Title: BAGNELL v LEMERY

State: montana

Issuer: Montana Supreme Court

Document:

N O . 81-413 I N THE SUPREME COURT OF THE STATE OF MONTANA 1 9 8 3 COLLEEN N . BAGNELL, P l a i n t i f f and A p p e l l a n t , V S . CHARLES J . LEMERY, DANIEL LEMERY e t a l . , D e f e n d a n t s and R e s p o n d e n t s . Appeal f r o m : D i s t r i c t C o u r t o f t h e F o u r t h J u d i c i a l D i s t r i c t , I n a n d f o r t h e County o f Lake H o n o r a b l e J a c k L. G r e e n , J u d g e p r e s i d i n g . C o u n s e l o f R e c o r d : F o r A p p e l l a n t : M o r a l e s , V o l i n k a t y and H a r r , M i s s o u l a , Montana F o r R e s p o n d e n t s : T u r n a g e & McNeil, P o l s o n , Montana S u b m i t t e d on b r i e f s : December 11, 1 9 8 1 ~ ~ ~ i d ~ d : January 2 7 , 1 9 8 3 F i l e d : J A N 2 7 1983 M r . J u s t i c e John Conway H a r r i s o n d e l i v e r e d t h e Opinion of t h e C o u r t . P l a i n t i f £ / a p p e l l a n t i n i t i a t e d t h i s a c t i o n s e e k i n g to e n j o i n d e f e n d a n t / r e s p o n d e n t from i n t e r f e r i n g w i t h t h e water f l o w i n Ashley Creek i n Lake County, Montana, and t o a d j u d i c a t e t h e water r i g h t s of t h e p a r t i e s . The District Court of t h e F o u r t h J u d i c i a l D i s t r i c t i n and f o r t h e County of Lake, found d e f e n d a n t s to have a s e n i o r water r i g h t of 178 acre f e e t per y e a r and a p r i o r i t y d a t e of 1917 and p l a i n t i f f t o have a j u n i o r w a t e r r i g h t l i m i t e d t o d e f e n d a n t s 1 s u r p l u s . P l a i n t i f f a p p e a l s . Defendants a r e owners of real p r o p e r t y s i t u a t e d i n Lake County, n o r t h of S t . I g n a t i u s , Montana, d e s c r i b e d as t h e ~ ~ 4 4 , S e c t i o n 31, Township 1 9 North, Range 19 West, M.P.M. P l a i n t i f f is t h e owner of real p r o p e r t y a d j a c e n t t o d e f e n d a n t s 1 n o r t h w e s t boundary l i n e d e s c r i b e d a s t h e ~ ~ 4 4 , SE44 , S e c t i o n 25, Township 1 9 N o r t h , Range 20 West, M.P.M. T h i s case i n v o l v e s water from n a t u r a l s p r i n g s l o c a t e d west of d e f e n d a n t s ' p r o p e r t y on land owned by T h e r i n Mahle. The water from t h e Mahle S p r i n g s flows t h r o u g h d e f e n d a n t s 1 l a n d and i n t o Ashley Creek and t h e n Ashley Creek flows from d e f e n d a n t s ' land o n t o p l a i n t i f f ' s l a n d . Defendants' p r e d e c e s s o r s i n i n t e r e s t began using t h e water from t h e Mahle S p r i n g s i n 1917 a s domestic water f o r t h e f a m i l y home, water f o r a "duck pond" used i n r a i s i n g domestic fowl f o r commercial p u r p o s e s , s t o c k water f o r r a i s i n g c a t t l e , h o r s e s and p i g s , and f o r i r r i g a t i o n of t h e i r 160 acre t r a c t . Defendant Lemery t e s t i f i e d t h e r e had been a c o n t i n u o u s b e n e f i c i a l use of water on t h e d e f e n d a n t s ' land i n t h e amount of 110 g a l l o n s p e r m i n u t e or 178 a c r e f e e t p e r y e a r s i n c e 1917. I n 1956 d e f e n d a n t s began c o n s t r u c t i o n of an ASC approved dam t o impound t h e s p r i n g w a t e r . The dam was completed i n 1958. The purpose of t h e dam was to s t a b i l i z e d e f e n d a n t s ' w a t e r s u p p l y and d e f e n d a n t s claim no i n c r e a s e i n t h e amount of t h e i r water r i g h t v i a t h e c o n s