Nielsen v. Cronquist

The Utah Court of Appeals recently issued its decision in Nielsen v. Cronquist. The case addressed the issue of awarding attorney fees in water cases.

The Nielsens and the Cronquists were neighboring landowners in Smithfield, Utah. The parties sued each other over a number of issues, including boundary issues and water issues. The Nielsens' parcel included a retention pond that stored water from Swamp Springs, where "all parties enjoy[ed] established water rights." Two water lines extended from the pond across the Nielsens' property to the Cronquists' property. One line provided water for irrigation and the other line provided water for a horse trough. The Nielsens' parcel also included a water pump that pulled water from Miles Spring. This pump and associated water line provided culinary water to the Nielsens' home and to the Cronquists' home. The Cronquists paid the Nielsens for the electricity required to pump the spring water to the Cronquists' home.

After the lawsuit was filed, the Nielsens disconnected the water line to the Cronquists' horse trough and also intermittently turned off the valve controlling the irrigation water. The parties brought competing claims against each other related to the water, including the Cronquists alleging that the Nielsens had interfered with their water rights and the Nielsens alleging that the Cronquists were "illegally diverting water" from Miles Spring and wrongfully installing water lines across the Nielsens' property. 

Following a five-day trial, the district court granted judgment in favor of the Nielsens. The court concluded that the Nielsens had wrongfully interfered with the Cronquists' water rights in Swamp Springs and that the Nielsens' claims regarding the Miles Spring water were "without merit" and "improperly motivated." The district court also awarded attorney fees to the Cronquists based on Utah Code section 73-2-28 (which allows for attorney fees in cases involving "injuries caused by a diversion of water in violation of an existing water right) and Utah Code section 78B-5-825 (which allows for attorney fees in cases where a claim is found to be "without merit and not brought or asserted in good faith). The Cronquists' attorneys filed affidavits and time records supporting their claimed attorney fees. Because the Cronquists could only collect attorney fees on the water claims (and not the boundary claims and other claims in the case), the attorneys noted that some time entries (related to work solely on water issues) should be collected at 100% while other time entries (related to work on water issues and other case issues) should be collected at 33%. The court determined that the Cronquists' attorneys had "made reasonable efforts in calculating attorney fees" and granted the award of fees.

The Nielsens appealed to the Utah Court of Appeals. The Nielsens asserted that the district court had incorrectly determined the amount of reasonable attorney fees. The Court noted that the Nielsens did not challenge the determination that the Cronquists were entitled to attorney fees, but rather the amount of the fees that were awarded. The Court determined that the affidavits and time entries provided by the Cronquists' attorneys provided a reasonable and rational basis for the fees awarded. The Court therefore concluded that the district court did not abuse its discretion on the amount of attorney fees awarded.

To read the full opinion, click here.

Water Horse Resources v. Wilhelmsen

The Utah Supreme Court recently issued its opinion in the case of Water Horse Resources LLC v. Wilhelmsen. This case focused on a proposal to divert water from the Colorado River system in Utah and to use the water in Colorado.

Water Horse filed an export application with the Utah State Engineer to divert 55,000 acre-feet of water from the Green River in Daggett County, Utah. The water was to be piped across Wyoming and used somewhere along the Front Range in Colorado. The application received numerous protests, and the State Engineer held an administrative hearing on the application. The State of Colorado sent a letter stating that it believed that Water Horse was required to follow Colorado's laws and procedures for water rights administration. The Utah State Engineer ultimately concluded that the application did not meet the approval criteria contained in Utah's water export statutes (Utah Code sections 73-3a-101 to -109), and the State Engineer therefore issued an order rejecting the application. Water Horse requested reconsideration, which the State Engineer did not grant. Water Horse appealed to the district court.

In the district court, Water Horse and the State Engineer filed competing motions for summary judgment. After a hearing, the district court granted summary judgment in favor of the State Engineer. Water Horse appealed to the Utah Supreme Court.

Water Horse argued that the Upper Colorado River Basin Compact ("Upper Compact") preempts Utah's export statutes. Specifically, Water Horse cited the Upper Compact language that states that "no State shall deny the right of another signatory State, any person, or entity of any signatory State to acquire rights to the use of water ... or regulating water in an upper signatory State for consumptive use in a lower signatory State, when such use is within the apportionment to such lower State." The Court determined, however, that the Upper Compact and Utah's export statutes do not conflict. The Court noted that the Upper Compact allowed Water Horse to file for the water use but did not guarantee that the water use would be approved. "The Upper Compact only prohibits a state from denying a right to acquire rights to the use of water; it does not guarantee that an applicant will acquire the particular right it seeks." The Court further concluded that the export statutes do not "impede the congressionally ratified purpose of the Upper Compact," but actually further that purpose.  

Water Horse further argued that it had satisfied the criteria of the export statutes. The Court disagreed. The statutes require an applicant to show that "the water can be transported, measured, delivered, and beneficially used in the recipient state." The Court concluded that Water Horse could not meet this requirement because Water Horse had not filed any application or received any approvals from the State of Colorado for the beneficial use of the water in Colorado. "The reason to believe standard may be low, but it is not so low that an applicant can present a 'we'll figure it out as we go' proposal and obtain an appropriation."

The Court also reviewed and rejected several other minor arguments made by Water Horse. The Court therefore affirmed the district court and upheld the State Engineer's rejection of Water Horse's application.

To read the full opinion, click here.

Marriott v. Wilhelmsen

The Utah Supreme Court recently issued its opinion in the case of Marriott v. Wilhelmsen. This case focuses on the following question: If a person dies while they are challenging the State Engineer's denial of their Application to Appropriate, does their legal challenge die with them?

In 1997, Randy Marriott filed an Application to Appropriate, in which he sought the right to divert and use outflow water from a treatment plant for irrigation and stockwatering uses. In 2018, the State Engineer rejected the Application and also denied Randy's request for reconsideration. Randy then filed an action in district court seeking judicial review of the State Engineer's decision. While the case was pending in the district court, Randy passed away. Randy's attorneys filed a motion with the district court to substitute Kami Marriott, who was the personal representative of Randy's estate, as the plaintiff so that the case could continue. The district court, however, denied the motion and dismissed the case. Kami appealed to the Utah Supreme Court.

Rule 25(a) of the Utah Rules of Civil Procedure provides that substitution of a deceased party is allowed only if "(1) the claims survived the party’s death; (2) the proposed substitute is a proper party; and (3) the motion is timely." The Court began its decision by noting that Kami had the burden to demonstrate that Randy's legal claims survived his death. 

The Court first examined if Randy's claims survived his death under common law. Kami asserted that Randy's claims "related to real property or property rights," and therefore survived under common law. The Court disagreed because Randy never had a perfected water right and that the Application to Appropriate created no right to water. The Court declined to extend the common law to protect Randy's claims because Randy had "no present property interest."

The Court then examined if any statutory provisions allowed Randy's claims to survive his death. Kami asserted that because the Utah water code allows Applications to Appropriate to be assigned to new owners, that claims related to the denial of an Application to Appropriate should survive death. The Court disagreed and noted that assignability and survival are not the same thing. The Court held that because Kami could not point to any statute that would allow for Randy's claims to survive his death, the district court was correct in dismissing Randy's claims following his death.

