R-794 

OFFICE OF 

THE ATTORNEY GENERAL 

AUSTIN.TEXAS 

PRICE DANIEL 

ATTORNEY GENERAL 

October 24, 1947 

Hon. E. V. Spence, Chairman 

Board of Water Engineers 

Austin, Texas 

Opinion No. V-411 

Re: Present status and 

relative priority of 

certain applications 

pending before the 

Board of Water Engineers. 

Dear Sir: 

The facts and clrcmstances upon which your 

questions are predicated are, In part, set out in the 

opinion of the Court of Civil Ap eals In Clark v. Briscoe 

Irrlgati6n C-any, 200 S.‘W. (27 674, 

ing, from which we quote as follows: 

writ of error pend- 

“This appeal is from a declaratory 

judgment decreeing in effect that the 

owner of a pendt granted by the Board 

(Board of Water Engineers ,o,f the State 

of Texas) $n April 1940 authorizing the 

appropriator (perndtteej to divert f&m 

a Texas stream a specified amount of wa-, 

ter for the purpose of lrrlgatlng speclfioally desctibed land (the right to which 

appropriation has ripened Into a title), 

is not required to apply to the Board for 

authortty to substitute other lands for 

those des%gnated in the permit, or to 

change the purpose of use of the water 

from irrigation to other lawful uses; the 

right of such appropriator being free of any 

regulation or control by the Board, so long 

as the new use is a beneficial one authorized 

by law, and does not (1) result In an in- 
Hon. E. V. Spence - Page 2 -- v-411 

creased appropriation . . _ 

or taking a greater quantity of water than authorized in 

the permit; or (2) impair the vested 

rights of other appropriators. 

"The correctness of this holding 

controls the decision of the case upon 

its merits. 

"Substantially, the facts are,these: 

"April 6, 1940, the Board, upon his 

application and after due notice and hearing granted to R. T. Brlscoe a pent&t to 

'divert, approptiate and use' not exceeding 75,000 acre-feet per annum of the uuappropriated waters of the Brazos River, 

In Fort Bend,County,,,%hen beneficially 

used for the purpose of irrigation, mini 

and munkcipal use' . 0 * o August 13, 19 "$' 5, 

appellee f-fled with the Board an application 

to amend the pezmdt so as to substitute other 

specified,lands for those designated in the 

permit and to change the purpose of use so 

as to include mlnlng, manufacturing, and 

municipal. After proper notice and hearing 

the Board denied this application on December 13, 1945. This suit was filed by appellee on January 8, 1946, against the Board 

and others, in which it sought the following relief: 

"1. A declaratory judgment decreeing 

that it was not required to obtain an amendment of its permit from the Board as a prerequisite: 

"a. To change the place of use of its 

waters in the manner alleged. 

"b. To change the purpose of use of. 

Its waters to Include minlng,.manufacturlng 

end municipal. 

"2. In the alternative, if it,were 

held that an amendment of the permit was 

required, a declaratory judgment decreeing 

that the functionof the Board was purely 
Eon. E. V. Spence - Page 3 -- V-411 

ministerial, with no discretion to deny 

the application; and that mandamus to 

compel approval of the amendment be awarded. 

“3. In the alternative, If the Board 

were held to have any discretion in the 

matter, a decree that the refusal of the 

Board was ~a gross abuse of.its discretion, 

and that mandamus Issue to compel approval 

of the application. 

"4. A decree (a) as between appellee 

and defendants other than the Board, and 

(b) a8 between appellee and the State that 

appellee has the right to extend its canal 

and supply its appropriated waters to lrrlgate the lands described In the application and for Industrial and other lawful 

uses in or near Texas City or elsewhere in 

Galveston County. 

“5. A dec~ree quieting appellee's 

vested title fn its appropriated waters, 

and its right Inherent therein to change 

the.place and purpose of use thereof without interference from defendants, and that 

cloud upon its said title by~reason of 

claims of defendants be removed. 

"Burlng the course of the trial (to 

the court without a jury) all testimony 

offered by appellants Insupport of their 

contention that the Board had properly 

exercised whatever discretion it had In 

deny- the application to amend the permit, was excluded upon objection of appelleels counsel upon the ground that the 

only Issue In the case was whether appellee 

had the right to use the water for other 

beneficial purposes than those stated in 

the permit, and whether the Board had any 

discretion at all In such matters. This 

statement of appelleets counsel and ruling 

of the court ellmlnated from the case the 

alternative relief sought under paragraphs 
Hon. E, V, Spence - Page 4 - V-411 

designated 2 and 3 above; and the court 

rendered judgment declaratory of ap-. 

pelleels rights as sought under paragraphs 1 and 4 above, and quieted the 

title of appellee as against other defendants than the Board as sought in paragraph 5 above." 

