Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca10-90-01046/USCOURTS-ca10-90-01046-0/pdf.json

Nature of Suit Code: 290
Nature of Suit: Other Real Property Actions
Cause of Action: 

---

ROBERTL. HOECKER 

CLERK 

UNITED STATES COURT OF APPEALS 

TENTH CIRCUIT 

UNITED STATES COURTHOUSE 

DENVER, COLORADO 802tl4 

June 21, 1991 

TO: ALL RECIPIENTS OF THE CAPTIONED OPINION 

RE: 90-1046, Application of City & County of Denver 

City and County of Denver, et al v. USA, et al 

(Lower docket: 2782, 5016 & 5017) 

On page 3, line 5 the following attorneys have been added 

(303) 844-3157 

FIS 564-3157 

after the word "Colorado", Gregory J. Hobbs, Jr. and Bennett W. Raley, 

of Davis, Graham, & Stubbs, Denver, Colorado; Anthony W. Williams 

and Mark A. Hennundstad of Williams, Turner & Holmes, Grand Junction, 

Colorado; Stanley W. Cazier of Baker, Cazier & McGowan, Granby, 

Colorado; D. J. Dufford of Dufford, Waldeck, Milburn & Krohn, Grand 

Junction, Colorado; Frederick G. Aldrich of Nelson, Hoskins & Farina, 

Grand Junction, Colorado; Mark N. Williams, Grand Junction, Colorado, ... (with them on the briefs) .... on the opinion which issued on 

June 10, 1991. 

PF:afw 

Very truly yours, 

ROB~ .. HOECC&. r-cl~rk . . 

\ I -. 

By: '\ tt\lvttt\· . - /'-.1 

· Ratrick Fisher 

Chief Deputy Clerk 

Appellate Case: 90-1046 Document: 01019297913 Date Filed: 06/10/1991 Page: 1 
PUBLISH 

FILED 6/10/91 

UNITED STATES COURT OF APPEALS 

TENTH CIRCUIT 

IN RE: APPLICATION OF CITY AND COUNTY OF 

DENVER ACTING BY AND THROUGH ITS BOARD OF 

WATER COMMISSIONERS WITH RESPECT TO ITS 

WATER RIGHTS IN THE BLUE AND ITS 

TRIBUTARIES IN SUMMIT COUNTY, COLORADO. 

CITY AND COUNTY OF DENVER, ACTING BY AND 

THROUGH ITS BOARD OF WATER COMMISSIONERS 

WITH RESPECT TO ITS WATER RIGHTS IN THE 

BLUE AND ITS TRIBUTARIES IN SUMMIT COUNTY, 

COLORADO, 

Applicant-Appellant, 

v. 

) 

) 

) 

) 

) 

) 

) 

) 

) 

) 

) 

) 

) 

) 

) 

) 

) 

UNITED STATES OF AMERICA; TRANS MOUNTAIN ) 

HYDRO CORPORATION; BASALT WATER CONSERVANCY ) 

DISTRICT; BRECKENRIDGE SKI AREA; COPPER ) 

MOUNTAIN WATER AND SANITATION DISTRICT; ) 

COPPER MOUNTAIN INCORPORATED; EXXON ) 

COMPANY, USA; MOBIL OIL CORPORATION; ) 

COLORADO STATE ENGINEER; DIVISION ENGINEER ) 

FOR WATER DIVISION NO. 5; COLORADO DIVISION ) 

OF WILDLIFE; TOWN OF BASALT; TOWN OF ) 

COLLBRAN; TOWN OF DE BEQUE; TOWN OF EAGLE; ) 

TOWN OF PALISADE; CITY OF RIFLE; PUBLIC ) 

SERVICE COMPANY OF COLORADO; OXY USA INC.; ) 

NORTHERN COLORADO WATER CONSERVANCY DISTRICT ) 

AND MUNICIPAL SUBDISTRICT, NORTHERN COLORADO ) 

WATER CONSERVANCY DISTRICT; OIL SHALE ) 

CORPORATION; TOWN OF SILVERTHORNE; UPPER ) 

EAGLE REGIONAL WATER AUTHORITY; TOWN OF ) 

BRECKENRIDGE; BOARD OF COUNTY COMMISSIONERS ) 

OF SUMMIT COUNTY, COLORADO; EXXON ) 

CORPORATION, VAIL ASSOCIATES, INC. VIDLER ) 

TUNNEL WATER CO.; CITY OF GRAND JUNCTION, ) 

COLORADO; ORCHARD MESA IRRIGATION DISTRICT; ) 

CLIFTON WATER DISTRICT; COLORADO RIVER ) 

WATER CONSERVATION DISTRICT; PALISADE ) 

IRRIGATION DISTRICT, a Colorado Corporation; ) 

CITY OF FRUITA, a Colorado Municipality; THE ) 

COLORADO WATER CONSERVATION BOARD; GRAND ) 

VALLEY IRRIGATION COMPANY; VAIL VALLEY ) 

CONSOLIDATED WATER DISTRICT; THE CITY OF ) 

AURORA, COLORADO; MIDDLE PARK WATER ) 

No. 90-1046 

Appellate Case: 90-1046 Document: 01019297913 Date Filed: 06/10/1991 Page: 2 
CONSERVANCY DISTRICT; KEYSTONE-ARAPAHOE ) 

LIMITED PARTNERSHIP; N. LEE LACY; THE ) 

DANIEL L. RITCHIE CORPORATION; GRAND VALLEY ) 

WATER USERS ASSOCIATION; MESA COUNTY ) 

IRRIGATION DISTRICT; GETTY OIL COMPANY; ) 

GETTY OIL EXPLORATION COMPANY; UTE WATER ) 