In the end, the Utah Supreme Court affirmed the district court's decision that Kami could not be substituted as a plaintiff for Randy and that the case should therefore be dismissed.

To read the full opinion, click here.

Hall v. Springville City

The Utah Court of Appeals recently issued its opinion in the case of Hall v. Springville City. This case focuses on Springville City's ownership claims to water rights that were included in the Proposed Determination for the Hobble Creek area. 

The case concerns water rights that were originally associated with the Anderson Ranch and Clark Ranch in Hobble Creek Canyon. The ranches were homesteaded in the late 1800s, and water rights were established by diligence (i.e., by diversion and use of surface water prior to 1903). In 1928, the Springville Irrigation Company was formed, and the Andersons and Clarks conveyed irrigation water rights to the Company in exchange for water shares. In the 1940s, the City determined to buy water rights in Hobble Creek Canyon in order to expand its water system to serve its growing population. The City acquired the Anderson Ranch and the Clark Ranch, along with all water rights and all Company water shares associated with the ranches. A few years later, the City sold the ranches to Ralph Phillips. The land deed noted that "All water and water rights heretofore used on the aforesaid granted premises have been separately sold and transferred and this conveyance is made subject to the reservation of all water rights excepting only a flood water right to which the cultivated or improved part of the aforesaid granted premises shall be entitled when and as long as such flood water is available." The City and Mr. Phillips subsequently entered into agreements allowing Mr. Phillips to use the water rights and water shares until the City needed the water for its own purposes.

Decades later, the subsequent owners of the ranches filed Diligence Claims and Water Users Claims asserting year-round rights from springs for irrigation, domestic, and stockwatering purposes. These asserted water rights were included in the Proposed Determination published in 1986. The City filed objections to the Proposed Determination, asserting that the water rights were invalid because (among other things) the City was "the owner of the entire flow of water from the sources given" for the water rights. 

In 2020, the City filed motions for summary judgment on its objection, in which the City sought to have the district court declare the water rights invalid because the landowners' predecessors had deeded all water rights to the City in the 1940s. The landowners opposed the motions and argued, among other things, that the "flood water" language in the 1940s deed gave them a legitimate basis for their water rights. The Special Master ruled in the City's favor, which the district court later confirmed. The landowners appealed the case to the Utah Court of Appeals.

The Court began its opinion by determining that when the City acquired title to the ranches, the City also acquired all water rights and all water shares. The Court then examined the "flood water" language from the 1940s deed and determined that the language did not convey any water rights from the City to Mr. Phillips but, instead, granted Mr. Phillips the ability to take advantage of any natural flooding that occurred; i.e., any water that naturally escaped the stream channel during periods of high flow. The Court further noted that even if the interpretation of "flood water" was ambiguous, the extrinsic evidence supported the City's assertion that it did not convey any water rights to Mr. Phillips. Additionally, the Court noted that the Utah Constitution prohibits municipalities from selling or conveying away its water rights, which further confirms that the City did not convey any water rights to Mr. Phillips. Finally, the Court disagreed with the landowners' assertion that the City and Mr. Phillips entered into an exchange of water rights.

The Court also examined the landowners' claim that they had been denied due process rights because they had not been given "adequate notice" of the City's claims of ownership of the water rights. The Court determined that the City's objection was satisfactory under the relevant statutes at the time and that the landowners were given sufficient opportunity to engage in discovery and litigate the relevant issues in the adjudication. 

Based on these determinations, the Court of Appeals affirmed the district court's decision that the water rights were invalid.

(The attorneys at Smith Hartvigsen were proud to represent Springville City in this case.)

To read the full opinion, click here.

Zundel v. Ramsdell

The Utah Court of Appeals recently issued its decision in the case of Zundel v. Ramsdell. The case focused on the issue of whether water shares were included in a land transaction based on appurtenance and the wording of the deed.

Robert Brough (through his Trust) owned 17 acres of farmland in Box Elder County, which was irrigated with 15.87 shares of stock in Bear River Canal Company. In 2007, the Trust conveyed the property to Brough Properties LLC, and the deed stated that the conveyance included "all water rights appurtenant thereto, if any." The Trust did not, however, transfer any water shares to Brough Properties. In 2011, Brough Properties sold the land to the Zundels. Nothing was said about water, but the Zundels expected to receive some water shares. However, no shares were ever transferred to the Zundels. Instead, the Trust transferred the water shares to Robert's daughters, with instructions that they not transfer any shares to the Zundels. In 2019, the Zundels filed suit against the daughters, seeking to quiet title to the water shares.

The Zundels' primary argument asserted that the water shares were appurtenant (or attached) to the land, and therefore the shares passed with the land when the land was conveyed from the Trust to Brough Properties, and then from Brough Properties to the Zundels. The case ultimately went to trial, and the jury determined that the water shares were appurtenant to the land, but that the Trust did not intend to transfer the water shares to Brough Properties. The Zundels attempted to challenge the jury's determinations, but the district court ultimately ruled that the daughters (and not the Zundels) were the legal owners of the shares. The Zundels then appealed.

The law in existence at the time of the 2007 conveyance was that water shares did not automatically pass with land, but that presumption could be rebutted by clear and convincing evidence (1) that the water shares were appurtenant to the land and (2) that the grantor intended to transfer the water shares to the grantee. The court determined that the deed from the Trust to Brough Properties, which included "all water rights," was ambiguous about whether the Trust intended to transfer the water shares -- particularly because the court noted that there is a difference between water rights and water shares. The court also noted that there was sufficient evidence that the Trust did not intend to transfer the water shares to Brough Properties, including evidence that Robert had transferred water shares separate from land in the past and also transferred land without water shares. Based on these determinations, the court held that the daughters (and not the Zundels) were the legal owners of the water shares.

It should be noted that this decision has limited applicability because in 2013, the Utah legislature modified the law to make it more clear that water shares are not appurtenant to land.

To read the full text of the opinion, click here.

Washington County Water Conservancy District v. Washington Townhomes LLC

The Utah Court of Appeals recently issued its decision in the case of Washington County Water Conservancy District v. Washington Townhomes LLC. The central issue in this case was whether a special master should have been appointed to resolve the issues regarding impact fees for water facilities.

This case has been ongoing for a number of years. The controversy started in 2006 when Washington County Water Conservancy District adopted impact fees based on its capital facilities plan. The District collected these fees for several years, until a group of property owners and developers sued the District, alleging that the impact fees did not comply with Utah's Impact Fee Act. The landowners sought a refund of millions of dollars. At one point, the case was appealed to the Utah Supreme Court, who sent the case back to the district court in 2016. Click here to read about the 2016 decision.

Following several more years of litigation, the property owners sought to have a special master appointed to preside over the litigation on the basis that the case involved "esoteric issues" and required the "application of a specialized area of law." The District opposed the motion and argued that there was no need or basis for the appointment of a special master. Ultimately, the district court granted the motion and appointed a retired district court judge as the special master. The District appealed the decision to the Utah Court of Appeals.

