On September 11, 2014, the First District Court of Appeal issued its opinion in Millview County Water District, et al. v. State Water Resources Control Board, et al., No. A139481, 2014 Cal.App. LEXIS 825.  The opinion includes two noteworthy conclusions.  First, the Court held that the State Water Resources Control Board (State Board) has the authority to issue cease and desist orders to preclude unauthorized diversions under claimed pre-1914 appropriative water rights.  Second, the Court clarified that forfeiture of a water right requires both a five-year period of non-use of the right and the presence of a competing claim to the water.

Background

Millview County Water District (Millview) began diverting water from the Russian River in 2001 under the authority of a pre-1914 appropriative water right assigned to Millview by two private parties.  After a citizen complaint and an administrative hearing, the State Board issued Millview a cease and desist order restricting its authority to divert under the pre-1914 right and finding that the right was largely forfeited due to non-use from 1967 to 1987.  Millview petitioned for a writ of mandate on the grounds that the State Board lacked jurisdiction to limit its pre-1914 appropriation and that the State Board’s forfeiture finding lacked evidence of a timely adverse claim.  The trial court granted the writ and the State Board appealed.

The State Board’s Jurisdiction

The Court followed the Third District Court of Appeal’s recent decision in Young v. State Water Resources Control Board, 219 Cal.App.4th 397 (2013) (Young) which found that in order for the State Board to exercise its authority to prevent unauthorized diversions of water, it must necessarily have the jurisdiction to determine whether a claim of right under a pre-1914 appropriation is valid.  Both Courts of Appeal reasoned that any other rule would allow a diverter to claim a pre-1914 right and be entirely beyond the State Board’s regulation.

The Court’s ruling also expanded on Young, which dealt only with the existence of a pre-1914 right, and found that the State Board has the authority to determine the scope of the claimed right as well.  It reasoned that an unauthorized diversion of water includes not just water claimed under an invalid pre-1914 right but also diversion beyond the scope of a valid right.  Thus, the State Board can determine both the existence and the extent (i.e., the water right elements of the appropriation, such as lawful rate of diversion) of claimed pre-1914 rights.  As a result, the Court overruled the trial court and found that the State Board had jurisdiction to issue Millview the cease and desist order.

Forfeiture

The Water Code provides that if a water right holder fails to beneficially use all or a portion of a water right for a period of five years, “that unused water may revert to the public and shall, if reverted, be regarded as unappropriated public water.”  Water Code § 1241.  Relying on existing case law, the Court found that what is required for forfeiture is not merely nonuse by the rights holder but also “the presence of a competing claim” by a rival diverter who is prepared to use or is using the water.  The Court departed from the requirement outlined inNorth Kern Water Storage District v. Kern Delta Water District, 147 Cal.App.4th 555 (2007), that formal notice communicated to the rights holder is required.  Rather, the Court found that existing California authority supports that a rights holder whose water use falls below the full appropriation for five years or more may nonetheless resume full use at any time if no conflicting claims have been asserted in the meantime.  Thus, no particular manner of asserting a conflicting claim exists beyond the conflicting claim and use of the surplus water.

The Court drew on various California authorities to find that a conflicting claim exists if another claimant has actually appropriated the water covered by the original claims, and has perfected the appropriation by making beneficial use of the water or has attempted to appropriate the water by instituting proceedings to establish a right (e.g., seeking a permit to appropriate from the State Board).  Ultimately the Court concluded that if the original claimant’s use of less than its full appropriation lasts for at least five years and does not end before the assertion of any conflicting claims, a forfeiture occurs.  The Court remanded the matter to the State Board to determine whether there is evidence of a conflicting claim during a period of alleged non-use by Millview’s predecessors in interest.

Conclusion

The Court followed Young and confirmed the State Board’s authority to determine both the existence and extent of claimed pre-1914 appropriative water rights in administrative enforcement proceedings.  Although this conclusion is unremarkable by itself, the methods and extent by which the State Board exercises this authority remain to be seen.  Furthermore, the Court established that both a period of non-use and an overlapping conflicting claim are needed to establish forfeiture.  Although just the decision of one Court of Appeal, this conclusion provides new insight for waters users subject to forfeiture proceedings or claiming new rights, particularly in a case where a water right went through a period of non-use and re-use.

For additional information, please contact Rich Deitchman at (916) 446 7979 orrdeitchman@somachlaw.com.

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