Adams v. Twin Falls-Oakley Land & Water Co.

• Citation: 29 Idaho 357,161 P. 322
• Parties: ROME ADAMS et al., Plaintiffs, v. TWIN FALLS-OAKLEY LAND & WATER COMPANY, a Corporation, et al., Defendants
• Decision Date: 15 July 1916
• Court: Idaho Supreme Court

161 P. 322

29 Idaho 357

ROME ADAMS et al., Plaintiffs, v. TWIN FALLS-OAKLEY LAND & WATER COMPANY, a Corporation, et al., Defendants

Supreme Court of Idaho

July 15, 1916

CAREY ACT LEGISLATION CONSTRUED-CONSTRUCTION LIENS ON LAND AND WATER RIGHT-DEFAULT BY SETTLER-STATUTORY FORECLOSURE EXCLUSIVE REMEDY-CONTRACT BETWEEN CONSTRUCTION COMPANY AND SETTLER-CONTRACTUAL PROVISION FOR DEPRIVATION OF WATER ON DEFAULT-PUBLIC POLICY.

1. Under Federal and State Carey Act legislation (29 Stats. at Large, 434, and sec. 3288, Rev. Codes), first liens for the cost of construction of irrigation works are authorized to be created on the land and water right in order to insure the construction company a return of the initial cost of construction and a reasonable profit on the investment. Any lien thus created for the original cost of construction together with the interest thereon, is subject to foreclosure and sale under the provisions of sec. 1629, Rev. Codes, and upon default by the settler in the payment of instalments of principal or interest in accordance with his contract with the construction company for the purchase of water right, the company should resort to the security afforded it by the creation of such liens and the enactment of such statutory procedure which constitute an exclusive remedy.

2. Where a person, association or corporation contracts to deliver a certain quantity of water to any party or parties and the amount to be paid by said party or parties for the delivery of such water is fixed by contract or provided by law, it becomes a first lien upon the land for the irrigation of which said water is furnished and delivered, independent of the lien fixed by contract for the initial cost of construction of the irrigation works; and if the title to said tract of land is in the United States or the state of Idaho, then the said amount becomes a first lien upon any crop or crops which may be raised upon said tract of land during such irrigation season; and these liens may be recorded and collected as provided by law. (Sec. 3288, Rev Codes.)

3. Paragraph 1 of the contract between the defendant construction company and the settler recites that "This agreement is made in accordance with the provisions of said contract between the State of Idaho and the company, which together with the laws of the state of Idaho under which this agreement is made, shall be regarded as defining the rights of the respective parties." The contract between the state and the construction company contains no provision authorizing the construction company to withhold delivery of water for nonpayment of principal or interest by the settler on his water contract; neither do the laws of the state sanction such provision in the contract between the company and the settler.

4. The contract between the construction company and the plaintiffs in this case contains the following provision: "It is agreed that no water shall be delivered to the purchaser from said irrigation system while any instalment of principal or interest is due and unpaid from the purchaser to the company or while any toll and assessment is due and unpaid from the purchaser to the Oakley Canal Company" It being admitted in this case that plaintiffs have paid the fixed charges made by the construction company through the operating company for the operation and maintenance of the irrigation works during the season of 1916 for the lands held by them respectively and that there is an ample supply of water available for distribution, said provision contravenes sec. 3240, Rev. Codes, and in particular the final clause of said section, which is as follows: "And the right to continue the use of any such water shall never be denied or prevented from any other cause than the failure on the part of the user thereof to pay the ordinary charges or assessments which may be made to cover the expenses for the delivery of such water." Said provision in the contract is therefore unenforceable and void.

5. The enforcement of a provision in a contract between a Carey Act construction company and a settler empowering the company to deprive the settler of the right to the use of water on his failure to make payments upon the original contract debt might prevent the settler from making proof which would entitle him to a deed, and prevent the state from procuring patent to the lands within the Carey Act project. This result would destroy the security out of which the construction company seeks reimbursement for the cost of construction and thereby render valueless its lien upon the land. It would also result in the public waters of the state not being applied to the highest beneficial use. Even from these considerations alone, such contractual provision is contrary to public policy, and can only be resorted to as provided by law for the collection of ordinary charges for maintenance of works and operating expenses properly incident to the delivery of water.

[As to validity of rules and regulations of irrigation company, see note in Ann.Cas. 1912D, 137]

Original application for writ of mandate to compel the delivery of water for irrigation purposes. Peremptory writ issued.

