Opinion ID: 162215
Heading Depth: 3
Heading Rank: 2

Heading: Whether the United States is engaging in procedural fencing

Text: 61 The district court was concerned that the United States engaged in procedural fencing because it had moved to dismiss the New Mexico case on jurisdictional grounds several times. The court found that the United States' jurisdictional argument was rejected by every court to consider it, including the New Mexico Court of Appeals, and that the United States brought the present federal action shortly after losing its third attempt to dismiss on jurisdictional grounds. 62 The United States has attempted at every juncture in the New Mexico adjudication to resist jurisdiction. Other parties have made motions to dismiss. The State Engineer himself made several. This preliminary skirmishing has ended, however. After an extended period of pleadings and dismissal motions in the New Mexico proceedings and after realignment, the New Mexico stream adjudication is progressing rapidly. In the three years since the realignment and the denial of the State Engineer's last motion to dismiss, the parties have been cooperating; none have questioned the state court's jurisdiction. Only the United States and Texas parties still resist the stream adjudication. 63 As the district court found, it is significant that the United States filed the instant action just a short time after the last jurisdictional objections to the New Mexico adjudication were rejected and it became clear the adjudication will proceed to judgment. See St. Paul Fire & Marine Ins. Co. v. Runyon, 53 F.3d 1167, 1170 (10th Cir.1995) (holding no abuse of discretion when district court determined that insurer's filing of federal declaratory action on eve of insured's state contract suit after waiting three years before seeking declaration constituted procedural fencing). The United States contends that it waited until 1997 to file the present suit because only then did it become clear that the New Mexico and Texas adjudications would not reach the claims enumerated in its federal complaint. The exclusion of Elephant Butte Reservoir from the New Mexico adjudication, however, was apparent from the filing of the first complaint in 1986. Moreover, the Texas adjudication was initiated in 1994. This court agrees that the procedural fencing factor weighs against the exercise of jurisdiction. 64 3. Whether the exercise of federal jurisdiction would result in friction with the state courts and encroach upon their traditional jurisdiction 65 The district court expressed concern that if it declared relative rights to Project water, it could cause friction between the federal and state courts. The court's concern centered around the special role and expertise state courts have in adjudicating water rights. This court agrees with the district court that a federal declaration of rights could encroach upon the state courts' traditional role as arbiter of water rights disputes. 66 Water rights adjudications traditionally have been within the ambit of state court expertise. See Arizona v. San Carlos Apache Tribe, 463 U.S. 545, 569, 103 S.Ct. 3201, 77 L.Ed.2d 837 (1983) (observing that considering the specialized resources and experience of the state courts in adjudicating water rights, it was far from obvious federal adjudications would proceed faster). Congress recognized as much when it enacted Section 8 of the Reclamation Act, requiring the federal government to procure water for reclamation projects in accordance with state law. See 43 U.S.C. § 383. As stated by the 1951 Senate Judiciary Committee in discussing Section 8 of the Reclamation Act, 67 Down through the years the courts of the respective States marked out the pathway whereby order was instituted in lieu of chaos. [Water] [r]ights were established, and all of this at the expense, trial, and labor of the pioneers of the West, without material aid from our United States Government until a much later time when irrigation projects were initiated by Congress through the Department of Interior and later the Bureau of Reclamation. Even then Congress was most careful not to upset, in any way, the irrigation and water laws of the Western States. 68 S.Rep. No. 82-755, at 3 (1951). Declaring title to water would thus encroach upon the traditional jurisdiction of the state courts. 69 In addition, the federal action carries the danger of grave interference with the state proceedings. The likelihood of such interference is another justification for the refusal of jurisdiction. See Mhoon, 31 F.3d at 984 (finding no abuse of discretion when federal proceeding involved no undue interference with the state proceeding). The McCarran Amendment was enacted out of the concern that without the participation of the United States, state adjudications, intended to adjudicate the interlocking rights of all users, would be left unable to adjudicate the rights of any. See S.Rep. No. 82-755, at 4-5 (1951); see also United States v. Dist. Court for Eagle County, 401 U.S. 520, 525, 91 S.Ct. 998, 28 L.Ed.2d 278 (1971). Precisely the same chaos could result in this case if the United States is permitted to litigate its claim in federal court. Faced with an ongoing federal dispute, the New Mexico court could be faced with the question whether to defer resolution of the claims of water users dependent on the resolution of the United States' fight with the named defendants over title. Unable to reach some claims, and needing to reach all in order to establish priority, the state adjudication could grind to a halt. On the other hand, the New Mexico state court could adjudicate the title fight that is the subject of the federal action. The district courts are given discretion to decline jurisdiction over declaratory judgment actions, however, precisely to avoid becoming such an arena for a race to res judicata.  See Mhoon, 31 F.3d at 983 (quotations omitted). 70 4. Whether the state remedy is the most effective remedy 71 The district court concluded that the state adjudications would provide a more effective remedy to the general controversy than the federal declaratory judgment action. The state proceedings would produce a more comprehensive and cohesive remedy, because the rights of all, including the parties to the federal action, would be decided. The district court was correct in concluding that the state adjudications are the more effective remedy. 72 In arguing that the state proceedings are not the more effective remedies, the United States and Texas parties fail to acknowledge the reality of water rights disputes in the West. Thousands of individuals claim water rights that depend on the resolution of the claims of others. The situation has long been recognized as demanding a comprehensive adjudication of all users' claims. See El Paso & R.I. Ry. Co. v. District Court, 36 N.M. 94, 8 P.2d 1064, 1067 (1931). Congress recognized this need when it passed the McCarran Amendment: 73 [The concern over inconsistent dispositions of property] is heightened with respect to water rights, the relationships among which are highly interdependent. Indeed, we have recognized that actions seeking the allocation of water essentially involve the disposition of property and are best conducted in unified proceedings. The consent to jurisdiction given by the McCarran Amendment bespeaks a policy that recognizes the availability of comprehensive state systems for adjudication of water rights as the means for achieving these goals. 74 Colorado River, 424 U.S. at 819, 96 S.Ct. 1236 (citation omitted). The New Mexico and Texas adjudications are designed to provide such a comprehensive solution to a complex problem. See United States v. Bluewater-Toltec Irrigation Dist., 580 F.Supp. 1434, 1446 (D.N.M.1984) (The idea that New Mexico lacks a comprehensive system for adjudication of water rights is not grounded in facts and needs no further comment.); Tex. Water Code Ann. § 11.307 (Vernon, WESTLAW through 2001 Reg. Sess.) (requiring [e]very person claiming a water right of any nature to file a claim with the TNRCC during an adjudication) (emphasis added). As such, they are the preferred mechanisms for settling water rights disputes. 75 Moreover, a federal declaration of rights will be particularly ineffective. Even if the federal action proceeds, both state adjudications will continue to go forward with the United States as a party. Because a federal declaratory judgment will affect only the named defendants, the United States will be forced to litigate its rights relative to other water users in the state proceedings. The federal declaration can hardly be considered an effective remedy since the United States will have to reargue numerous factually similar issues against water users excluded from the federal action. See Runyon, 53 F.3d at 1169-70 (noting that district courts generally should not entertain jurisdiction over declaratory judgment action involving the same fact-dependent issues likely to be decided in another proceeding).