Maricopa-Stanfield v. Robertson

• Decision Date: 30 November 2005
• Docket Number: No. CV-04-0385-SA.,CV-04-0385-SA.
• Citation: 211 Ariz. 485,123 P.3d 1122
• Parties: MARICOPA-STANFIELD IRRIGATION & DRAINAGE DISTRICT, an Arizona municipal corporation; Central Arizona Irrigation and Drainage District, an Arizona municipal corporation; and approximately two hundred landowners, Petitioners, v. The Honorable Kelly Marie ROBERTSON, Judge of the Superior Court of the State of Arizona, in and for the County of Pinal, Respondent, and John E. Smith, et al., Respondents-Real Parties in Interest.
• Court: Arizona Supreme Court

123 P.3d 1122

211 Ariz. 485

MARICOPA-STANFIELD IRRIGATION & DRAINAGE DISTRICT, an Arizona municipal corporation; Central Arizona Irrigation and Drainage District, an Arizona municipal corporation; and approximately two hundred landowners, Petitioners, v. The Honorable Kelly Marie ROBERTSON, Judge of the Superior Court of the State of Arizona, in and for the County of Pinal, Respondent, and John E. Smith, et al., Respondents-Real Parties in Interest.

No. CV-04-0385-SA.

Supreme Court of Arizona, En Banc.

November 30, 2005.

Miller, LaSota & Peters, P.L.C. by Donald M. Peters, Susan A. Cannata, Phoenix, Attorneys for Maricopa-Stanfield Irrigation & Drainage District.

Salmon, Lewis & Weldon, P.L.C., by Mark A. McGinnis, M. Byron Lewis, Richard N. Morrison, Phoenix, Attorneys for Central Arizona Irrigation & Drainage District.

Sacks Tierney, P.A. by Marvin S. Cohen, Scottsdale, Attorneys for Approximately Two Hundred Landowners.

Renaud, Cook, Drury, Mesaros, P.A. by J. Gordon Cook, Denise J. Henslee, Phoenix, Attorneys for John E. Smith, et al.

W. Patrick Schiffer, Chief Counsel, Ryan A. Smith, Deputy Counsel, Maxine M. Becker, Deputy Counsel, Phoenix, Attorneys for Amicus Curiae Arizona Department of Water Resources.

Engelman Berger, P.C. by William H. Anger, Phoenix, Attorneys for Amici Curiae Cities of Chandler, Glendale, Goodyear, Mesa, Peoria and Scottsdale.

Jane D. Alfano, Frederic L. Beeson, Phoenix, Attorneys for Amici Curiae Salt River Valley Water Users' Association and Salt River Project Agricultural Improvement and Power District.

Curtis, Goodwin, Sullivan, Udall & Schwab, P.L.C., by Larry K. Udall, Phoenix, Attorneys for Amici Curiae Hohokam Irrigation & Drainage District and San Carlos Irrigation & Drainage District.

Somach, Simmons & Dunn by Robert B. Hoffman, Sacramento, CA, Attorneys for Amicus Curiae Central Arizona Water Conservation District.

Rodney B. Lewis, General Counsel, Chandler, Attorney for Amicus Curiae Gila River Indian Community.

Michael G. Rankin, City Attorney, Christopher E. Avery, Principal Assistant City Attorney, Tucson, Attorneys for Amicus Curiae City of Tucson.

David P. Frank, Attorney General, Tohono O'Odham Nation, Sells, and Quigley & Whitehill, P.L.C. by Daniel J. Quigley, Tucson, Attorneys for Amicus Curiae Tohono O'Odham Nation.

OPINION

BALES, Justice.

I.

¶ 1 The issue presented is whether agricultural landowners have vested rights to certain irrigation water from the Central Arizona Project ("CAP"). The water is the subject of a master contract between the United States and the Central Arizona Water Conservation District ("CAWCD") and related subcontracts between these entities and the two petitioner irrigation districts. The landowners are not parties to these agreements. Because we hold that the landowners do not have vested rights to the CAP water in question, we vacate the trial court's contrary ruling and remand this case for entry of judgment in favor of the districts.

II.

¶ 2 This litigation arose because the irrigation districts contemplate entering into a water rights settlement that would relinquish their rights to CAP water under their subcontracts with the United States and the CAWCD.

¶ 3 The districts are Arizona municipal corporations governed by boards of directors who in turn are elected by landowners within a district's boundaries. Ariz.Rev.Stat. ("A.R.S.") §§ 48-2901, -2922, -2978 (2005). Irrigation districts are specifically authorized to enter into contracts with the United States for the delivery, distribution, or apportionment of water for the lands of the district. A.R.S. § 48-3092.

¶ 4 The districts have faced more than a decade of financial turmoil stemming from the high cost of repaying the United States for constructing the CAP to distribute irrigation water from the Colorado River. The proposed settlement would allow the districts to obtain debt relief in exchange for relinquishing their rights to CAP water under the subcontracts; they also would be able to purchase CAP water through 2030 under new agreements.

¶ 5 By a majority vote, landowners within each district approved the proposed relinquishment of rights to CAP water under the subcontracts. Some dissenting landowners ("landowners") filed two lawsuits, one against the districts and one against the CAWCD, alleging that they had vested rights to CAP water that could not be abrogated without their consent.