CONSERVANCY DISTRICT; BLUE RIVER VALLEY ) 

RANCH LAKES ASSOCIATION; TOWN OF DILLON; ) 

THE EAGLE COUNTY BOARD OF COUNTY ) 

COMMISSIONERS; CITY OF COLORADO SPRINGS; ) 

DILLON VALLEY DISTRICT; BEAZER MATERIALS AND ) 

SERVICES, INC.; TOWN OF FRISCO; UNION OIL ) 

COMPANY OF CALIFORNIA; SALVATION DITCH ) 

COMPANY, TOWN OF GYPSUM; HARLAND ADAMS; ) 

ADAMS RANCH HOMEOWNERS ASSOCIATION; OWL ) 

CREEK DEVELOPMENT CORPORATION; ESTATE OF ) 

DIANE SMITH; SUMMIT COUNTY; AVON ) 

METROPOLITAN DISTRICT; ARROWHEAD AT VAIL; ) 

CITIZENS FOR THE PROTECTION OF MIDDLE PARK ) 

WATER; HYDROWEST; MAIN ELK CORPORATION; ) 

JERIS A. DANIELSON; ORLYN BELL; DONALD ) 

PATTON; DIANE H. SMITH TRUST; MOUNT POWELL ) 

RANCH PARTNERSHIP, ) 

) 

Parties in Interest-Appellees. ) 

APPEAL FROM THE UNITED STATES DISTRICT COURT 

FOR THE DISTRICT OF COLORADO 

(D.C. NOS. 2782, 5016 AND 5017) 

Jack F. Ross of Saunders, Snyder, Ross & Dickson, P.C., Denver, 

Colorado (Wayne D. Williams, Michael L. Walker, and Casey S. Funk, 

Board of Water Commissioners for City and County of Denver, 

Denver, Colorado, and David E. Bellack of Saunders, Snyder, Ross & 

Dickson, P.C., Denver, Colorado, with him on the briefs), Attorneys for Applicant-Appellant. 

James s. Lochhead of Leavenworth & Lochhead, Glenwood Springs, 

Colorado, and Robert L. Klarquist, Attorney, Department of 

Justice, Environment & Natural Resources Division, Washington, 

D.C. (Donald H. Hamburg, General Counsel, Colorado River Water 

Conservation District, Glenwood Springs, Colorado; Richard B. 

Stewart, Assistant Attorney General, Michael J. Norton, United 

States Attorney, Denver, Colorado, John R. Hill, Jr., Attorney, 

Department of Justice, Environment & Natural Resources Division, 

Denver, Colorado, and David C. Shilton, Attorney, Department of 

Justice, Environment & Natural Resources Division, Washington, 

D.C.; Kenneth Balcomb and Scott Balcomb, Delaney & Balcomb, P.C., 

Glenwood Springs, Colorado; Glenn E. Porzak and Richard A. 

Johnson, Holme Roberts & Owen, Boulder, Colorado; David w. Robbins 

and Mark J. Wagner, Hill & Robbins, P.C., Denver, Colorado; David 

A. Bailey, Parcel, Mauro, Hultin & Spaanstra, Denver, Colorado; 

-2-

Appellate Case: 90-1046 Document: 01019297913 Date Filed: 06/10/1991 Page: 3 
.-

and Gregory L. Johnson and Mark T. Pifher, Anderson, Johnson & 

Gianunzio, Colorado Springs, Colorado, Kevin L. Patrick, P.C., 

Aspen, Colorado, David L. Harrison, James R. Montgomery and James 

J. DuBois of Moses, Wittemyer, Harrison and Woodruff, Boulder, 

Colorado, Gregory J. Hobbs, Jr. and Bennett w. Raley, of Davis, 

Graham, & Stubbs, Denver, Colorado; Anthony w. Williams and Mark 

A. Hermundstad of Williams, Turner & Holmes, Grand Junction, 

Colorado; Stanley w. Cazier of Baker, Cazier & McGowan, Granby, 

Colorado; D. J. Dufford of Dufford, Waldeck, Milburn & Krohn, 

Grand Junction, Colorado; Frederick G. Aldrich of Nelson, Hoskins 

& Farina, Grand Junction, Colorado; Mark N. Williams, Grand 

Junction, Colorado, with them on the briefs), Attorneys for 

Parties in Interest-Appellees. 

Before HOLLOWAY, Chief Judge, SEYMOUR, and ANDERSON, Circuit 

Judges. 

ANDERSON, Circuit Judge. 

-3-

Appellate Case: 90-1046 Document: 01019297913 Date Filed: 06/10/1991 Page: 4 
PUBLISH 

UNITED STATES COURT OF APPEALS 

TENTH CIRCUIT 

IN RE: APPLICATION OF CITY AND COUNTY OF 

DENVER ACTING BY AND THROUGH ITS BOARD OF 

WATER COMMISSIONERS WITH RESPECT TO ITS 

WATER RIGHTS IN THE BLUE AND ITS 

TRIBUTARIES IN SUMMIT COUNTY, COLORADO. 

CITY AND COUNTY OF DENVER, ACTING BY AND 

THROUGH ITS BOARD OF WATER COMMISSIONERS 

WITH RESPECT TO ITS WATER RIGHTS IN THE 

BLUE AND ITS TRIBUTARIES IN SUMMIT COUNTY, 

COLORADO, 

Applicant-Appellant, 

v. 

