Nettleton v. Higginson , 98 Idaho 87 ( 1977 )

DONALDSON, Justice.

This controversy involves a dispute between plaintiff-appellant J. H. Nettleton, a water user located in the Upper Reynolds Creek Water District, and defendant-respondent Department of Water Resources, which assumes distribution of waters of Reynolds Creek. Reynolds Creek is a natural stream located in Owyhee County, Idaho, and the Department of Water Resources, formerly the Department of Water Administration, divided the stream into two water districts, District 57-A which is known as Upper Reynolds Creek District wherein the appellant owns property, and District 57-J which comprises Lower Reynolds Creek. The appellant’s lands are located in Upper Reynolds Creek, and it is stipulated he has three types of water rights, adjudicated rights, licensed rights, and unadjudicated “constitutional” rights.

The respondent claims direction and control of the distribution of all of the waters of Reynolds Creek within the boundaries of Upper Reynolds and Lower Reynolds, and has ordered the watermaster for Upper Reynolds to distribute the waters in Upper Reynolds as if both Upper and Lower Reynolds were one water district. Consistent with that policy, respondent’s position is that the decree of September 14, 1973, which adjudicated the rights of ten water users in Lower Reynolds, requires that the watermaster of Upper Reynolds recognize the priorities of those in Lower Reynolds in allocating the waters in his district.

The matter was submitted to the trial court upon stipulation of facts with the appellant seeking to enjoin the respondent from administering the distribution of waters from Reynolds Creek. The trial court granted respondent’s motion for summary judgment, from which appellant now appeals.

Appellant assigns error to the lower court’s failure to find the provisions of I.C. § 42-607 in violation of his constitutional rights.¹ His challenge is threefold: first, that the statutory preference for “adjudicated, decreed, permit, or licensed right[s]” over the so-called unadjudicated “constitutional use” water rights in times of water scarcity is a deprivation of property without due process (Idaho Const. Art. I, § 13; U.S. Const. Amend. XIV, § 1); second, that said statute is a denial of equal protection under the laws (U.S.Const. Amend. XIV, § 1; and finally, I.C. § 42-607 authorizes a taking of property for a public use without payment of just compensation (Idaho Const. Art. 1, § M).

We first consider appellant’s contention that the statute amounts to a deprivation of property without due process of law. We agree that individual water rights are real property rights which must be afforded the protection of due process of law before they may be taken by the state. Idaho Const. Art 15, § 4; Anderson v. Cummings, 81 Idaho 327, 340 P.2d 1111 (1959); Follett v. Taylor Brothers, 77 Idaho 416, 294 P.2d 1088 (1956).

The constitutional guarantee of procedural due process applies to governmental taking of legitimate property interests within the meaning of the Fifth or Fourteenth Amendments. It demands that if such a deprivation takes place, it must be accompanied by some type of notice and hearing. The United States Supreme Court, in Fuentes v. Shevin, 407 U.S. 67, 92 S.Ct. 1983, 32 L.Ed.2d 556 (1972), held that except in “extraordinary circumstances” where some valid governmental interest justifies the postponement of notice and hearing, due process requires an adversary proceeding before a person can be deprived of his property interest.

The appellant, however, in order to invoke the protection of the Due Process Clause, must have a “significant property interest” which is being deprived by the state’s actions pursuant to I.C. § 42-607. Boddie v. Connecticut, 401 U.S. 371, 91 S.Ct. 780, 28 L.Ed.2d 113 (1971); Bell v. Burson, 402 U.S. 535, 91 S.Ct. 1586, 29 L.Ed.2d 90 (1971); Goldberg v. Kelly, 397 U.S. 254, 90 S.Ct. 1011, 25 L.Ed.2d 287 (1970). The difficulty appellant has in this case is apparent. His claimed property interest is that of a “constitutional use” water right, such right being created simply by diverting unappropriated waters and putting those waters to beneficial use. I.C. § 42-103 et seq. Such a right, unless adjudicated, is an unproven right, i. e. no formal proceeding, neither judicial nor administrative, has established said right. Until such a water right is adjudicated, the only evidence that the right exists are the declarations of the claimant himself. Even if upon investigation by the Water Resource Board or some interested person a means of diversion, as claimed by appellant, is discovered, there still remains the unanswered questions concerning the date such diversion of water was put into operation; the amount of water being diverted; the use for which the water is being diverted; and the continuity in time of appellant’s diversion of water. Thus, this Court, in considering appellant’s due process argument, faces the same problem ² that the watermaster faces when attempting to distribute the waters in times of scarcity—i. e. determining which claimed “constitutional use” rights are valid and which are unwarranted and unjustified claims for water under the guise of a “constitutional use right.”