t r u c t i o n o f t h e dam. The water impounded by t h e dam h a s been used f o r f l o o d i r r i g a t i n g a p p r o x i m a t e l y 6 0 acres of d e f e n d a n t s ' l a n d , s p r i n k l e r i r r i g a t i n g t h e f u l l 160 a c r e s of d e f e n d a n t s ' l a n d , s t o c k w a t e r f o r c a t t l e , and a commercial f i s h o p e r a t i o n . On A p r i l 3 , 1973, d e f e n d a n t Lemery f i l e d a n o t i c e of completion of ground w a t e r a p p r o p r i a t i o n without w e l l , claiming 110 g a l l o n s per minute. Defendant e s t i m a t e d 110 g a l l o n s p e r minute equaled 1 5 a c r e f e e t of water used p e r y e a r . P l a i n t i f f ' s p r e d e c e s s o r began u s i n g w a t e r from Ashley Creek i n 1957 f o r s t o c k w a t e r . P l a i n t i f f 's p r e d e c e s s o r tes t i £ ied t h a t a t times Ashley Creek would become completely d r y and she would approach d e f e n d a n t Lemery and aslc him t o r e l e a s e water from h i s dam which he would d o . P l a i n t i f f purchased h e r p r o p e r t y i n 1974 and on May 1 7 , 1978, p l a i n t i f f obtained a water use p e r m i t f o r Ashley Creek from t h e Montana Department of N a t u r a l Resources. The permit s t a t e s p l a i n t i f f I s use is s u b j e c t to a l l p r i o r a p p r o p r i a t i o n s . I n 1978, d e f e n d a n t Lemery refused t o r e l e a s e a d d i t i o n a l w a t e r t o p l a i n t i f f . P l a i n t i f f then i n i t i a t e d t h i s a c t i o n i n t h e Fourth J u d i c i a l D i s t r i c t , Lake County, to a d j u d i c a t e the p a r t i e s ' w a t e r r i g h t s and t o e n j o i n d e f e n d a n t s from i n t e r f e r i n g w i t h the t r i b u - t a r y w a t e r s of Ashley Creek. O n J u l y 1, 1981, the District Court f i l e d its f i n d i n g s of f a c t , conclusions of law, judgment and d e c r e e nunc p r o t u n c . The D i s t r i c t Court found d e f e n d a n t s t o have a s u p e r i o r water r i g h t of 110 g a l l o n s p e r minute o r 15 a c r e f e e t p e r y e a r . The District Court f u r t h e r found p l a i n t i f f is o n l y e n t i t l e d t o any s u r p l u s water over and above d e f e n d a n t s ' r i g h t s . P l a i n t i f f appealed. On A p r i l 1, 1982, t h i s Court remanded t h e case back to t h e District Court f o r f u r t h e r find- i n g s . On July 7, 1982, the D i s t r i c t Court f i l e d second amended f i n d i n g s of f a c t , c o n c l u s i o n s of law, judgment and d e c r e e . The D i s t r i c t Court found d e f e n d a n t s to have a r i g h t t o 110 g a l l o n s p e r minute which a c t u a l l y e q u a l s 178 a c r e f e e t p e r y e a r w i t h a p r i o r i t y d a t e of 1917 and found p l a i n t i f f ' s r i g h t s l i m i t e d to any a v a i l a b l e w a t e r i n Ashley Creek or any s u r p l u s w a t e r from d e f e n d a n t s ' dam. P l a i n t i f f a p p e a l s . The i s s u e s r a i s e d on appeal a r e a s f o l l o w s : 1. Whether t h e D i s t r i c t Court f a i l e d to comply w i t h t h i s C o u r t ' s remand f o r f u r t h e r f i n d i n g s . 2 . Whether t h e District Court e r r e d i n h o l d i n g t h a t d e f e n d a n t s 1 water r i g h t s are s u p e r i o r and p r i o r i n t i m e to p l a i n t i f f I s . 3. Whether t h e District Court e r r e d by g r a n t i n g d e f e n d a n t an e x c e s s i v e a p p r o p r i a t i o n of water. 