) 

) 

) 

) 

) 

) 

) 

) 

) 

) 

) 

) 

) 

) 

) 

) 

) 

UNITED STATES OF AMERICA; TRANS MOUNTAIN ) 

HYDRO CORPORATION; BASALT WATER CONSERVANCY ) 

DISTRICT; BRECKENRIDGE SKI AREA; COPPER ) 

MOUNTAIN WATER AND SANITATION DISTRICT; ) 

COPPER MOUNTAIN INCORPORATED; EXXON ) 

COMPANY, USA; MOBIL OIL CORPORATION; ) 

COLORADO STATE ENGINEER; DIVISION ENGINEER ) 

FOR WATER DIVISION NO. 5; COLORADO DIVISION ) 

OF WILDLIFE; TOWN OF BASALT; TOWN OF ) 

COLLBRAN; TOWN OF DEBEQUE; TOWN OF EAGLE; ) 

TOWN OF PALISADE; CITY OF RIFLE; PUBLIC ) 

SERVICE COMPANY OF COLORADO; OXY USA INC.; ) 

NORTHERN COLORADO WATER CONSERVANCY DISTRICT ) 

AND MUNICIPAL SUBDISTRICT, NORTHERN COLORADO ) 

WATER CONSERVANCY DISTRICT; OIL SHALE ) 

CORPORATION; TOWN OF SILVERTHORNE; UPPER ) 

EAGLE REGIONAL WATER AUTHORITY; TOWN OF ) 

BRECKENRIDGE; BOARD OF COUNTY COMMISSIONERS ) 

OF SUMMIT COUNTY, COLORADO; EXXON ) 

CORPORATION, VAIL ASSOCIATES, INC. VIDLER ) 

TUNNEL WATER CO. ; CITY OF GRAND JUNCTION, ) 

COLORADO; ORCHARD MESA IRRIGATION DISTRICT; ) 

CLIFTON WATER DISTRICT; COLORADO RIVER ) 

WATER CONSERVATION DISTRICT; PALISADE ) 

IRRIGATION DISTRICT, a Colorado Corporation; ) 

CITY OF FRUITA, a Colorado Municipality; THE ) 

COLORADO WATER CONSERVATION BOARD; GRAND ) 

VALLEY IRRIGATION COMPANY; VAIL VALLEY ) 

CONSOLIDATED WATER DISTRICT; THE CITY OF ) 

AURORA, COLORADO; MIDDLE PARK WATER ) 

FILED 

United States Court of Appeals 

Tenth Circuit 

JUN 1 0 1991 

.ROBERT L. HOECKER 

Clerk 

No. 90-1046 

Appellate Case: 90-1046 Document: 01019297913 Date Filed: 06/10/1991 Page: 5 
CONSERVANCY DISTRICT; KEYSTONE-ARAPAHOE ) 

LIMITED PARTNERSHIP; N. LEE LACY; THE ) 

DANIEL L. RITCHIE CORPORATION; GRAND VALLEY ) 

WATER USERS ASSOCIATION; MESA COUNTY ) 

IRRIGATION DISTRICT; GETTY OIL COMPANY; ) 

GETTY OIL EXPLORATION COMPANY; UTE WATER ) 

CONSERVANCY DISTRICT; BLUE RIVER VALLEY ) 

RANCH LAKES ASSOCIATION; TOWN OF DILLON; ) 

THE EAGLE COUNTY BOARD OF COUNTY ) 

COMMISSIONERS; CITY OF COLORADO SPRINGS; ) 

DILLON VALLEY DISTRICT; BEAZER MATERIALS AND ) 

SERVICES, INC.; TOWN OF FRISCO; UNION OIL ) 

COMPANY OF CALIFORNIA; SALVATION DITCH ) 

COMPANY 1 TOWN OF GYPSUM; HARLAND ADAMS; ) 

ADAMS RANCH HOMEOWNERS ASSOCIATON; OWL ) 

CREEK DEVELOPMENT CORPORATION; ESTATE OF ) 

DIANE SMITH; SUMMIT COUNTY; AVON ) 

METROPOLITAN DISTRICT; ARROWHEAD AT VAIL; ) 

CITIZENS FOR THE PROTECTION OF MIDDLE PARK ) 

WATER; HYDROWEST; MAIN ELK CORPORATION; ) 

JERIS A. DANIELSON; ORLYN BELL; DONALD ) 

PATTON; DIANE H. SMITH TRUST; MOUNT POWELL ) 

RANCH PARTNERSHIP, ) 

) 

Parties in Interest-Appellees. ) 

APPEAL FROM THE UNITED STATES DISTRICT COURT 

FOR THE DISTRICT OF COLORADO 

(D.C. NOS. 2782, 5016 AND 5017) 

Jack F. Ross of Saunders, Snyder, Ross & Dickson, P.C., Denver, 

Colorado (Wayne D. Williams, Michael L. Walker, and Casey S. Funk, 

Board of Water Commissioners for City and County of Denver, 

Denver, Colorado, and David E. Bellack of Saunders, Snyder, Ross & 

Dickson, P.C., Denver, Colorado, with him on the briefs), Attorneys for Applicant-Appellant. 

James S. Lochhead of Leavenworth & Lochhead, Glenwood Springs, 

Colorado, and Robert L. Klarquist, Attorney, Department of 

Justice, Environment & Natural Resources Division, Washington, 

D.C. (Donald H. Hamburg, General Counsel, Colorado River Water 

Conservation District, Glenwood Springs, Colorado; Richard B. 

Stewart, Assistant Attorney General, Michael J. Norton, United 

States Attorney, Denver, Colorado, John R. Hill, Jr., Attorney, 

Department of Justice, Environment & Natural Resources Division, 

Denver, Colorado, and David c. Shilton, Attorney, Department of 

Justice, Environment & Natural Resources Division, Washington, 

D.C.; Kenneth Balcomb and Scott Balcomb, Delaney & Balcomb, P.C., 

Glenwood Springs, Colorado; Glenn E. Porzak and Richard A. 

