Luskin Daughters 1996 Trust for the Benefit of Ackerman v. Young

• Decision Date: 09 September 2019
• Docket Number: Supreme Court Case No. 18SA215
• Citation: 448 P.3d 982
• Parties: The LUSKIN DAUGHTERS 1996 TRUST FOR the BENEFIT OF Lyndell Joy Luskin ACKERMAN, Matthew Riley, Trustee, Plaintiff-Appellant, v. Steve YOUNG a/k/a Stephen W. Young and Heather Young a/k/a Heather A. Young, Defendants-Appellees, and Corey DeAngelis, Division Engineer, Water Division 1, Appellee Pursuant to C.A.R. 1(e).
• Court: Colorado Supreme Court

448 P.3d 982

The LUSKIN DAUGHTERS 1996 TRUST FOR the BENEFIT OF Lyndell Joy Luskin ACKERMAN, Matthew Riley, Trustee, Plaintiff-Appellant,

v.Steve YOUNG a/k/a Stephen W. Young and Heather Young a/k/a Heather A. Young, Defendants-Appellees,andCorey DeAngelis, Division Engineer, Water Division 1, Appellee Pursuant to C.A.R. 1(e).

Supreme Court Case No. 18SA215

Supreme Court of Colorado.

September 9, 2019

Petition for Rehearing Denied September 30, 2019

Attorneys for Plaintiff-Appellant: Alperstein & Covell, P.C., Gilbert Y. Marchand, Jr., Denver, Colorado

Attorneys for Defendants-Appellees: Porzak Browning & Bushong LLP, Kevin J. Kinnear, Boulder, Colorado

No appearance by or on behalf of Corey DeAngelis, Division Engineer, Water Division 1.

En Banc

CHIEF JUSTICE COATS delivered the Opinion of the Court.

¶1 The Trust appealed from an order of the water court dismissing its complaint for declaratory and injunctive relief, as well as for damages. The water court concluded that in the absence of an application for the determination of a water right, the Trust’s claim of interference by the Youngs with its unadjudicated appropriative rights to springs that arise on the Youngs’ land could not proceed before the water court. It therefore granted the Youngs’ motion, pursuant to C.R.C.P. 12(b)(1), (2), or (5), to dismiss.

¶2 Because the water court could not provide the Trust’s requested relief without the Trust’s first having adjudicated its water rights in accordance with section 37-92-302, the water court’s dismissal of the Trust’s complaint is affirmed. Because the Youngs have successfully defended the dismissal of this tort action on appeal, they are statutorily entitled to their reasonable appellate attorney fees, and the case is remanded to the water court for a determination of the amount of those fees.

I.

¶3 In 2018, The Luskin Daughters 1996 Trust filed a Complaint for Declaratory and Injunctive Relief and Damages in the Water Court for Division 1, asserting interference by Steve and Heather Young with the Trust’s right to use natural spring water that historically arose on the Youngs’ property. The complaint alleged that the Trust and the Youngs own adjacent parcels of land; that in 2017 the Youngs built a house that destroyed one or more ditches that had historically delivered spring water to the Trust’s property; and that those water rights had been used on the Trust’s property for purposes of irrigation, animal watering, wildlife, and recreation. The complaint conceded, however, that those water rights had never been adjudicated.

¶4 The Trust’s complaint actually asserted five separate claims for relief, seeking: (1) a declaratory judgment confirming the existence of its unadjudicated water rights, (2) a declaratory judgment confirming the existence of ditch easements for those water rights, (3) injunctive relief from the Youngs’ interference with those water rights, (4) injunctive relief from the Youngs’ trespass and damage to the Trust’s ditch rights, and (5) damages.

¶5 Without answering the complaint, the Youngs filed a motion to dismiss, premised on three different provisions of C.R.C.P. 12. First, the Youngs asserted that the water court lacked jurisdiction over the Trust’s first claim for declaratory relief, arguing that its claim effectively sought an application for a "determination of a water right" under section 37-92-302(1)(a) of the 1969 Water Right Determination and Administration Act, which on its face mandates compliance with the resume notice and publication procedures set forth in subsection 302(3). Second, they asserted that since the water court lacked jurisdiction to consider the only "water matter" in the Trust’s complaint, it similarly lacked ancillary jurisdiction over the remaining claims. Finally, the Youngs moved to dismiss on the alternate ground that even if the water court were determined to have jurisdiction over the Trust’s claims, it could not provide the Trust’s requested relief because although an unadjudicated appropriative right may be reduced to an adjudicated water right, until it has been so adjudicated, it cannot itself be judicially enforced against another party.