Writ of mandate issued. Costs of this proceeding awarded to plaintiffs.

W. L. Dunn, for Plaintiffs.

Having paid the maintenance and operating expense as fixed for the season of 1916, it is the duty of defendants to deliver the water for the irrigation of plaintiffs' crops, and determine the question of arrears on the contract afterward. (Shelby v. Farmers' Co-Op. Ditch Co., 10 Idaho 723 (738), 80 P. 222.)

"The law in force when a contract is made is a part of such contract as fully as if its provisions had been incorporated into such contract." (2 Page on Contracts, par. 1117; 9 Cyc. 582.)

"The attempt to contravene the policy of a public statute is illegal, nor is it necessary to render it so that the statute contain an express prohibition of such attempt." ( Sharp v. Teese, 9 N.J.L. 252 (254), 17 Am Dec. 479.)

"Forfeitures under the well-known rule of law, are not favored, and such contracts will be strictly construed against the company, especially where the consumer has the right of compulsory service." (Kinney on Irrigation and Water Rights, 2d ed., sec. 1528; Shelby v. Farmers' D. Co., supra.)

There is a statutory duty to furnish the water under the Carey Act, and upon the payment of the rentals and tolls for the operation and maintenance of the system for the irrigating season of 1916, it is the duty of the company to furnish the water. (Mandell v. San Diego etc. Co., 89 F. 295; San Diego etc. Co. v. Sharp, 97 F. 394, 38 C. C. A. 220.)

By the enforcement of clause 6 of the contract, defendants may withhold the waters from plaintiffs' lands, and foreclose without proceeding in the ordinary tribunals, and deny the plaintiffs their equity of redemption which is provided to them by sec. 1629, Rev. Codes. This is in all respects contrary to the established policy of the state in husbanding its waters, and a plain violation of the constitutional rights of plaintiffs. (Const., art. 15, secs. 1, 2, 4; Wilterding v. Green, 4 Idaho 773, 45 P. 134.)

Any policy that works contrary to an economical, beneficial use of the waters is discountenanced. (State v. Twin Falls Canal Co., 21 Idaho 410, 121 P. 1039; Van Camp v. Emery, 13 Idaho 202, 89 P. 752; Farmers' etc. Ditch Co. v. Riverside Irr. Dist., 16 Idaho 525, 102 P. 481.)

What right has the operating company, at the mere suggestion of the construction company, in anybody's control, to arbitrarily assist it in the collection of its past due bills, to the extent of withholding water from the lands of plaintiffs, even if based on a clause in a contract? ( Hatch v. Consumers' Co., 17 Idaho 204, 104 P. 670, 40 L. R. A., N. S., 263.)

The defendant construction company's right is only to the extent created for the purpose of permitting it to appropriate for sale and delivery, as provided by law, in its capacity as a quasi-public corporation, the quantity agreed to be delivered to the lands of plaintiffs, whether these lands may remain in the lands of plaintiffs or pass to the hands of some other qualified entrymen or purchasers. The only other interest of this company in this water is by virtue of its lien, whether it be called a mortgage, mechanic's lien or special statutory lien. (Bennett v. Twin Falls N. S. L. & W. Co., 27 Idaho 643, 150 P. 336.)

J. H. Peterson, Attorney General, D. A. Dunning and Herbert Wing, Assts., for Plaintiffs.

Under the constitution and laws of the state and the decisions of this court, after the water has once become appurtenant to a certain tract of land, the land and water cannot be separated to the injury of any other person or unless consented to by the owner of the land. (Hard v. Boise City Irrigation & Land Co., 9 Idaho 589, 76 P. 331, 65 L. R. A. 407.)

S. H. Hays and P. B. Carter, for Defendants.

"There is nothing to compel either a municipality or a water company to furnish water to one who will not pay for it, and a regulation that in case the consumer is in default, his supply will be cut off, is reasonable and may be enforced." (1 Farnham on Waters, sec. 164a; Hatch v. The Consumers' Co., 17 Idaho 204, 104 P. 670, 40 L. R. A., N. S., 263.)

The contracts here in question were directly and fully agreed to in the most formal manner and were afterward approved by the state authorities. Entrymen were not required to take land. There was no obligation upon them to do so. They took it of their own volition. (Idaho Irr. Co. v. Pew, 26 Idaho 278, 141 P. 1099.)

Conditional sale contracts may lawfully be made whereby, in case of failure to make payment, the owner may retake the property. ( Pease v. Teller Co., 22 Idaho 807, 128 P. 981...