Johnson, Holme Roberts & Owen, Boulder, Colorado; David W. Robbins 

and Mark J. Wagner, Hill & Robbins, P.C., Denver, Colorado; David 

A. Bailey, Parcel, Mauro, Hultin & Spaanstra, Denver, Colorado; 

-2-

Appellate Case: 90-1046 Document: 01019297913 Date Filed: 06/10/1991 Page: 6 
and Gregory L. Johnson and Mark T. Pifher, Anderson, Johnson & 

Gianunzio, Colorado Springs, Colorado, Kevin L. Patrick, P.C., 

Aspen, Colorado, David L. Harrison, James R. Montgomery and James 

J. DuBois of Moses, Wittemyer, Harrison and Woodruff, Boulder, 

Colorado, with them on the briefs), Attorneys for Parties in 

Interest-Appellees. 

Before HOLLOWAY, Chief Judge, SEYMOUR, and ANDERSON, Circuit 

Judges. 

ANDERSON, Circuit Judge. 

The City and County of Denver appeals a district court order 

dismissing, without prejudice, its application for adjudication of 

certain water rights. We affirm. 

BACKGROUND 

Denver's appeal is part of a complex dispute that has been in 

litigation for over 40 years. The controversy centers around 

water rights to the Blue River, a tributary of the Colorado River, 

located on the Western Slope of the Continental Divide in 

Colorado. In 1937, Congress authorized a multi-million dollar 

reclamation effort known as the Colorado-Big Thompson Project 

("CBT"). Among other things, the CBT involved construction of a 

reservoir and power plant on the Blue River. This facility, known 

as Green Mountain Reservoir and Power Plant, was completed in 

1942. The purpose of the CBT is set forth in Senate Document No. 

80, 75th Cong., 1st Sess. (1937), which reveals that Green 

Mountain's main purpose is to store replacement water for the 

Western Slope to compensate for other Colorado River water 

diverted to the Eastern Slope as part of the CBT. Id. at 1. It 

-3-

Appellate Case: 90-1046 Document: 01019297913 Date Filed: 06/10/1991 Page: 7 
was also intended, however, to generate hydroelectric power and 

supply additional water for agricultural and industrial uses on 

the Western Slope. Id. at 3. 

The litigation began in 1949, when the United States brought 

an action in United States District Court for the District of 

Colorado for a determination of its rights in connection with the 

CBT, and for a declaratory judgment defining its operational 

obligations under Senate Document No. 80 with respect to Green 

Mountain Reservoir. The United States sought to quiet title to 

water rights in the Blue River against Denver, Colorado Springs, 

and others. These parties maintained their own claims to Blue 

River water. Denver claimed the right to divert Blue River water 

upstream from Green Mountain and transport it to the Eastern Slope 

to augment its municipal water supply. 

On October 12, 1955, the court entered a final judgment and 

decree ("the Blue River Decree") that incorporated a stipulation 

executed by the parties. The incorporated stipulation recognized 

Denver's right to divert Blue River water, subject, however, to 

the federal government's senior right to fill and utilize Green 

Mountain Reservoir. Thus, according to the incorporated stipulation, Denver could divert Blue River water if the Secretary of the 

Interior determined that the diversion would "not adversely affect 

the ability of Green Mountain Reservoir to fulfill its function as 

set forth in [Senate Document No. 80] .... " R. Vol. I, Tab 4 

at 31. In return, Denver agreed to deliver to the United States 

electrical energy "in substantially the same amounts, at approximately the same hours and at substantially the same rates of 

-4-

Appellate Case: 90-1046 Document: 01019297913 Date Filed: 06/10/1991 Page: 8 
delivery that would have been generated by the Green Mountain 

Powerplant had it not been for the diversions .... " Id. at 32. 

Denver also agreed to bypass water in quantities sufficient to 

meet all downstream water rights on the Blue River and the 

downstream segment of the Colorado River having priorities 

superior to Denver's. Id. at 32-33. 

In 1960, the parties returned to court disputing issues 

related to the pending completion of Denver's Dillon Reservoir, 

located upstream from Green Mountain Reservoir on the Blue River. 

At issue was: 1) the effect that Denver's filling Dillon Reservoir 

had on the operation of Green Mountain Reservoir; and, 2) whether 

Denver could make replacement releases from its Williams Fork 

Reservoir in order to satisfy the senior, downstream calls for 

water that were being filled by the Blue River water Denver wished 

to use to fill Dillon. In 1964, another consent decree ("the 1964 

Decree") was submitted and entered by Judge Arraj, who has 

continued to preside over this litigation in the district court. 

The 1964 Decree provided, in pertinent part, that: Denver has no 

right, title, or interest in Green Mountain Reservoir or the water 

that the United States is entitled to store there (para. 2); the 

United States has the right to fill Green Mountain Reservoir each 

year (para. 3); Denver's right to divert water from the Blue River 

is subject to the approval of the Secretary of the Interior (para. 

4); the right of Denver to make certain replacements or exchanges 

of Blue River water is subject to the approval of the Secretary 

(para. 5); and any arrangement for replacement must not impair any 

-5-

Appellate Case: 90-1046 Document: 01019297913 Date Filed: 06/10/1991 Page: 9 
right of any beneficiary under Senate Document No. 80 (para. 2). 

1964 Decree, R. Vol. I, Tab 9. 

The next major dispute arose in 1977, when Denver withheld in 

Dillon Reservoir over 28,000 acre-feet of water which was necessary to complete the fill at Green Mountain Reservoir and refused 

the Secretary of the Interior's requests to release the water. 

