Fellows v. Shultz

• Decision Date: 04 May 1970
• Docket Number: No. 8804,8804
• Citation: 469 P.2d 141,81 N.M. 496,1970 NMSC 71
• Parties: Leland L. FELLOWS and Doralea Sanders Bean, Petitioners-Appellees, v. Addie SHULTZ, Leon Ramey and Ethel Ramey, Respondents-Protestants-Appellants, v. STATE of New Mexico ex rel. S. E. REYNOLDS, State Engineer, Defendant-Appellee.
• Court: New Mexico Supreme Court

Page 141

469 P.2d 141

81 N.M. 496

Leland L. FELLOWS and Doralea Sanders Bean, Petitioners-Appellees, v. Addie SHULTZ, Leon Ramey and Ethel Ramey, Respondents-Protestants-Appellants, v. STATE of New Mexico ex rel. S. E. REYNOLDS, State Engineer,

Defendant-Appellee.

No. 8804.

Supreme Court of New Mexico.

May 4, 1970.

D. D. Archer, Artesia, for respondents-appellants

Sanders & Bruin, Roswell, for petitioners-appellees.

James A. Maloney, Atty. Gen., F. Harlan Flint, Peter B. Shoenfeld, Special Asst. Attys. Gen., Santa Fe, for defendant-appellee.

OPINION

SISK, Justice.

Appellants protested an application filed by appellees with the State Engineer for a change of location of a water well, in accordance with the provisions of § 75--11--7, N.M.S.A.1953, as amended in 1967. The constitutionality of this statute is challenged by both appellants and the State Engineer. The trial court entered judgment for appellees on the merits of their application, but because the constitutional question is determinative it is not necessary to consider the additional points asserted on appeal.

We must first determine whether § 75--11--7, supra, is constitutional or whether it is violative of art. III, § 1 of the New Mexico Constitution, which provides for the separation of powers between the three departments of government. If the statute repugnant to the separation of powers clause, we must then determine whether its constitutionality was saved or validated by the subsequent adoption of art. XVI, § 5 of the New Mexico Constitution. Article III, § 1, supra, provides:

'The powers of the government of this state are divided into three distinct departments, the legislative, executive and judicial, and no person or collection of persons charged with the exercise of powers properly belonging to one of these departments, shall exercise any powers properly belonging to either of the others, except as in this Constitution otherwise expressly directed or permitted.'

The purpose, meaning and interpretation of this section of our constitution was first considered in detail in Kelley v. Marron, 21 N.M. 239, 153 P. 262 (1915).

Our first concern in the present case is whether § 75--11--7, supra, requires the exercise by the courts of powers which are fundamentally executive or administrative in nature. The problem arises because of the development of administrative agencies, which we have had in New Mexico since statehood. See art. XI, §§ 1 through 11, New Mexico Constitution, which establish the State Corporation Commission and grant to it powers which would otherwise generally be legislative in nature. San Juan Coal & Coke Co. v. Santa Fe, S.J. & N. Ry., 35 N.M. 512, 2 P.2d 305 (1931). This court has also determined that certain powers granted to that administrative agency by statute were legislative or administrative as opposed to judicial. State ex rel. State Corp. Comm'n v. Zinn, 72 N.M. 29, 380 P.2d 182 (1963); Harris v. State Corp. Comm'n, 46 N.M. 352, 129 P.2d 323 (1942). In Fischer v. Rakagis, 59 N.M. 463, 469, 286 P.2d 312, 316 (1955), we said, '(t)hat the legislature may create boards, such as boards for the licensing of contractors, and vest them with administrative powers, needs no citation of authorities.'

This court has held that the legislature, in exercising its police powers, may confer certain 'quasi-judicial' powers on administrative agencies with regard to laws affecting the general public, but that such powers do not extend to determinations of rights and liabilities between individuals. State ex rel. Hovey Concrete Products Co. v. Mechem, 63 N.M. 250, 252, 316 P.2d 1069 (1957); State v. Kelly, 27 N.M. 412, 202 P. 524, 530, 21 A.L.R. 156 (1921).

The State Engineer has been held to have administrative powers. In Kelley v. Carlsbad Irrigation District, 71 N.M. 464, 379 P.2d 763 (1963), the court determined that a review on appeal from a decision of the State Engineer was controlled by the rules applicable to review of decisions and orders of administrative agencies as announced in Continental Oil Co. v. Oil Conservation Comm'n, 70 N.M. 310, 373 P.2d 809 (1962).

Section 75--11--7, supra, the statute here in question, reads:

'The owner of a water right may change the location of his well or change the use of the water, but only upon application to the state engineer and upon showing that such change or changes will not impair existing rights and to be granted only after such advertisement and hearing as are prescribed in the case of original applications.