American Canal Company, together with others, 

protested the above described application of Driscoe 

Irrigation Company, and it was made a party defendant 

In the trial court. It became subject to those portions 

of the judgment which run to the defendants other than 

the Board of Water Engineers. Amerfean did not join 

In the appeal from this judgment. 

On March 17, 1947, American filed Its pending 

application to change the purpose and place of use of 

its permitted waters. On this same date, Briscoe filed 

a Motion for Rehearing of the application denied by you 

on December 13, 1945. 

Predicated upon the foregoing, you desire our 

advice as to whether: (1) your Board may rehear Bristoe's application, (2) the effect upon American's pending application of fts failure toaIReal from the judgment of the trial court, and (3) the relative prlorlties between Briscoe and American as to their pending 

applications. 

We will consider first the matter of rehearing, 

the Briscoe application. 

The general policy in Texas concerning rehearing of denied applications for permits by admlnistratlve 

boards has evolved, for the most part, as the result of 

hearings conducted by Texas Railroad Commlsslon in connection tith Its Rule 37. The law In this regard appears 

to be as follows: 

1. Absent judicial ascertaksuent, the Commission may rehear applications covering the same subject 

matter as often as it wishes. Its action on the prior 

application does not necessarily govern any result it may 

reach on succeeding applications. The applicant is not 

required to show that conditions have changed in order to 

secure rehearing by the Commission. Gulf Land Co. v, 
Hnn. E. V. Spence -- Page 5 - V-411 

Atlantic Reffnztng Co., Sup. Ct., 131 S. W. (2) 73; 

nolla v. Mew Process Co., Sup. Ct., 104 S. W. 

1106; Gulf Land Co. v. Atlantic, C.C.A., 113 F. 

2. After judicial ascertainment has been 

had on the merits of granting or denying the appllcation, although such ascertainment does not prevent 

the aggrieved party from reapplying, nevertheless, 

unless conditions are shown to have substantially 

changed, the Commission is bound by the court18 judgment. The Court in rendeting its judgment looks only 

to condltlons as they existed at the tl.me of the Commission's decision and such judgment Is binding on the 

subject matter only so long as conditions thereafter 

do not change. The original jurisdiction In such 

cases to determlne If conditions have, In fact, changed 

so as to warrant rehearing rests with the Commission. 

Magnolia v. Wew Process Co . Ed ar v. Stanolind 

T. C. A., writ refused, gO.$.~?p~~ 65E: Rumble v. Tua& 

bow, T. C. A,, writ refused, 133 S.W. (2) 191; R. R. 

Commission v. Wencker, Sup. Ct., 168 S.W. (2) 625; 

R. R. Commission v. Humble, T. C. A., writ refused, 

11 S. W. (2) 728; Gulf Land Co. v. Atlantic, 113 F. 

(23 902. 

3. Pending judicial ascertainment, the same 

rules Indicated In (2) above apply and the result ln 

such cases may be to render moot the pending litigation 

if the Commission reverses its decision. The reversal 

must, of course, be based upon changed conditions: 

Stewart v. Smith, Sup. ct.; 83 S. Y. (2) 945; Stanollnd 

v. Sklar Oil Co., T.C.A., writ refused, 179 S. W. (2) 

376; Edgar v. Stanolind, supra; Hagnolla v. New Process 

co., supra. 

A reading of the above cases shows that emphasis Is placed upon the fact that judicial ascertainment 

has been had on the merits of the Commission's action In 

denying or granting the permit, and this appears to be 

the element upon which a res adjudicata effect is drawn 

from the Judgment and applied to the rehearing appllcation absent changed conditions. The very fact that judicial consideration extends only to conditions as they 

existed at the time of the Conmtlsslonts decision and that 

the judgment has a res adjudicata effect only so long 

as conditions do not change Is indicative that the conditions, circumstances and transactions which are considered by the Commission in arriving at its decision 
Hon. E. V. Spence - Page 6 -- V-411 

on the merits, are decisive in applying res adjudlcata to the rehearing. If the litigation, pending 

or concluded, is not predicated upon the merits of 

the Commlsslon*s action but upon Its ability or 

right to act at all, the situation, in our opinion, 

is taken completely out of the above indicated rules 

relating to permits subject to litigation. We have 

quoted at length from the opinion in the Clark case 

because we believe that the portions quoted show 

clearly that both the trial and appellate courts have 

been concerned with only the right and jurisdiction 

of your Board to entertain applications to change 

purpose and place of use, and that the merits relating 

to your denial of Briscoels application have not been 

Involved. For the purpose then of applying the foregoing rules as they relate to rehearing of denied applications pending litigation, we hold that these rules 

are not applicable to the situation which confronts 

Briscoels application to rehear, and that Briscoe's 

denied application occupies exactly the same status as 

though no suit had been filed. We, therefore, conclude that you may rehear said application without a 

finding of changed conditions. 