The district court again held that the federal government's right 

to fill Green Mountain Reservoir was superior to Denver's right to 

fill Dillon Reservoir and prohibited Denver's diversions of Blue 

River water until Green Mountain Reservoir is either filled or 

assured of filling each year. We upheld the decision on appeal. 

United States v. Northern Colo. Water Conservancy Dist., 608 F.2d 

422 (lOth Cir. 1979). 

The current controversy began in 1987 when the City and 

County of Denver, acting through its Board of Water Commissioners, 

submitted two water rights applications--labeled by the parties 

the Change Application and the Exchange Application--seeking additional water rights to the Blue River. The United States, the 

Colorado State Division of Wildlife, several Colorado water 

districts, and various interested Western Slope entities 

("appellees") filed objections to Denver's applications. The 

district court granted summary judgment against Denver on its 

-6-

Appellate Case: 90-1046 Document: 01019297913 Date Filed: 06/10/1991 Page: 10 
Change Application, and that order is not the subject of this appeal.1 Denver here appeals the dismissal of its Exchange Application ("the application"), which sought adjudication of Denver's 

right to exchange water from nine reservoirs to be constructed on 

the Western Slope for additional Blue River water to be diverted 

to Denver. 

Citing to the Blue River and 1964 Decrees, the district court 

dismissed the application, without prejudice, on two grounds: 1) 

Denver had not obtained approval of the Secretary of the Interior 

for the proposed exchange; and, 2) Denver did not have the water 

in storage when it proposed the exchange. 

DISCUSSION 

The parties contest the appropriate standard of review. 

Several appellees assert that Denver's application sought to 

modify the Blue River Decree, and that we should, therefore, 

review the district court's ruling under the abuse of discretion 

standard. E.E.O.C. v. Safeway Stores, Inc., 611 F.2d 795, 799 

(lOth Cir. 1979), cert. denied, 446 u.s. 952 (1980). Although one 

sentence of Denver's application does request the district court 

to "modify the terms" of the Blue River Decree, 2 Denver insists 

that it did not seek modification of the earlier Decrees. We 

1 This did not stop one appellee from devoting the greater part 

of its brief to arguing that the summary judgment should be affirmed. See Harland Adams, et al., Answer Brief at 1-5. 

Unfortunately, much of the briefing on this appeal has been 

similarly disappointing. 

2 Exchange Application, R. Vol. I, Tab 16 at 10. 

-7-

Appellate Case: 90-1046 Document: 01019297913 Date Filed: 06/10/1991 Page: 11 
agree. The application as a whole is more accurately characterized as a request that the district court, under its retained 

jurisdiction, 3 interpret the previous Decrees as permitting its 

proposed exchanges. At any rate, the district court did not 

undertake modification analysis. Instead, the district court's 

ruling is based upon its interpretation of the previous Decrees. 

"The construction of a consent decree is a matter of contract 

interpretation . . . . However, ... 'the district court's views 

on interpretation of a consent decree are entitled to deference.'" 

Ferrell v. Pierce, 743 F.2d 454, 461 (7th Cir. 1984) (quoting 

United States v. City of Chicago, 717 F.2d 378, 382 (7th Cir. 

1983)); see Vertex Distributing, Inc. v. Falcon Foam Plastics, 

Inc., 689 F.2d 885, 892-93 (9th Cir. 1982). We will defer to the 

district court's interpretation so long as it is "reasonable in 

light of the language and purpose of the decree." E.E.O.C. v. 

Safeway Stores, Inc., 611 F.2d at 798. 

Denver contends that the district court improperly imposed 

conditions on its right, under the Colorado Constitution, to 

initiate and adjudicate its proposed exchange rights to the Blue 

River. To support this contention, Denver relies upon 1) language 

in the prior agreements among the parties, and 2) principles of 

Colorado water law. We turn first to the prior agreements--the 

3 Upon entering the final judgment and decree in 1955 (the Blue 

River Decree), the district court retained continuing jurisdiction 

over the consolidated cases involved in the matter. Final Judgment, R. Vol. I, Tab 4 at 13. In 1964, the district court 

similarly retained continuing jurisdiction "for the purpose of 

effectuating the objectives" of the Blue River and 1964 Decrees. 

1964 Decree, R. Vol. I, Tab 9 at 6. 

-8-

Appellate Case: 90-1046 Document: 01019297913 Date Filed: 06/10/1991 Page: 12 
Blue River Decree, the 1964 Decree, and the 1964 Stipulation--and 

review the relevant language in those documents. 

The Blue River Decree, in paragraph 4(c), states: 

This obligation adequately to provide water for the 

priorities on the Blue River and the Colorado River 

antedating the respective priority dates of [Denver], 

may be fulfilled by replacement storage by and on the 

Blue River or on the Williams River, subject nevertheless to the requirement that the parties provide that 

the plans for replacement storage will first have been 

approved by the Secretary of the Interior or his 

designated representative . . . . The water to be 

exchanged shall be on hand and in storage when the 

exchange is proposed. Any exchange approved shall not 

relieve said cities from the obligation to deliver 

electrical energy for the amount of water diverted from 

the Blue River. 

R. Vol. I, Tab 4, at 33 (emphasis added). 

This language reveals the central interpretive problem: the 

Blue River Decree does not discuss the exchange sources Denver 

proposes in its application. The Decree's language is limited to 

the Williams Fork and Blue Rivers, and Denver proposes exchanges 

from nine other Western Slope sources. The question is whether 

the parties envisioned exchanges from other sources, and, if they 

did, what conditions would apply to the exchanges. 