'When the owner of a water right makes application or applications for a temporary change of not to exceed one (1) year for not more than three (3) acre-feet of water to a different location, or to a different use, or both, the state engineer shall make an investigation, and, if such change does not permanently impair any vested rights of others, he shall make an order authorizing the change. If he shall find that the change sought might impair such rights, he shall order advertisement and hearing as in other cases.

'If objections or protests have been filed within the time prescribed in the notice, or if the state engineer is of the opinion that the permanent should not be issued, the state engineer shall notify the applicant of that fact by certified mail sent to the address shown in the application. Unless the applicant files within thirty (30) days after the receipt of notice by certified mail an action for hearing in the district court of the county in which the proposed well or wells have been, or will be located, the state engineer may proceed to deny the permit. Said application shall then be heard and tried as cases originally docketed in the district court, and the state engineer shall be a party thereto.

'The decision of the district court, without jury, shall be binding on the state engineer who shall thereafter act in accordance with such decision unless within sixty (60) days after entry of such decision or judgment an appeal shall be taken.'

The last two paragraphs, which were added by amendment in 1967 (ch. 308, § 3, Laws of 1967), create the constitutional problem.

We recognize and reaffirm the long-established rule which was stated in the opinion on rehearing in State v. Armstrong, 31 N.M. 220, 255, 243 P. 333, 347 (1924):

'The Legislature is a co-ordinate branch of our state government. Its prerogative in the matter of legislation is to be questioned solely from the standpoint of our federal or state constitutional limitations. The function of the courts in scrutinizing acts of the Legislature is not to raise possible doubt not to listen to captious criticism. The Legislature possessing the sole power of enacting law, it will not be presumed that the people have intended to limit its power or practice by unreasonable or arbitrary restrictions. Every presumption is ordinarily to be indulged in favor of the validity and regularity of legislative acts and procedure. * * *'

For some of the numerous other cases which announce this rule, see In re Estate of Welch, 80 N.M. 448, 457 P.2d 380 (1969); City of Raton v. Sproule, 78 N.M. 138, 429 P.2d 336 (1967); Drink, Inc. v. Babcock, 77 N.M. 277, 421 P.2d 798 (1966).

The crucial question here, however, is whether a proceeding which has long been established as administrative in nature can be made judicial in nature by the legislative act of removing such proceeding from the jurisdiction of an administrative body and placing it within the original jurisdiction of the courts, as was attempted by the change in procedure contained in the 1967 amendment to § 75--11--7, supra. In Continental Oil Co. v. Oil Conservation Comm'n, supra, this court said:

'* * * (I)t should be initially recognized that an administrative body may be delegated the power to make fact determinations to which the law, as set forth by the legislative body, is to be applied. See, Opp Cotton Mills v. Administrator, 1941, 312 U.S. 126, 657 (sic 145), 61 S.Ct. 524, 85 L.Ed. 624, in which it is said:

"The essentials of the legislative function are the determination of the legislative policy and its formulation as a rule of conduct. Those essentials are preserved when Congress specifies the basic conclusions of fact upon ascertainment of which, from relevant data by a designated administrative agency, it ordains that its statutory command is to be effective."

In Kelley v. Carlsbad Irrigation District, supra, which also involved the State Engineer, this court considered the proper scope of review under § 75--6--1, N.M.S.A.1953, of a decision denying an applicant the right to change the point of diversion of surface water under § 75--5--23, N.M.S.A.1953. Section 75--6--1, supra, provided that on appeal the proceeding should be 'de novo,' which in effect would make it a judicial determination. We quote at length from Kelley, supra:

'The question of the proper scope of review is immediately presented upon the taking of an appeal from any decision of the state engineer. Even though the review by the district court, in this case, was prior to the decision of this court in Heine v. Reynolds, 69 N.M. 398, 367 P.2d 708 and Continental Oil Co. v. Oil Conservation Commission, 70 N.M. 310, 373 P.2d 809, we had clearly indicated in Spencer v. Bliss, 60 N.M. 16, 287 P.2d 221, 228; Application of Brown, 65 N.M. 74, 332 P.2d 475, 479; and Clodfelter v. Reynolds, 68 N.M. 61, 358 P.2d 626, that when called upon to specifically determine the question, the scope of review would be limited. Our prior decisions were reviewed and extensively quoted from in Heine. It would serve no useful purpose to repeat that review here.

'We consider Continental Oil Co. v. Oil Conservation Commission, supra, controlling on the question of scope of review. That decision discussed the constitutional division of powers and after pointing out that grave constitutional problems would be presented if the administrative agency performed a judicial function, it was said:

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