The Court of Appeals' decision focused on Rule 53(b) of the Utah Rules of Civil Procedure, which governs the appointment of special masters. The rule states that a case should be referred to a special master "only upon a showing that some exceptional condition requires it." The Court noted that there is "scarce Utah caselaw interpreting what constitutes an 'exceptional condition.'" The Court looked at the reasons cited by the district court for appointing a special master, including (1) that the district court judge was going to be retiring soon, (2) that the case had been ongoing for many years, (3) that the case included several procedural and substantive complexities, and (4) the congested court calendar that made it nearly impossible for the case to be tried before the judge's retirement. The Court of Appeals concluded that a number of these reasons (retirement of a judge, long-standing cases, and congested court calendars) are normal conditions and not "exceptional conditions" in litigation. The Court also concluded that this impact fee case was not any more factually or legally complex than many of the civil cases found throughout the state. 

In sum, the Court of Appeals concluded that there was an insufficient basis for the district court to appoint a special master. Accordingly, the district court's appointment of a special master was reversed, and the case was returned to the district court for further proceedings.

Metropolitan Water District v. Sorf

The Utah Court of Appeals recently issued its decision in the case of Metropolitan Water District of Salt Lake & Sandy v. Sorf. The primary issue in the case was enforcement of an easement for a water pipeline. This case has been ongoing for many years. (Click here to read about a 2019 decision by the Utah Supreme Court in the same case.)

The District operates the Salt Lake Aqueduct, which is a large pipeline that runs for 42 miles through Utah County and Salt Lake County -- including through the backyard of Zdenek Sorf. The District owns a 125-foot easement for the pipeline, which the District acquired by warranty deed in 1946 from Sorf's predecessor-in-interest. In 2009, Sorf installed some improvements in his backyard, including sheds, a hot tub, decks, rock walls, and a pond, and some of these improvements are within the District's easement. In 2010, the District filed suit against Sorf and sought to have the district court require Sorf to remove the improvements from the easement area. Following a trial, a jury determined that Sorf's improvements did not unreasonably interfere with the District's use and enjoyment of the easement. The district court accordingly granted judgment in favor of Sorf, and the District appealed to the Utah Court of Appeals.

The District argued that district court should have instructed the jury that the placement of any permanent structure within the easement area was unreasonable as a matter of law. Some courts in other states have made this determination with respect to easements for ingress and egress, but not with respect to easements for underground pipelines. The Court of Appeals refused to adopt such a bright-line rule, and instead reiterated the "rule of mutual reasonableness, which is that "the owners of the dominant and servient estates must exercise their rights so as not unreasonably to interfere with the other."

The District also argued that the district court should have asked the jury about the cumulative effect of the improvements on the easement, instead of asking the jury to determine if each individual improvement unreasonably interfered with the District's easement rights. The Court of Appeals determined that if the district court had included a cumulative effect question to the jury, it would have made it more difficult to fashion a remedy; in other words, how would the court know which improvements would need to be removed in order to resolve the issue.

The District also argued that the district court should have limited the testimony of an engineer who testified on behalf of Sorf. In particular, the District argued that the engineer should not have been allowed to testify about possible alternative methodologies that the District could use to rehabilitate and repair the pipeline. The Court of Appeals rejected this argument, and reiterated that the "rule of mutual reasonableness" made it highly relevant how the District might make use of the easement area to operate, maintain, repair, and replace the pipeline.

In the end, the Court of Appeals ruled for Sorf and upheld the decision made by the district court (and the jury).

To read the full opinion, click here.

Park City Premier Properties v. Silver Summit Estate

The Utah Court of Appeals recently issued its decision in Park City Premier Properties LLC v. Silver Summit Estates. The central issue in this case was whether a developer was required to install a secondary water system for a residential subdivision.

In 2013, Park City Premier Properties ("Premier") acquired property in Weber County, along with 94 shares in Co-op Farm Irrigation Company. The irrigation company water had historically been used for agricultural irrigation on the property. Premier then filed a subdivision application with Weber County, which noted the irrigation company shares. Ultimately, Premier determined that each subdivision lot would have its own well that would provide water to be used for culinary purposes in the home as well as for irrigation of a small lawn/garden around the home. Water use from each well was authorized through (1) a water contract with Weber Basin Water Conservancy District ("Weber Basin") for one acre-foot of water and (2) an exchange application approved by the Utah Division of Water Rights. Some lot owners also acquired  irrigation company shares, if they requested such shares under their Real Estate Purchase Contract. 

Several years later, several lot owners became dissatisfied with the limited amount of irrigation water that they had. For example, a 3-acre lot might have enough well water to irrigate only 0.18 acres of the land. These lot owners sued Premier and asserted that Premier was obligated by Weber County ordinance to install a secondary water system and provide more irrigation water to the subdivision lots. The district court ultimately ruled in favor of the lot owners, and Premier appealed the decision to the Utah Court of Appeals.

The Court focused its decision on the plain language of the relevant Weber County ordinance, which provided as follows: "Where a subdivision is proposed within an existing culinary water district[,]...the planning commission shall, as part of the approval of the subdivision, require the applicant to furnish adequate secondary water and install a secondary water delivery system to the lots in the subdivision sufficient to conform to the public works standards, if such water district or company files or has filed a written statement with the Weber County Planning Division which specifies that the policy of such water district or company is to the effect that its water is not to be used for other than culinary purposes and will not permit culinary water connections unless secondary water is provided by the applicant."

The Court determined that the ordinance was unambiguous in its application to the Premier subdivision. The Court noted that Weber Basin had not adopted a policy that its water could not be used for irrigation purposes. To the contrary, Weber Basin's water contracts, as well as the exchange applications based on the water contracts, specifically allowed for the water to be used for both culinary and irrigation purposes. The lot owners argued that the limited amount of irrigation allowed for each lot was a "de facto policy" that met the requirements of the ordinance. The Court, however, held that the ordinance explicitly required a written policy adopted by the water district, and not an inferred policy. In the end, the Court held that "[b]y it's plain language, the Weber County Code does not require Premier to provide secondary water" to the subdivision lots, thereby reversing the decision of the district court.

To read the full opinion, click here.

Utah Stream Access Coalition v. VR Acquisitions LLC

The Utah Supreme Court recently issued its decision in Utah Stream Access Coalition v. VR Acquisitions LLC. This case focused on one question: “whether there was a 19th-century basis for an easement providing the public with the right to touch privately owned streambeds underlying state waters.”

In the 2008 decision in Conatser v. Johnson, the Utah Supreme Court established a broad public easement to utilize the beds of Utah's waterways for recreational purposes. In response to this decision, the Utah legislature adopted the Public Water Access Act in 2010. The Act placed restrictions on the broad easement recognized under Conatser. Specifically, the Act restricted recreational access to water on public property and to waterways that are navigable.

In 2010, Utah Stream Access Coalition (USAC) filed a lawsuit challenging the constitutionality of the Act under several different arguments. The district court originally ruled against USAC on the majority of its claims, but did rule that the Act violated the public trust doctrine found in Article XX, Section 1 of the Utah Constitution. That decision was previously appealed to the Utah Supreme Court, who reversed the district court’s decision and sent the case back to the district court to determine if the Conatser easement was “in line with the sort of public access right that our law would have dictated at the time of the framing of the Utah Constitution.”

After hearing additional evidence and argument from the parties, the district court determined that USAC was unable to show that there was a “historical basis as a public easement at the time of the framing of the Utah Constitution” and therefore held that the Act was not unconstitutional. USAC then appealed to the Utah Supreme Court for a second time.