But even if the appellant has sufficiently substantiated the existence of this claimed property interest so as to invoke the protections of the Due Process Clause, there are other reasons for rejection of this constitutional challenge.

Justice Powell, in a concurring opinion in Mitchell v. W. T. Grant Company, 416 U.S. 600, 94 S.Ct. 1895, 40 L.Ed.2d 406 (1974), notes that the determination of what due process is required in a given context requires a balancing of both the nature of the governmental function involved and the private interests affected. 416 U.S. at 624-25, 94 S.Ct. 1895. It is well-settled that the water itself is the property of the state, which has the duty to supervise the allotment of those waters with minimal waste to the private appropriators. I.C. § 42-101; Poole v. Olaveson, 82 Idaho 496, 356 P.2d 61 (1960); Walbridge v. Robinson, 22 Idaho 236, 125 P. 812 (1912). In addition, the state’s authority to regulate the distribution of the water is constitutionally based:

“The use of all waters now appropriated, or that may hereafter be appropriated for sale, rental or distribution; also of all water originally appropriated for private use, but which after such appropriation has heretofore been, or may hereafter be sold, rented, or distributed, is hereby declared to be a public use, and subject to the regulation and control of the state in the manner prescribed by law.” Idaho Const. Art. 15, § 1.

The governmental function in enacting not only I.C. § 42-607, but the entire water distribution system under Title 42 of the Idaho Code is to further the state policy of securing the maximum use and benefit of its water resources. As to the private interests affected, it is obvious that in times of water shortage someone is not going to receive water. Under the appropriation system the right of priority is based on the date of one’s appropriation, i. e. first in time is first in right. However, as stated earlier, it is the state’s duty to supervise the distribution of the waters through the Water Resource Board and its watermasters. In DeRousse v. Higginson, 95 Idaho 173, 505 P.2d 321 (1973), the dissent aptly considered the practical difficulties facing the water-master:

“It is to be kept in mind that the authority of the watermaster in his district is to control the delivery of the water from the source of supply * * * into the respective ditches or canals leading from the main stream. The watermaster is confronted by two significant problems when delivering water within his water district: first, he must maintain the constitutional requirement of priority of water rights among the various users; second, he is confronted with the practical problem of delivering water to the correct point of diversion. When one considers the magnitude of the water-master’s problem of water delivery in his water district, it is evident that a proper delivery can only be effected when the watermaster is guided by some specific schedule or list of water users and their priorities, amounts, and points of diversion. * * *

“Only by having a specific list reciting the names of the water users, with their dates of priority, amounts, and points of diversion can such a system be administered. Since the so-called ‘constitutional use right’ is unrecorded in respect to priority, amount and point of diversion, the whole system of delivery in a water district would be endangered if such a right were recognized. * * *

“ * * * All those individuals that enjoy the use of water by reason of having their rights adjudicated, or that have the use of water by reason of permits or licenses issued from the department of [water resources], are entitled to expect the state, which has granted them the right to the use of water, to protect them in their established rights.

“If [appellant’s] interpretation [of the constitutionality] of I.C. § 42-607 is [followed], the validity of any decreed right or water permit or license would be placed in jeopardy. If anyone claimed a constitutional ‘use right,’ and took the water from the stream, the watermaster charged with the responsibility of administering the stream would be powerless to act. Consequently, a person enjoying a prior right established by a decree, permit or license, would be subject to losing his use of the water by anyone claiming a ‘constitutional use right’ without regard to its priority.” 95 Idaho at 180, 181, 505 P.2d at 329.

