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April 19, 2022  |  Written by Michael W. Daugherty

Five Tips for Colorado Ditch Companies

As spring arrives in Colorado, ditch companies across the state will begin running their ditches for the benefit of their shareholders and other water users. Like most arid Western states, ditches have a storied history in Colorado, dating back to the 1850s when the state’s first non-Native settlers arrived in the San Luis Valley, and ditches continue to provide water to irrigators throughout the state during irrigation season each year.

Regardless of this legal protection, it is still important to take stock of your ditch company’s legal positioning and determine whether there is room for improvement.

Colorado water law has developed over the years to protect ditch users and ensure that the state’s rapid development does not upend the historical ditch irrigation systems that supply a wide array of users. Regardless of this legal protection, it is still important to take stock of your ditch company’s legal positioning and determine whether there is room for improvement.

Whether you are a water user that relies on a ditch to bring you water, a ditch company official, or a private property owner, consider these five tips intended to help ditch companies make the most of this year’s irrigation season and give landowners information about how a ditch may impact their property rights:

1. Know what type of easement a ditch company owns.

Ditch companies generally own either a prescriptive or an express easement. Once a ditch has been constructed and operated, the ditch company has the legal right to run water through the ditch and cross private property as necessary to access the ditch for required maintenance activities.

If a ditch relies on an historical right of access, and that right has never been formally deeded and recorded, the ditch company likely holds a prescriptive easement. Since prescriptive easements do not always show up in title investigations, landowners may not realize the picturesque stream flowing through their new backyard is actually an irrigation ditch that imposes significant responsibility and does not necessarily provide water to that property. Just because a prescriptive easement is not recorded, however, it does not mean that a ditch company does not still enjoy the legal protection offered to irrigation ditches under Colorado law. One good rule of thumb for a ditch company is to require an express easement for any property owner that proposes a ditch modification or crossing, and landowners should expect such a request when they propose a project that involves a ditch.

If there is a formal recorded agreement that grants the right to cross private property to operate a ditch, then this reflects a deeded easement, which is a type of express easement, rather than a prescriptive easement. Over the years, many ditches have formalized and recorded easements for the operation of their ditches, replacing their historical prescriptive easement with a deeded one. One benefit of a deeded easement is that landowners know whether a ditch easement exists when they purchase a property. This can help prevent confusion and unauthorized modifications to a ditch. If a ditch company currently owns a prescriptive easement, and a development is proposed that involves the ditch and requires ditch company consent, a ditch company should consider formalizing its rights through a deeded easement.

While both prescriptive and express easements provide ditch companies the legal right to cross private property to operate and maintain their ditches, knowing which type of easement a company owns will help ensure efficient operations for the benefit of all users.

2. Have agreements in place for all types of development.

Rapid development is occurring across the West, and sooner or later that development will likely reach a ditch (if it has not already). Whether a developer proposes to build a large shopping center on top of a ditch, or a homeowner wants to construct a small pedestrian bridge across it, a proper agreement can protect the ditch company and other users from adverse impacts. For large projects, developers may propose significant modifications to a ditch, including piping and re-routing it, and ditch companies will need a comprehensive agreement and engineering review. For small-scale projects, a short crossing agreement that grants the property owner the right to cross the ditch may suffice. For time-sensitive projects, a temporary agreement that is later replaced with a more comprehensive one can bridge the gap. Regardless of what a developer is proposing for a ditch, an agreement is recommended so that all the parties understand their rights and obligations.

3. Make sure you are protected in the event of a disruption.

Construction accidents happen, and you want to be prepared for the worst. Sometimes, ditch companies execute agreements that do not provide adequate protection in the event that a construction activity negatively impacts ditch operations. Best practices include reviewing the agreements that the ditch company has executed recently and assessing whether they lay out each party’s obligations in the event of an accident. Ditch companies may face liability from third parties, including from water users that do not get their water and/or property owners whose property suffers damage due to a ditch’s operation, so it is important to make sure all ditch crossing and modification agreements shift that liability to the developer or landowner if that party’s activities cause the disruption. Ditch companies should evaluate their form agreements and assess whether they provide adequate legal protection in the event of a disruption, and developers should review these agreements to make sure they are fair to all parties.

4. Consider whether the ditch company charges consistent, fair rates for licensing and other activities.

When ditch companies incur expenses to accommodate a construction project, they often shift those expenses onto the developer or landowner. Even for small-scale residential projects, ditch companies can incur significant legal, engineering, and inspection expenses. Best practices for ditch companies include making sure that the company is charging a consistent rate for crossings and modifications, so that developers are not surprised or confused when they approach a ditch company about a proposal. While ditch companies often cooperate with landowners to build and maintain good relationships, the general rule is that a ditch company charges the property owner the expenses related to that party’s project. Ditch companies should review agreements to ensure that deposits are sufficient to cover up-front expenses, lay out a timeline and process for payment of future expenses, and provide an avenue for relief in the event that a party fails to pay. Developers and other private landowners should review payment terms to ensure that all obligations and timelines are clear.

5. Seek out sound legal advice.

No number of tips or recommendations can replace the benefit of retaining an attorney familiar with ditch law for ditch-related matters. An attorney can draft comprehensive agreements that protect legal interests and assist with negotiations between ditch companies, developers, landowners, and municipalities or other public entities. Somach Simmons & Dunn can provide transactional and litigation support to public and private parties for all types of ditch-related matters.

For more information or to ask specific questions about your ditch company’s legal rights, contact Michael W. Daugherty at mdaugherty@somachlaw.com, or call 303.449.2834.

Somach Simmons & Dunn provides the information in its Environmental Law & Policy Alerts and on its website for informational purposes only. This general information is not a substitute for legal advice, and users should consult with legal counsel for specific advice. In addition, using this information or sending electronic mail to Somach Simmons & Dunn or its attorneys does not create an attorney-client relationship with Somach Simmons & Dunn.

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