Court Opinion

ID: 5165645
Source: CourtListenerOpinion
Date Created: 2022-01-02 03:31:34.974477+00
Date Added: 2024-06-11T08:25:50.483876
License: Public Domain

Justice SCOTT
dissenting:
Arapahoe County’s application seeking a conditional water decree permitting it to construct and develop the Union Park Reservoir Project was denied because Arapahoe County failed to prove sufficient water availability. Because I too would reverse and remand this case to the water court for consideration of the application of Arapahoe County for a conditional water rights decree, without requiring Arapahoe County to prove the availability of water because I believe such a requirement should not be read into our “can and will” statute, I join Justice Mullarkey in her dissent. I write separately only to make clear my view that although constitutional issues were not raised on appeal, the majority’s interpretation of the “can and will” statute may, in fact, be in conflict with relevant constitutional provisions and our public policy of maximum utilization of the waters of Colorado.
The majority maintains that to acquire a conditional water rights decree, an applicant must “establish that there is a substantial probability that within a reasonable time the facilities necessary to effect the appropriation can and will be completed with diligence, and that as a result waters will be applied to a beneficial use.” Maj. op. at 961. The majority then holds that Arapahoe County “must prove, as a threshold requirement, that water is available based upon river conditions existing at the time of ... application,” id. at 962, and “in sufficient quantities and in sufficiently frequent occasions” to satisfy Arapahoe County’s claimed conditional water right. Id. The majority concludes that conditional water rights under which diversions have been made must be considered. Because the calculus mandated by the majority necessarily includes conditional water rights that may later be abandoned before they would otherwise mature into absolute rights, I believe the majority’s interpretation raises serious questions regarding the constitutional right to divert unappropriated waters to beneficial uses.
The Colorado Constitution in relevant part provides:
Section 5. Water of streams public property. The water of every natural stream, not heretofore appropriated, within the state of Colorado, is hereby declared to be the property of the public, and the same is dedicated to the use of the people of the state, subject to appropriation as hereinafter provided.
Colo. Const, art. 16, § 5.
Section 6. Diverting unappropriated war ter — priority preferred uses. The right to *979divert the unappropriated waters of any natural stream to beneficial uses shall never be denied. Priority of appropriation shall give the better right as between those using the water for the same purpose; but when the waters of any natural stream are not sufficient for the service of all those desiring use of the same, those using the water for domestic purposes shall have the preference over those claiming for any other purpose, and those using the water for agricultural purposes shall have preference over those using the same for manufacturing purposes.
Colo. Const. art. 16, § 6. Pursuant to section 6, “the right to divert the unappropriated waters of any natural stream to beneficial uses shall never be denied” and can only be limited by “priority of appropriation.” Colorado River Water Conservation Dist. v. Vidler Tunnel Water Co., 197 Colo. 413, 415, 594 P.2d 566, 568 (1979).
While I agree with the majority that our “long established and legislatively recognized policy of maximum utilization of water provides guidance in construing the ‘can and will’ statute,” maj. op. at 962, and that “[t]he policy of maximum beneficial use is derived from an understanding that the waters of Colorado are a scarce and valuable resource,” id., I believe that both public policy and the sometimes stark reality of our limited water resources militate against the majority’s interpretation of our “can and will” statute. Because water resources are limited, our public policy requires that we seek their maximum utilization. A policy promoting the “maximum beneficial use” contemplates flexible and not static or forever fixed uses. Thus, we should abhor artificial bars to the most beneficial use.
In Kelly Ranch v. Southeastern Colorado Water Conservancy Dist., 191 Colo. 65, 74-75, 550 P.2d 297, 304 (1976), we reasoned:
The fact that the rivers involved are over-appropriated, rather than being an argument against [a plan for agumentation that does not introduce new water into a water system], is the very reason for the valid exercise of ingenuity of persons seeking to maximize the use of water....
Almost thirty years ago, Justice Groves, writing for the court in Fellhauer, opined that our system of water rights
[has] developed under article XVI, section 6 of the Colorado constitution [in which it] ... is implicit ... that, along with vested rights, there shall be maximum utilization of the water of this state. As administration of water approaches its second century the curtain is opening upon the new drama of maximum utilization and how constitutionally that doctrine can be integrated into the law of vested rights. We have known for a long time that the doctrine was lurking in the backstage shadows as a result of the accepted, though oft violated, principle that the right to water does not give the right to waste it.
