Mont. Trout Unlimited v. Beaverhead Water Co.

• Decision Date: 23 June 2011
• Docket Number: No. DA 10–0382.,DA 10–0382.
• Citation: 361 Mont. 77,255 P.3d 179,2011 MT 151
• Parties: MONTANA TROUT UNLIMITED, Objector and Appellant,v.BEAVERHEAD WATER COMPANY, Garrison Ranches, Inc., Paul H. Cleary, Jr. Trust, Montana Board of Land Commissioners, Hairpin LC, Spenco LLC, Claimants and Appellees.
• Court: Montana Supreme Court

361 Mont. 77

255 P.3d 179

2011 MT 151

MONTANA TROUT UNLIMITED, Objector and Appellant,

v.BEAVERHEAD WATER COMPANY, Garrison Ranches, Inc., Paul H. Cleary, Jr. Trust, Montana Board of Land Commissioners, Hairpin LC, Spenco LLC, Claimants and Appellees.

No. DA 10–0382.

Supreme Court of Montana.

Orally Argued and Submitted Feb. 2, 2011.Decided June 23, 2011.

For Appellant: Laura S. Ziemer, Patrick Byorth (argued) (attorneys), E. Rebecca Gantt, (law student intern); Montana Trout Unlimited, Bozeman, Montana.For Appellees: John E. Bloomquist (argued), Patti L. Rowland, Abigail J. St. Lawrence; Doney Crowley Bloomquist Payne Uda P.C., Helena, Montana (for Appellees Beaverhead Water Company; Garrison Ranches, Inc.; and Paul H. Cleary, Jr. Trust), Holly Jo Franz (argued); Franz & Driscoll, PLLP, Helena, Montana (for Appellees Hairpin LC and Spenco LLC).For Amicus Curie: William A. Schenk (argued), Agency Legal Counsel, Special Assistant Attorney General, Montana Department of Fish, Wildlife and Parks, Helena, Montana (in support of Appellant Montana Trout Unlimited).Chief Justice MIKE McGRATH delivered the Opinion of the Court.

[361 Mont. 78] ¶ 1 Montana Trout Unlimited (MTU) appeals from the Water Court's order filed June 4, 2010, dismissing its objections to water right claims by Beaverhead Water Company, Garrison Ranches and the Paul H. Cleary, Jr. Trust (Claimants). Those claims were contained in the Water Court's Temporary Preliminary Decree for the Big Hole River Basin issued on April 6, 2007. We reverse.

BACKGROUND

¶ 2 Pursuant to Article IX, Section 3(4) of the Montana Constitution, Montana law provides for an orderly process for adjudicating existing water rights. See generally Title 85, Chapter 2, MCA. Persons who claim water rights that existed prior to July 1, 1973, were required to file statements of their claims, which are then compiled and examined by the Department of Natural Resources and Conservation under the direction of the Water Court. The Water Court then issues an interlocutory, temporary preliminary, or preliminary decree of water rights based on the claims, on data from the DNRC, on other information obtained by the water judge, and on water compacts where applicable. Public notice of the decree provides opportunity for interested persons to review and object to the decree for good cause. The Water Court holds hearings on the issues raised by the objections and issues a final decree. Rule 1(b), Water Right Adjudication Rules (W.R.Adj. R.); §§ 85–2–224 through–235, MCA.

¶ 3 On April 6, 2007, the Water Court issued a temporary preliminary decree in Basin 41D, the Big Hole River. Pursuant to notice of the decree, MTU filed timely objections to several of the claims of each of the Claimants and requested a hearing. The Claimants moved to dismiss the MTU objections, arguing that MTU lacked standing to object. The Water Court converted the motions to dismiss to motions for summary judgment. MTU and Claimants waived their right to a hearing on summary judgment and stipulated that the Water Court could accept as true the assertions of fact made in their briefs and in the attachments to MTU's brief.

¶ 4 The Water Court determined that the motions involved only issues of law and ultimately granted summary judgment to the Claimants, holding that MTU lacked standing to file objections to the water right claims. In doing so the Water Court expressly incorporated its prior decision on similar standing issues issued in response to motions to dismiss objections filed by the Western Watersheds Project (Water Court Case No. 41D–2).

¶ 5 MTU is a membership conservation organization of anglers dedicated to the conservation, protection and restoration of coldwater fish, including wild and native trout in Montana. MTU has been actively involved in cooperative restoration efforts for arctic grayling and wild trout in the Big Hole River Basin and actively participates in the Big Hole Watershed Committee. MTU has contributed funding to support the implementation of a voluntary drought plan on the Big Hole which seeks to maintain minimum water flows without unduly restricting the interests of diversionary water users. MTU's efforts on the Big Hole have been directed at improving habitat for the grayling and wild trout, focusing on mitigating the impacts of low stream flows through water conservation and habitat and flow restoration. MTU asserts that unsupported large water right claims could unravel its years of fish restoration and protection on the river and negatively impact the instream water reservations on the Big Hole River held by the Montana Department of Fish, Wildlife and Parks.

