of quasi-
estoppel to apply to governmental entities or agents acting in a sovereign or governmental
capacity.
Furthermore, Rangen has failed to establish that the required elements of quasi-estoppel
are met. Rangen argues at length that IDWR has recognized for decades that the source of
Rangen’s water is the entire spring complex, citing two previous IDWR actions. First, Rangen
cites to a 1979 order in which former IDWR Operations Bureau Chief L. Glen Saxton authorized
Rangen to measure water flows at the outlets rather than the inlets. Second, Rangen cites to a
2005 order in Rangen’s prior delivery call in which former Director Karl Dreher made findings
about flow measurements at Rangen’s facility. Former Director Dreher found that
[t]he flow measurements that are considered to be representative of the
total supply of water available to the Rangen hatchery facilities under
water rights nos. 36-15501, 36-02551, and 36-07694, consist of the sum of
the discharge from raceways designated by Rangen as the “CTR”
raceways and the flow over the check “Dam.” The dam is sited upstream
from the discharge points from the CTR raceways and downstream from
the discharge points from raceways designated by Rangen as the “Large”
raceways. The sum of the discharge from the CTR raceways and the flow
over the check dam is considered to be representative of the total supply of
water available even though at times some of the flow over the check dam
may include water flowing from small springs downstream from the
diversion to the Large raceways, water discharged from the Large
raceways that was not diverted through the CTR raceways, and irrigation
return flows.
Second Amended Order at ¶54, In the Matter of Distribution of Water to Water Rights Nos. 36-
15501, 36-02551, and 36-07694 (Idaho Dep’t Water Res. May 19, 2005) available at
15
http://www.idwr.idaho.gov/browse/WaterMngmt/Orders-Archive/2005/05-19-2005%20Rangen
%20Inc%20Second%20Amended%20Order.pdf.
The district court found that the Director has not taken a different position with respect to
the interpretation of the source and point of diversion elements in Rangen’s partial decrees, given
that none of the cited agency actions addressed the questions of where Rangen is legally entitled
to divert water and from which sources. The district court noted that the 1979 order predates
Rangen’s partial decrees so it could not have addressed the interpretation of those partial decrees.
In context, the 2005 order did not interpret the partial decrees. Rather, it merely described
Rangen’s flow measurements—including acknowledging that the measurements might include
water to which Rangen was presumably not entitled. We agree with the district court and hold
that the Director has not changed positions, given that prior to this proceeding the Director had
not taken any position on the interpretation of the source or point of diversion elements of
Rangen’s partial decrees. Thus, Rangen has failed to prove the first element of quasi-estoppel,
that “the offending party took a different position than his or her original position.” Allen, 145
Idaho at 812, 186 P.3d at 668.
For the foregoing reasons, we affirm the district court’s holding that the doctrine of
quasi-estoppel does not preclude the Director from interpreting Rangen’s partial decrees to allow
Rangen to divert water only from the mouth of the Martin-Curren Tunnel.
B. The Director’s adoption of Sullivan’s 63/37 regression analysis is supported by
substantial and competent evidence.
Applying the analysis above, Rangen is entitled to the water from the tunnel but not the
water from the other springs. Accordingly, the Director needed to determine how the total water
in the Rangen cell would be distributed between the tunnel and the other springs.
Three opinions of the proportion of water accruing to the tunnel versus the other springs
were presented in this case. Pocatello’s expert witness Sullivan initially opined that 75% of the
water in the Rangen model cell would accrue to the tunnel and 25% would accrue to the springs.
However, Sullivan’s initial 75/25 regression analysis was developed using Rangen’s flow
measurements, which all parties agreed were understated.5 After learning of the errors in
Rangen’s flow measurements, Sullivan corrected the underlying data and created a new
5
The Director found that Rangen used a nonstandard measurement method to measure water flows through its
facility and used incorrect rating tables for determining flow rates, concluding that Rangen’s reported historic flows
were lower than actual flows.
16
regression analysis, ultimately opining that 63% of the water in the Rangen cell would accrue to
the Curren Tunnel and 37% to the springs. IDWR staff independently developed a third analysis,
determining that 70% of the water would accrue to the tunnel and 30% to the springs. The
Director adopted Sullivan’s 63/37 regression analysis.