Although the 1964 Decree recognized the problem, it 

explicitly left the issue unresolved. The 1964 Decree, in 

paragraph 5, states: 

5. Without prejudice ... to the question whether 

Denver or Colorado Springs may make exchanges of other 

Western Slope water for Blue River water or the right of 

any signatories to the 1955 stipulation to contest the 

existence of such right, the right of Denver or Colorado 

Springs to exchange water lawfully impounded on the 

Williams Fork River or Blue River, as provided for in 

paragraph 4(c) of said 1955 stipulation [the Blue River 

Decree], is subject to the consent of the Secretary of 

-9-

Appellate Case: 90-1046 Document: 01019297913 Date Filed: 06/10/1991 Page: 13 
the Interior. The Secretary will not unreasonably withhold his consent whenever the following conditions exist: 

A. The right of the United States to fill 

Green Mountain Reservoir and to use Green 

Mountain Reservoir as provided in the 

documents will not be impaired. 

B. The water to be exchanged is on hand when 

the exchange is proposed. 

c. Power replacement is tendered by the cities to the United States as provided in 

paragraph 4(b) of said 1955 stipulation 

as implemented by paragraph 6 hereof. 

When either city desires such an exchange it will 

give the Secretary and the Division Engineer of Irrigation Division No. 5, or his successor, written notification thereof, together with its proposal or tender for 

power replacement. If the Secretary does not notify 

such city within a period of ten days that his consent 

is withheld, the Secretary's consent shall be deemed 

given, and the exchange may proceed forthwith. If 

consent is withheld, a statement of the reasons shall 

accompany the notification. The cities and the 

Secretary shall endeavor to work up procedures which 

will shorten the ten day interval specified above. 

R. Vol. I, Tab 9 at 4-5 (emphasis added). 

The only document that discusses exchanges from sources other 

than the Williams Fork and Blue Rivers is known as the 1964 

Stipulation. This agreement was adopted on April 16, 1964, the 

same day as the 1964 Decree, but did not receive the approval of 

all of the parties. It was, however, signed by both Denver and 

the United States. 

Although substantially identical to the 1964 Decree, the 1964 

Stipulation contains an important difference in paragraph 5's 

opening language: 

5. The right of Denver and Colorado Springs to exchange 

water lawfully impounded on the Williams Fork River or 

Blue River, as provided for in paragraph 4(c) of said 

stipulation [the Blue River Decree], and to make 

-10-

Appellate Case: 90-1046 Document: 01019297913 Date Filed: 06/10/1991 Page: 14 
exchanges of water lawfully impounded at other places on 

the Western Slope for Blue River water, is subject to 

the consent of the Secretary of the Interior. The 

Secretary will not unreasonably withhold his consent 

whenever the following conditions exist: 

(1) The right of the United States to fill 

Green Mountain Reservoir and to use Green 

Mountain Reservoir for decreed purposes 

will not be impaired; 

(2) The water to be exchanged is on hand when 

the exchange is proposed; 

(3) Power replacement is tendered by the cities to the United States as provided in 

paragraph 4(b) of said stipulation as 

implemented by Paragraph 6 hereof. 

When the cities desire an exchange they will give 

the Secretary written notification thereof, together 

with their proposal or tender for power replacement. If 

the Secretary does not notify the cities within a period 

of ten days that his consent is withheld, the 

Secretary's consent shall be deemed given, and the 

exchange may proceed forthwith. If consent is withheld, 

a statement of the reasons shall accompany the notification. The cities and Secretary shall endeavor to work 

up procedures which will shorten the ten day interval 

specified above. 

R. Vol. I, Tab 8 at 5-6 (emphasis added). 

In its dismissal of Denver's exchange application, the 

district court did not analyze whether the Blue River and 1964 

Decrees permit Denver to exchange water from sources other than 

the Williams Fork and Blue Rivers. That issue remains unresolved 

and we do not purport to answer it here. For the purposes of this 

appeal, we assume, arguendo, as the district court implicitly did, 

that exchanges from other sources are allowed and then focus, as 

did the district court, on the conditions that would apply to such 

exchanges. 

Although its position apparently evolved during the briefing 

process, Denver does not now deny that the exchange conditions 

-11-

Appellate Case: 90-1046 Document: 01019297913 Date Filed: 06/10/1991 Page: 15 
.... 

4 listed in the Decrees apply to their proposed exchanges. Denver 

only disputes the district court's conclusion that the agreements 

require Denver to satisfy the conditions before it may adjudicate 

its exchange rights under state law. Denver asserts that the 

conditions are merely operational, i.e., that they only apply to 

the act of performing specific exchanges after the adjudication of 

the state water rights upon which the exchanges depend. 

Denver's argument is well-taken with respect to the condition 

that it have the water on hand when it proposes the exchange. 

Common sense suggests that such a condition is chiefly operational. However, we do not read the district court's holding as 

requiring Denver to have replacement water on hand before 

adjudicating its exchange rights. In this regard, the district 

court stated that the on-hand requirement did "not preclude the 

4 In its opening brief, Denver asserts that the exchange conditions listed in the Blue River and 1964 Decrees were only intended 

to apply to exchanges from two sources: the Williams Fork and 

Blue Rivers. Applicant's Opening Brief at 16-18. In that brief, 

Denver does not once mention the 1964 Stipulation. In its Reply 

Brief, however, Denver states that it "fully expected ... identically the same terms and conditions as applied to the 

exercise of exchange rights originally recognized by the Blue 

River Decree and implemented by the 1964 Consent Decree" to apply 

to its proposed exchange rights from other sources. Reply Brief 

at 16. In fact, Denver goes further and claims that it "committed 

itself to the imposition of all of those exchange conditions" by 

citing to the Blue River and 1964 Decrees in its application. Id. 

at 16-17. Then Denver cites to the 1964 Stipulation and contends 

that it constituted Secretarial consent to the additional exchange 

sources. Id. at 25. 

