Court Opinion

ID: 5163110
Source: CourtListenerOpinion
Date Created: 2022-01-02 03:07:07.358957+00
Date Added: 2024-06-11T08:25:42.895944
License: Public Domain

Justice VOLLACK
dissenting:
I respectfully dissent from the majority’s holding affirming the judgment of the District Court, Water Division No. 5 (the water court), denying the application for certain changes of water rights filed by the City and County of Denver, acting by and through its Board of Water Commissioners (the Board). In my opinion the evidence considered by the water court was sufficient to overcome the presumption that the Board had abandoned its rights in the waters in question. Therefore I would hold that the water court abused its discretion in holding that the evidence did not overcome the presumption of abandonment.
Because I would hold that the water court abused its discretion in concluding that the evidence did not overcome the presumption of abandonment, I address the issue of whether the water court erred in holding that the inability to quantify historical use of the water rights prevented the court from developing terms and conditions which would avoid injury to other appropriators. I would hold that the water court’s holding on this point was also an abuse of discretion.
I.
A.
At trial the Board and the objector-appel-lees presented evidence on the issue of whether the Board had abandoned the subject water rights. The evidence at trial established that on December 4, 1962, the Board received a Special Use Permit from the United States Department of Agriculture and the United States Forest Service. The permit gave the Board permission to use a ditch ten feet wide to convey water through the Snake River Ditch and the Straight Creek Ditch.
The evidence at trial also established that on July 27, 1960, the Board conveyed 0.6 cubic feet per second (c.f.s.) of its Snake River Ditch water right to Hans Hansen, the owner of the Loveland Pass Motel. On August 18,1971, the Board conveyed to the town of Dillon (Dillon) 3.5 c.f.s. of the Board’s 62.5 c.f.s. Straight Creek water right.1 The agreement effecting the 1971 conveyance stated that “[t]he [Dillon Valley] District agrees not to protest any application filed by [Dillon] to change the use of the right deeded by the Board to [Dillon] ... from its decreed use [generation of electric power] to a municipal year-round use.” Dillon agreed to convey to the Board water rights identified as the “Dillon Enlargement,” decreed in the amount of 25 c.f.s., and the “Meadow,” decreed in the amount of 23.3 c.f.s.
In 1978 the Board, Dillon, and the Dillon Valley District agreed to share the cost of constructing a diversion dam and intake structure on Straight Creek. At trial Mr. Robert Fischer testified for the Board that the project involved the construction of a pipeline following the right of way of the old Straight Creek Ditch. The project was authorized by a permit issued by the Summit County Board of County Commissioners (the Summit County Board).
The Board presented evidence at trial that during the 1970s it protected its water rights in the Snake River Ditch and the Straight Creek Ditch through a series of license agreements. On October 3, 1973, the Board authorized Dillon to construct and operate a 16-inch water pipeline in the Board’s Straight Creek Ditch property. In a 1976 license agreement the Board authorized Keystone International to construct a *781condominium complex within and across the Board’s Snake River Ditch property. On May 24, 1977, and November 21, 1980, the Board authorized Keystone to construct and operate a condominium complex within and across the same property. Each of' these agreements stated that “[t]he term ‘property’ ... refers to real property and includes easements, rights-of-way and other Board interests in land.” In each of these agreements the Board reserved “the right to make full use of the property involved as may be necessary or convenient in the operation of the water plant and system under the control of the Board.” The agreements also stated that “[a]t no time shall Licensee interfere with the flow of water in Board facilities and Licensee shall assume all risks incident to the presence of water in Board facilities.”
The Board also offered into evidence a June 23, 1982, letter from the head of the Denver Water Department. The letter was in answer to an inquiry by a Mr. Barry Rothman about the possible sale by the Board of some of its interest in the Snake River Ditch. The letter referred to a provision in agreements between the Board and landowners along the Snake River Ditch which protected the Board’s interest in the ditch and ensured that the ditch would remain available to the Board to carry water for waterworks purposes.
In 1984 the Board applied for an exemption from licensing of a hydroelectric project in Dillon Dam. The Federal Energy Regulatory Commission granted the exemption on August 20, 1984.
B.
During the trial the Board submitted into evidence a 1987 Denver Water Department study (the Department study) of the historical use of the subject water rights based on Public Service Company power generation records from the Summit Hydro Plant (the old power plant). The study included charts of the average daily flow rates, in cubic feet per second, of water from the Snake River and Straight Creek Ditches to the old power plant. Appendix B of the study contained Straight Creek Ditch stream flows in cubic feet per second recorded by the United States Geological Survey.