Rangen challenges the sufficiency of the evidence supporting the Director’s adoption of
the Sullivan 63/37 analysis. The Sullivan 63/37 analysis was upheld by the Director on
reconsideration and by the district court on judicial review. On appeal, Rangen presents
substantially the same arguments rejected by the district court: the IDWR 70/30 analysis is more
accurate than the Sullivan 63/37 analysis, Sullivan’s revision of his analysis reduces his
credibility, and Sullivan’s corrected data are inaccurate. None of these arguments have merit.
Rangen argues extensively in its briefing for the adoption of IDWR’s 70/30 analysis. But
conflicting evidence is irrelevant because it has no bearing on the sufficiency of the evidence
supporting the Director’s adoption of Sullivan’s 63/37 analysis. Nor is it significant that Sullivan
changed his opinion when he learned of the error in the data on which he originally relied. If
anything, the fact that Sullivan revised his analysis in light of new information makes it more,
rather than less, credible.
Rangen also attacks Sullivan’s 63/37 analysis by focusing on the data Sullivan relied on
in forming his opinion. Rangen insists Sullivan’s analysis is invalid because it is based on
unreliable USGS measurements and because it may include water from other sources. In a staff
memorandum responding to expert reports in this case, IDWR staff noted that the USGS
subjectively rated its own measurements of Billingsley Creek as ‘fair’ or ‘poor’, indicating that
the measurements are not ideal and contribute to measurement error. Nonetheless, the Director
found that USGS flow measurements are widely accepted as accurate and objective
measurements. Even if there is some evidence in the record supporting the conclusion that the
USGS data is unreliable, Rangen has not established that it is so unreliable as to preclude a
reasonable mind from accepting it to support a conclusion. This is particularly so where there is
no dispute that Rangen’s own measurements are flawed and Rangen points to no other evidence
in the record suggesting alternative measurements that might be more reliable.
Rangen alleges that the USGS measurements were taken downstream from the Rangen
measurements and likely include water that is not measured or used by Rangen. But Sullivan
testified that the USGS measurements are intended to include only the spring flows and not any
17
irrigation returns. Sullivan also testified that USGS measurements made outside the irrigation
season would not include water in any significant quantity from these irrigation returns.
Rangen’s conclusory assertion that the USGS measurements “likely include” additional sources
of water is not evidence. Additionally, the conflicting evidence to which Rangen does cite fails
to undermine the substantiality or competency of the evidence supporting the Director’s finding
that the USGS measurements are adequate. As the district court observed, Sullivan’s 63/37
analysis is supported by substantial record evidence, including various reports and comparisons
Sullivan authored, as well as Sullivan’s hearing testimony.
Finally, Rangen argues that the weir coefficient Sullivan ‘extrapolated’ from the USGS
measurements is different than the ‘hybrid’ weir coefficient Sullivan created and advocated for
in his expert reports. However, Rangen neither cites to record evidence in support of this
allegation nor articulates its legal significance. Therefore, the allegation does nothing to call into
question the sufficiency of the evidence supporting the Director’s adoption of Sullivan’s 63/37
analysis.
For the foregoing reasons, we affirm the district court’s holding that substantial evidence
supported the Director’s adoption of Sullivan’s 63/37 regression analysis.
C. The Director’s conclusion that junior priority ground water users are using
water efficiently and without waste is supported by substantial and competent
evidence.
Conjunctive Management Rule 40.03 provides that in responding to a delivery call “[t]he
Director will also consider whether the respondent junior-priority water right holder is using
water efficiently and without waste.” IDAPA 37.03.11.040.03. The Director concluded in this
case that the junior-priority water right holders are using water efficiently and without waste.
The Director upheld this conclusion on reconsideration and the district court affirmed it on
judicial review.
Rangen asserts that the Director’s conclusion was not supported by substantial evidence.
