CO Supreme Court Releases Water Rights Decision With Potentially Significant Ramifications

June 10, 2015   |   Litigation, Water Law

On June 1, the Colorado Supreme Court released its decision in Frees v. Tidd, in which it held that a land owner whose property is burdened by an irrigation ditch easement may obtain a junior conditional water right at the headgate of that irrigation ditch for non-consumptive hydropower use of water that the neighbor is diverting from the stream under a senior water right. This is a novel issue never before addressed by the Supreme Court. The Court’s decision appears to permit a junior appropriator to divert flow from a senior diversion so long as the diversion does not injure the senior right. Two justices dissented raising serious questions about the effect of this decision on Colorado’s prior appropriation system.

The case arose in Saguache County where the Frees owns an irrigation water right decreed to Garner Creek Ditch No. 1 for 6.4 cfs diverted from Garner Creek with an 1890 priority. The headgate is located on the Tidds’ property and delivers water into a ditch that crosses the Tidds’ property. Ultimately, the water reaches the Frees’ property where it is used for irrigation. The Frees own an easement on the Tidds’ property for the headgate and ditch. During irrigation season, the Frees’ water right takes the entire flow of Garner Creek, except in periods of very high flow.

In 2014, the Water Court decreed a conditional water right for use by the Tidds in the amount of 0.41 cfs with a 2010 priority for hydropower use that is diverted from Garner Creek at Garner Creek Ditch No. 1. The Tidds do not intend to divert an additional 0.41 cfs from Garner Creek. Instead, they intend to divert 0.41 cfs of the 6.4 cfs owned by the Frees after the Frees have diverted pursuant to their 1890 priority. The Tidds’ will pipe 0.41 cfs from the ditch 1,222 feet downhill and pass it through a flywheel to generate electricity on the Tidds’ property. The entire 0.41 cfs will then be returned via a discharge pipe to the ditch before the place of use of the Frees’ water right. The Tidds admitted that the 0.41 cfs may not be sufficient to reach their pipe intake if the Tidds were to divert it themselves from Garner Creek.

Both parties agreed that the decree includes terms and conditions necessary to prevent material injury to the Frees’ water right. Nevertheless, the Frees appealed the Water Court’s decision arguing that the Tidds may not appropriate the same physical water that the Frees had already appropriated through their 1890 irrigation priority.

The Supreme Court affirmed the Water Court’s decision. The Court reasoned that the Frees do not physically own the water diverted at Garner Creek Ditch No. 1; instead, they have the right to use it for irrigation purposes. Therefore, the Frees’ ownership interest in the water does not prevent the Tidds from also using the water. Also, the Court affirmed the Water Court’s determination that there is water available at the headgate for the non-consumptive hydropower use and that such use will not materially injure the Frees’ senior irrigation right. Finally, the Court highlights the policy of maximum beneficial use of limited water resources that is implicit in Colorado water law to conclude that the multiple use of water proposed by the Tidds is consistent with Colorado law.

The dissent raises some very interesting questions as to whether the conditional water right decreed by the Water Court is truly consistent with Colorado’s prior appropriation doctrine, and it identifies possible ramifications of the decision.

The dissent argues that although the Tidds’ conditional water right carries a 2010 priority, they are actually diverting pursuant to the Frees’ 1890 priority because they are diverting water from the Frees’ appropriation. The dissent concludes that under this decision, a new appropriator may intercept water that is available only by virtue of a senior appropriator’s diversion. This “piggyback” situation effectively allows the junior appropriator to gain an overvalued water right by diverting under an earlier priority date. The dissent sees the Tidds’ conditional water right as an exception to the prior appropriation doctrine that is not permitted in the Water Code.

The dissent also raises some interesting questions about possible unforeseen ramifications of the decision. For example, what obligations do the Frees owe to the Tidds to prevent injury if the Frees wish to change their point of diversion? Also, what happens if instead of a small hydropower water right, the water right was used to power a large hydroelectric power plant? Does that power plant have to be shut down if the senior appropriator decides to change its point of diversion?

The Court’s decision does help foster maximum utilization of the state’s waters; however, this decision raises significant policy questions that will have to be worked out in future court cases or legislation.