Title: Due Process and the Effect of Eastern Appropriation Proposals on Existing Rights, with Special Emphasis on the Michigan Proposal
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Title: Due Process and the Effect of Eastern Appropriation Proposals on Existing Rights, with Special Emphasis on the Michigan Proposal
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Abstract: Richard Hamann's Collection - Due Process and the Effect of Eastern Appropriation Proposals on Existing Rights, with Special Emphasis on the Michigan Proposal
General Note: Box 12, Folder 7 ( The Law of Water Allocation In The Eastern United States - 1956 ), Item 14
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DUE PROCESS AND THE EFFECT OF EASTERN
APPROPRIATION PROPOSALS ON EXISTING
RIGHTS, WITH SPECIAL EMPHASIS
ON THE MICHIGAN PROPOSAL
by Clyde O. Fisher, Jr.*

As the title suggests, this paper concerns itself only with those possible
attacks on the constitutionality of the proposed Michigan appropriation law
which are based on the due process clause of the Fourteenth Amendment
and similar state constitutional provisions. The legal literature on due
process contains ample general statements to support almost any propo-
sition. Little is gained by a review of cases which do not decide issues
closely analogous to the question here presented. On the whole, analogous
constitutional cases are not found in Michigan and appear largely among
western state and federal court decisions. However, Michigan water law
cases will be emphasized when relevant to show the extent to which the
Michigan proposal modifies Michigan riparian law. Despite the fact that
many of the particular arguments and conclusions will therefore apply
only to Michigan, the issues which would be raised by an attempted enact-
ment of the Michigan proposal in another jurisdiction will probably be
quite similar, and it is hoped that this paper will be helpful to further
studies. Among the reasons for choosing the Michigan proposal as a mod-
el for discussion was the fact that, of the various appropriation proposals
recently drafted in the eastern states, it contains the most intricate pro-
visions for preserving vested rights. These provisions, combined with the
rest of the proposed law, seem to raise most of the due process issues
arising in connection with the statutes proposed or enacted in other states,
as well as some additional questions. Consequently, the Michigan statute
was singled out for purposes of achieving maximum coverage of possible
due process issues.




Attorney, City Plan Commission, New Haven, Conn. LL.B., Yale University;
M.S., Yale Conservation Program. Member of the Connecticut Bar.
The author is indebted to Professor David Haber for his suggestions.
1. The suggested legislation described here as the "Michigan proposal" or
"Michigan statute" (for text of the proposal, see pp.49-62) was drawnupfor purposes
of study and discussion, and for possible introduction in the 1951 Michigan Legis-
ture, and never appeared in bill form. For a general discussion of the proposal
and its background, see Barlowe, Raleigh, "Proposed Water Rights Legislation in
Michigan", Land Economics, Vol. 26, No. 3, August 1950, pp. 300-305.
For a discussion of other recent legislative proposals in eastern states, see
pp. 87-94.


~






LAW OF WATER ALLOCATION


I.

Discussion of the validity of Michigan's proposed statute must begin
with the sections that purport to preserve "existing rights". If these pro-
visions should turn out to be all-encompassing, the proposal's enactment
could not possibly result in a "taking" of property, and the "due process"
issue would not arise.2 It should be noted that, in considering the "exist-
ing rights" sections, certain differences between the riparian and the ap-
propriation system, as they are generally understood, will be emphasized.
Later in the paper, it will be suggested that some of these differences
might not be so drastic as they at first appear. There it will also be shown
that the smaller the differences between the riparian and appropriation
systems appear to be, the greater is the chance that an appropriation law
will be held constitutional in an eastern state. But, under this argument,
emphasizing the similarity between the two systems of water law, it is on
the whole unnecessary to rely on provisions explicitly attempting to pre-
serve all existing rights. To evaluate the efficacy of these provisions,
therefore, it is important to emphasize the differences between riparian
and appropriation methods of water allocation. Only in this way can one
know whether the law might be upheld on the ground that vested rights are
saved, no matter how great a change in the methods for creating future
rights the proposal is held to bring about.
In the Michigan proposal, the provisions purporting to preserve existing
rights read as follows:

Section 2. EXISTING RIGHTS PRESERVED. Nothing in this act is intended to
impair any existing valid right in the use of water, or to interfere with the con-
tinuance of any such right, or to prevent the maintenance of such stream flows
or lake levels as are necessary to the reasonable exercise of private vested
rights and to the reasonable use of natural streams and lakes for public purposes
of recreation, fishing, sanitation, and navigation.

Section 7. VESTED RIGHTS. Class A. The holder of any tract of land that now
conforms, or hereafter shall conform, to the definition of riparian land in Sec-
tion 3, supra, shall be deemed to have a Class A vested right to the reasonable
use of the stream or body of water to which his land is riparian, for purposes
of domestic use as defined in Section 3, supra, power, recreation, and fishing
on or in connection with such land.