We reject this last assertion. The 1964 Stipulation only 

provides that any right of Denver to exchange water from other 

sources is subject to Secretarial consent. As demonstrated in 

paragraph 5 of the 1964 Decree, adopted the same day, the United 

States reserved its prerogative, as a signatory to the Blue River 

Decree, "to contest the existence" of such an exchange right. R. 

Vol. I, Tab 9 at 4. 

-12-

Appellate Case: 90-1046 Document: 01019297913 Date Filed: 06/10/1991 Page: 16 
Secretary's approval of a plan for exchange if the approval is 

conditioned upon the requirement that the water be on hand at the 

time of the actual exchange." Amended Memorandum Opinion and 

Order, R. Vol. I, Tab 23 at 12 (emphasis added). Thus, the 

district court ruled that Denver may apply for state adjudication 

of its exchange rights even though it does not have the replacement water on hand as long as it has obtained Secretarial consent. 

We now turn to this more important question whether Denver must 

obtain Secretarial consent before it applies for state adjudication of its exchange rights. 

According to Denver, paragraph 5 in the 1964 documents demonstrates that the parties intended the Secretary's consent to be 

operational--requested only days before an anticipated exchange, 

and granted if the enumerated conditions are satisfied. We 

disagree. While the latter part of paragraph 5 in the 1964 agreements does, indeed, describe an operational consent, we do not 

interpret that provision to mean that Secretarial consent is only 

operational. The first enumerated condition of paragraph 5 hinges 

Secretarial consent on Green Mountain fulfilling its function. 

With regard to sources other than the Williams Fork and Blue Rivers, the Secretary's determination whether Green Mountain's function will be impaired involves a calculus broader than the advisability of individual exchanges. The proposed replacement water, 

for example, may enter the Colorado River system below Green 

Mountain's intended beneficiaries. Such factors universal to any 

exchange from another source inform the question whether the 

-13-

Appellate Case: 90-1046 Document: 01019297913 Date Filed: 06/10/1991 Page: 17 
f 

Secretary should consent to the exchanges at all, regardless of 

whether there is sufficient water for an individual exchange. 

Moreover, the 1964 documents explicitly state that they were 

only intended to implement, not modify or limit the Blue River 

Decree. See 1964 Decree, para. 7, R. Vol. I, Tab 9 at 5; 1964 

Stipulation, para. 7, R. Vol. I, Tab 8 at 6. And paragraph 4(c) 

of the Blue River Decree describes broader Secretarial involvement 

than mere operational consent. It requires the Secretary to 

"first" approve the "plans" for replacement storage. 

Denver also asserts that the language "lawfully impounded" in 

paragraph 5 of the 1964 Stipulation implies that the parties 

intended Secretarial consent to follow the adjudication of the 

state water rights. We do not find this argument persuasive. 

Denver cites no authority, nor do we find any evidence, to support 

its assertion that "lawfully impounded" means "having obtained an 

adjudicated exchange right." 5 Contrary to the logic of Denver's 

assertion, when the 1964 documents were adopted, Colorado water 

law apparently did not provide for the adjudication of exchanges. 6 

It was only with the 1981 amendments to the Water Right Determination and Administration Act, and in particular Colo. Rev. Stat. 

§ 37-92-302(1)(a), that provisions for judicial approval of such 

5 And even if it did mean that, such language would 

an interpretation that the Secretary must also consent 

"plans" for exchange before the state water rights are 

adjudicated. 

not negate 

to the 

6 See Colo. Rev. Stat. § 148-6-1, et ~ (1963), repealed and 

re-enacted Colo. Rev. Stat. § 37-83-101, et ~ (1973). 

-14-

Appellate Case: 90-1046 Document: 01019297913 Date Filed: 06/10/1991 Page: 18 
f 

exchanges through the filing of a water rights application were 

7 adopted. 

We cannot say that the district court's interpretion of the 

Decrees as requiring Secretarial approval before adjudication of 

the state water right is unreasonable. Any answer to the question 

whether the parties would have intended the consent to precede 

statutory adjudication is conjectural, and can only be inferred 

from the general intentions of the parties regarding the extent of 

Secretarial involvement over the exchange process. The district 

court's interpretation is certainly compatible with the history 

and language of the Blue River Decree and Senate Document No. 80, 

both of which charge the Secretary with extensive responsibility 

for the effective administration of Green Mountain. See, ~' 

Blue River Decree, Findings of Fact and Conclusions of Law, R. 

Vol. I, Tab 4 at 29, 31, 48; S. Doc. No. 80, 75th Cong. 1st Sess., 

"Manner of Operation of Project Facilities and Auxiliary 

Features," at 2-5. 

We now turn to Denver's contention that requiring Secretarial 

consent as a precondition to adjudication of its exchange rights 

violated Colorado water law. The adjudication of state water 

rights is governed by the Water Right Determination and Administration Act of 1969, Colo. Rev. Stat. §§ 37-92-101, et ~ 

(1990 Replacment Vol.) ("the Water Right Act"). According to 

Denver, the adjudication process established by the Water Right 

7 It should not be too 

prior agreements does not 

consent should precede or 

not exist at the time the 

surpr1s1ng that the language in the 

clearly indicate whether Secretarial 

follow an adjudicatory process that did 

agreements were reached. 

-15-

Appellate Case: 90-1046 Document: 01019297913 Date Filed: 06/10/1991 Page: 19 
t 

Act is the means for determining what conditions (such as 

Secretarial consent) should attach to an asserted right. Denver 

alleges that dismissal on the pleadings deprived Denver of its 

statutory right, under§ 37-92-305(3), to propose terms and conditions for its asserted exchange rights that would have obviated 

any injury to others, and would have required the district court, 

sitting as a state water judge, 8 to grant Denver conditional 

exchange rights. 