¶ 6 The suit against the CAWCD was removed to the United States District Court, which later dismissed it for failure to state a claim. The Ninth Circuit Court of Appeals affirmed this ruling. Smith v. Cent. Ariz. Water Conservation Dist., 418 F.3d 1028 (9th Cir.2005).

¶ 7 The suit against the districts proceeded in the superior court. The trial court granted partial summary judgment in favor of the landowners, holding that they have vested rights to the CAP water governed by the subcontracts and that the districts may not alter those rights without the landowners' consent. This petition for special action followed.¹

¶ 8 Because the trial court's decision is of statewide importance and the districts have no "equally plain, speedy, and adequate remedy by appeal," this Court accepted jurisdiction. Ariz. R.P. Spec. Act. 1(a), 4(a); see also Bledsoe v. Goodfarb, 170 Ariz. 256, 257, 823 P.2d 1264, 1266 (1991) (granting special action relief when legal issue affected water organizations statewide). We have jurisdiction pursuant to Article 6, Section 5(3), of the Arizona Constitution.

III.

¶ 9 Three federal reclamation laws provide the statutory backdrop to this case. In 1902, Congress passed the Reclamation Act, 32 Stat. 388, to establish water reclamation projects in the western United States. In 1928, Congress passed the Boulder Canyon Project Act, 45 Stat. 1057, which provided for the construction of Hoover Dam and authorized the Secretary of the Interior ("Secretary") to contract for the storage and delivery of Colorado River water. Finally, in 1968, Congress passed the Colorado River Basin Project Act, 82 Stat. 885, which provided for the construction and operation of the CAP. As a result, states and water users operate under a somewhat complicated system of intertwining federal statutes.

¶ 10 Critical to our analysis is the relationship between section 8 of the Reclamation Act and section 5 of the Boulder Canyon Project Act.² Under section 8 of the Reclamation Act, the Secretary generally must comply with state law in "the control, appropriation, use, or distribution of water" through a federal reclamation project. 43 U.S.C. § 383 (2000). Rights to water acquired under the Reclamation Act are appurtenant to the land irrigated and are measured by beneficial use. 43 U.S.C. § 372.

¶ 11 Section 5 of the Boulder Canyon Project Act ("BCPA"), in contrast, authorizes the Secretary to contract for the storage and delivery of water from its projects for irrigation and domestic uses. 43 U.S.C. § 617d. The statute expressly declares that "no person shall have or be entitled to have the use" of such water except by a contract with the Secretary. Id. Section 5 of the BCPA does not mention state law and thus is in tension with the directive in section 8 of the Reclamation Act that state law shall control the recognition of water rights.

¶ 12 The United States Supreme Court addressed the relationship between these two statutes in Arizona v. California, 373 U.S. 546, 83 S.Ct. 1468, 10 L.Ed.2d 542 (1963). Arizona had sued in 1952 to resolve the allocation of Colorado River water among the states in the river's lower basin. The Court held that Congress, in enacting the BCPA, "created its own comprehensive scheme for the apportionment among California, Arizona, and Nevada of the Lower Basin's share of the mainstream waters of the Colorado River...." Id. at 565, 83 S.Ct. 1468.

¶ 13 The Court also clarified the respective roles of state and federal law in controlling rights to water from the lower Colorado. For federal reclamation projects in general, section 8 of the Reclamation Act requires the Secretary to follow state law regarding the control, use, or appropriation of water. The Court, however, expressly rejected the argument that state law controlled the distribution of water subject to the BCPA. Id. at 580-81, 584-86, 83 S.Ct. 1468. Instead, the BCPA vests the Secretary with the power, "through his § 5 contracts, both to carry out the allocation of the waters of the main Colorado River among the Lower Basin States and to decide which users within each State would get water." Id. at 580, 83 S.Ct. 1468.

¶ 14 In its subsequent decree, the Court reaffirmed the distinctive nature of Colorado River distribution and the need for secretarial contracts. Arizona v. California, 376 U.S. 340, 84 S.Ct. 755, 11 L.Ed.2d 757 (1964). The decree noted that, unless used for a federal reservation:

Mainstream water shall be released or delivered to water users ... in Arizona, California, and Nevada only pursuant to valid contracts therefor made with such users by the Secretary of the Interior, pursuant to Section 5 of the Boulder Canyon Project Act or any other applicable federal statute.

Id. at 343, 84 S.Ct. 755.

¶ 15 Against this legal background, Congress in 1968 passed the Colorado River Basin Project Act ("CAP Act"), which, among other things, created the CAP. In so doing, Congress carefully avoided unsettling the BCPA, stating that, unless otherwise provided, nothing in the CAP Act was to "be construed to alter, amend, repeal, modify, or be in conflict with the provisions of the" former. 43 U.S.C. § 1551(a). The CAP Act also vests the Secretary with broad authority to administer the CAP. See Maricopa-Stanfield Irrigation & Drainage Dist. v. United States, 158 F.3d 428, 438 n. 18 (9th Cir.1998) ("The Secretary's generous measure of discretion survived the Colorado River Basin Project Act...."); Cent. Ariz. Irrigation & Drainage Dist. v. Lujan, 764 F.Supp. 582, 589 (D.Ariz.1991) ...