4. Whether t h e t r a d i t i o n a l p o l i c y cons i d e r a t i o n s of Montana w a t e r l a w j u s t i f y t h e f i n d i n g t h a t d e f e n d a n t s have b e n e f i c i a l l y a p p l i e d t h e i r a p p r o p r i a t i o n . On A p r i l 1, 1982, t h i s Court remanded t h i s case f o r f u r t h e r f i n d i n g s to d e t e r m i n e t h e amount of t h e 1917 water r i g h t , t h e e x t e n t to which t h e w a t e r r i g h t was changed by v i r t u e of t h e 1956 dam c o n s t r u c t i o n , and t h e f u r t h e r e x t e n t , i f any, of a change as a r e s u l t of a usage s i n c e 1961. I n t h e District C o u r t ' s second amended f i n d i n g s of f a c t , c o n c l u s i o n s of law, judgment and d e c r e e , t h e D i s t r i c t Court made f i n d i n g s t h a t : d e f e n d a n t had made c o n t i n u o u s b e n e f i c i a l use of t h e water from t h e s p r i n g s i n t h e amount of 110 g a l l o n s p e r minute or 178 a c r e f e e t per y e a r ; t h e d e f e n d a n t s c l a i m no i n c r e a s e i n t h e quantum of t h e i r p r e s e n t water r i g h t by r e a s o n of t h e completion of t h e i r ASC approved dam i n 1958 above t h e 1917 w a t e r r i g h t ; and t h e commercial f i s h farm c r e a t e d an a d d i t i o n a l b e n e f i c i a l use s i n c e 1961, b u t r e q u i r e d no i n c r e a s e i n t h e i r water r i g h t s . P l a i n t i f f c o n t e n d s t h e District Court f a i l e d to comply w i t h o u r remand f o r f u r t h e r f i n d i n g s . However, t h e District Court a d d r e s s e d each f a c t u a l d e t e r m i n a t i o n r e q u e s t e d i n t h i s Court I s o r d e r of A p r i l 1, 1982. T h i s Court h a s s t a t e d s e v e r a l times: "Our f u n c t i o n on a p p e a l i n reviewing f i n d i n g s of f a c t is n o t to s u b s t i t u t e o u r judgment f o r t h a t of t h e D i s t r i c t C o u r t , b u t r a t h e r to d e t e r m i n e whether t h e r e is s u b s t a n t i a l e v i d e n c e to sup- p o r t t h e lower c o u r t ' s f i n d i n g s . " Shanahan v. U n i v e r s a l Tavern C o r p o r a t i o n ( 1 9 7 8 ) , 179 Mont. 36, 585 P.2d 1314, 1316. W e f i n d t h e District Court s f i n d i n g s were supported by s u b s t a n t i a l e v i - dence which w a s p r e s e n t e d a t t h e h e a r i n g of J u n e 16 and 1 7 , 1982. P l a i n t i f f h a s n o t p r e s e n t e d s u f f i c i e n t e v i d e n c e found i n t h e r e c o r d which would p r e p o n d e r a t e a g a i n s t t h e District Court I s f i n - d i n g s . W e , t h e r e f o r e , f i n d t h e D i s t r i c t Court d i d comply w i t h t h i s C o u r t ' s remand f o r f u r t h e r f i n d i n g s . P r i o r to t h e 1973 Water Use A c t one could a c q u i r e a water r i g h t by complying w i t h t h e a p p l i c a b l e s t a t u t e s a t t h e t i m e or by s i m p l y p u t t i n g t h e water t o a b e n e f i c i a l u s e . T h i s was t h e r e s u l t of t h i s C o u r t ' s h o l d i n g i n Murray v. Tingley ( 1 8 9 7 ) , 20 Mont. 260, 50 P. 723. I n B a i l e y v. T i n t i n g e r ( 1 9 1 2 ) , 45 Mont. 154, 122 P. 575, t h i s Court commented upon Murray, s u p r a , s t a t i n g : " I n Murray v. T i n g l e y , 20 Mont. 260, 50 Pac. 723, t h i s c o u r t had b e f o r e it t h e s i n g l e q u e s t ion: Can a p e r s o n make a v a l i d a p p r o p r i a t i o n of water af t e r t h e s t a t u t e of 1885 went i n t o e f f e c t , w i t h o u t complying w i t h t h e s t a t u t e ? A f t e r c i t i n g D e Necochea -- v . C u r t i s and W e l l s v . Mantes, ayd o t l n g the .