The requirement of procedural due process is satisfied by the statutory scheme of Title 42 of the Idaho Code. Our holding is supported by a comparison of the state’s duty as mandated by Article 15, § 1 of the Idaho Constitution with the appellant’s ability, under I.C. § 42-1405,³ to at any time verify his “constitutional use right,” thereby reaping the protective benefit of I.C. § 42-607 himself. Granted that when action is taken pursuant to I.C. § 42-607 there is no notice or hearing prior to the shutting off of the unadjudicated water rights, but as the United States Supreme Court noted in Fuentes v. Shevin, supra, there are extraordinary situations when postponement of notice and a hearing is justified. It is justified when:

“First * * * the seizure has been directly necessary to secure an important governmental or general public interest. Second, there has been a special need for very prompt action. Third, the State has kept strict control over its monopoly of legitimate force; the person initiating the seizure has been a government official responsible for determining, under the standards of a narrowly drawn statute, that it was necessary and justified in the particular instance.” 407 U.S. at 91, 92 S.Ct. at 2000.

We find the above three requirements to be met in the present case and find no procedural due process violation in the actions of the watermaster pursuant to I.C. § 42-607.

Appellant further contends that I.C. § 42-607 denies him equal protection of the laws as guaranteed by the Fourteenth Amendment to the United States Constitution. He claims that the statute discriminates against constitutional use appropriators in an arbitrary and capricious manner.

The state has a legitimate purpose in enacting I.C. § 42-607, that purpose being to protect all private water rights in times of water shortage. Since the classes involved in I.C. § 42-607 are non-suspect, i. e. those with recorded water rights and those without, we need only find a rational relationship between the state’s purpose and the enactment of the statute to uphold its constitutionality. State v. Cantrell, 94 Idaho 653, 496 P.2d 276 (1972). Considering the problems of a “constitutional use” appropriation discussed earlier, the legislature and this Court recognize that we cannot adequately protect these rights unless the state’s agent, the watermaster, has a specific record of the users’ priority dates, use and points of diversion. We find that the legislative classification is rationally related to the state’s purpose; and as it operates equally, uniformly and impartially on all persons within the same class, we find no denial of equal protection.

Appellant’s final constitutional challenge is that I.C. § 42-607 would constitute a taking of private property for public use without just compensation contrary to Idaho Constitution, Article 1, § 14. We do not agree with this argument. The right of appropriation does not carry with it an unconditional guarantee of water regardless of the supply of water available. In times of shortage one holding an unadjudicated water right stands in a position similar to he who holds the “recorded” water right of the lowest priority date. The fact that his diversion must be shut off to allow those with an earlier priority to receive water cannot be complained of as being a violation of Article 1, § 14 of the Idaho Constitution.

Next, the appellant argues that the respondent had no authority to create water districts on Reynolds Creek. The parties have stipulated that no combination of decrees includes every constitutional-use right on Reynolds Creek. Under I.C. § 42-604 a water district cannot be created on streams whose “priorities of appropriation have not been adjudicated by the courts.” It is appellant’s contention that the statute requires every constitutional-use water right to be adjudicated before a water district can be created.

The stipulation fails to raise an issue of fact as to the validity of the creation of the water districts. Both Upper and Lower Reynolds Creek were originally created as one water district sometime prior to 1915.⁴ The validity of the creation of that district depends upon the number of unadjudicated constitutional-use rights at that time, not at the present. Even assuming that there were some unadjudicated constitutional-use rights when the original district was formed, we do not construe I.C. § 42-604 as requiring that every such right must be adjudicated.

Although there is neither case law nor legislative history on this point, some legislative intent may be gleaned from the existence of I.C. §§ 42-607 and 42-1405. The first section authorizes the watermaster of a district to shut off the diversion of those having unadjudicated rights in times of water scarcity. The latter allows for supplemental adjudication proceedings against the district watermaster by one whose water rights were not adjudicated in an earlier proceeding. The existence of these two statutes shows that the legislature recognizes that a water district may be validly created even though not all users within said district have had their rights adjudicated.

