Opinion ID: 1354851
Heading Depth: 1
Heading Rank: 1

Heading: Abandonment or Forfeiture

Text: The distinction between abandonment and forfeiture is important to the correct determination of this case. The Director, relying upon Withers et al. v. Reed, 194 Or. 541, 558, 243 P.2d 283 (1952), held that ORS 540.610(1) is a forfeiture statute. However, if ORS 540.610(1) is an abandonment statute and an intent to abandon the water right is required, the Director might have reached a different result because there is uncontradicted evidence in the record that before the end of the fifth irrigation season, Rencken dug a sump and bought an electrical pump to use the water from the East Branch of Mud Creek. ORS 540.610(1) was passed by the Oregon Legislature in 1913 as Chapter 279. The language of the statute has remained the same since its enactment except for minor editorial changes. See Or. Laws 1920, ch. 8, § 5776; 3 Oregon Code Annotated (1930) § 47-901; OCLA § 116-437 (Oregon Compiled Laws Annotated). Oregon cases decided after the enactment of this statute have not always drawn a clear distinction between abandonment and forfeiture. Broughton v. Stricklin, 146 Or. 259, 276, 28 P.2d 219, 30 P.2d 332 (1934), involved the change of the place of use of water from the Deschutes River. This court said: The proposition to change the place of use of water from Cline Falls to the district    is not an abandonment of such water. To constitute an abandonment of a water right there must be a concurrence of an intention to abandon and an actual failure in its use for the statutory period. Hutchinson v. Stricklin, 146 Or. 285, 301, 28 P.2d 225 (1934), involved an agreement wherein a milling company in Baker County for a valuable consideration agreed not to demand the use of its 1870 priority water so that it would be available to upstream users. It was held: We would not term it an abandonment. The right to the use of the water cannot be deemed forfeited by nonuser short of the period of time prescribed by the statute, and nonuser will not effect an abandonment in the absence of proof of intent to abandon:    Dober v. Ukase Investment Co., 139 Or 626 (10 P.(2d) 356). Tudor v. Jaca, et al., 178 Or. 126, 164 P.2d 680, 165 P.2d 770 (1946), was a suit to quiet title to the use of the waters of Crooked Creek, a tributary of the Owyhee River in Malheur County. It was claimed that the respondent had lost the right to irrigate the Loveland field by either abandonment or forfeiture by failing to use the water for more than five years, citing OCLA § 116-437 (ORS 540.610(1)). This court made the following distinction between abandonment and forfeiture: Abandonment, as applied to an appropriation of water, is an intentional relinquishment of a known right. Pringle Falls Electric Power and Water Co. v. Patterson, 65 Or 474, 128 P 820, 132 P 527. The evidence, in our opinion, does not indicate that there was ever any intention to abandon the Loveland field rights,   . Forfeiture is `the involuntary or forced loss of the (water) right, caused by the failure of the appropriator or owner to do or perform some act required by the statute,' Kinney, Irrigation, 2 ed., section 1118. 178 Or. at 151, 164 P.2d 680, 165 P.2d 770. This court went on to hold that there was no forfeiture under the facts of the case. In Withers et al. v. Reed, supra , the sole question was whether OCLA § 116-437, now ORS 540.610(1), applied to the State of Oregon's ownership of lands. In 1928, Robert C. Lowe mortgaged 40 acres of land in Harney County to an agency of the State of Oregon to secure a veteran's loan. In 1932, Lowe defaulted on the loan and conveyed the land to the state in lieu of foreclosure. At the time of the conveyance, Lowe had a right to irrigate the land with waters from Mill Creek and Coffee Pot Creek. The state held title to the land until 1945 when it conveyed the 40 acres to defendant Reed's predecessor in interest. During the period of 13 years when the state owned the land, it was not irrigated, although water was available for that purpose. The circuit court affirmed the state engineer's order cancelling the water rights. Justice Lusk, writing for this court, held that OCLA § 116-437, now ORS 540.610(1), applied to the state ownership of lands and affirmed the circuit court. The 4-3 opinion of the court said at 194 Or. Page 558, 243 P.2d 283: Under the statute in question, failure of `the owner of a perfected and developed water right' to use the water appropriated for a period of five successive years works a forfeiture of the right, not for the benefit of any individual as in the case of an ordinary statute of limitations  which this is not  but for the benefit of the public, to the end that the `water right shall revert to the public and become again the subject of appropriation in the manner provided by law.' Here again, is a statement as clear as words can make it of the public policy behind the statute. [4] (Emphasis added.) In a 1965 case, Day v. Hill, 241 Or. 507, 508, 406 P.2d 148, the court quoted ORS 540.610(1) and held that the plaintiffs' predecessor forfeited by nonuse any right of appropriation he had. (Emphasis added.) Bausch v. Myers, 273 Or. 376, 541 P.2d 817 (1975), was