After the trial the Board submitted proposed findings of fact and conclusions of law. The proposed findings of fact included the statement that “[t]he water diverted under the subject priorities will continue to be used for the generation of electric power, which is a non-consumptive use.” The proposed findings also contained a stipulation enforcing the 1971 agreement between the Board, the Dillon Valley District, and Dillon subordinating up to 7 c.f.s. of the Board’s Straight Creek water right. The proposed decree also stated that the proposed diversions would be discontinued, and “the ditch abandoned and rendered nonfunctional subject to the rights of Hans Hansen or his assigns to divert .6 cfs, pursuant to agreement dated July 27, 1960.” The Board’s proposed decree set out monthly maximum flow rates for the Board’s proposed diversions. The maximum flow rates were based on the Department study’s estimates of maximum monthly stream flow rates into the old power plant. The Board’s proposed decree limited the Board’s right to place calls on the Blue River or Ten Mile Creek to meet the needs of the subject water rights, but did not restrict the Board’s right to place calls on Straight Creek or Snake River upstream of the original points of diversion to satisfy the subject water rights. The proposed decree also contained the following provision:
This court shall retain jurisdiction in this proceeding to consider the question of injury to the vested water rights of others as provided in C.R.S. § 37-92-304(6), 15 C.R.S. (1986 Supp.). At any time within a five year period commencing on the date of this decree but not thereafter, any person may request a hearing by this Court for such purposes and for modification of the decree only as to the reconsideration by the Court on the question of injury to the vested rights of others.
At trial both sides presented evidence on the issue of whether it was possible for the *782water court to enter a decree which protected other appropriators from injury. Edwin James, a water rights engineer for the Board, testified that because power generation was a non-consumptive use the change sought by the Board would not injure water users located downstream of Dillon Dam. The Snake River Water District called Mr. Harold Bishop, the president of a consulting firm, as an expert witness. Mr. Bishop testified on cross-examination that if the Board were-allowed to place a call on the Snake River upstream of the historic diversion point for the old power right, that call would injure decreed water rights. Mr. Bishop also testified to several shortcomings in the Department study which minimized the possibility that the change in water rights sought by the Board would not injure the decreed water rights of others.2 However, Mr. Bishop testified that the Dercum Ditch water right was the only right located above the historic point of diversion, and that it would not be affected by a decree identifying the Snake River Ditch priority as a 1946 priority. Mr. Bishop also testified that virtually all the other water rights owned by the Snake River Water District were below the historic point of diversion and would not be subject to call if the decree limited the Board to utilizing the water right at the historic point of diversion.
The water court concluded that “there is an inability to accurately quantify the historic use of the subject power rights,” and therefore it could not “develop terms and conditions that would avoid injury to other appropriators.” The water court based this conclusion on several findings. The court noted that “[tjhere were no water diversion records regarding the subject power rights.” The water court found that the existence of an auxiliary stream generating unit capable of generating power at the equivalent of 21.2 c.f.s. of water diversions undermined the Board’s estimated stream flow rates, which were based on the old power plant’s electrical output. The court also found several inconsistencies in the power production records upon which the Department study was based. The court referred to the fact that the records indicated diversions in excess of the 48.6 c.f.s. capacity of the power plant penstock. The court also referred to an admitted 10 percent discrepancy in the conversion formula. Finally, the court noted that the diversion to the Loveland Pass Motel may have consumed as much as 10 c.f.s. in order to transport the motel’s 0.6 c.f.s. The court cited May v. United States, 756 P.2d 362 (Colo.1988), for the proposition that “[wjhere the inability to accurately quantify historic use prevents the court from developing terms and conditions that avoid injury, a change of water rights must be denied.”
II.
I agree with the majority’s conclusion that the evidence was sufficient to establish a rebuttable presumption that the Board had abandoned the water rights. Maj. op. at 779. I disagree, however, with the majority’s conclusion that the evidence rebutting the presumption of abandonment was “limited and inconclusive.” Maj. op. at 779. I would hold that the water court abused its discretion in holding that the evidence of the Board’s sales to Dillon and the Loveland Pass Motel, the Board’s licensing agreements, and the June 23, 1982, letter did not overcome the presumption of abandonment.