Class B. Actual application of water under reasonable methods of diversion to
reasonable beneficial use other than in the exercise of a Class A vested right,
on or in connection with either riparian or nonriparian land, prior to the date
upon which this Act shall go into effect, shall be deemed to create in the person
effecting such use or in his successor in interest a Class B vested right to the
extent of the actual application to such reasonable beneficial use; provided such

2. The Michigan provisions are in Mich. Const. art X, 16 (1908).







DUE PROCESS AND EASTERN PROPOSALS


use has not been abandoned in the manner provided in Section 23, infra. The
priority of such right shall date from the time of actual application of water to
beneficial use.

Section 8. EFFECT OF PRIORITY OF RIGHT. The natural supply of water in
any natural watercourse or lake shall be available at all times for the require-
ments of Class A vested rights as provided for in Section 7, supra, and for the
other uses provided for in Section 2, supra. The excess over such requirements
at any particular time shall be available for the requirements of Class B vested
rights provided for in Section 7, supra, and for the appropriative rights acquired
after the effective date of this Act under the procedure provided for that purpose
in Section 11 et seq., infra, in the order of their respective dates of priority. No
holder or claimant of a Class B vested right or of an appropriative right shall be
entitled to divert or impound or use water at any time when such water is required
to satisfy both (a) the Class A vested rights and other uses hereinabove referred
to, and (b) any Class B or appropriative right or rights with an earlier date or
dates of priority. (Emphasis supplied.)

Section 2 seems to preserve three categories of rights: "existing valid
rights", "private vested rights", and the use of water for certain "public
purposes". "Private vested rights" are specifically defined in section 7.
"Public purposes" are explicitly listed, but the meaning of "existing valid
rights" is nowhere spelled out. These may be construed to encompass all
other than "public purpose" uses and "vested" rights which courts have in
the past or might in the future regard as constituting "existing valid rights"
at the time of enactment of the proposed law. Under this construction, all
new rights obtainable under the statute are held subject to rights which
the courts in the future might decide deserved protection, with the conse-
quence that the proposal cannot be attacked on due process grounds. How-
ever, this view of the law tends to defeat painstaking limitations imposed
Sby section 7, underscored by a sentence in section 11 (not quoted above) to
the effect that "it is the express intention of the Legislature that rights to
the use of water... vested on the date of this Act... shall comprise only
those rights declared vested in section 7... 3 A close look at Section 2
reveals that phrases dealing with "existing valid rights" speak of impair-
ment of, or future interference with, rights themselves, while provisions
Dealing -with vested rights are couched in terms of maintenance of stream
flows. It seems probable, therefore, that Section 2's statements about
"existing valid rights" and "private vested rights" are but two ways of
saying the same thing, with "existing valid rights" intended as no more
than an elliptical synonym for what is later spelled out in somewhat
3. Of course this sentence, too, can be taken literally as referring only to the
i vested rights of section 7. "Existing valid rights" would still remain a separate
category. It is more likely, however, that the draftsman meant to say that all
"preserved rights" were those declared "vested" in section 7. Public purpose
uses especially mentioned by section 2 were also not to be interfered with. But
they are not called "rights" according to the vocabulary of the statute.


I






LAW OF WATER ALLOCATION


greater detail. In the discussion which follows, this interpretation will be
assumed to be correct.
As to Section 7, its effectiveness in preserving existing rights depends
on the scope of the Class A provisions. For even a cursory glance at the
Class B provisions makes it apparent that these are insufficient to pre-
serve existing riparian rights. Class B rights are not available to nonusing
riparians and, as Class B claimants, even riparians using water may lose
some of their status. Under Section 8 their rights are subject to a prefer-
ence in favor of Class A users, who include others than the domestic users
preferred under riparian law. Unlike what would generally be true under
riparian law, section 8 retroactively favors Class B claimants with an
earlier priority based on the time of commencement of use. Under section
23, referred to in section 7, Class B claimants, unlike riparians, may
lose their rights after continuous nonuse for a period of five years. More-
over, former riparians claiming Class B rights are not preferred over
other Class B claimants whose uses are on nonriparian land or for non-
riparian purposes.4
The Class A provisions seem more promising. Unused rights are not
excluded or terminated, and in relation to each other riparians are al-
lowed a "reasonable use". Courts are left free to act as they always have:
to make priority in the time of commencement of use more or less impor-
tant; to prefer domestic users and perhaps upper users; to obey demands
of the public interest when such are called to their attention; or, where
there are no other overriding policies, to protect investment-if at all
possible.
Still, the protection afforded by the Class A provisions seems to be in-
complete, especially when these provisions are read in the light of other
sections of the proposal. For example, section 5 of the statute provides
that any right to use water "shall not... include the right to use more
water than is necessary for reasonable beneficial purposes, nor shall it
include the right to resort to unreasonable methods of diversion". No one
may transgress this limit, nor even a Class A user who interferes only