We now consider the effect of the trial court's 

judgment on Americants pending application for chang e. 

The contentions made in the trial court and.the 

relief granted by it are set forth In those portions of 

the .opinion of the Court of Civil Appeals heretofore quoted. 

Substantially, the trial court held that under existing law 

neither BPiscoe nor permittees generally are required to 

obtain from your Board amendments to existing permits in 

order to change the place and purpose of use of permitted 

waters; that as between Briscoe and the Board and as between Briscoe and the other defendants, Briscoe ham 

right to extend its canal system and supply water In the 

manner sought by it; and that Brlscoels title to 50 000 

;z;f;;z of water be quieted as to all parties excipt 

0 

We assume for the purpose of this opinion, the 

contention made by Briscoe relattve to the effect of such 

judgment, I.e., that as between Brlscoe and American, 

Briscoe obtained the exclusive right to "extend and SupplY" 

and that American was expressly denied this right. We 

must decide, therefore, whether American is bound to this 
Hon. E. V. Spence - Page 7 - V-411 

construction of the judgment through its failure to 

appeal. 

In our optnion the effect of the judgment 

rendered by the Court of Civil Appeals, reversing and 

rendering the judgment In all respects and affirming 

it only in so far as it quieted Briscoels title to 

50,000 acre-feet of water, had the effect of deleting 

for all purposes that portion of the judgment upon 

which Brlscoels contentions are based, not only for 

the beneftt of San Jacinto, Conservation and Reclamation 

District, the only appealing defendant subject to the 

portion of the judgment In question, but also for the 

benefit of all non-appealing defendants, including 

American. 

We recognize the general rule that where one 

party appeals from a judgment, the reversal as to him 

will not justify a reversal against the other nonappealing parties. 3 T. J. p. 1112. This rule, however, is subject to the rule that where the judgment 

is entire and not severable, a reversal by the appellate 

court inures to the benefit of those who do not appeal. 

3 T.J. p. 1154, 5 C. J. S. p. '1423; Lockhart v. A. W. 

Snyder % Co., Tex. Sup, ct., 163 S. W. (2) 385, 3923 

Valee v. Joiner, Tex. Corn. App., 44 S. W. (2) 983; 

Reeves v. McCracken, Tex. Sup. Ct., 128 S. W. 895; Irwin 

v. Auto Flnance'Go., T. C. A. 

on other grounds 60 S. W. (21 

40 S. W. (2) 87l, reversed 

1 2; ffarrlson v. Davis, 

Utah Sup. Ct., 54 P. (2) 439, 44 z . 

The foundation of the trial courtls judgment 

here was the absence of jurisdiction In your Board over 

application for change. The trial court having found 

no jurisdiction in your Board necessarily found that no 

admlnlstratlve control had been provided covering this 

phase of our water law. It then performed what would 

eraipaFily be the function of the administrative body 

bysupervising and allocating the right of change. Clearly, the allocation of right made by It is untenable if, in 

fact, your Board has jurlsalction in the matter. In our 

minds, the judgment is entirely dependent upon the question 

of jurlsdlct~on; and since the court of Civil Appeals has 

overturned the trial court on this point, it necessarily 

follows that those portions of the judgment which allocate the right as between certain parties is overturned 

whether such parties appeal or not. The major premise 

which held Briscoels right in place was removed when the 
Hon. E. V. Spence - Page 8 - V-411 

Court of Civil Appeals found jurisdiction over the 

subject matter in your Board, at which point we conclude that the attempted allocation failed for all 

purposes. For the reasons stated, the judgment is 

not severable and inures to the benefit of American 

whose pending application Is in no way affected by 

the judgment in question. 

The conclusions just arrived at result from 

analogy to legal principles as those principles have 

evolved based upon the relationship betueen trial and 

appellate court. Analogy to judicial relatlonshLps 

may not be applicable in deciding the questions presented here because the problem is one which, in its 

final analysis, involves relationships between judicial and administrative branches of government. 