Fellhauer v. People, 167 Colo. 320, 335-36, 447 P.2d 986, 994 (1968). Because the curtain has long risen and we are called to play a part in deciding how future water uses will be determined, I believe our application of law and public policy must permit future uses that we today cannot contemplate but which cannot arise if they are unduly burdened.
By following our previously limited holding in Southeastern Colorado Water Conservancy Dist. v. City of Florence, 688 P.2d 715 (Colo.1984), the right to “divert ... unappropriated waters” is unduly burdened. This is so because requiring proof that sufficient water is available before application for a conditional water right, in effect, gives little force to the reality that over time, demographics and economic pressures change and so too the development of water rights under existing conditional water decrees, or the actual use to which either water yet to be appropriated and water diverted but to which a right has not been perfected may be applied. What may be a beneficial use an appropriator under a conditional decree is willing to risk developing today, may not prove to be the maximum beneficial use tomorrow, hence, it may not be the use to which resources will in fact be applied in later years. Consequently, a beneficial use that originally supported a particular condi*980tional right may not, in the marketplace for limited resources, support the continued development of such rights, leading later to the abandonment of water rights.
Inherent in our constitutional provisions is the reasonable assumption that we are rational maximizers of limited resources. Despite today’s anticipated uses, however, precisely because behavior may be altered and circumstances exist beyond our control in the marketplace for water rights, there are three fundamental factors which must be considered before adopting any result: first, the law of supply and demand, that is, the relation between higher or maximum use and quantity; second, the idea that competition, when not impeded by unnecessary government intrusion into a free marketplace, will permit a free flow of water to uses that approximate maximum use or opportunity costs; and third, the fact that where the quantity of water is reduced by artificial scarcity, competitive equilibrium is lost and water will not gravitate toward the most beneficial or valuable use because there will no longer be a voluntary exchange. See generally David W. Barnes and Lynn A. Stout, Cases and Materials on Law and Economics 345 (1992) (“The key to the smooth operation of a free market economy is that buyers and sellers through the forces of demand and supply find the equilibrium price where demand equals supply. At that point, the economy operates most efficiently. It is at this price that resources will be best allocated.”) (quoting Standard Oil Co. of Ohio v. Federal Energy Admin., 612 F.2d 1291, 1296 (TECA 1979)); see also Richard A. Posner, Economic Analysis of Law § 1.1-1.3 (2d ed. 1977); Paul Anthony Samuelson, Economics 67-68, 630-32 (10th ed. 1976); Chesapeake and Ohio Ry. Co. v. United States, 704 F.2d 373, 376 (7th Cir.1983) (“The allocative-efficiency or consumer-welfare concept of competition dominates current thinking, judicial and academic, in the antitrust field.”) (citing cases).
Failure to acknowledge economic forces will not result in maximum utilization. In its place will be uses inefficiently retained by long standing conditional decrees that, by the passage of time and the change of circumstances, may no longer be developed but abandoned.
It is not our role to determine which use ultimately will prevail. Under the majority’s opinion and judgment, however, to the extent one use is prohibited from competing because an applicant cannot prove the availability of water, we grant to an existing use the legal right to interfere or inhibit a later, more beneficial use. This result will occur even if the later use is not more beneficial, because the right to compete is too easily burdened by the threshold requirement of proving water availability.
The majority, in the name of our “can and will” statute, charges unperfected rights against an applicant seeking a new conditional water right. Thus, the majority requires that Arapahoe County and future applicants for conditional water rights must take all present and future demands on the stream under absolute and unperfected water rights into consideration on application, i.e., prove the availability of water.
In my opinion, proving the availability of unappropriated water is an unrealistic requirement and creates too great a demand upon applicants for conditional water decrees. If an applicant is willing to pursue a conditional water right on the chance that the proposed beneficial use will continue to exist and that water will be available when the project comes on line, our constitution does not allow us to deny the applicant the right to attempt to divert those, as yet, unappropriated waters. Contrary to the judgment of the water court and the opinion of the majority, upon a showing of intent and ability, Arapahoe County should be permitted to apply for and obtain a conditional water decree, allowing it to proceed with development of such rights.
In sum, I would only require an applicant under our “can and will” statute to demonstrate the intent and ability to appropriate water before granting a conditional water decree, which represents the opportunity for one with a need and use of water to develop *981that use and, if appropriate, later perfect that interest.