Caw Equities, L.L.C. v. City of Greenwood Vill.

• Decision Date: 22 March 2018
• Docket Number: Court of Appeals No. 17CA0212
• Citation: 425 P.3d 1197
• Parties: CAW EQUITIES, L.L.C., a Colorado limited liability company, Plaintiff–Appellant, v. CITY OF GREENWOOD VILLAGE, Colorado, a home rule municipality, Defendant–Appellee.
• Court: Colorado Court of Appeals

425 P.3d 1197

CAW EQUITIES, L.L.C., a Colorado limited liability company, Plaintiff–Appellant,

v.CITY OF GREENWOOD VILLAGE, Colorado, a home rule municipality, Defendant–Appellee.

Court of Appeals No. 17CA0212

Colorado Court of Appeals, Division VII.

Announced March 22, 2018

Rehearing Denied May 3, 2018

Waas Campbell Rivera Johnson & Velasquez LLP, Darrell G. Waas, Patricia C. Campbell, Denver, Colorado, for Plaintiff–Appellant

Otten, Johnson, Robinson, Neff & Ragonetti, P.C., Thomas J. Ragonetti, Bill E. Kyriagis, Brian J. Connolly, Denver, Colorado; Tonya Haas Davidson, City Attorney, Greenwood Village, Colorado, for Defendant–Appellee

Opinion by JUDGE FREYRE

¶ 1 In this private condemnation action under Colorado Constitution article XVI, section 7 (Section 7 ), we address a novel question—Does the "prior public use" doctrine of eminent domain law apply to private condemnations under Section 7 ? We answer that question "yes" and affirm the district court's judgment related to that doctrine. We also conclude that while Section 7 is self-executing, it is not limitless. Consistent with numerous Colorado cases, we conclude that this constitutional right, as others, is subject to reasonable legislative regulation.

¶ 2 Petitioner, CAW Equities, L.L.C. (CAW), appeals from the district court's judgment denying its private condemnation of a public trail belonging to respondent, the City of Greenwood Village. CAW contends that the district court erred when it: (1) placed statutory limitations on the constitutional right to private condemnation for water use; (2) determined that CAW needed to make a showing of necessity for the condemned property without first addressing the bad faith issue; (3) required CAW to make a showing of "absolute" necessity; (4) admitted testimony regarding the feasibility of CAW's water plan; and (5) awarded the City attorney fees. Because we conclude that Section 7 may be limited by statute, and that the prior public use doctrine provides an alternate basis to affirm the district court's judgment, we do not address the necessity issue, the bad faith issue, or the admissibility of the feasibility evidence. Moreover, because we affirm the district court's judgment, we also affirm its award of attorney fees.

I. Background

¶ 3 CAW is a Colorado limited liability company managed by Robert Lembke and owned and controlled by the Lembke family. CAW sought private condemnation of a public equestrian and pedestrian trail (public trail) that bisects two of its adjacent properties. The public trail runs between the Highline Canal to the north and Long Road to the south. The City owns the public trail from a plat dedication and separate dedication agreement for equestrian and pedestrian use.

This diagram, based on admitted exhibits, is not to scale and is provided for illustrative purposes only.

¶ 4 Several years before this suit was filed, CAW proposed creating a new trail along the southern edge of the Eastern Lembke Tract in exchange for vacating the public trail through its property. The City expressed interest initially, so Lembke made some improvements to the proposed route. He offered easements to the City on CAW's property in exchange for the public trail. The City ultimately rejected this offer, so Lembke offered to purchase the public trail for $85,300. Without responding to this offer, the City began construction to improve the public trail. Two days after the City placed surveying stakes on the public trail, CAW filed this petition in condemnation under Section 7.

¶ 5 CAW petitioned to condemn the entire public trail to construct a ditch from the Highline Canal to the southern end of its properties. The City opposed CAW's petition in a C.R.C.P. 12(b)(1) motion to dismiss. It argued that CAW brought the condemnation action in bad faith, and that the rights it asserted did not comply with the legislative authority that guided and implemented the constitutional right of private condemnation. The district court granted the City's motion in part, concluding that the eminent domain statutes clarified and implemented the rights and responsibilities of a party seeking to condemn property under Section 7. It deferred the bad faith argument to the hearing on the merits.

¶ 6 At the hearing, CAW presented expert testimony that its proposed water plan was the most efficient and cost-effective means of transporting water from north to south and diverting it to the eastern and western tracts for irrigation. The City presented contrary expert testimony of numerous alternatives that did not require condemning the entire public trail. The record reflects that the City offered to grant CAW an easement to transport water across the public trail consistent with these alternatives and that CAW rejected that offer.