Once the evidence at trial establishes a rebuttable presumption of abandonment, the burden of going forward shifts to the *783owner of the water right, “who may then introduce evidence sufficient to rebut the presumption established by non-use.” Southeastern Colorado Water Conservancy Dist. v. Twin Lakes Assocs., 770 P.2d 1231, 1237 (Colo.1989) (quoting Beaver Park Water, Inc. v. City of Victor, 649 P.2d 300, 302 (Colo.1982)). “In order to rebut a presumption of abandonment it is necessary to adduce evidence that the water right owner did not intend to abandon the water right notwithstanding the long period of nonuse that gave rise to the presumption.” People v. City of Thornton, 775 P.2d 11, 18 (Colo.1989). Mere expressions by the water right owner of a desire or hope to retain the water right are insufficient to rebut a presumption of abandonment. Id.; Mason v. Hills Land & Cattle Co., 119 Colo. 404, 408-09, 204 P.2d 153, 156 (1949). The water right owner must present evidence of facts or conditions excusing the period of non-use. Thornton, 775 P.2d at 18; Twin Lakes, 770 P.2d at 1238. As we explained in Thornton, 775 P.2d at 18, however, the existence of an excuse for non-use is not independently significant but is relevant to the determination of the owner’s intent. “Thus, evidence sufficient to show that during the period of nonuse the owner never intended to discontinue permanently the use of the water available under the water right will rebut the statutory presumption of abandonment.” Id. The question of whether an owner of a water right intended to abandon that right is “essentially a question of fact for determination by the trier of fact on the basis of the evidence produced at trial.” Masters Investment Co., Inc. v. Irrigationists Ass’n, 702 P.2d 268, 272 (Colo.1985).
A.
The majority concludes that the evidence that the Board twice conveyed portions of its water rights to third parties does not establish that the Board was making diligent efforts to sell the water rights. In my opinion the Board’s sale of part of its water rights to Dillon and the Loveland Pass Motel indicates that the Board believed it had water rights to sell. Our precedents establish that water rights sales are persuasive evidence of an intent not to abandon water rights.
In People v. City of Thornton, 775 P.2d at 19-20, we considered whether the water court erred in holding that the evidence at trial overcame a rebuttable presumption that the owners of certain water rights had abandoned those rights. In Thornton we upheld the water court’s finding that the water rights in question had not been abandoned. We relied on the subjective declarations of the water rights owners, which were only sufficient to support our decision because they were supported by evidence that on two occasions the water rights owners had attempted to sell the two wells at issue in the case. Id. at 20. We stated that “[ajctual good faith efforts to sell a water right ... are strongly indicative of absence of intent- to abandon and provide objective evidence of the intent that a water right not be abandoned.” Id. at 21. In Thornton we held that “the totality of the evidence of the water rights owners’ testimony, the documentary evidence of attempts to sell the water rights, and the testimony of counsel for a potential purchaser are sufficient to support the water court’s finding that there was never any intent to abandon the ... water rights.” Id.
In the present case the Board did more than merely engage in good faith efforts to sell parts of its water rights. The Board actually succeeded in conveying parts of its water rights to Dillon and the owner of the Loveland Pass Motel. See Beaver Park, 649 P.2d at 302-03 (holding that evidence consisting largely of the leasing, sale and mortgaging of the water rights at issue was sufficient to rebut a presumption of abandonment arising from a twenty-year period of non-use). The Board’s 1960 and 1971 sales indicate that the Board did not intend to abandon its unsold water rights in the Snake River and Straight Creek ditches. In my opinion the water court’s failure to recognize the Board’s expression of intent not to abandon its remaining water rights in the Snake River and Straight Creek ditches was an abuse of discretion.
*784B.
The majority concludes that although the evidence of the Board’s licensing agreements with Keystone provide some support for an inference that the Board did not intend to abandon the water rights at issue, the water court was within its discretion as fact-finder to reject that inference. Maj. op. at 778-779. In my opinion the fact that the Board entered into the licensing agreements indicates that in doing so it intended to protect the water rights in the rights of way covered by the agreements. In each of the agreements the Board reserved the right to make full use of the rights of way involved for the operation of “the water plant and system under control of the Board.” The agreements also stated that “[a]t no time shall Licensee interfere with the flow of water in Board facilities.”
The Board’s entry into these licensing agreements in the 1970s is analogous to the “constant activity” on the part of the water rights owner in Beaver Park, 649 P.2d at 303. In Beaver Park we upheld the water court’s finding of non-abandonment on the basis of activity of the water rights owner, including the owner’s and others’ entry into lease and mortgage arrangements, negotiations undertaken by the owner about the sale of the subject water rights, and other activities indicative of the owner’s intent not to abandon the water rights. Id. at 302-03. Inferences drawn from the licensing agreements support the Board’s intent not to abandon the subject water rights.