The Court first looked at the modern caselaw that USAC cited in support of the public easement. The Court determined that these cases were the product of common-law developments in the 20th and 21st centuries, and were therefore inapplicable to the status of the law in 1896 when the Utah Constitution was adopted. The Court then examined the customs and practices of early Utahns that USAC asserted in support of an “easement by custom.” The Court concluded that USAC did not carry its burden in establishing a legal basis for a Conatser easement based on the 19th century customs and practices of Utahns. Finally, the Court examined USAC’s argument that 19th century federal laws suggested the existence of a Conatser easement. The Court determined that the federal laws were irrelevant because they related to the appropriative use of water, and not the public’s use of easements for accessing the bed of waterways.

In sum, the Utah Supreme Court upheld the district court’s determination that there is not a historical basis for the type of public easement established by the Conatser case. This therefore means that the Public Water Access Act is constitutional in its current form.

To read the full opinion, click here.

 

Feldman v. Salt Lake City Corporation

The Utah Supreme Court recently issued its decision in the case of Feldman v. Salt Lake City Corporation. The case focused on a wrongful death claim for a drowning in a City park.

In April 2017, Leonid and Liudmila Feldman went walking with their dogs in Parley's Historic Nature Park, which is owned by Salt Lake City. The dogs went into the creek at the East Creek Access. Mr. Feldman entered the creek to retrieve the dogs, but was swept downstream by the strong current. Ms. Feldman then entered the creek to retrieve the dogs, but was caught in the current and drowned. 

Mr. Feldmans sued the City for wrongful death. The City moved to dismiss the case under Utah's Limitations on Landowner Liability Act, which provides that a person cannot make a claim against an owner of land that has been opened to the general public without charge for injuries caused by the inherent risks of participating in a recreational activity on the land. The district court agreed with the City and dismissed the lawsuit. Mr. Feldman appealed.

The Utah Supreme Court first determined that the Act applied to wrongful death actions. The Court then determined that the Act did not violate the Wrongful Death Clause of the Utah Constitution. The Court then had to answer the question of whether Ms. Feldman's drowning in the creek was an "inherent risk" of walking in the park with her dogs. The Act defined inherent risks as "those dangers, conditions, and potentials for personal injury or property damage that are an integral and natural part of participating in an activity for a recreational purpose." The Court determined that it was unable to determine if drowning in the creek was an "integral and natural part" of entering the creek because Mr. Feldman had alleged that the dangerous current in the creek was caused by manmade developments in the creek. The Court therefore reversed the dismissal of Mr. Feldman's lawsuit and remanded the case back to the district court for additional proceedings.

To read the full opinion, click here.

 

Arave v. Pineview West Water Company

The Utah Supreme Court recently issued its decision in the case of Arave v. Pineview West Water Company. This case focused on issues of interference with well water rights.

The Araves and other plaintiffs had water rights that allowed them to divert water from two wells for their two homes and a bed and breakfast. Most of these water rights were established in the 1960s and 1970s. Pineview West Water Company ("PWCC") had a larger, junior water right that is allowed to be diverted from deeper and stronger wells to supply water to 70 homes and irrigate 20 acres. One of PWCC's wells is located only a few hundred feet from the plaintiffs' wells. When the PWCC well was first test pumped in 2004, it affected one of the plaintiffs' wells almost immediately. Within hours, the well was unable to pump any water and was sucking air, which resulted in silt damage to the two homes. A subsequent test yielded the same results. The plaintiffs' other well also experienced issues, albeit to a lesser degree. To resolve the issue, PWCC connected the plaintiffs to its water system and provided them with water for a flat rate of $20 per month. Several years later, however, PWCC sought to increase the fees to match the fees paid by other PWCC customers. When negotiations broke down, the plaintiffs brought this lawsuit claiming interference with water rights, negligence, and nuisance.

Following a four-day trial, the district court ruled in favor of the plaintiffs on their interference and negligence claims. The court concluded that when PWCC's well was operating, it deprived the plaintiffs' first well of "virtually all water" and obstructed the second well's ability to produce water. The court also concluded that PWCC had been negligent in locating, drilling, and using its well in such close proximity to the plaintiffs' wells. The court ordered PWCC to stop pumping its well unless it could demonstrate that it could do so without interfering with the plaintiffs' two wells or, in the alternative, to provide replacement water to the plaintiffs at no cost to the plaintiffs. The court also awarded PWCC to pay approximately $50,000 in compensatory damages to the plaintiffs. PWCC appealed the decision to the Utah Supreme Court.

The Court began by laying out the elements of an interference claim. To prevail on an interference claim, a plaintiff must establish that
(1) they have an enforceable water right;
(2) their water right is senior to the defendant's water rights;
(3) their methods and means of diversion are reasonable;
(4) despite their reasonable efforts, they are unable to obtain the quantity or quality of water to which they are entitled; and
(5) the defendant's conduct obstructed or hindered their ability to obtain that water.

The Court determined that the district court had made insufficient findings regarding the third and fourth elements. With respect to the third element, the district court had not made findings about whether the plaintiffs could have lowered their pumps or modified their wells to reach the available water. With respect to the fourth element, the plaintiffs had not offered evidence about how much water they used or how much of their allowed water they were not able to obtain (due in part to the fact that the plaintiffs did not have a meter on their wells). 

Thus, the Court reversed the district court's ruling that PWCC's well had interfered with the plaintiffs' two wells. Because the district court's negligence determination was related to its interference determination, the Court remanded the negligence claim back to the district court for further factfinding and analysis. The Court also vacated a portion of the compensatory damage award and remanded to the district court to revisit the calculation of compensatory damages based on the reversal of the interference determination.

To read the full opinion, click here.

Rocky Ford Irr. Co. v Kents Lake Reservoir Co. (amended)

In July 2019, the Utah Supreme Court issued a decision in the case of Rocky Ford Irrigation Company v. Kents Lake Reservoir Company. Following that decision, both parties filed Petitions for Rehearing, which the Court granted. After additional briefing from the parties (and the Utah State Engineer) and additional oral arguments, the Court withdrew its prior decision and issued a new decision. This case focuses on the issues of water efficiency savings, impairment of others' water rights, and obligations to measure water diversions.

Rocky Ford and Kents Lake are two irrigation companies on the Beaver River system. Both irrigation companies have various direct flow water rights and storage water rights with varying priority dates. In 1931, the Fifth District Court issued the Beaver River Decree, which divided the Beaver River system into an upper portion and a lower portion. Upper water users were allowed to divert water prior to lower water users, despite later priority dates, in part because the lower water users benefitted from return flows from the upper water users' flood irrigation. The Decree also required that all points of diversion be equipped with measuring devices.

In the 1930s and 1940s, Kents Lake filed two applications (a change application and an application to appropriate) with the State Engineer to construct Three Miles Reservoir in the upper portion of the Beaver River system. Rocky Ford protested the applications, but the State Engineer ultimately approved the applications. In 1953, Rocky Ford and Kents Lake entered into an agreement in which Rocky Ford agreed not to protest future change applications associated with Three Mile Reservoir, and Kents Lake agreed not to oppose Rocky Ford's expansion of its reservoir located in the lower portion of the Beaver River system. Kents Lake later filed a change application, and Rocky Ford did not protest it. Kents Lake later certificated this change application with the State Engineer.