A related problem confronted the United States 

Supreme Court in Federal Communication Commission v, 

Pottsville Broadcasting Company, 309 U. S. 13% In that 

case, an applicant sought a permit for the construction 

of a broadcasting station and was denied because of financial inability. This finding was based upon mlsconception by the Cononission of Pennsylvania law. On appeal, the court pointed out the error and returned the 

case to the Commission for reconsideration. In the meantime, other applicants had applied for the same facilities; and their applications were set down with that of 

the denied applicant for hearing to determine wNch 'on 

a comparative basis in the judgment of the Commission 

will best serve the public interest." The denied applicant clairnea priority aa objected to the setting 

down of his application for hearing on a comparative 

basis, He sought and obtained mandamus to set aside the 

"comparative basis" order of the Commission. With respect to this action by the Court of Appeals, Justice 

Frankfurter said: 

"This was not a mandate from court to 

court but from a court to an administrative 

agency. What is in issue is not the relationship of federal courts inter se - a 

relationship defined largely by the courts 

themselves - but the due observance by courts 

of the distribution of authority made by 

Congress as between its power to regulate 

commerce and the reviewing power which it has 

conferred upon the courts under Article III 
Hon. E. V. Spence - Page 9 -- V-411 

of the Constitution. A review by a federal 

court of the action of a lower court is only 

one phase of a elngle unified process. But 

to the extent that a federal court is authorized to review an administrative act, 

there is superimposed upon the enforcement 

of legislative policy through administrative 

control a different process from that out of 

which the administrative action under review 

ensued. The technkal rules derived from the 

interrelationship of judicial tribunals forwing a hierarchical system are taken out of 

their environment when mechanically applied 

to determine the extent to which Congressional 

power, exercised through a delegated agency, 

can be controlled rithln the limited scope 

of 'judicial power' conferred by Congress under 

the Constitution. 

" 

. . . 

"The Comndssionrs responsibility at all 

tlmes,ls to measure applications by the standard of 'public convenience, interest, or 

necessity.' The Commission originally found 

respondent's application Inconsistent with 

the public interest because of an erroneous 

vien regarding the law of Pennsylvania. The 

Court of Appeals laid bare that error, and, 

in compelling obedience to its correction, 

exhausted the only power wNch Congress gave 

it. At this point the Commission was again 

charged with the duty of judging the appllcation In the light of 'public convenience, 

interest, or necessity.1 The fact that In Its 

first disposition the Commission had committed 

a legal error did not create rights of priority 

In the respondent, as against the later applicants, which it would not have otherwlse possessed. Only Congress could confer such a 

priority. It has not done so. The Court of 

Appeals cannot write the principle of priority 

into the statute as an indirect result of its 

power to scrutinize legal errors in the first 

of an allowable series of administrative actions. 

Such an implication from the curtailed revleu 

allowed by the Communications Act is at war 

with the basic policy underlying the statute. 
Hon. 33. V. Spence - Page 10 --V-411 

It would mean that~for practical purposes 

the contingencies of judicial review and 

litigation, rather than the public interest, 

would be decisive factors in determining 

which of several pending applications was 

to be granted." 

No direct mandate from Court to Board is involved here as it was in the cited case, nor was the 

direct appellate problem presented here involved In that 

case. Nevertheless, the basic problem of judicial control of adminAstrative discretion is Involved here, as it 

was there. The*prfnciples announced in that ease with 

reference to control by the judiciary of administrative 

discretion lead us to conclude that since the trial court 

here has been found in error on the question of the Board's 

jurisdiction, then it must follow that the attempted exercise of administrative discretion by the court in allocating as‘between the party defendants the right of change 

was a matter beyond its province and was a matter which 

It could not decide unless it had correctly decided the 

jurisdiction question. 

This conclusion Is confirmed by Borchard in his 

work on Declaratory Judgments, 2nd Ed., p. 878, from which 

we quote: 

"The declaratory judgment cannot and 

is not designed to cut down the statutory 

reotirements for administrative review. 

Again, no court by declaration or otherwise 

should attempt to control administratlve~ 

discretion, th h the exercise of ads&nistrative disc;%& may~well be decreed 

either by declaration or mandamus. But' 

where administrative authority over a particular transaction or business is in dispute, and, the facts being established, the 

issue of jurisdiction is purely one of law, 

there Is no reason why the courts cannot 

make a declaration, although in some of these 

cases an injunction would be refused." 