C.
The June 23, 1982, letter introduced into evidence by the Board also established the Board’s intent not to abandon the subject water rights. One of the Board’s witnesses testified that the letter was from the head of the Denver Water Department and advised Barry Rothman that the Board did not intend to offer a portion of the Snake River Ditch for sale. The letter also advised Mr. Rothman that the Board had “entered into agreements with land owners along the [Snake River Ditch] for the use of portions of the [ditch] where the ... Board only had a right-of-way.” The letter referred to the following provision in those agreements:
If the Board requires the use of the easement for water works purposes, Licensee agrees, solely at its own expense and in a manner and at a location acceptable to the Board, to install a conduit or other water carrying facility capable of transporting the decreed water rights of the [Snake River Ditch], and convey to the Board an acceptable right-of-way for the water carrying facility.
While it is true the agreements appear to have only protected the Board’s rights of way in the Snake River Ditch, the fact that the Board was careful to preserve its rights of way for “other water works purposes” indicates that the Board did not intend to abandon its rights in the water which travelled through the Snake River Ditch. See Beaver Park, 649 P.2d at 302-03.
I respectfully dissent from the majority’s decision to affirm the water court’s conclusion that the Board failed to overcome the presumption of abandonment. The Board’s evidence of its sales of parts of its water rights in the Snake River Ditch and the Straight Creek Ditch, the various licensing agreements entered into by the Board, and the 1982 Denver Water Department letter overcame the presumption of abandonment created by the period of non-use. Thornton, 775 P.2d at 21; Beaver Park, 649 P.2d at 302-03.
III.
Because the majority affirms the water court’s determination of abandonment, it does not consider whether the evidence of historical use was so deficient as to supply an independent basis to uphold the water court’s judgment. Maj. op. at 774 n. 1. Because I believe that the water court abused its discretion in holding that the Board did not overcome the presumption of abandonment, I address the issue presented by the water court’s holding that it could not quantify historical use of the water rights and therefore could not develop terms and conditions which would avoid *785injury to other appropriators. In my opinion the water court’s holding that it could not quantify historical use, or develop terms to avoid injury to other appropriators, was an abuse of discretion.
A.
Before the water court may grant an application for a change of water right, the applicant must establish that the proposed change will not injuriously affect the vested rights of other water users. §§ 37-92-304(3) & 37-92-305(3), 15 C.R.S. (1974 & Supp.1989); May, 756 P.2d at 370. “[T]he right to change a point of diversion is limited in quantity by historical use at the original decreed point of diversion.” Orr v. Arapahoe Water and Sanitation Dist., 753 P.2d 1217, 1223 (Colo.1988). “‘Historical use’ as a limitation on the right to change a point of diversion has been considered to be an application of the principle that junior appropriators have vested rights in the continuation of stream conditions as they existed at the time of their respective appropriations.” Weibert v. Rothe Bros., 200 Colo. 310, 317, 618 P.2d 1367, 1372 (1980); see Orr, 753 P.2d at 1223 (the requirement of non-injury protects the vested rights of junior appropriators to the continuation of stream conditions existing at the time of the respective appropriations). “Where expansion of use is the injury asserted, establishment of historical use is the burden of the applicant.” Weibert, 200 Colo. at 317, 618 P.2d at 1372. Historical use is measured by the amount of water applied to a beneficial use and the amount to return flow. May, 756 P.2d at 371; Danielson v. Kerbs Ag., Inc., 646 P.2d 363, 373 (1982). The water court may not grant an application for a change in water right if the change will increase the historical use to the detriment of other appropriators. May, 756 P.2d at 371.
Subsection 37-92-305(3) requires the water court to offer applicants an opportunity to propose terms or conditions which will prevent the injurious effects which would otherwise follow from the change in water rights requested by the applicant. See Weibert, 200 Colo. at 316, 618 P.2d at 1371. The applicant has the burden to present a plan which will prevent or compensate injury to other appropriators. May, 756 P.2d at 372.
B.