an action to recover damages for misrepresentation involving the sale of a ranch in Douglas County. When the ranch was sold in 1967, the seller represented to the plaintiffs that there were 27 acres of water rights. In 1972, the State Engineer found that there had been a nonuse of a portion of the water rights during the period of 1962-66, inclusive, and cancelled the rights for 20.4 acres. This court found that the representation was recklessly made. It quoted ORS 540.610(1) and made the following statement at Page 380: Urbanites might not know that water rights are conclusively presumed abandoned for failure to use for five successive years. This law, however, is common knowledge among all in Oregon who are dependent upon an adequate supply of water for irrigation. We believe it is equally well known that five years of nonuse is a conclusive abandonment whether proceedings before the State Engineer are brought immediately after the five years of nonuse or 10 or 15 years later. For an example, see Withers v. Reed, 194 Or 541, 243 P2d 283 (1952). In the Bausch case this court did not use the term forfeiture, but did refer to Withers et al. v. Reed, supra , which was based upon the proposition that ORS 540.610(1) is a forfeiture statute. Crandall v. Water Resources Dept., 290 Or. 771, 626 P.2d 877 (1981), was the review of a proceeding under ORS 540.610 to 540.650 to cancel a water right from Little Butte Creek for power purposes at the Daley Flour Mill at Eagle Point. We said that the Director of Water Resources in his findings of fact and conclusions of law had correctly identified the question to be decided: `The sole issue here is whether or not the statutory abandonment or forfeiture for failure to use the water for five successive years has or has not taken place. If it has, the right was lost at that time and the water reverted to the public. If it wasn't, the right to the use of the water must be affirmed.' 290 Or. at 774, 626 P.2d 877 (emphasis added). None of the Oregon cases which consider the abandonment-forfeiture question refers to ORS 540.631, which in part provides: Whenever it appears to the satisfaction of the Water Resources Director    that a perfected and developed water right has been abandoned as provided in ORS 540.610, the director may initiate proceedings for the cancellation of such water right   . (Emphasis added.) Two law professors and one attorney general agree that ORS 540.610(1) is a forfeiture statute. Professor Chapin D. Clark in Survey of Oregon's Water Laws (reprinted and updated by the Oregon Law Institute (August 1983)) at Page 153 refers to ORS 540.610(1): This is a statutory declaration that failure to use a water right for five successive years shall cause the right to be forfeited. Intent to abandon, actual or inferred, is not an element of forfeiture. In a footnote the same author writes: ORS 540.631 refers to water rights abandoned as provided in [ORS 549.610(1)], but it is clear that a conclusive presumption of abandonment creates in effect a statutory forfeiture. 157 n. 11. 1942-44 Opinions of Attorney General 48 comments on OCLA § 116-437 (now ORS 540.610(1)): Although the statute employs the word `abandonment', it clearly contemplates an involuntary forfeiture through non-user rather than a voluntary abandonment. An intent to relinquish the right is, of course, an essential element of abandonment, but the forfeiture provided by section 116-437 results without regard to the owner's intent. [5] 2 Hutchins, Water Rights Law in the Nineteen Western States (1974), contains the following statement concerning ORS 540.610(1) on Page 320:    The controlling sentence in the Oregon statute reads: `Whenever the owner of a perfected and developed water right ceases or fails to use the water appropriated for a period of five successive years, the right to use shall cease, and the failure to use shall be conclusively presumed to be an abandonment of water right.' [Emphasis in original.] This goes beyond the Kansas Legislature's `shall be deemed abandoned' and makes it clear that if `conclusively presumed' means anything at all, it completely rules out the element of intent. Its ingredients are those of forfeiture  nonuse and lapse of time. Although this may purport to be an abandonment statute, it is in effect a forfeiture statute. (Footnote omitted.) Since the 1952 case of Withers et al. v. Reed, supra , this court has consistently indicated that ORS 540.610(1) is a forfeiture statute. The above-cited legal literature agrees with the conclusion. [6] We reaffirm Withers et al. v. Reed, supra . Neither Broughton v. Stricklin, supra , nor Hutchinson v. Stricklin, supra , referred to Oregon Code Annotated § 47901, which was a predecessor statute of ORS 540.610(1), even though the statute had been passed in 1913 and at the time of those opinions had remained unchanged for 21 years. Both cases can be read to say that an intent to abandon must concur with the failure to use the water for a period of five years. If Broughton v. Stricklin, supra , and Hutchinson v. Stricklin, supra , were not overruled by Withers et al. v. Reed, supra , we now overrule the portions of them that are inconsistent with ORS 540.610(1) and this opinion. [7]