---- language f ram'-the-former o p i n i o n which w e reproduce above, t h i s c o u r t s a i d : 'We t h i n k t h e c o n s t r u c t i o n of t h e s t a t u t e by t h e supreme c o u r t of C a l i f o r n i a is l o g i c a l and correct, and a r e of t h e o p i n i o n t h a t t h e Montana A c t [of 18851 s h o u l d be c o n s t r u e d i n t h e same manner. That t h e c o n c l u s i o n reached by t h e C a l i f o r n i a c o u r t i n each of t h o s e c a s e s , as w e l l as t h e c o n c l u s i o n of t h i s c o u r t i n Murray v. T i n g l e y , is correct, does n o t admit of - - argument. S e c t i o n 1419, C a l i f o r n i a C i v i l Code (Mont. Rev. Codes, sec. 4 8 4 9 ) , c l e a r l y recog- n i z e s a r i g h t which one may a c q u i r e to t h e use o f w a t e r w i t h o u t complying w i t h t h e s t a t u t e , and t h a t such r i g h t s h a l l be good as a g a i n s t everyone e x c e p t a n a p p r o p r i a t o r who complies w i t h t h e s t a t u t e b e f o r e t h e f i r s t c l a i m a n t h a s a c t u a l l y completed h i s work and a p p l i e d t h e water to a b e n e f i c i a l use ." 45 Mont. a t 168. P l a i n t i f f a r g u e s i n t h e p r e s e n t case b o t h p a r t i e s f a i l e d to comply w i t h s e c t i o n 89-810, R.C.M. 1947, t h u s , h e r r i g h t is p r i o r t o d e f e n d a n t s ' because h e r p r e d e c e s s o r began using water i n Ashley Creek i n 1957 and d e f e n d a n t s d i d n o t complete t h e i r dam of t h e Mahle S p r i n g water u n t i l 1958. P l a i n t i f f contends had defen- d a n t s complied w i t h t h e n o t i c e r e q u i r e m e n t s , t h e y would have been a b l e to o b t a i n a p r i o r i t y d a t e of 1956 v i a t h e R e l a t i o n Back D o c t r i n e d e f i n e d i n s e c t i o n 89-812, R.C.M. 1947, t h e a p p l i c a b l e s t a t u t e a t t h a t time. However, t h e District Court found d e f e n d a n t s had made a con- t i n u o u s b e n e f i c i a l use of t h e Mahle S p r i n g water s i n c e 1917. Defendants do n o t contend t h e i r water r i g h t i n c r e a s e d by t h e c o n s t r u c t i o n of t h e dam between 1956 t o 1958, b u t r a t h e r , they claim t h e dam merely s t a b i l i z e d d e f e n d a n t s f water and made it a v a i l a b l e a t l a t e r and d r i e r times of t h e y e a r . Thus, d e f e n d a n t s have a p r i o r i t y d a t e of 1917 which is when t h e i r p r e d e c e s s o r s f i r s t began to make a b e n e f i c i a l use of t h e s p r i n g water. P l a i n t i f f f u r t h e r c o n t e n d s t h e d o c t r i n e s of e q u i t a b l e e s t o p - p e l and l a c h e s b a r d e f e n d a n t s from a s s e r t i n g a s u p e r i o r water r i g h t . The e l e m e n t s n e c e s s a r y to e s t a b l i s h e s t o p p e l i n a water r i g h t s case were d e f i n e d i n Smith v. K r u t a r (1969)r 1 5 3 Mont. 325, 457 P.2d 459. However, t h i s Court h a s r u l e d p r e v i o u s l y , e s t o p p e l arises when a p a r t y by h i s acts, conduct or a c q u i e s c e n c e , h a s caused a n o t h e r i n good f a i t h to change h i s p o s i t i o n f o r t h e worse. Smith v. K r u t a r , s u p r a ; Hustad v. Reed ( 1 9 5 8 ) , 1 3 3 Mont. 211, 2 2 3 , 3 2 1 P.2d 1083. Here, d e f e n d a n t s d i d n o