(Emphasis added) 

In addition, it appears to be settled in Texas 

that courts may not put themselves In the place of the 

administrative body and exercise the discretion which 

the Legislature has committed to that body. The rule 
Hon. E. V. Spence - Page 11 - V-411 

is thus stated in Railroad Commission v. Shell, 

sup. ct. 1942, 161 s. v. (2) 1022: 

"If the matter covered by the order 

is one comm$tted to the agency by the 

Legislatufe, and involves the exercise 

of its sound judgment and discretion in 

the admzinistration of the matter so cominltted to It, the court will not undertake tcr put itself in the position of the 

agency, and detenfdne the wisdom or advisability of the particular ruling or order 

in question, but will sustain the action 

of the agency so long as its conclusions 

are reasonably supported by substantial 

evidence. This is so because since the 

See, also, Lone Star Qas Co. v. State, 137 Tex. 279 and 

Blair v. Trinity Independent School District, TCA 1942, 

writ refused, 161 S. W. (2) 1030, 1033. 

Consideration will now be given to the aueetlon 

of priorltXes. 

One of our purposes in citing ana quoting at 

length from Federal C olnmunications Commission v. Potts- 

_ vllle Broadcasting~ Co., supra, is the light which that case 

throws on the question of priorities. The Commisslonls reresponsibility there and the Board's duty here Is to measure 

applications by the standard of public welfare. In that 

case no priority was found to exist as between various applicants for the same facilities simply because one applicant had filed his applloation earlier than the others. 

Oni: C!ngreas could confer such priority and It had not 

. In consequence neither the Court nor the Commlselon had authority to confer priority on that basis, 

the province of ~tfie court being the limited review confhrred upon it, and the province of the CommZssion being to 

measure the applications in the light of public interest. 
Hon. E. V. Spence - Page’ 12 -iV;:Q,l I : ” ‘:-:,;:: : 

In this State certain 

fs 

riotiities are created 

by statute. For example, Art. 7 n'# V:C. S., sets up 

priorities between uses of water; Art. 7472, V. C. S., 

provides wlth reference to the original application to 

appropriate water that the first in ,time is the first 

in right; Art. 7496, V. C. S., raises priorities in connection with presentations ; and Article 7523, V. C. S., 

provides that the right to appropriatejshall date from 

the filing of the application. In none of these articles do we find any inference to sustain a theory that 

priorities based upon date of filing' exist between applications for change. As we b.ave.already~ pointed out in 

our Opinion V-388, addressed to you,‘yourpHmary consideration as regards applications to change is the public welfare involved. Absent any statutory directive, 

and we find none either express or Lmplled, that priorlties attach because of date of filing-andin view of the 

nature of your considerations, we advise you that no 

priorities based upon date of,fil,lng exist between the 

various applications for change.now pendgng relative to 

furnishing water to the Texas City-Galveston area. 

.~, 

For the same reasons, we conclude that no priorities exist~by reason of one applicant having applied first 

to extend his canal system in order to accomplish the 

change, or his having first described,certain acreage which 

he desires to irrigate by reason of the change. Again we 

point out that your primarg consideration in the matter of 

change is the public welfare involved, and we know of no 

g00a reason, statutory or otherwise, which binds you on 

grounds of priority to grant the application of one over 

the application of another. In our opinion, you are free 

to grant any or all of the pending applications within your 

sound discretion as to the arrangementwhich will best serve 

the public welfare. 

(1) The general rule that, absent 

substantially changed conditions, adminlstrative boards may not rehear denied applications In the face of concluded or pending 

judicial ascertainment on the merits of a 

Board18 decision, is not applicable under 

the facts presented to the Board of Water 

Engin-+, since It is apparent that both 
Bon. E. V. Spence - Page 13 - V-411 

the trial court and the Court of Civil 

Appeals were concerned through aeclaratory judgment, not with the merits of 

the Board of WaQer Engineers' decision, 

but only ppith its right and &risdiction 

to hear at all. applications for change of 

purpose and place of use of permitted 

waters. Under such circumstances the 

Board may rehear the application without 

a finding of changed conditions. Hagno- 

;p&v. Wew Process Company, lOJ+ 9. W. (2) 

. 

(2) Under the facts presented 

the judgment of the trial court was entire 

and Inured to the benefit of non-appealing parties. Lockhart v. A. W. Snyder 

Ik co., 163 9. W. (2) 385. The result 

reacbed'is fiarther supported by the rule 

that courts may not exercise the dlscretl.6n conferred by the Legislature upon 

administrative bodies. Railroad Commlsslon V. Shell, 161 9. W. (2) 1022; Federal Communication Commlsslon v. Pottsvllle 

Broadcasting Co., 309 U. 9. 134. 

(3) No priorities based upon date 

of filing exist between applications to 

change purpose and place of use of permitted waters. 

Yours very truly 

ATTORE'EYG~ OF TREAS 

R.DP:bt