Beginning in the 1970s, Beaver River water users began converting from flood irrigation to sprinkler irrigation. Rocky Ford alleged that it was being harmed due to the reduced return flows from upper water users and due to Kents Lake storing the "saved" water from the efficiency gains in its reservoir. In 2010, Rocky Ford filed a lawsuit against Kents Lake seeking damages, declaratory relief, injunctive relief, and rescission of the 1953 Agreement, based on allegations of water right interference, conversion of water rights, and negligence. Rocky Ford asserted that its water rights had been injured by the actions of Kents Lake, including the storage change application and the failure to measure water diversions. In one decision, the district court concluded that Rocky Ford had effectively waived some of its claims based on prior rights due to the 1953 Agreement. Following this decision, Rocky Ford stipulated to dismiss its damage claims. The remaining claims went forward to trial, and the district court ruled in favor of Kents Lake. The district court also awarded attorney fees to Kents Lake. Rocky Ford then appealed the case to the Utah Supreme Court. The Utah Supreme Court focused its decision on answering five questions, which are discussed below.

1. Did the district court err in denying Rocky Ford's motion for summary judgment?

The Court determined that there was a legitimate dispute about which of Rocky Ford's water rights were subject to the 1953 Agreement, and that the district court therefore erred in granting summary judgment on its interpretation of the 1953 Agreement.

The Court confirmed the principle that a "change maintains its original priority only so long as it does not harm preexisting rights." Thus, the Court determined that Kents Lake's changed storage rights maintained their original priority date of 1890 only if Kents Lake's changed water storage did not injure Rocky Ford's preexisting water rights.

The Court then explored the issue of impairment vs. interference. This was a central issue of dispute in the case. Rocky Ford asserted that impairment and interference meant the same thing, whereas Kents Lake asserted that the two terms have different meanings and contexts. The Court agreed with Kents Lake, and clarified the distinction between the two terms (while also noting that some of the Court's prior decisions were causes for the confusion due to the Court using the two terms interchangeably). The Court clarified that impairment claims are statutory claims made with the State Engineer during the application approval process. If a water user thinks their prior rights will be injured by a new application, the water user asserts impairment by filing a protest in the application proceedings (and, if necessary, by seeking judicial review of the State Engineer's decision). The standard of review is that the State Engineer should approve the application if there is "reason to believe" that the application will not impair existing water rights. Interference claims, on the other hand, are common law claims that are brought after an application has been approved and actual injury has been inflicted on prior rights. When interference claims are brought to a court, the opponent of the change must show, by a preponderance of the evidence, that the change has interfered with its water rights. The Court also clarified that a water user may bring an interference claim even if they did not file a protest and assert impairment during the application process. The Court concluded that Rocky Ford had waived its impairment claim when it failed to protest Kents Lake's change application, and that Rocky Ford had waived its interference claim when it dismissed its damage claim prior to trial.

2. Did the district court err in refusing to declare that Kents Lake could not store its efficiency gains?

The district court had concluded that Rocky Ford had failed to establish that any injury to its water rights was caused by Kents Lake's storage changes, rather than by intervening causes -- such as the impact of groundwater pumping or the conversion to sprinkler irrigation by water users other than Kents Lake. Based on the record of the district court, the Court affirmed the district court's decision.

3. Did the district court err in refusing to declare that Kents Lake must measure its water usage?

The Court next examined Kents Lake's obligations to measure its water diversions. Kents Lake asserted--and the district court had agreed--that even though Kents Lake did not measure all of its diversions, it was compliant because it did all measuring required by the State Engineer. But the Court noted that both Utah law (Utah Code section 73-5-4) and the Beaver River Decree require Kents Lake to measure all of its diversions. Thus, the Court reversed the district court on this point.

4. Did the district court err in refusing to rescind the 1953 Agreement?

Rocky Ford had asserted that the 1953 Agreement should be rescinded because Kents Lake had breached material provisions of the agreement. The Court determined that the alleged breaches were not material terms to the agreement, and therefore concluded that the district court had correctly refused to rescind the 1953 Agreement.

5. Did the district court err in awarding attorney fees to Kents Lake?

The Court finished its opinion by determining that the district court had not provided sufficient detail to support its conclusion to award attorney fees against Rocky Ford based on bad faith. Accordingly, the Court reversed this determination.


To read the full opinion, click here.

Black Diamond Financial LLC v. Big Cottonwood Pine Tree Water Co.

The Utah Court of Appeals recently issued its decision in the case of Black Diamond Financial LLC v. Big Cottonwood Pine Tree Water Company. The case focused on a water company's liability for a share transfer that was in violation of its Bylaws.

Big Cottonwood Pine Tree Water Company serves water to a cabin subdivision in Big Cottonwood Canyon in Salt Lake County. The Company's Bylaws provide that each lot owner was a member of the Company and was entitled to one Company water share that was only transferable with the lot. The Bylaws provided that the shares could not be transferred to other lots and could not be transferred separate from the lot. But as a matter of practice, the Company did not ensure that share transfers were performed according to these Bylaws.

Steven Rollins owned Lot 25 in the subdivision and owned one share that was associated with his lot. He was in a relationship with Vicki Kincaid, who loaned him money to remodel the property. When Rollins was unable to repay Kincaid, he agreed to transfer his water share to Kincaid as repayment. Both parties were unaware that the Bylaws prohibited the share transfer separate from the lot. Kincaid took the endorsed share to the Company, who issued a new share certificate to Kincaid. Later, Rollins' lender foreclosed on the lot. The lender found out that the lot had no water service because Kincaid owned the water share. Black Diamond Financial LLC purchased the lot from the lender at a discounted price due to the lack of water service. Black Diamond thought it would be able to resolve the water service issue, but was unable to reach an agreeable price to purchase the share from Kincaid or find water service in some other way. Black Diamond then filed suit against Kincaid and the Company.

Kincaid moved for summary judgment and asserted that she was a protected purchaser of the share under the Utah Uniform Commercial Code. Black Diamond and the Company also filed motions for summary judgment on breach of contract issues. The district court concluded that Kincaid was a protected purchaser, and was therefore entitled to retain the share. The district court also concluded that the Company was in breach due to its failure to follow the share transfer provision in its Bylaws. (Utah courts have long held that the Articles and Bylaws of a water company form a contract or agreement between the company and its shareholders.) But the district court determined that Black Diamond was not damaged by the breach because Black Diamond purchased the lot at a discounted price because of the water share issue. The district court required the Company to pay $1.00 in nominal damages to Black Diamond. Black Diamond then appealed to the Utah Court of Appeals.

The Court of Appeals first analyzed if Kincaid was a protected purchaser of the water share under the UCC. The Court reviewed the elements of a protected purchaser in Utah Code section 70A-8-3, and concluded that Kincaid met all of these elements. The Court therefore upheld the determination that Kincaid was entitled to retain ownership of the share.

The Court next examined Black Diamond's assertion that it was entitled to more than just nominal damages. The Court determined that even though the Company had breached its obligations under the Bylaws, Black Diamond was not injured by the breach because Black Diamond had purchased the lot at a discounted price due to the fact (and with full knowledge) that the lot lacked water service due to Kincaid's ownership of the water share. The Court noted that Black Diamond would receive a windfall if it was able to purchase the property at a discount and get damages based on property devaluation due to the lack of a water share. Based on these determinations, the Court of Appeals upheld the district court's decision.