t c a u s e p l a i n t i f f ' s p r e d e c e s s o r to change h e r p o s i t i o n f o r t h e worse as d e f e n d a n t s had a l r e a d y e s t a b l i s h e d a v a l i d use r i g h t to t h e s p r i n g water. A s s t a t e d above, d e f e n d a n t s 1 use began i n 1917 and d i d n o t i n c r e a s e af ter t h e c o n s t r u c t i o n of t h e dam, t h u s p l a i n t i f f would n o t have o b t a i n e d a r i g h t s u p e r i o r to d e f e n d a n t s ' had s h e s o u g h t a d j u d i c a t i o n i n 1957 or any t i m e t h e r e a f t e r . D e f e n d a n t s ' a c t i o n t o release w a t e r o u t of t h e dam was e i t h e r a mere g r a t u i t y o r t r a n s f e r of s u r p l u s water. I n e i t h e r case p l a i n t i f f ' s p r e d e c e s s o r could have done nothing to improve h e r pos it i o n . P l a i n t i f f a l s o claims t h e d o c t r i n e of l a c h e s s h o u l d be a p p l i e d to e s t a b l i s h p l a i n t i f f ' s s u p e r i o r r i g h t . I n Montgomery v . Bank of D i l l o n ( 1 9 4 3 ) , 114 Mont. 395, 136 P.2d 760, t h i s Court s t a t e d : "Laches means t h e n e g l i g e n c e or omission to s e a s o n a b l y assert a r i g h t . . . and it e x i s t s when t h e r e is an unexplained d e l a y of such d u r a t i o n or such c h a r a c t e r as to r e n d e r enforcement o f an a s s e r t e d r i g h t i n e q u i t a b l e . " 136 P.2d a t 766. P l a i n t i f f claims d e f e n d a n t s ' release of t h e dam w a t e r c o n s t i t u t e d n e g l i g e n t d i s r e g a r d f o r t h e i r own p r o p e r t y . However, t h e r e were no f i n d - i n g s n o r was t h e r e any evidence a t t r i a l which would show t h e release was n o t s i m p l y a r e l e a s e of s u r p l u s water. I n t h e absence of e v i d e n c e , t h i s Court cannot a p p l y l a c h e s i n t h i s case. P l a i n t i f f n e x t a r g u e s t h e District Court awarded d e f e n d a n t s a n e x c e s s i v e a p p r o p r i a t i o n of water because t h e award is g r e a t e r t h a n t h e c a p a c i t y of d e f e n d a n t s ' r e s e r v o i r . P l a i n t i f f relies on Whitcomb v. Helena Water Works C o . ( 1 9 6 9 ) , 1 5 1 Mont. 443, 444 P.2d 301. However, Whitcomb is d i s t i n g u i s h a b l e from t h e case a t hand. I n Whitcomb, t h e c i t y of Helena had f i r s t r i g h t to 550 m i n e r ' s i n c h e s of water from Ten Mile Creek. The c i t y ' s p i p e l i n e w a s o n l y a b l e to c a r r y 225 m i n e r ' s i n c h e s a t t h e t i m e of t h e o r i g i n a l d e c r e e i n 1903. A f t e r t h e o r i g i n a l d e c r e e t h e c i t y b u i l t a system of s t o r a g e r e s e r v o i r s . During t h e d r y s e a s o n t h e c i t y would d i v e r t water from t h e t r i b u t a r i e s to make up f o r l o s s and e v a p o r a t i o n and t o keep a c e r t a i n amount of water moving t h r o u g h t h e r e s e r v o i r . The c i t y ' s a c t i o n worked to d e p r i v e p r i o r downstream a p p r o p r i a t o r s of t h e f u l l or even p a r t i a l use of t h e i r d e c r e e d r i g h t s . T h i s Court h e l d t h e c i t y could n o t c o n t i n u e t o store water when it would c u t o f f o t h e r u s e r s who had p r i o r r i g h t s . I n t h e p r e s e n t case a d i f f e r e n t s i t u a t i o n d e v e l o p s . Defendants b u i l t and maintained a r e s e r v o i r to s t a b i l i z e t h e i r water s u p p l y and to o p e