We disagree. The Colorado Supreme Court has addressed and 

rejected Denver's argument. The case of Fort Lyon Canal Co. v. 

Catlin Canal Co., 642 P.2d 501 (Colo. 1982) (en bane), is almost 

directly on point. In that case, a water judge dismissed, without 

prejudice, an application by Fort Lyon and the State of Colorado, 

a shareholder in Catlin Canal Co., for a change of water rights 

because the applicants had failed to comply with a Catlin bylaw 

provision requiring the approval of Catlin's board of directors. 

The water judge held that director approval was a condition 

precedent9 to application for adjudication of the water right. 

8 As we noted in United States v. Northern Colo. Water 

Conservancy Dist., 608 F.2d at 430, federal courts involved in 

this case sit as Colorado water courts. See also the orders of 

the district court dated August 4, 1977, R. Vol. I, Tab 17, and 

March 17, 1988, id. at Tab 18. 

9 Significantly, the disputed bylaw did not describe director 

approval as a condition precedent to adjudication. In fact, it 

contained language that Denver would characterize as 

"operational." The relevant language stated: 

Each stockholder desiring to change the place to which 

any water he may be entitled shall be delivered, shall 

make written request therefor to the directors. If, in 

the opinion of the [directors], such transfer may be 

made without injury to the canal, the company or other 

[footnote continued] 

-16-

Appellate Case: 90-1046 Document: 01019297913 Date Filed: 06/10/1991 Page: 20 
On appeal, the applicants argued that requiring director approval as a condition precedent to adjudication impermissibly 

infringed on the jurisdiction of the water judge and violated the 

statutory adjudication process set forth in the Water Right Act. 

The Colorado Supreme Court rejected the argument: 

We must determine • . . whether a mutual ditch company 

bylaw purporting to further condition or limit the right 

to a change in point of diversion can be given effect 

consistent with allowing full scope to the jurisdiction 

of the water court. 

The concept that the rights incident to water right 

ownership can be modified by private agreement is not 

novel. 

* * * 

Although the Water Right Act provides protection 

against a change in water right that would injuriously 

affect other vested water rights or decreed conditional 

water rights, section 37-92-305(3), this is not 

inconsistent with or frustrated by private agreements 

contractually limiting an owner's right to a change of 

water right so long as those limitations are reasonable. 

• . • We are reluctant to deny force and effect to 

private agreements . • . where those agreements supplement rather than frustrate the purposes of the Water 

Right Act. 

* * * 

The instant bylaw . • • does not oust the water court of 

jurisdiction, since the court retains jurisdiction over 

the statutory change in point of diversion proceeding as 

well as the effect to be accorded private agreements 

dealing with the proposed change. Nor does the reasonable bylaw at issue here conflict with the purposes of 

the Water Right Act or unduly interfere with the water 

court's exercise of its authority pursuant to that 

statute. 

* * * 

[footnote continued] 

stockholders, such water shall be then delivered to such 

place or places as requested. 

Fort Lyon Canal Co. v. Catlin Canal Co., 642 P.2d at 505. 

-17-

Appellate Case: 90-1046 Document: 01019297913 Date Filed: 06/10/1991 Page: 21 
' 

Finally, should the directors disapprove the 

requested transfer we consider the question of the appropriateness of that disapproval to involve a "water 

matter" within the jurisdiction of the water court. 

Judicial economy would be promoted by permitting any 

challenge to director disapproval to be presented to the 

water court in the same proceeding as that in which a 

request for judicial approval of the directordisapproved change of water right is made. 

Fort Lyon Canal Co. v. Catlin Canal Co., 642 P.2d at 506-07, 509 

(citations omitted). 

In light of the Secretary of the Interior's significant role 

in operating Green Mountain as trustee for Green Mountain's 

beneficiaries on the Western Slope, United States v. Northern 

Colo. Water Conservancy Dist., 608 F.2d at 430, we cannot say that 

the consent provision is unreasonable. In addition, we agree with 

the Colorado Supreme Court's assessment that judicial economy is 

best served by treating the consent provision as a condition 

precedent to adjudication of the right under the Water Right Act. 

If, as Denver suggests, its proposed exchanges will not affect 

Green Mountain's function, and the Secretary nevertheless 

unreasonably withholds consent, Denver may challenge the 

Secretary's refusal in the same proceeding in which it files for 

adjudication of its exchange rights. 10 

We therefore reject Denver's contention that the district 

court improperly applied conditions to adjudication of its 

exchange rights under state law. The history and language of the 

prior agreements among the parties and the requirements of 

10 Denver would have a claim against the Secretary under paragraph 5 of the 1964 Stipulation, in which the Secretary apparently 

agreed not to unreasonably withhold consent as long as the enumerated conditions were satisfied. 

-18-

Appellate Case: 90-1046 Document: 01019297913 Date Filed: 06/10/1991 Page: 22 
•• 

Colorado water law support the district court's dismissal of 

Denver's application as premature. 

Denver's final contention is that the dismissal of its application, although nominally without prejudice, deprived it of 

the priority dates for its claimed exchange rights. See the Water 

Right Act, Colo. Rev. Stat. § 37-92-305(1). We have already held 

that Denver's application was properly dismissed. The responsibility for any loss of priority lies squarely with Denver for 

failing to obtain the consent of the Secretary of the Interior 

before filing its ambitious application. 

Accordingly, the ruling of the district court is AFFIRMED. 

-19-

Appellate Case: 90-1046 Document: 01019297913 Date Filed: 06/10/1991 Page: 23