¶ 6 The Water Court acknowledged MTU's “historical contributions” in Montana's water adjudication efforts, noting its participation in litigation, the Water Right Adjudication Advisory Committee, legislative hearings, and the Water Court's rule-making proceedings. The Water Court concluded that MTU “contributed much to the outcomes.”

¶ 7 The Water Court decided the motions to dismiss MTU's objections by first applying § 85–2–233, MCA, which provides:

(1)(a) For good cause shown ... a hearing must be held before the water judge on any objection to a temporary preliminary decree or preliminary decree by:

(i) the department [of Natural Resources and Conservation];

(ii) a person named in the temporary preliminary decree or preliminary decree;

(iii) any person within the basin entitled to receive notice under 85–2–232(1); or

(iv) any other person who claims rights to the use of water from sources in other basins that are hydrologically connected to the sources within the decreed basin and who would be entitled to receive notice under 85–2–232 if the claim or claims were from sources within the decreed basin.

(b) For the purposes of this subsection (1), “good cause shown” means a written statement showing that a person has an ownership interest in water or its use that has been affected by the decree.

The Water Court held that while MTU was a person entitled to receive notice of the decree, it must also demonstrate “good cause” by showing “an ownership interest in water or its use that has been affected by the decree” when filing objections.

¶ 8 MTU filed a “statement of interest” to meet the “good cause” requirement. It recited MTU's participation in the Big Hole River fish and water flow protection and restoration efforts, its interest in promoting and protecting those efforts by insuring that water right claims are thoroughly examined and well supported, its interest in fulfilling the instream water reservations of the Department of Fish, Wildlife and Parks, and its goal of insuring that its members could continue to fish the river. The Water Court acknowledged that it is “beyond dispute that all citizens of Montana have public environmental and recreational interests in the natural waters of Montana.” (Emphasis in original.)

¶ 9 The Water Court held:

For purposes of the Claimants' motions for summary judgment, the Court will assume that TU's statement of interest and the affidavits of its members sufficiently allege personal environmental and recreational interests of the members in the Big Hole River basin, distinct from the public at large, that arguably could be adversely affected by the temporary preliminary decree in the Big Hole River basin.

Under the broad standing requirements of the Montana Administrative Procedures Act and even broader standing requirements of most federal and Montana environmental protection statutes, such interests may be sufficient for persons to establish either constitutional or statutory standing to challenge the constitutionality of governmental acts or agency decisions.

However, personal environmental and recreational interests in the water, alone, are not sufficient to establish the “personal stake” required for standing to be heard on objections to claims in the present adjudication of existing water rights, unless those interests are coupled with an “ ownership interest in water or its use....” [Emphasis in original.]

The Water Court determined that the amendments to § 85–2–233, MCA, “over time” demonstrate legislative intent to narrow the scope of objections entitled to be heard to those that are coupled with an ownership interest in water or its use.

¶ 10 The Water Court observed that there was no evidence that MTU or any of its members had filed any water right claims in the adjudication process or that they had applied for post-July 1, 1973 certificates or permits to use water. Further, the court determined that under Montana law, only the DNRC and the DFWP are authorized to “represent the public in the adjudication process.” See §§ 85–1–101, –204, and –223, MCA, and In the Matter of the Missouri River Drainage Area, 2002 MT 216, ¶ 1, 311 Mont. 327, 55 P.3d 396 ( Bean Lake III ). The Water Court concluded that MTU's interests in the Big Hole River are related to citizen interests “claimed and reserved by the DNRC and DFWP” and further that the

Legislature and the Supreme Court have resolved the public policy and legal debate on who represents the public in the adjudication process. As a result, TU does not have standing to champion the public interests either through the filing of claims or through the filing of objections to claims.

MTU, therefore, was precluded from filing water claims for public recreational or wildlife purposes, from filing objections to claims or from requesting hearings on objections to claims.

¶ 11 Last, the Water Court considered MTU's contention that, in the alternative, it had a “legitimate role to play” in the Big Hole adjudication to insure that DNRC issue remarks were properly resolved. Issue remarks are statements by the DNRC added to its abstracts of water right to “identify potential factual or legal issues” associated with the claims. Section 85–2–250, MCA. Because the State of Montana owns all water in the state under Article IX,...