It is important to note that the Court clarified that the result could have been very different if Black Diamond had acquired the lot without knowledge of the share issue. In such a circumstance, the Company would have been required to pay damages to Black Diamond due to the Company's failure to follow the share transfer provisions contained in its Bylaws. Water companies should, therefore, take heed to follow the share transfer provisions in its Articles and Bylaws (or, alternatively, amend its Articles and Bylaws to conform the share transfer provisions to match the Company's actual share transfer practices). Failure to do so could result in significant liability and monetary damage claims for the Company.

To read the full text of the opinion, click here.

Salt Lake City v. Haik

The Utah Supreme Court recently issued its decision in the case of Salt Lake City v. Haik. This case is another chapter in a long-running dispute regarding access to water service in Albion Basin in Little Cottonwood Canyon.

For years, Mark Haik and the Pearl Raty Trust, and others have sought to get water service from Salt Lake City so they can develop their lots in the Albion Basin. In 2014, Salt Lake City brought a water right quiet title action against Mr. Haik, the Raty Trust, who responded with various counterclaims. One counterclaim asserted that Salt Lake City was required to provide water service to the lots under Article XI, Section 6 of the Utah Constitution. Mr. Haik's counterclaim was dismissed based on res judicata because he had already litigated (and lost) the same claim in federal court, but the Raty Trust was allowed to pursue her counterclaim. The Raty Trust asserted that although the Albion Basin is not within Salt Lake City's municipal boundaries, it is within the City's approved water service area, and that the City was, therefore, obligated to serve water to the Trust's lot. The district court disagreed and dismissed the counterclaim. The case was appealed to the Utah Court of Appeals, who affirmed the district court. The Trust then appealed to the Utah Supreme Court.

The Utah Supreme Court began its analysis by reviewing the language of Article XI, Section 6, which provides that all of the "waterworks, water rights and sources of water supply now owned or hereafter to be acquired by any municipal corporation, shall be preserved, maintained and operated by it for supplying its inhabitants with water at reasonable charges." The Trust asserted that because its property was within the City's water service area, the Trust was an "inhabitant" of the City and that the City was, therefore, constitutionally required to provide water service to the Trust's property. The Court disagreed, and determined that the Trust did not meet the plain-language definition of an "inhabitant" of Salt Lake City. Further, the Court held that it was not persuaded that those who ratified the Utah Constitution understood the word "inhabitant" to encompass any person who owned property within a city's approved water service area. The Court therefore affirmed the dismissal of the Trust's counterclaim.

To read the full opinion, click here.

Allen Family Trust v. Holt

The Utah Court of Appeals recently issued its opinion in the case of Allen Family Trust v. Holt. This case focuses on an easement for a water pipeline, as well as forfeiture of water rights.

In the late 1800s, Ammon Allen settled in the Ogden Valley and constructed ditches to carry water from a creek and springs to his property. He later deeded the property to his son, Abner Allen. In the 1948 Ogden River Decree, Abner was awarded water rights in the Creek and springs. A ditch carried the water from the sources, across State-owned land, and to Abner's property. In the 1960s, Abner's sons formed a ranching company, which acquired the land and water rights. The ranching company also entered into a lease with the State for the abutting property that the ditch crossed. In the 1970s, the sons dissolved the ranching company. The deeds led to confusion, but it was ultimately determined that one son acquired 70% of the water rights (which was later conveyed to his son, David Allen) and another son acquired 30% of the water rights (which was later conveyed to his children Jarl, Jenna, and Lesly). A few years later, David constructed a system of pipes to convey his water from the sources to the property. The pipe system generally followed the location of the original ditch system.

In the 1990s, the State sold its property to a third party, who later sold the land to Millennia Partners North LLC ("MPN) in 2008. Shortly thereafter, disputes arose between David and MPN regarding David's access to MPN's property to maintain the pipe system. MPN sent threatening letters to David, erected fences around the property, and even dug up and cut the pipes. This led to a first lawsuit, which was resolved in David's favor. In 2011, Jarl, Jenna, and Lesly conveyed their land and 30% interest in the water rights to MPN.

In 2012, David initiated a second lawsuit, asserting (1) that David had an easement across MPN's property to convey water through the pipe system; (2) that MPN had unlawfully interfered with David's water rights; and (3) that MPN had forfeited its water rights due to nonuse. Following a trial, the district court concluded that David did have an easement across MPN's property and that MPN had unlawfully interfered with the easement. But the district court also ruled that MPN had not forfeited its water rights because nonuse had not been proven by clear and convincing evidence. The district court ordered MPN to pay David's attorney fees. MPN appealed the ruling, and David cross-appealed.

The Court of Appeals first examined if David did have an easement for the pipe system. The district court had determined that an easement existed under the 1866 Mining Act, which required a finding that Ammon Allen had constructed the ditch system before 1896, which is the year that Utah became a state. The Court of Appeals determined that sufficient evidence had been presented to the district court to support the conclusion that the ditch system had been constructed prior to 1896. Thus, the Court of Appeals upheld the determination that David had an easement.

The Court of Appeals also upheld the determination that MPN had interfered with the easement. As noted by the Court, "it is hard to imagine a more clear-cut case of interference with a water right than a party threatening to shut off access to the water, fencing off the right of way, and sawing through a pipe conveying the water to its rightful recipients."

The Court of Appeals then examined whether MPN had forfeited its water rights due to nonuse. The Court began its analysis by noting that it is unsettled law in Utah whether the "clear and convincing" or the "preponderance" standard of proof apply in a water forfeiture action. The Court, unfortunately, did not answer this question, as it determined that the evidence in this case was sufficient to meet both burdens of proof. The Court noted that there was plenty of evidence that MPN's water rights had not been placed to beneficial use between 1994 and 2011. MPN did not dispute this evidence, but rather asserted that David had used MPN's water rights pursuant to a 1977 agreement between Abner Allen's two sons. The Court rejected this argument on several grounds, including the fact that the district court had never determined that such an agreement existed. Thus, the Court reversed the district court and ruled that MPN's water rights have been forfeited due to nonuse.

Finally, the Court of Appeals upheld the district court's order that MPN pay attorney fees. The Court of Appeals also awarded MPN to pay attorney fees for the appeal.

To read the full opinion, click here.

Metropolitan Water District of Salt Lake & Sandy v. SHCH Alaska Trust

The Utah Supreme Court recently issued a decision in the case of Metropolitan Water District of Salt Lake & Sandy v. SHCH Alaska Trust. The case focused on the scope and size of an easement for a water pipeline, as well as a district's authority to regulate land use within the easement area.

The District owns an easement for a water pipeline across the Trust's property in Wasatch County. The Trust determined to build a commercial zipline course on its property, and received a conditional use permit from Wasatch County. The District purported to enact regulations restricting land use within the easement area on the Trust's property. Pursuant to these regulations, the District asserted that the Trust was required to obtain a license from the District before constructing the zipline course. The Trust moved ahead with the zipline course without obtaining the permit. The District then sued the Trust in district court and requested that the court order the Trust to comply with the District's regulations. The Trust counterclaimed and asked the court to determine the relative property interests of the parties, including the scope and size of the easement.

The district court ruled that Utah law granted regulatory authority to the District. Accordingly, the district court granted summary judgment to the District. The district court also determined that the easement was 200 feet in width. The Trust then appealed the decision to the Utah Supreme Court.

