Summary of a Recent
Judicial Development in
Water Law

Injured Landowner's Right to Sue in Tort Trumped
by State's Reservation of Natural Waterways

Eric H. Foy
National AgLaw Center Research Associate

Summary of Decision

In Southwest Sand and Gravel, Inc. v. Central Arizona Water Conservation District, 212 P.3d 1 (Ariz. Ct. App. 2008), the Arizona Court of Appeals affirmed the decision of the Maricopa Country Superior Court, which had entered summary judgment for the water district. The plaintiff, a gravel company, brought suit against the water district alleging negligence, negligence per se, trespass, nuisance, and inverse condemnation for diverting water in a manner injurious to the company.

Background

The water district managed the Central Arizona Project (CAP) and promoted water conservation in the Central Arizona region. Id. at *1. The Arizona legislature authorized district to operate underground storage facilities to store CAP water when the water was not in demand. Id. In 1999, the district received a permit from the Arizona Department of Water Resources to store 100,000 acre-feet of water each year for twenty years. Id. The permit also authorized the district to conduct recharge into the Agua Fria River upon the observance of certain operational limitations. Id. Pursuant to its permit authorization, the district began diverting CAP water into the Agua Fria River, which filled the aquifers under and adjacent to the river. Id. The diversion also raised the water table beneath the gravel company's sand and gravel facility, interfering with its business operations. Id. The district conceded that the water level near the facility had risen as a result of the recharge, but it argued that the water level was still lower than where it would have been under natural water flow conditions. Id. The gravel company sued the water district in Maricopa County Superior Court, alleging negligence, negligence per se, trespass, nuisance, and inverse condemnation. Id. at *2. The company moved for partial summary judgment and the district moved for summary judgment. Id. The court granted the district's motions for summary judgment and denied the company's motion for partial summary judgment. Id. The instant appeal ensued. Id.

Arguments

The gravel company argued that the district's use of the riverbed to transport and store water gave the company, as owner of the riverbed and adjacent land, a cause of action for a governmental taking and trespass. Id. at *3. Additionally, the company argued that even if the district had the right to transport and store water on its land, the right was limited to non-injurious use. Id. at *5.

Analysis and Holdings

The Arizona Constitution repudiates the concept of riparian rights to water, and instead, adopts the law of prior appropriation. See id. at *3. By so doing, when an entity in Arizona acquires land, it takes the land subject to any water rights obtained prior to its ownership. Id. In addition, Arizona Revised Statute § 45-173(A) recognizes the state's right to locate an underground storage facility in a natural stream. Id. The court stated that the statute contemplated that private property could be used to carry water of another or for the location of an underground water facility. Id. The court also stated that the permitting process did not alter the pre-existing rights of the parties. Id. In the instant action, the gravel company took its property subject to the state's reservation of natural channels to move and store water; therefore, no taking had occurred. Id. The district had used the channel for its intended statutory purpose. Id.

The gravel company did not have the historical right to exclude others from using the natural water channel. See id. at *4. Without the right to exclude others, the court held that the company's claim of trespass or any other wrongful injuries could not be maintained. Id.

Finally, the court disagreed with the gravel company regarding a non-injurious use limitation to the district's water rights. Id. at *5. The court said that the company's argument was inapplicable because the cited case law referred to the movement and storage of wastewater and was limited to circumstances involving two competing water users. Id.

The case was decided on November 10, 2008.