We must presume that the district was validly created. Without evidence as to the number of unadjudicated constitutional-use rights in existence at that time, the appellant has failed to create any factual issue as to the validity of the district.

The original Reynolds Creek water district was split into two districts in April, 1916. Appellant contends that the creation of two districts on Reynolds Creek violated I.C. § 42-604. Under that statute a single stream may be divided into two or more water districts

“when the distance between the extreme points of diversion thereon is more than forty miles * * * provided, that any stream may be divided into two or more water districts, irrespective of the distance between the extreme points of diversion, where the use of the waters of such stream by appropriators in one district does not affect or conflict with the use of the waters of such stream by appropriators outside such district *

Appellant relies for this argument upon the parties’ stipulation that the distance between the extreme points of diversion from the whole of Reynolds Creek has never exceeded forty miles. Appellant has presented no evidence, however, that in 1916 the use of the water by appropriators in one district affected or conflicted with the use by those in the other. The mere fact that there is a conflict almost sixty years later is not sufficient to show that there was a conflict in 1916.

Another of appellant’s major assignments of error is that the Department of Water Resources has directed the water-master for the Upper Reynolds District to distribute the waters within both Upper and Lower Reynolds District in accordance with priorities established by both the 1911 Gifford decree (Upper Reynolds ) and the 1973 Benson decree (Lower Reynolds). Appellant claims that since he was not a party to the action resulting in the 1973 decree he is not bound by it. To support his argument, appellant relies upon Scott v. Nampa & Meridian Irr. Dist., 55 Idaho 672, 45 P.2d 1062 (1934).

The Court in Scott merely held that the consumers who were not parties to a prior action involving the canal company which supplied them with water were not bound by that decree in the sense of res judicata. They could therefore bring an action to determine their relative priorities to the water furnished by the canal company.

We fail to understand how the directive from the Department of Water Resources could be construed as having a res judicata effect on appellant’s water rights. It in no way attempts to prohibit him from challenging the priorities established in the Benson decree. Whenever he desires, he may bring an appropriate action to do so. Until then both the Benson and Gifford decrees may be used by the state to provide a basis for the orderly distribution of irrigation water.

Subsequent to the district court decision in this case, the respondent issued an order combining into one water district the two districts involved herein. Under the facts of this case, we think that before such action can be taken creating one district the Department of Water Resources must first hold a public hearing, upon reasonable notice, wherein all interested persons may testify before the Department regarding facts relevant to the combined water district. There are approximately 68 decreed, licensed, and permit water rights on Reynolds Creek.⁵ There is no indication as to the number of unadjudicated constitutional-use rights claimed on the Creek. There is also apparently some dispute as to whether the existing uses substantially conform to the claimed rights. As between the various Reynolds Creek water users, some of the water rights may have been lost by abandonment, Sutton v. Brown, 91 Idaho 396, 422 P.2d 63 (1966), or forfeiture, I.C. § 42-222(2); may have been transferred to other land which could have affected the return flow to Reynolds Creek, I.C. § 42-108, -202; or may have been acquired by adverse possession following five years of continuous adverse use, Bachman v. Reynolds Irrigation Dist., 56 Idaho 507, 55 P.2d 1314 (1936). After receiving all of the claims and the evidence supporting said claims, the respondent must then decide whether there are sufficient uncontested rights to develop a workable plan for water distribution. If not, then the respondent should proceed with an adjudication pursuant to I.C. § 42-1406 before combining these two districts into one.

The judgment, is reversed and remanded to the district court to order such a hearing before the Department of Water Resources in accordance with this opinion. Costs to appellant.

McFADDEN, C. J., SHEPARD, J., and SCOGGIN, District Judge, retired, concur.