¶ 7 The district court issued a detailed written order denying CAW's petition. It found that (1) the eminent domain statutes were a proper application of legislative authority to implement and regulate Section 7; (2) CAW was required to show necessity for the proposed condemnation; (3) the proposed water plan failed to comply with the relevant statutes, and that CAW had failed to establish a need to take property already in public use; and (4) CAW's failure to establish the necessity of constructing its proposed ditch rendered any bad faith determination unnecessary. The court then awarded the City attorney fees and costs.

II. Private Condemnation Under Section 7

¶ 8 We first address whether the district court erred in concluding that CAW lacked the authority to condemn the public trail. CAW contends that the court imposed unlawful restrictions on its right to condemn property under Section 7. It argues that Section 7 is self-executing and that a private condemnor need not comply with the eminent domain statutes or show necessity before exercising his or her condemnation right. We disagree, and conclude, consistent with well-settled law pertaining to other constitutional provisions, that the legislature, through the eminent domain statutes, may regulate Section 7 so long as it does not unnecessarily limit or curtail the constitutional right.

A. Standard of Review and Applicable Law

¶ 9 We review a district court's judgment in a condemnation action as a mixed question of fact and law. See Glenelk Ass'n v. Lewis , 260 P.3d 1117, 1120 (Colo. 2011). "[W]e defer to the trial court's findings of fact unless they are so clearly erroneous as to find no support in the record." Id. We review the court's legal conclusions, including questions of constitutional and statutory interpretation, de novo. Gessler v. Colo. Common Cause , 2014 CO 44, ¶ 7, 327 P.3d 232. When interpreting a statute, "a court's essential task is to determine and give effect to the intent of the legislature." Premier Farm Credit, PCA v. W–Cattle, LLC , 155 P.3d 504, 513 (Colo. App. 2006) (quoting People v. Goodale , 78 P.3d 1103, 1107 (Colo. 2003) ). To accomplish this task, we must first examine the plain language of the statute itself. Jefferson Cty. Bd. of Equalization v. Gerganoff , 241 P.3d 932, 935 (Colo. 2010). If the language is clear and unambiguous, we must interpret it as written. Id.

¶ 10 This case involves a conflict between two rights. On the one hand, the right to own and use property is fundamental and important. See Akin v. Four Corners Encampment , 179 P.3d 139, 144 (Colo. App. 2007). On the other hand, water is a "scarce and valuable resource" in Colorado. Mount Emmons Mining Co. v. Town of Crested Butte , 40 P.3d 1255, 1257 (Colo. 2002). Consequently, water is carefully managed, including its distribution in ditches, to promote beneficial uses. See, e.g. , Colo. Const. art. XVI, § 6 ("Diverting unappropriated water—priority preferred uses"); Colo. Const. art. XVI, § 7 ("Right-of-way for ditches, flumes"); §§ 37–86–101 to – 113, C.R.S. 2017 ("Rights-of-way and Ditches"); Archuleta v. Gomez , 200 P.3d 333, 341–43 (Colo. 2009).

Ditches are important to Colorado. They permit a landscape, economy, and history in which fertile valleys prosper. Without them, properties adjacent to or distant from watercourses wither. Colorado is not a riparian state in which only those lands adjacent to the streams and rivers have rights to waters. Rather, as early as the tenure of the territorial legislature, our lawmakers recognized that our arid climate required the creation of a right to appropriate and convey water across the land of another so that lands not immediately proximate to water could be used and developed.

Roaring Fork Club, L.P. v. St. Jude's Co. , 36 P.3d 1229, 1231–32 (Colo. 2001).

¶ 11 The importance of water distribution in Colorado is expressed in the state constitution, which permits private property to be taken, without the consent of the owner, for "reservoirs, drains, flumes, or ditches on or across the lands of others." Colo. Const. art. II, § 14. It also permits public land to be condemned for rights-of-way, stating as follows:

All persons and corporations shall have the right-of-way across public, private and corporate lands for the construction of ditches, canals and flumes for the purpose of conveying water for domestic purposes, for the irrigation of agricultural lands, and for mining and manufacturing purposes, and for drainage, upon payment of just compensation.

Colo. Const. art. XVI, § 7.

¶ 12 Section 7 is self-executing, which means that it "shall take immediate effect, and ancillary legislation is not necessary to the enjoyment of the right thus given, or the enforcement of the duty thus imposed. In short, if a constitutional provision is complete in itself, it executes itself." Town of Lyons v. City of Longmont , 54 Colo. 112, 117, 129 P. 198, 200 (1913). Thus, at the time of its adoption in 1876, no further legislative action was required to implement it.

¶ 13 Nevertheless, "[a] provision can still be self-executing even if 'further legislation may clarify or facilitate the execution of the provision.' " Developmental...