Abandonment

1. Abandonment Water 101 Abandonment Issues in Wyoming Wyoming Farm Bureau Foundation Leadership Conference Series June 5-6, 2007

2. OUTLINE • Wyoming Water Law philosophies • Abandonment statute and statutory language • Procedure for Abandonment action • Break-down of elements required for an Abandonment Proceeding: • Standing • Joe Johnson Company and schulthess • Same Source of Supply • Schulthess • Benefit and Injury • Joe Johnson Company and schulthess • Excuses and Extensions for Nonuse of Water • Intentional or unintentional Nonuse • McTiernan • Conclusion • Questions

3. Wyoming’s Water Philosophy • Water must be put to “beneficial use” • “Use It or Lose It”

4. Wyoming’s Water Philosophy • Forfeitures and abandonment are not favored in law, and in cases of abandonment, the evidence must be clear and convincing that it was the intent of the owner to abandon. Ramsay v. Gottsche, 51 Wyo. 516 (1936).

5. Wyoming’s Abandonment Statute • W.S. 41-3-401 • If an appropriator fails to “intentionally” or “unintentionally” use his water for “beneficial use” during any five (5) successive years, he is considered to have abandoned his water rights.

6. Wyoming’s Abandonment Statute • Abandonment proceedings are heard in front of the Board of Control. • If an action is filed, superintendent must notify all affected water users of proceedings. • BOC decisions on abandonment may be appealed to the District court and Wyoming Supreme Court. • The Courts must defer to the BOC’s specialized knowledge and expertise regarding the use or nonuse of water and the technicalities involved in irrigation. Joe Johnson Co.

7. Wyoming’s Abandonment Statute • All water rights subject to appropriation are likewise subject to abandonment • Supplement water rights are subject to abandonment.

8. Wyoming’s Abandonment Statute NON-USE: • Must establish non-use for five (5) consecutive years.

9. Wyoming’s Abandonment Statute STANDING • Must prove two (2) essential facts: • You must possess a valid water right of equal or junior standing to the right to your neighbor; AND • Your water right and your neighbor’s water right must be from the “same source of supply.”

10. Wyoming’s Abandonment Statute BENEFIT or INJURY • If you have met the non-use and standing requirements, you must now prove the following: • You will “benefit” from the abandonment or • You will sustain “injury” if your neighbor reactivates his water right.

11. Wyoming’s Abandonment Statute BENEFIT or INJURY • The “benefit” or “injury” must be tangible. • An improvement in priority is not sufficient to prove “benefit.” • Must provide evidence that there is benefit or injury.

12. Joe Johnson Co. v. Wyoming Bd. Of Control857 P. 2d 312 (Wyo. 1993) • J had junior ground water rights, naming the Eydie Lee Johnson Well. • Bowen and G.E. had ground water rights • J petitioned the BOC (2 petitions) to abandon the Bowen Wells and G.E. Wells. • G.E. did not object and did not appear at the hearing. • J argued that if the Bowen and GE Wells were abandoned this would enhance (improve) his priority. • Control Area

13. Joe Johnson Co. v. Wyoming Bd. Of Control857 P. 2d 312 (Wyo. 1993)

14. Joe Johnson Co. v. Wyoming Bd. Of Control857 P. 2d 312 (Wyo. 1993) • BOC held J did not have standing and denied abandonment. • BOC held “the enhancement of a petitioner’s relative priority without a showing of potential tangible benefit or injury was insufficient to sustain J’s standing to seek the abandonment. • BOC also said J did not provide enough evidence.

15. Joe Johnson Co. v. Wyoming Bd. Of Control857 P. 2d 312 (Wyo. 1993) Wyoming Supreme Court held: • J had standing (in spite of BOC decision): • J had a junior right to the wells; • J’s right and S’s right were from the same source of supply (red aquifer); • However, Court denied abandonment because J did not demonstrate a “tangible” benefit or “Injury by Reactivation” of the S’s water right. • Court held, “a relative improvement in priority, standing alone, is not sufficient to show a benefit.”

16. Schulthess v. carollo832 P. 2d 552 (Wyo. 1992) • S owned an original supply water right in the upper Ham’s Fork Creek (Jan. 20, 1916) and supplemental water right in the Beaver Creek (Jan. 29, 1931) • C owned original supply territorial right in Beaver Creek (May 15, 1889) and surplus right (March 1, 1945). • C petitioned the BOC to abandon S’s original right in Ham’s Fork Creek and supplemental right in Beaver Creek. C argued: • C had standing b/c C was junior (surplus 1945 right.) • C would benefit b/c if S’s rights were abandoned, there would be more unappropriated water in the stream system and C would have a greater change that he would be able to satisfy his surplus water right.