1 . 42-607. Distribution of Water. — It shall be the duty of said watermaster to distribute the waters of the public stream, streams or water supply, comprising his water district, among the several ditches taking water therefrom according to the prior rights of each respectively, in whole or in part, and to shut and fasten, or cause to be shut or fastened, under the direction of the department of water resources, the headgates of the ditches heading from such stream, streams or water supply, when in times of scarcity of water it is necessary so to do in order to supply the prior rights of others in such stream or water supply; provided, that any person or corporation claiming the right to the use of the waters of the stream or water supply comprising a water district, but not owning or having the use of an adjudicated or decreed right therein, or right therein evidenced by permit or license issued by the department of water resources, shall, for the purposes of distribution during the scarcity of water, be held to have a right subsequent to any adjudicated, decreed, permit, or licensed right in such stream or water supply, and the watermaster shall close all headgates of ditches or other diversions having no adjudicated, decreed, permit or licensed right if necessary to supply adjudicated, decreed, permit, or licensed right in such stream or water supply. So long as a duly elected watermaster is charged with the administration of the waters within a water district, no water user within such district can adversely possess the right of any other water user.”

2 . While it is noted by the Court that both parties have stipulated, for the purposes of this case, that appellant owns a valid unadjudicated constitutional use right, such stipulation is not proof of his property interest.

3 . “42-1405. Summary supplemental adjudication of water rights. — 'Where the priority rights upon any stream, canal or reservoir in this state shall have been determined by decree of any court of competent jurisdiction, and thereafter it shall appear that any person or corporation having the right to the use of any part of said water was not included in said decree as a party thereto, and said right was not determined thereby, or that any person who subsequent thereto has acquired any right to the use of such waters, any such person or corporation may have such right adjudicated in the following manner:

He may bring an action in the district court of the county wherein such decree was entered against the watermaster having charge of the distribution of the water of said stream, canal or reservoir in which said party claims an interest, or if there be no watermaster thereof, then against the department of reclamation; that the said party shall in his complaint, set out his own right as he is now required to do in cases involving the right of priority of use of water, and he shall further set forth his acceptance as binding upon him of the said decree and the findings of fact and conclusions of law upon which it is based. Thereupon summons shall issue out of said court in said cause and be served upon said defendant. The plaintiff in said action shall cause to be published once a week for not less than three weeks a notice of the pendency and purpose of said action in such newspaper or newspapers as the judge of said district court may order, which notice shall contain the title of the court and the cause, the name of the stream, canal or reservoir in the waters of which said plaintiff claims an interest, the date of priority claimed by him and the date and short title (being usually the name of the first plaintiff and thé first defendant) of the decree theretofore entered, fixing the permanent rights in said stream, canal or reservoir. After the expiration of the time fixed by said order, said cause may be brought on for hearing in open court, and any party interested may appear and defend against said right. The court by its decree in said action shall determine the rights of said plaintiff in accordance with the proof submitted but subject to the terms of the original decree herein-before referred to: provided, that the right thus established shall not be deemed adjudicated, but prima facie merely, and may be attacked by suit brought in a court of competent jurisdiction at any time by any person deeming himself aggrieved thereby. The court shall charge all costs arising under said action to the party bringing the same, unless the defendant personally shall be guilty of mismanagement or bad faith in the action or defense. Whereupon water shall be distributed to him in accordance therewith and in the same manner as though he had had his said right included in said decree. The plaintiff, any party to said original decree, or any person interested, may appeal from the decree entered in the action hereby authorized to be brought, and the statutes governing new trial and appeal and the procedure in connection therewith shall govern so far as applicable: provided, however, if the plaintiff appeals or moves for a new trial, notice thereof and of the date fixed for the settlement of any reporter’s transcript, bill of exceptions, or any other matter required to be settled, shall be served by the publication of such notice or notices for three weeks in such newspaper as the judge of said district may by order direct. The proposed draft of such reporter’s transcript, or other matter required to be settled, or bill of exceptions, shall be filed with the clerk of said court and such filing shall be sufficient service thereof. The transcript and briefs upon appeal shall be served as in other civil cases.”

4 . The official records of the Department of Water Resources, of which we take judicial notice, indicate that the original district was created prior to 1915, but they do not contain the exact date thereof.

5 . The official records of the Department of Water Resources, of which we take judicial notice, list the decreed, licensed, and permit water rights, but do not contain information as to the unadjudicated constitutional-use water rights claimed in the district.