¶6 The water court granted the motion to dismiss, reasoning that by seeking a declaration of its undecreed water rights pursuant to Rule 57, without proceeding according to the statutorily mandated process for adjudicating such rights in the first instance, the Trust was asking it "to operate outside the 1969 Act." The court ultimately concluded that it did not have the "authority" to make such a determination. In its order granting the motion to dismiss, the water court indicated that in the absence of an application for the determination of a water right pursuant to the Act, it lacked the jurisdiction to grant the relief requested in the Trust’s claims.

¶7 The Trust appealed to this court from the water court’s ruling.

II.

¶8 The 1969 Act defines a "water right" as "a right to use in accordance with its priority a certain portion of the waters of the state by reason of the appropriation of the same." § 37-92-103(12), C.R.S. (2019). We have therefore made clear that one does not own water but merely owns a right to use water within the limitations of the prior appropriation doctrine. Kobobel v. State Dep’t of Nat. Res. , 249 P.3d 1127, 1134 (Colo. 2011). More particularly, in Colorado a property right in water entitles the holder "to use beneficially a specified amount of water, from the available supply of surface water or tributary groundwater, that can be captured, possessed, and controlled in priority under a decree, to the exclusion of all others not then in priority under a decreed water right." Empire Lodge Homeowners’ Ass’n v. Moyer , 39 P.3d 1139, 1147 (Colo. 2001).

¶9 Although the right to use water is created when a person appropriates or initiates an appropriation of unappropriated water of a natural stream of the state, Shirola v. Turkey Cañon Ranch Ltd. Liab. Co. , 937 P.2d 739, 748 (Colo. 1997), only upon adjudication of that right is the amount and priority of the right identified, Empire Lodge Homeowners’ Ass’n, 39 P.3d at 1148. Therefore, as we have also previously made clear, absent an adjudication under the Act, water rights are generally incapable of being enforced. Shirola , 937 P.2d at 749 ("Generally then, a vested water right is not legally enforceable through the water administration system unless it is represented by a water court decree, obtained after full adjudication.").

¶10 The significance of a water right’s adjudication does not end there however. We have also indicated that an adjudication is necessary for maintaining a related action premised upon the existence of a claimed water right. See In re Tonko , 154 P.3d 397, 407 (Colo. 2007). Because a condemnation action involves issues such as necessity and valuation in determining the compensation award for a ditch or pipeline right-of-way needed for water transportation in the exercise of a water right, we found in Tonko , that the adjudication of a water right was actually a "prerequisite" for maintaining the private condemnation action for ditch easements allowing for the exercise of that water right. Id.

¶11 The 1969 Act outlines the exclusive method to obtain adjudication of one’s water right. Subsection 302(3) of the Act sets forth specific resume notice and publication procedures required for a water rights application. The purpose of those procedures is "to give notice of the nature, scope and impact of the decree sought," which then serves to enable any interested person "to file a statement of opposition and contest the factual or legal grounds for issuance of such a decree." S. Ute Indian Tribe v. King Consol. Ditch Co. , 250 P.3d 1226, 1234 (Colo. 2011). While the notice requirements of the Act are generally consistent with those applicable to proceedings in rem, the procedures of the statutory adjudication process itself are unique, involving a division engineer’s consultation report, a referee’s investigation, discovery, and a trial to resolve contested issues involving the claimed water rights. In re Tonko , 154 P.3d at 407. We have therefore characterized water right adjudications as special statutory proceedings, as to which C.R.C.P. 81(a) limits the applicability of the civil rules to situations in which they are not inconsistent or in conflict with the statute. See Groundwater Appropriators of S. Platte River Basin, Inc. v. City of Boulder , 73 P.3d 22, 25 (Colo. 2003) ; see also Am. Water Dev., Inc. v. City of Alamosa , 874 P.2d 352, 381 (Colo. 1994) (quoting introductory note preceding Uniform Local Rules for all State Water Court Divisions).

¶12 Prior to passage of the 1969 Act, adjudications historically occurred on a piecemeal, haphazard basis. James N. Corbridge, Jr. & Teresa A. Rice, Vranesh’s Colorado Water Law 139 (rev. ed. 1999). The 1969 Act was the General Assembly’s attempt to provide a "comprehensive, integrated scheme of adjudication and tabulation of water rights." Id. And in this way, the uniform adjudication process promotes our water law system’s objectives of security, reliability, and flexibility. See Empire Lodge Homeowners’ Ass’n , 39 P.3d at 1147. Allowing for any other method to adjudicate one’s water right would not comport with the General Assembly’s intent to provide a comprehensive and specialized scheme to that end.

III.

¶13 It is undisputed that the Trust did not file an application for an adjudication of its water rights or otherwise follow the resume notice and publication procedures required of such applications; and in the absence of such an application, the water court resolved that it lacked the jurisdiction to grant the declaratory and injunctive relief requested by the Trust. While the water court did not more particularly describe in its order the nature of the jurisdictional defect it perceived, it discussed law concerning subject matter jurisdiction earlier in its ruling,...