Salt Lake City Corp. v. Haik

• Decision Date: 18 May 2020
• Docket Number: No. 20190091,20190091
• Citation: 466 P.3d 178
• Court: Utah Supreme Court
• Parties: SALT LAKE CITY CORPORATION and Metropolitan Water District of Salt Lake & Sandy, Respondents, v. Mark C. HAIK and Pearl Raty, as Trustee of the Pearl Raty Trust, Petitioners.

466 P.3d 178

SALT LAKE CITY CORPORATION and Metropolitan Water District of Salt Lake & Sandy, Respondents,

v.Mark C. HAIK and Pearl Raty, as Trustee of the Pearl Raty Trust, Petitioners.

No. 20190091

Supreme Court of Utah.

Heard January 15, 2020

Filed May 18, 2020

Shawn E. Draney, Scott H. Martin, Danica N. Cepernich, Salt Lake City, for respondents

Paul R. Haik, Eden Prairie, MN, for petitioners

Chief Justice Durrant authored the opinion of the Court, in which Associate Chief Justice Lee, Justice Himonas, Justice Pearce, and Justice Petersen joined.

On Certiorari to the Utah Court of Appeals

Chief Justice Durrant, opinion of the Court:

Introduction

¶1 The Pearl Raty Trust (the Trust) seeks water for an undeveloped lot it owns in Little Cottonwood Canyon. Although the lot sits in unincorporated Salt Lake County, it falls within Salt Lake City's water-service area. According to the Trust, this makes it an inhabitant of Salt Lake City and thereby entitled to the city's water under article XI, section 6 of the Utah Constitution. The court of appeals rejected this argument. Because the Trust fails to persuade us that the voters who ratified Utah's Constitution would have considered it an inhabitant of Salt Lake City, we affirm.

Background

¶2 This case is the latest episode in the "ongoing saga" between Mark Haik and Salt Lake City (the City) over water access in Little Cottonwood Canyon.¹ The protagonist in this chapter is not Mr. Haik, however, but the Pearl Raty Trust, which owns property next to Mr. Haik's in the Albion Basin subdivision. Both the Trust and Mr. Haik seek water from Salt Lake City so they can develop the lots they own in this subdivision.

¶3 In February 2014, Salt Lake City brought a quiet title action against Mr. Haik and the Trust's predecessor-in-interest, Butler Management Group, over their water rights in the Albion Basin. In response, Butler and Mr. Haik asserted five counterclaims based on their inability to obtain the water necessary to develop their Albion Basin properties. One of these counterclaims, which is the sole subject of this appeal, is that article XI, section 6 of the Utah Constitution obligates the City to supply their properties with water.² The district court dismissed Mr. Haik's counterclaim on the basis of res judicata because he previously litigated an identical claim in federal court.³ But because neither Butler nor the Trust was a party to Mr. Haik's federal lawsuit, the district court considered the Trust's counterclaim on its merits.

¶4 The Trust's counterclaim rests on the fact that, although the Albion Basin subdivision is not part of Salt Lake City proper, it falls within the city's approved water-service area.⁴ In 1992, the City filed a change application, approved by the State Engineer, allowing it to divert up to 15.75 acre-feet of water annually for thirty-five homes in the subdivision. But even though this gave the City approval to deliver water to the Basin, it is not currently delivering enough water for the Trust and Mr. Haik to develop their empty lots. According to the Trust, the Salt Lake Valley Board of Health will not issue a building permit until its lot is able to receive 400 gallons of water per day. But the City currently supplies only fifty gallons per day to four cabins that already exist in the Basin.

¶5 According to Salt Lake City, even though it has approval to supply the Basin with 400 gallons of water per day, its distribution system does not extend far enough up Little Cottonwood Canyon to reach the Trust's and Mr. Haik's lots. In other words, although the Trust's lot technically falls within Salt Lake City's approved water-service area, the City lacks the infrastructure to actually supply the lot with water. Nonetheless, the Trust claims to "stand[ ] ready, willing, and able to finance the costs of extend[ing]" Salt Lake City's distribution system up the canyon.

¶6 With this context in mind, we now turn back to the Trust's counterclaim, which the district court dismissed in February 2017. According to the district court, the counterclaim "boil[ed] down to a dispute over the proper interpretation of the term ‘inhabitant[s]’ as used in article XI, section 6," and whether the Trust was an inhabitant of Salt Lake City by virtue of owning property within the City's approved water-service area. To resolve this dispute, the district court adopted a "common sense meaning of inhabitant" as "someone residing within the corporate boundaries of [a] city"—a definition that does not include the Trust. The district court also concluded that the Trust is not an inhabitant of Salt Lake City because it "merely holds undeveloped property within territory over which the City asserts water rights and extra-territorial jurisdiction." "At best," the district court explained, the Trust "wants to build on the property so others can inhabit it."

¶7 The Trust appealed this ruling and the court of appeals affirmed.⁵ In so doing, the court of appeals held that, because the Trust's lot is "beyond the limits" of Salt Lake City, forcing the city to provide its lot with water "would cut directly against that section's purpose."⁶ We granted certiorari to determine whether the court of appeals erroneously interpreted article XI, section 6 of the Utah Constitution. We have jurisdiction under Utah Code section 78A-3-102(3)(a).

Standard of Review

¶8 "On certiorari, we review the court of appeals’ decision for correctness, focusing on whether that court correctly reviewed the trial court's decision under the appropriate standard of review."⁷ The district court's decision to grant Salt Lake City's motion to dismiss "is a question of law," which the court of appeals reviewed "for correctness."⁸

Analysis

¶9 Article XI, section 6 of the Utah Constitution provides that "[n]o municipal corporation, shall directly or indirectly, lease, sell, alien or dispose of any waterworks, water rights, or sources of water supply now, or hereafter to be owned or controlled by it." Instead, "all such waterworks, water rights and sources of water supply now owned or hereafter acquired by any municipal corporation, shall be preserved, maintained and operated by it for supplying its inhabitants with water at reasonable charges."⁹

¶10 The Trust argues that this provision obligates Salt Lake City to supply water to its Albion Basin lot. This argument hinges specifically on the word "inhabitants" in the phrase "supplying its inhabitants with water."¹⁰ The Trust claims it is an inhabitant of Salt Lake City because its lot falls within the City's approved water-service area. And because it is an inhabitant of Salt Lake City, the Trust argues, article XI, section 6 requires the City to supply its lot with water. The court of appeals rejected this argument. Instead, it adopted the district court's interpretation of inhabitant as one who "reside[s] within the corporate boundaries of [a] city."¹¹ Under this interpretation, because its lot is located outside city limits in an unincorporated part of Salt Lake County, the Trust is not an inhabitant of Salt Lake City. The Trust asks us to reject this interpretation.

¶11 According to the Trust, the court of appeals erred in adopting the district court's interpretation of "inhabitants." Instead of endorsing the district court's "common sense" interpretation, the Trust argues, the court of appeals should have conducted an originalist analysis to determine what the word "inhabitants" meant to the Utahns who ratified our constitution in 1896. And it claims that, were we to perform this analysis, we would conclude that the original understanding of article XI, section 6 obligated cities to supply water to any property within their approved water-service area—even those properties falling outside of a city's corporate boundaries.

¶12 The Trust correctly points out that when interpreting the Utah Constitution, we "seek to ascertain and give power to the meaning of the text as it was understood by the people who validly enacted it as constitutional law."¹² This approach, which "has been our primary mode of constitutional interpretation since the founding of the state,"¹³ requires us to determine the "original public meaning" of the constitutional provision in question at the time it was adopted.¹⁴ And while there is "no magic formula" for this determination, "prior case law guides us to analyze [a provision's] text, historical evidence of the state of the law when it was drafted, and Utah's particular traditions at the time of drafting."¹⁵

¶13 But despite making several arguments based on the text of article XI, section 6, and the historical evidence surrounding its adoption, the Trust fails to persuade us that the Utahns who ratified our constitution understood the word "inhabitants" to encompass any person who owned property in a city's approved water-service area. After reviewing the plain language of article XI, section 6 and several historical sources—including the proceedings of Utah's constitutional convention, the 1898 Utah Code, and interpretations of "inhabitants" adopted by other late-nineteenth century courts—we conclude that the court of appeals did not err in construing the term "inhabitants" to apply only to those who reside within a city's corporate boundaries. So we affirm.¹⁶

I. The Trust is Not an Inhabitant of Salt Lake City Under the Plain Language of Article XI, Section 6

¶14 The Trust focuses its argument on the second clause of article XI, section 6. This clause mandates that "all ... waterworks, water rights and sources of water supply now owned or hereafter acquired by any municipal corporation, shall be preserved, maintained and operated by it for supplying its inhabitants with water at reasonable charges." According to the Trust, the word "inhabitants" in this clause refers to those residing within a municipal corporation's approved water-service area. We disagree.

¶15 In matters of constitutional interpretation, "our job is first and foremost to apply the...