I would hold that in this case the water court’s rejection of the Board’s proposed decree was supported by inadequate findings of fact. The water court relied on May v. United States, 756 P.2d at 373, to support its holding that its inability to quantify historical use of the subject water rights prevented it from developing terms and conditions which would avoid injury to other appropriators. In May the appellants applied for a conditional decree for storage of 462 acre-feet of water in an unnamed basin. Id. at 365. Objectors to the application claimed that the proposed storage and use of water in the unnamed basin would alter the rate, timing, and quantity of diversions from Rock Creek, the source of supply. Id. at 366. The court found that based on the historical uses of the water rights involved there were less than 284.15 acre-feet of water available for the proposed project, which would demand 384 acre-feet. Id. at 367. The water court therefore determined, based on the total historical use demonstrated by the applicant that it would not be possible to grant the application without injuring other appropriators. Id. The court rejected the applicant’s proposed order to avoid injury because the order assumed an availability of water “far in excess of the amount determined by the [cjourt to be available.” Id. at 373. In May we affirmed the order of the water court on the ground that the water court’s inability to accurately calculate the maximum historical use of the applicant’s wells prevented the water court from granting the application subject to terms and conditions that would avoid injury to other appropriators. Id.
Our holding in May does not mean that in every case in which it is difficult to quantify historical use the water court must deny the application for change of water rights. The underlying reason to quantify historical use is to protect the vested rights of junior appropriators. Orr, *786753 P.2d at 1223; Weibert, 200 Colo. at 317, 618 P.2d at 1372. If the evidence establishes that the water court might be able to protect the vested rights of other users without calculating historical use with mathematical certainty, then the water court must address that possibility in its findings of fact. See Southeastern Colorado Water Conservancy Dist. v. Fort Lyon Canal Co., 720 P.2d 133, 147 (Colo.1986) (water court failed to enter specific, detailed factual findings of the various quantities and ways that applicants would diminish or change patterns of historical consumptive use and return flows).
The evidence in the present case indicated that it may have been possible for the water court to enter a decree which protected other appropriators from injury. The application in the present case stated as a proposed term and condition to prevent injury to other water users that the Board “will divert water only when and to the extent it is feasibly and legally available at the original points of diversion.” Edwin James testified that the Board’s planned non-consumptive use of the water would not injure downstream appropriators. Harold Bishop testified for the Snake River Water District to injury to decreed water rights that a change in water rights might cause. However, Mr. Bishop also identified a series of conditions which would ensure that the change in water rights did not . exceed the historical use at the historic point of diversion. See supra at 774, n. 2. Mr. Bishop also testified that upstream users would not be injured if the decree limited the Board to utilizing the water rights at the historic point of diversion.
The Board’s proposed decree stated that "[tjhe Snake River Ditch priority shall be administered with the same priority (June 24, 1946) as the Board’s Blue River Diversion Project which was decreed in C.A. Nos. 1805 and 1806 on March 10, 1952.” The Board’s proposed decree also protected the appropriations of the town of Dillon up to 7 c.f.s., and protected the 0.6 c.f.s. previously conveyed by the Board to Hans Hansen. Therefore the evidence at trial indicated that the change in water rights would not necessarily injure other appropriators, and that it might be possible for the water court to issue a decree which would prevent or compensate injury to other appropriators. Given the evidence introduced at trial the water court issued inadequate findings of fact to support its holding that, because of its inability to quantify the historical use of the water rights, it could not issue a decree which did not injure other appropriators.
I respectfully dissent from the majority holding affirming the water court’s determination that the Board failed to overcome the presumption of abandonment. I also believe that the water court abused its discretion in concluding that it could not quantify historical use and could not avoid injury to other appropriators. I would reverse the water court’s order that the Board has abandoned its water rights and remand the case to the water court for further proceedings.
I am authorized to say that Justice ROVIRA and Justice MULLARKEY join in this dissent.

. In the agreement the Board conveyed 3.5 c.f.s. of its Straight Creek water right to Dillon. The Board also agreed to withdraw protests in other pending water cases in the water court. The Dillon Valley Water and Sanitation District (the Dillon Valley District) agreed to seek only to change 3.5 c.f.s. of the "Rankin No. 1 Ditch” to year-round municipal use. Under the agreement, Dillon and the Dillon Valley District agreed to share the 7 c.f.s. the agreement gave them “as if jointly owned and held,” upon a set of terms and conditions.

. Mr. Bishop testified that, assuming the Department study accurately reported stream flows into the old power plant, several conditions would be required to prevent injury to other appropriators. First, the amount of the decree would have to be reduced by the amounts conveyed by the Board to Dillon and the Loveland Pass Motel. Second, the decreed amounts for the new points of diversion would have to be based on average rather than maximum stream flow rates into the old power plant. Third, the stream flow rates estimated in the Department study would have to be reduced by 10 percent to account for admitted discrepancies in the study. Finally, any call on the Snake River would have to be limited to 70 percent of the decreed water right because the Department study assumed that 70 percent of the water flowing into the old power plant came from the Snake River.