It alleges that an evaluation of whether water is used efficiently and without waste requires the
introduction of evidence such as: water usage compared to crops in the field or other permitted
uses; sprinkler package maintenance and replacement practices; and cultivation practices,
including information such as crop selection, seed choice, crop rotations and use of cover crops
and mulch. Rangen cites no authority for the proposition that the Rule 40.03 analysis requires
18
this evidence or that it requires any other specific evidence. Nor has this Court identified any
such requirement.
Contrary to Rangen’s suggestion, the record does disclose substantial evidence
supporting the Director’s conclusion that junior priority ground water users are using water
efficiently and without waste. Lynn Carlquist, chairman of the North Snake Groundwater
District, testified that most farmers in the District have converted from surface water irrigation to
sprinkler irrigation to use water more efficiently and that farmers limit ground water pumping to
minimize costs. Carlquist also testified that the District engages in projects to recharge ground
water and monitors ground water levels in a way that would identify whether its members are
using more water than they are entitled to. Tim Deeg, president of IGWA, testified that IGWA
participates in recharge efforts, that cost considerations cause farmers to pump only as much
water as they need, and that monitoring ensures that ground water pumpers operate within the
parameters of their decrees. Justin Armstrong, Pocatello’s Water Superintendent, testified as to
the City’s use of water. Rangen offered no evidence to controvert any of the testimony by these
witnesses. Accordingly, the Director’s conclusion that in this case junior priority ground water
users are using water efficiently and without waste is supported by substantial and competent
evidence.
For the foregoing reasons, we affirm the district court’s determination that substantial
evidence supported the conclusion that junior priority ground water users are using water
efficiently and without waste.
D. Rangen is not entitled to attorney fees on appeal. The Director is entitled to
attorney fees on appeal.
Both Rangen and the Director seek attorney fees on appeal pursuant to Idaho Code
section 12-117(1). Idaho Code section 12-117(1) provides in relevant part:
Unless otherwise provided by statute, in any proceeding involving as
adverse parties a state agency . . . and a person, . . . the court hearing the
proceeding, including on appeal, shall award the prevailing party
reasonable attorney’s fees . . . if it finds that the nonprevailing party acted
without a reasonable basis in fact or law.
Rangen is not the prevailing party and, therefore, is not entitled to attorney fees. The
Director is the prevailing party. The Director argues that Rangen’s pursuit of this appeal was
unreasonable.
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In an appeal where the prevailing party sought attorney fees under section 12-117, the
Court granted fees where the nonprevailing party
continued to rely on the same arguments used in front of the district court,
without providing any additional persuasive law or bringing into doubt the
existing law on which the district court based its decision. Although the
[nonprevailing parties] may have had a good faith basis to bring the
original suit based on their interpretation of Idaho law, [they] were very
clearly aware of the statutory procedures, failed to appeal separate
appraisals when they had a right to appeal, and were clearly advised on the
applicable law in an articulate and well reasoned written decision from the
district court. Nevertheless, [they] chose to further appeal that decision to
this Court, even though they failed to add any new analysis or authority to
the issues raised below. Accordingly, it was frivolous and unreasonable to
make a continued argument, and [the prevailing party] is awarded its
reasonable attorney fees.6
Castrigno v. McQuade, 141 Idaho 93, 98, 106 P.3d 419, 424 (2005).
Here, Rangen asserted substantially the same arguments on appeal as it did before the
district court on judicial review and failed to add significant new analysis or authority to support
its arguments. Accordingly, applying Castrigno, the Court finds that Rangen acted without a
reasonable basis in fact or law in bringing this appeal. Therefore, we grant the Director’s request
for attorney fees under Idaho Code section 12-117(1).
V.
CONCLUSION
We affirm the decision of the district court. The Director is awarded costs and attorney
fees on appeal.
Justices EISMANN, BURDICK and HORTON, and Justice Pro Tem WALTERS
CONCUR.
6
The prevailing party in Castrigno also sought fees under section 12-121. Castrigno, 141 Idaho at 98, 106 P.3d at
424. Because the Court held that the nonprevailing party was “unreasonable,” it may be inferred that this holding
reflected a conclusion that “the nonprevailing party had acted without a reasonable basis” as required to support a
fee award under section 12-117.
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