17. Schulthess v. carollo832 P. 2d 552 (Wyo. 1992) Beaver Creek Upper Ham’s Fork S = OS 1916 S S=SS 1931 C = OS 1889 Beaver Creek C= Surplus 1945 Lower Ham’s Fork

18. Schulthess v. carollo832 P. 2d 552 (Wyo. 1992) • BOC determined C had standing because the surplus water right priority date made C junior to S. • BOC abandoned S’s original and supplemental water rights to irrigate 37.78 acres, denied abandonment of the remaining 78.22 acres. • S appealed the BOC Decision to the Wyoming Supreme Court.

19. Schulthess v. carollo832 P. 2d 552 (Wyo. 1992) • Court reversed the BOC decision, holding C did not have standing. • Wyoming Supreme Court held BOC was required to find that C’s surplus rights were from Beaver Creek were from the same “source of supply” as S’s water rights. Court questioned how BOC could determine C’s Beaver Creek Water Right is from the same source of supply as S’s Ham’s Fork Creek Right. • Same Source of Supply does not mean “same stream system”. • Wyoming Supreme Court found BOC did not find C stood to “Benefit” from the abandonment. • Wyoming Supreme Court found benefit must be “tangible” not “theoretical”.

20. Schulthess v. carollo832 P. 2d 552 (Wyo. 1992) • Same Source of Supply: • Requires C to prove that S’s water right, “if not from an identical water source, is from a water source which contributes significantly to the water source upon which C relies to satisfy his appropriation.

21. Snider v. Kirchhefer115 P. 3d1 (Wyo. 2005) • Snider (S) land had 1915 irrigation right to divert water out of 6 mile creek. 6 mile creek runs through Kirchhefer’s (K’s) land and S’s diversion ditch is on K’s land. • K’s land did not have surface water permit to divert out of 6 mile, but did have well permitted in1995. • S had not used water for over 5 years and the diversion ditch was in disrepair.

22. Snider v. Kirchhefer115 P. 3d1 (Wyo. 2005) Snider Lands (1915) Diversion Ditch 6 Mile Creek Kirchhefer Lands (1995)

23. Snider v. Kirchhefer115 P. 3d1 (Wyo. 2005) • BOC abandoned S’s water rights • S appealed the • Wyoming Supreme Court held • No abandonment b/c K’s injury was too speculative to indicate a reasonable likelihood of injury or benefit.

24. Wyoming’s Abandonment Statute • Extensions • Reservoir rights May apply to BOC for an Extension • Must demonstrate Due Diligence toward utilization of the appropriation • Or Demonstrate reasonable cause for Nonuse

25. Wyoming’s Abandonment Statute Reasonable Cause (“Excuses”) or delay from: • Court Proceedings • Planning, Developing or Financing For Construction Projects • Statutes (Federal and State) • Any other Causes Beyond the Control of the Appropriator

26. Wyoming’s Abandonment Statute More excuses… • Disastrous floods that prevent water users from using ditches or dams • Inability to obtain water • Shortage of water • “The total absence of water to divert during an irrigation season precludes the inclusion of any such period of nonuse resulting therefrom in the computation of the successive five (5) year period under this section” • Involuntarily Nonuse (My nonuse of the water wasn’t voluntary).

27. Scott v. McTiernan 974 P. 2d 966 and 31 P. 3d 749 • Scott and McTiernan owned land that had at one time been owned in common. • S’s surface water rights were conveyed through ditches on M’s land. • M deliberately filled S’s ditches and prevented water from flowing to S. M told S he would replace the ditches. • M petitioned to abandon S’s water rights for nonuse. • S argued they had not “voluntarily” abandoned the water rights, that it was M’s fault.

28. Scott v. McTiernan 974 P. 2d 966 • BOC held S had abandoned the water rights, that S should have taken affirmative action to use water. • S appealed. • Wyoming Supreme Court reversed BOC’s decision and held that S’s failure to use the water was the result of M’s deliberate actions to prevent S from receiving water and therefore S did not voluntarily abandon the water. • Court also calculated irrigable acres in the decision. • Court remanded the case back to the BOC, then appealed back to the court.

29. Scott v. McTiernan 31 P. 3d 749 • The BOC followed the Court’s ruling in the first case and abandoned a portion of S’s water rights. • Court held BOC decision was not supported by substantial evidence.

30. Wyoming’s Forfeiture Statute • W.S. 41-3-402 If an appropriator fails to “intentionally” or “unintentionally” use his water for “beneficial use” during any five (5) successive years, the state engineer may initiate forfeiture proceedings against the appropriator with the BOC to determine the validity of the unused right.

31. CONCLUSIONS Conflicting views • Beneficial Use v. Forfeitures Not Favored • Beneficial Use v. Good Excuse • Beneficial Use v. Fairness • BOC v. Wyoming Supreme Court • Deference to BOC • Statute v. Wyoming Supreme Court • Intentional v. unintentional non-use • Drought v. State Engineer’s Ability to Forfeit Unused Water

32. Questions Eydie L. Trautwein Hageman & Brighton, P.C. 222 E. 21st Street Cheyenne, WY 82001 307-635-4888 etrautwein@hblawoffice.com www.hblawoffice.com