The Supreme Court first examined the District's assertion that it had regulatory authority. The District cited several provisions of the Utah Limited Purpose Local Districts Act to support its asserted authority. The Supreme Court reviewed each of these provisions and determined that none of them granted the District the authority to enact land use regulations that affect the property of others. The Supreme Court also noted that statutes governing land use regulations by cities and counties carefully define and limit the regulatory authority, and that it would be unreasonable to allow districts to exercise similar authority without the same limitations and public participation requirements.

The Supreme Court held that the District's rights with respect to the easement were no different than the rights that any other easement holder has. These rights include the right to prevent the landowner from unreasonably interfering with the easement. The case was remanded to the district court to gather the facts and determine if the Trust's zipline course unreasonably interfered with the District's pipeline easement.

The Supreme Court also reviewed the district court's determination that the pipeline easement was 200 feet in width. The original documents establishing the easement did not define the size or scope of the easement; rather, the documents created and undefined "floating easement." In 1961, an engineer for the US Bureau of Reclamation drafted a written description of the easement, which defined it as a 200-foot easement. The district court had determined that this description was determinative. The Supreme Court determined that the written description could be considered, but was not dispositive. The case was remanded to the district court to gather the facts and determine the extent and width of the easement.

To read the full opinion, click here.

Rocky Ford Irrigation Company v. Kents Lake Reservoir Company

**NOTE - This decision was withdrawn by the Utah Supreme Court and replaced with an amended decision.

The Utah Supreme Court recently issued its decision in the case of Rocky Ford Irrigation Company v. Kents Lake Reservoir Company. The case focuses on the issues of water efficiency savings, impairment of others' water rights, and obligations to measure water diversions.

Rocky Ford and Kents Lake are two irrigation companies on the Beaver River system. Both irrigation companies have various direct flow water rights and storage water rights with varying priority dates. In 1931, the Fifth District Court issued the Beaver River Decree, which divided the Beaver River system into an upper portion and a lower portion. Upper water users were allowed to divert water prior to lower water users, despite a later priority date, in part because the lower water users benefitted from return flows from the upper water users' flood irrigation. The Decree also required that all points of diversion be equipped with measuring devices.

In the 1930s and 1940s, Kents Lake filed applications with the State Engineer to construct Three Miles Reservoir in the upper portion of the Beaver River system. Rocky Ford protested the applications, but the State Engineer ultimately approved the applications. In 1953, Rocky Ford and Kents Lake entered into an agreement in which Rocky Ford agreed not to protest future change applications associated with Three Mile Reservoir, and Kents Lake agreed not to oppose Rocky Ford's expansion of its reservoir located in the lower portion of the Beaver River system. Kents Lake later filed a change application, and Rocky Ford did not protest it. Kents Lake later certificated this change application with the State Engineer.

Beginning in the 1970s, Beaver River water users began converting from flood irrigation to sprinkler irrigation. Rocky Ford alleged that it was being harmed due to the reduced return flows from upper water users and due to Kents Lake storing the "saved" water from the efficiency gains in its reservoir. In 2010, Rocky Ford filed a lawsuit against Kents Lake alleging water right interference, conversion of water rights, and negligence. Rocky Ford asserted that its water rights had been impaired by the actions of Kents Lake, including the storage change application and the failure to measure water diversions. Following a trial, the district court ruled in favor of Kents Lake. Rocky Ford then appealed the case to the Utah Supreme Court.

The Court first reviewed Rocky Ford's claims of impairment. The Court determined that even though Kents Lake had filed change applications in the 1950s, the water rights retained their (much earlier) original priority dates. And the Court rejected the "hybrid priority approach" that the priority date of the change applications is relevant to impairment, but the original priority is relevant to distribution. The Court then determined that parties cannot "claim impairment in perpetuity" and that "an impairment claim must be raised during the protest period before the State Engineer." Interestingly, the Court also implied that impairment protests can and should be raised at the proof stage, despite the fact that there is no public notice or protest period when proofs are filed or certificates are issued. Based on these determinations, the Court concluded that Rocky Ford had "failed to participate in any administrative proceedings" and therefore cannot claim impairment now.

The Court next examined whether Kents Lake is allowed to store the water it saves through increased irrigation efficiency. The Court determined that the lower water users "have no claim on runoff before it reenters the stream" and therefore "have no claim against upper water users requiring them to create a return flow." Based on these determinations, the Court concluded that "Rocky Ford has no claim to Kents Lake's efficiency gains."

The Court next examined Kents Lake's obligations to measure its water diversions. Kents Lake asserted--and the district court had agreed--that even though Kents Lake did not measure all of its diversions, it was compliant because it did all measuring required by the State Engineer. But the Court noted that both Utah law (Utah Code section 73-5-4) and the Beaver River Decree require Kents Lake to measure all of its diversions. Thus, the Court reversed the district court on this point.

The Court finished its opinion by determining that the district court had properly concluded that the 1953 Agreement between Rocky Ford and Kents Lake should not be rescinded, and determining that the district court had erred in granting an award of attorney fees to Kents Lake.

Metropolitan Water District v. Sorf

The Utah Supreme Court recently issued its decision in the case of Metropolitan Water District of Salt Lake and Sandy v. Sorf. The primary issue in the case was enforcement of easement rights associated with a water pipeline.

Metropolitan Water District owns and operates the Salt Lake Aqueduct, a large pipeline that transports water from Deer Creek Reservoir to the Salt Lake City area. The District owns some of the land along the course of the Aqueduct and has easements along other parts of the course of the Aqueduct. Zdenek Sorf is the owner of a parcel of land that the Aqueduct crosses, and in 1946, the then-owner of his land deeded a 125-foot wide easement for the Aqueduct. The District passed regulations controlling use of the Aqueduct easements by the landowners, including a prohibition on the construction of structures or the planting of trees within the easement areas.

Mr. Sorf made improvements to his property within the boundaries of the District's easement. These improvements included a hot tub, a gazebo, garden boxes, a water feature, and a shed. The District filed a lawsuit seeking to enjoin Mr. Sorf from making any more improvements within the easement area and to allow the District to remove the existing improvements. Mr. Sorf asserted that the case was not yet "ripe" because the District had no current plans to repair, replace, or reconstruct the Aqueduct across Mr. Sorf's property, and that his improvements were not interfering with the District's current operation of the Aqueduct. The district court agreed and dismissed the District's claims. The District appealed the case to the Utah Supreme Court.

The Court began its decision by noting that a dispute is ripe "when a conflict over the application of a legal provision has sharpened into an actual or imminent clash of legal rights and obligations of the parties thereto." The Court concluded that the easement dispute between the District and Mr. Sorf met this standard because the District had valid, deeded easement interests "to construct, reconstruct, operate and maintain" the Aqueduct. The Court noted that the district court had incorrectly focused on whether Mr. Sorf's improvements were interfering with the Aqueduct, and that the focus should have been on whether Mr. Sorf's improvements were interfering with the easement. Thus, the Court concluded that there was a "live dispute" that was ripe for judicial resolution.

In the end, the Court reversed the district court's dismissal and sent the case back to the district court because "the parties are both entitled to a determination of whether [Mr. Sorf's improvements] are permissible, and if not, a determination of the proper remedy."

To read the full text of the opinion, click here.