r a t e a commercial f i s h farm. The r e c o r d shows t h e r e s e r v o i r is f i l l e d i n t h e s p r i n g when r u n o f f is a t its peak. T h i s p r a c t i c e w a s p r a i s e d by t h i s Court i n F e d e r a l Land Bank v. Morris ( 1 9 4 1 ) , 112 Mont. 445, 116 P.2d 1007; " I t comes back to n o t h i n g else b u t t h a t o l d p r i n c i p a l t h a t ' h e who s a v e s something t h a t would o t h e r w i s e be lost is n o t o n l y to be pro- t e c t e d i n what he h a s s a v e d , b u t commended f o r so doing. " ' I t a p p e a r s t h a t d e f e n d a n t s use t h e water i n t h e r e s e r v o i r as a f o c a l p o i n t of t h e i r i r r i g a t i o n system as w e l l as f o r t h e i r commercial f i s h farm. The District Court decreed t h a t d e f e n d a n t s s h a l l have t h e r i g h t to use t h e water from t h e Mahle S p r i n g s a t t h e rate of 110 g a l l o n s p e r m i n u t e . P l a i n t i f f c o n t e n d s t h i s r a t e is e x c e s s i v e i n t h a t it allows d e f e n d a n t s m u l t i p l e f i l l i n g s of t h e i r r e s e r v o i r . W e d i s a g r e e . The d e f e n d a n t s have shown t h e prudence t o c a t c h t h e s p r i n g run-off to f i l l t h e i r r e s e r v o i r . A f t e r t h e r e s e r v o i r h a s been f i l l e d i n t h e s p r i n g , d e f e n d a n t s have a d e c r e e d r i g h t t o r e t a i n t h e incoming s p r i n g water a t t h e rate of 110 g a l l o n s p e r m i n u t e . T h i s does n o t c o n s t i t u t e a double f i l l i n g of t h e r e s e r v o i r . Any e x c e s s o v e r 110 g a l l o n s per minute must be allowed t o p a s s through t h e r e s e r v o i r and o n t o p l a i n t i f f ' s p r o p e r t y . T h i s is t h e e s s e n c e of t h e District C o u r t ' s d e c r e e and w e f i n d no error i n such a r u l i n g . L a s t l y , p l a i n t i f f claims t r a d i t i o n a l p o l i c y c o n s i d e r a t i o n s do n o t j u s t i f y t h e f i n d i n g t h a t d e f e n d a n t s have a p p l i e d t h e i r a p p r o p r i a t i o n to a b e n e f i c i a l use. P l a i n t i f f contends t h e f a c t t h a t d e f e n d a n t s r e l e a s e d water t o p l a i n t i f f 's p r e d e c e s s o r when r e q u e s t e d is evidence of t h e f a c t t h a t d e f e n d a n t s had more water t h a n t h e y could b e n e f i c i a l l y use. However, t h e District Court made s p e c i f i c f i n d i n g s as to t h e u s e s which d e f e n d a n t s made of t h e s p r i n g water: f l o o d i r r i g a t i o n , s p r i n k l e r i r r i g a t i o n , com- mercial f i s h farm, s t o c k water and domestic use. T h i s Court g e n e r a l l y allows one m i n e r ' s inch to i r r i g a t e each acre of land u n l e s s "evidence d i s c l o s e s t h a t a g r e a t e r or lesser amount is r e q u i r e d . " Conrow v . H u f f i n e ( 1 9 1 4 ) , 48 Mont. 437, 138 P. 1094. The D i s t r i c t Court awarded d e f e n d a n t s 110 g a l l o n s p e r minute to i r r i g a t e 160 acres. Even twelve m i n e r ' s i n c h e s (134 g a l l o n s p e r m i n u t e ) , t h e amount of water f o r i r r i g a t i n g twelve acres, e x c e e d s t h e amount decreed by t h e t r i a l c o u r t . (One m i n e r ' s inch e q u a l s 11.23 g a l l o n s p e r minute .) Thus, a l l t h e e v i d e n c e i n d i c a t e s 110 g a l l o n s p e r minute is c l e a r l y j u s t i f i e d . Judgment is af f irmed . We concur: