State v. Hagerman Water Right Owners, Inc. (HWRO)

• Citation: 947 P.2d 391,130 Idaho 718
• Decision Date: 10 September 1997
• Docket Number: No. 23071,No. 2,Nos. 39576,91-00002,s. 39576,2,23071
• Parties: In re SRBA Caseex rel. Award of Attorney Fees Under Private Attorney General Doctrine re Basin-Wide IssueSTATE of Idaho, Petitioner, v. HAGERMAN WATER RIGHT OWNERS, INC. (HWRO), Respondents. Boise, March 1997 Term
• Court: Idaho Supreme Court

Page 391

947 P.2d 391

130 Idaho 718

In re SRBA Case Nos. 39576, 91-00002 ex rel. Award of Attorney Fees Under Private Attorney General Doctrine re Basin-Wide Issue No. 2.

STATE of Idaho, Petitioner, v. HAGERMAN WATER RIGHT OWNERS, INC. (HWRO), Respondents.

No. 23071.

Supreme Court of Idaho,

Boise, March 1997 Term.

Sept. 10, 1997.

Alan G. Lance, Attorney General; Steven W. Strack, Deputy Attorney General (argued), Boise, for appellant

Hepworth, Lezamiz & Hohnhorst, Twin Falls, for respondents. John C. Hohnhorst argued.

SCHROEDER, Justice.

This case was brought in the Fifth Judicial District Court (SRBA court) as part of the proceedings in the Snake River Basin Adjudication (SRBA). As part of what came to be designated "Basin-Wide Issue No. 2," dealing with the role of the Director of the Idaho Department of Water Resources (Director) and the Idaho Department of Water Resources (IDWR), the district court awarded Hagerman Water Right Owners, Inc. (HWRO) attorney fees pursuant to the private attorney general doctrine for its role in obtaining basin-wide designation of those issues. The SRBA court's order entered on October 15, 1993, did not specify against whom the award was made. Subsequently, the Idaho Legislature amended Title 42, eliminating the Director and/or the Department as a party in the SRBA. The State of Idaho appeals the award.

I. BACKGROUND AND PRIOR PROCEEDINGS

On April 29, 1993, HWRO filed a motion with the SRBA court to have it appointed as a "private attorney general" and to provide payment of attorney fees. ¹ Initially, the district court denied HWRO's motion because no issue had as yet been identified and designated as a basin-wide issue, noting that "[w]hen a potentially qualifying issue is identified, parties will be aligned, and then the matter of appointing a private attorney general can be addressed if raised."

On June 30, 1993, HWRO filed a Motion to Designate Basin-Wide Issues and, [inter alia,] Determine Award of Fees and Costs Under Private Attorney General Doctrine (Motion to Designate). The IDWR opposed an award of attorney fees. On October 15, 1993, the district court partially granted HWRO's motion to designate Basin-Wide Issue No. 2 which was stated as follows:

What is the role of the Director, i.e., the Idaho Department of Water Resources, as a party in this statutory adjudication requiring the judicial determination of each The district court declined to "[a]lign parties according to the positions advocated as to the eventually designated Basin-Wide Issues or to the Basin-Wide Subcases" and also held that HWRO would be entitled to "attorney fees incurred in litigating Basin-Wide No. # 2 before the court in such amount as is applied for and approved by the court at the conclusion of the case." The district court explained the prospective grant of attorney fees:

claimant's right to the use of water in the Snake River Basin?

By raising and strongly advocating for designation of the role of IDWR as a Basin-Wide Issue, Movants have provided a substantial service to this court and to all water users in this state.... The state of Idaho would not have sought to raise this issue and, in fact, has vigorously argued against this issue being designated as a Basin-Wide Issue.... Resolution of this issue is critical to the judiciary's ability to proceed to hearing and ultimately to resolve subcases and issues in the SRBA generally....

Movants have requested that the private attorney general doctrine be prospectively applied. The prospective application of the private attorney general doctrine is unique but is not prohibited.... The court can look to its equitable powers to make a determination of the prospective application of this doctrine in the resolution of an issue that is pivotal in the court's ability to proceed to judicial resolution.

Movants were faced with, and will continue to be faced with, litigating against the state of Idaho to define the role of IDWR in this statutory adjudication. There is an important public interest at stake in the resolution of this issue. Under the equitable powers inherent in this court's ability and responsibility to efficiently manage the case before it, the court orders the prospective application of the private attorney general doctrine and awards attorney fees to Movants for having successfully raised the issue and achieving its designation as a Basin-Wide Issue....

That order did not specify whether the award would be against IDWR or the State. The State filed a Motion to Appeal which was denied.

HWRO submitted a memorandum in which it requested "reasonable attorneys' fees against R. Keith Higginson, in his official capacity as Director of the Idaho Department of Water Resources and the Idaho Department of Water Resources" in the sum of $13,604.05.

The next relevant time line is set forth in In re SRBA Case No. 39576, 128 Idaho 246, 912 P.2d 614 (1995):

Prior to the district court's ruling on basin-wide issue two, the Legislature significantly revised and amended the SRBA statutes. H.B. 969, 990, 1994 Sess. Laws Ch. 454, pp. 1443-78; Ch. 455 pp. 1478-91. Under the amended statutes, the Director was no longer included in the definition of "Party," I.C. § 42-1401A(7) (1994), and the Director's reports, notices of claimed water rights, objections to those claims, responses to objections, and negotiated agreements were no longer referred to as pleadings. I.C. § 42-1412(4) (1994)....

Idaho Code Sections 42-1401B and 1401C (1994) were adopted to define, respectively, the role of the Director and the role of various state agencies in the SRBA. I.C. § 42-1401B(1) (1994) provides that "[t]he director's role under this chapter is as an independent expert and technical assistant...." Subsections two and three of that statute provide that the Director is neither a claimant on behalf of the State nor a party in the SRBA. I.C. §§ 42-1401B(2), (3).

Id. at 252, 912 P.2d at 620.

The SRBA court issued its Memorandum Decision on Basin-Wide Issue No. 2 and 3 on December 7, 1994, declaring the majority of the 1994 SRBA amendments unconstitutional and ordering the SRBA to proceed under the original 1985 statutes. The SRBA court determined that the role of the Director of IDWR was to proceed as statutorily required in the 1985 Act with the State as the real On December 13, 1994, the State filed a Motion to Disallow Portion of Attorney Fees, arguing that "many of the requested fees [were] unrelated to designation of the role of the director as a Basin-Wide Issue."

party in interest appearing through the Director. ²

Following this Court's decision in In re SRBA Case No. 39576, holding that amendments to the role of the Director and the status of reports filed by the IDWR were constitutional, the SRBA court issued an Order Granting State's Motion to Withdraw Pleadings and Deem Director's Reports Filed Nunc Pro Tunc. The SRBA court stated two directives: (1) the Director shall be eliminated from the caption in Twin Falls County Case No. 39576, (the SRBA), and (2) the Director's reports shall be deemed filed nunc pro tunc. The record does not otherwise contain an order realigning the State of Idaho to a position adverse to HWRO. The record does not otherwise contain any indication that the State of Idaho was in anyway "substituted" for the IDWR for the purposes of an award of attorney fees.

On April 10, 1996, the SRBA court awarded HWRO $10, 969.05 in attorney fees pursuant to its previous order for fees involved in "pre-designation" of Basin-Wide Issue No. 2. The SRBA court denied HWRO attorney fees in the amount of $2,655 for that portion of fees involved in "post-designation" litigation because:

The underlying motion and basis for an award under the private attorney general doctrine is that a party "represent the public interest," just as an attorney general might, or that a party act in a capacity which would bring about a "benefit to the general public...."

In the instant case, as in the cases previously before the court, a crucial factor in the final analysis is HWRO's degree of self-interest in the resolution of BWI # 2.... HWRO prompted the formulation of BWI # 2 by specifically requesting that it be designated.

....

[M]erger of the two Basin-Wide Issues, and the self-interested position of HWRO on BWI # 3, it is held that during the litigation or "post-designation" phase of BWI # 2, HWRO does not meet the requirements of the Hellar test.

The State filed a Motion for Interlocutory Appeal, or in the Alternative, for a Determination of Finality Under I.R.C.P. 54(b). The SRBA court denied permissive appeal but issued a I.R.C.P. 54(b) certificate of final judgment. The State appeals the award of attorney fees.

II.

STANDARD OF REVIEW

In those instances where attorney fees can properly be awarded, the award rests in the sound discretion of the court. Foster v. Shore Club Lodge, Inc., 127 Idaho 921, 927, 908 P.2d 1228, 1234 (1995); Miller v. EchoHawk, 126 Idaho 47, 49, 878 P.2d 746, 748 (1994); Hellar v. Cenarrusa, 106 Idaho 571, 577, 682 P.2d 524, 530 (1984). An award of attorney fees under the private attorney general doctrine will be reversed only on a showing of an abuse of discretion. Boundary Backpackers v. Boundary Co., 128 Idaho 371, 378, 913 P.2d 1141, 1148 (1996); EchoHawk, 126 Idaho at 49, 878 P.2d at 748 (citing Fox v. Board of County Comm'rs Boundary County, 121 Idaho 684, 685, 827 P.2d 697, 698 (1992)). Whether the three-part test for an award of fees under the private attorney general doctrine has been met is a factual determination. Boundary, 128 Idaho at 378, 913 P.2d at 1148; EchoHawk, 126 Idaho at 49, 878 P.2d at 748; Hellar, 106 Idaho at 577, 682 P.2d at 530. Factual findings that are the basis for an exercise of discretion are subject to a substantial

                and competent evidence standard consistent with the clearly erroneous standard of I.R.C.P. 52(a).   Boundary, 128 Idaho at 378, 913 P.2d at 1148;  EchoHawk, 126 Idaho

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