Salt Lake City Corp. v. Haik

The Utah Court of Appeal recently issued its decision in the case of Salt Lake City Corporation v. Haik. This case is a continuation of a long-standing water dispute between Salt Lake City and Mark Haik. (To read about prior cases in this dispute, click here, here, and here.)

Mark Haik and Pearl Raty are two of six owners of a portion of a water right from Little Cottonwood Creek that was decreed in the 1910 Morse Decree. In 1934, the then-owners of the water right entered into an agreement with Salt Lake City under which the City was granted use of most of the water right during the non-irrigation season. In 1950, a portion of the water right (represented by Water Right No. 57-7800) was moved from the Creek to a well through a change application that was certificated. In 2000, the then-owner of WR 57-7800 filed a change application to return the water back to the Creek. After this change application was approved, WR 57-7800 was conveyed to the six owners, who each filed a change application to move the water to be used for cabins at Albion Basin in Little Cottonwood Canyon. Two of the change applications were approved, but Haik's and Raty's change applications remained unapproved.

This lawsuit was initiated by the City as a judicial review of the two approved change applications, but the City also brought claims challenging the nature and validity of Haik's and Raty's water rights. Haty brought counterclaims against the City, asserting that the City was obligated to serve water to her property in Little Cottonwood Canyon. During the proceedings, the City acquired the rights associated with the two approved change applications, thereby leaving only the claims and counterclaims involving Haik and Raty. Ultimately, the district court concluded that Haik's and Raty's water rights had been forfeited due to nonuse and that the City did not have obligations to serve water to Ray's parcel. Accordingly, the district court issued a judgment in favor of the City. Haik and Raty appealed to the Utah Court of Appeals and argued that the district court had made several errors.

First, Haik and Raty asserted that the City lacked standing to bring its claims. The Court disagreed and determined that the City met the "traditional test" for standing because both parties had rights to draw water from the same source (Little Cottonwood Creek), and therefore was impacted by Haik and Raty's rights to divert and use water from the Creek.

Second, Haik and Raty asserted that the district court lacked subject matter jurisdiction because the City had not exhausted its administrative remedies. Haik and Raty argued that the City could not bring an action against them until the Division of Water Rights issued decision on their pending change applications. The Court noted that the City was not appealing a decision of the Division relative to the change applications; rather, the City was bringing a claim asserting forfeiture of the underlying water right -- which is a determination that can only be made by a court, and not by the Division. Thus, the Court determined that the district court had subject matter jurisdiction over the case.

Third, Haik and Raty argued that the district court had incorrectly determined that their water rights had been forfeited due to nonuse of more than seven years. Haik and Raty had presented evidence that their water had been diverted and used by successors to the original water right, but the Court held that this evidence was insufficient and did not meet the statutory requirements for beneficial use because Haik and Raty did not have agreements in place for other people to use the water. The City, on the other hand, had presented clear evidence that Haik and Ray had not made any beneficial use of the water since 2003. The Court also determined that the district court had applied the correct legal analysis for total forfeiture and that the City's forfeiture claims were not barred by the applicable statute of limitations. Thus, the Court affirmed the total forfeiture of Haik's and Raty's water rights.

Fourth, Raty asserted that the district court had incorrectly determined that the City did not have an obligation to serve water to Raty's parcel in Little Cottonwood Canyon. Raty asserted that the City had obligations to serve water to her property based on Article XI, Section 6 of the Utah Constitution, which provides that municipalities must preserve, maintain, and operate its water resources to serve its inhabitants. But the Court determined that Raty was not an inhabitant of the City because here property is located outside of the City's municipal boundaries. Raty also asserted that the City had denied her due process. But the Court determined that Raty did not have a protectable property interest, but rather had nothing more than a unilateral expectation of water service. Raty also asserted an equal protection claim under Article I, Section 24 of the Utah Constitution. The Court, however, determined that the City's decision to not serve her property was a proper exercise of its permissive right to serve water to people outside of its boundaries. Finally, Raty asserted that the City should be regulated by the Utah Public Service Commission. The Court disagreed, and noted that the Utah Constitution prohibits the Commission from regulating municipalities.

Based on these determinations, the Utah Court of Appeals affirmed the district court's decision on all points. The result is that Haik's and Raty's water rights are forfeited in their entirety, and the City is not obligated to provide water service to Raty's parcel in the Albion Basin.

To read the full text of the opinion, click here.

EnerVest Ltd v. Utah State Engineer

The Utah Supreme Court recently issued its opinion in the case of EnerVest, Ltd. v. Utah State Engineer. The case focused on the issue of who has standing to appeal a district court's decision on an objection to a proposed determination.

Minnie Maud Creek is a stream in Duchesne County that is tributary to the Green River. The General Adjudication for Minnie Maud Creek was initiated in 1956, and the State Engineer issued a Proposed Determination in 1964. The Minnie Maud Reservoir and Irrigation Company ("MMRIC") was awarded twelve water rights in the Proposed Determination. Four objections were filed, which challenged eight of MMRIC's water rights.

In 2012, EnerVest filed a petition to expedite a hearing on the objections, which were still pending. The district court granted the hearing, but limited the scope to the question of whether MMRIC was correctly listed as the owner of the water rights. Several parties participated in the hearing, including EnerVest and Michael Carlson, who had not filed objections to the Proposed Determination, and the Hammerschmid Trust, who had filed an objection. EnerVest and the Hammerschmid Trust argued that MMRIC did not own the water rights, and Carlson argued that MMRIC did own the water rights. The district court agreed with Carlson, and ruled that MMRIC was correctly listed as the owner of the water rights in the Proposed Determination.

EnerVest and the Hammerschmid Trust appealed the decision to the Utah Supreme Court. During the pendency of the appeal, the Hammerschmid Trust voluntarily dismissed their appeal, leaving EnerVest as the sole appealing party. Carlson then challenged EnerVest's standing to continue the appeal.

The Utah Supreme Court first had to determine if the appeal was proper under Rule 54(b) of the Utah Rules of Appellate Procedure, which allows appeals for individual claims within a larger case. The Supreme Court concluded that the appeal was not proper for under Rule 54(b) because the district court did not offer a rationale for why the immediate appeal was necessary and because the district court's rulings were not final.

The Supreme Court then had to determine if the appeal was proper under Rule 5(a) of the Utah Rules of Appellate Procedure, which allows interlocutory appeals (i.e., appeals before a case is final). As part of this determination, the Supreme Court examined whether EnerVest had standing to pursue the appeal. The key fact in this analysis was that neither EnerVest nor its predecessor-in-interest had filed an objection to the Proposed Determination, and a party who does not timely object to a Proposed Determination acquiesces to the Proposed Determination as published. Because EnerVest had already acquiesced to the Proposed Determination, it lacked standing to appeal the district court's decision upholding the Proposed Determination. Furthermore, EnerVest could not pursue the Hammerschmid Trust's interests in the appeal. As the Supreme Court noted, "a non-objecting party's interests can piggyback on another party's objection, but only as far as the objecting party is willing to travel. Once the objecting party chooses to end its objection's journey, the non-objecting party cannot take over.

Based on these determinations, the Supreme Court dismissed the appeal for lack of appellate jurisdiction.

**On January 11, 2019, the Utah Supreme Court issued an amended opinion in this case. This article has been updated to reflect the amended opinion. To read the full amended opinion, click here.