4. The provision for Class B rights explicitly refers only to nonriparian land,
but all purposes which have thus far not been held to be riparian by the Michigan
courts may also be included. Class B users are not limited to those making a
"reasonable use", which is the riparian standard, but are limited only to a "rea-
sonable, beneficial use." That term is not defined in the statute, but the term "pur-
pose of use of water" is defined by section 3 as including "domestic, irrigation,
municipal, industrial, recreational or other particular beneficial use." (Emphasis
supplied.) Thus, it would seem that irrigation, municipal and industrial uses are
protected as Class B rights. On the whole these uses up to now have not been held
to be possible riparian uses by the Michigan courts, and there is a possibility that
the courts might declare some of these uses to be unreasonable per se, or non-
riparian. For further discussion of this point, see pp. 445, 480-481 infra.






DUE PROCESS AND EASTERN PROPOSALS


with nonriparian Class B and appropriative rights.s In contrast, the ri-
parian law, as generally understood, restricts riparian uses only in rela-
tion to each other, and nonriparians cannot insist that riparians behave.6
Because of the restriction imposed on them by section 5, therefore, ri-
parians might complain that as Class A users they have lost the right to
hurt nonriparian neighbors with impunity.
Riparians may also complain about section 3's narrow definition of
Sriparian land, referred to in section 7:

The term 'riparian land' shall mean land lying (a) within the watershed of a
watercourse or lake, (b) contiguous to such watercourse or lake, and (c) con-
sisting of the smallest tract held under one title in the chain of title leading to
the current owner.
No Michigan case has thus far held that riparian land cannot extend beyond
the smallest tract in the chain of title or the watershed.7 While there is
no precedent opposed to these limitations, a constitutional issue would
arise were the courts, when presented with the issue, to refuse to confine
riparian land as the statute does.
Nor have Michigan cases explicitly held that riparians may not use
water for purposes other than the ones which entitle them to Class A
rights under section 7. On the contrary, among the uses thus far called
riparian by the courts, reasonable pollution and the commercial breeding
of fish are excluded from the Class A list.8 Perhaps it can be argued that
reasonable pollution is permitted under section 2's "reasonable use" for
the public purpose of "sanitation", and that Class A "fishing" includes
commercial fish breeding. But ice cutting, also recognized as riparian
by Michigan law, 9 remains left out. And since there is no precedent pro-
hibiting the courts from adding many more uses to their list, the Michigan
courts may in the future do so, and declare that the legislature's failure
to anticipate this development renders the law unconstitutional.
From what has been said, it is apparent that section 2, as well as sec-
tion 7's Class A and Class B provisions, do not fully preserve riparian
rights. Nor is this picture substantially altered by the fact that the


5. A similar restriction of Class A rights in their relation to Class B and
appropriation rights may be inferred from the statement in section 2 that stream
Sflows be maintained to the extent "necessary to the reasonable exercise of private
vested rights."
6. But see text at note 114 infra for contrary argument.
7. See p. 380 et seq.
8. See p. 383.
9. Clute v. Fisher, 65 Mich. 48, 31 N.W. 614 (1887). In one case in which the
court was evenly split one opinion referred to riparian uses as those for "domestic,
agricultural and mechanical purposes", Battle Creek v. Goguac Resort Assn., 181
Mich. 241, 243, 148 N.W. 441 (1914).


1







LAW OF WATER ALLOCATION


proposal also permits riparians to apply for appropriative rights. The
restrictions of section 5 are again applicable and, in addition, former ri-
parians claiming as appropriators are allowed to use only the amount of
water remaining after all Class A and Class B rights and all prior ap-
propriative rights are satisfied. Thus, at times not only other riparians
are preferred-on bases other than those generally understood to prevail
under existing riparian law-but also nonriparian Class B users and ap-
propriators with an earlier priority are favored. Moreover, riparians
claiming as appropriators, like Class B riparians, lose their rights ac-
cording to section 23 after nonuse for a period of five years. Finally, to
acquire new appropriative rights, former riparians are forced, by pro-
visions of the proposal1 not quoted above, to subject themselves to what
sometimes will turn out to be elaborate and perhaps costly proceedings
to obtain licenses and, prior thereto, provisional permits.1
These possible deprivations which former riparians might suffer as a
consequence of the proposal's enactment raise the question: Does the pro-
posed law amount to a taking of property without due process of law in
violation of state constitutional provisions and the due process clause of
the Fourteenth Amendment? In seeking an answer, it must be noted at the
outset that, before one can claim that property has been taken without due
process of law, one must be able to show that one's property right extends
to what has allegedly been impaired. Only then does a second issue arise,
namely, whether the new law actually effects a "taking", for which the
owner must be compensated, or whether, on the other hand, the legislation
is within the scope of the state's police power.

10. See Michigan proposal, 11-17 (procedures for the acquisition of appro-
priation rights) and 24 (procedures connected with "Change in Exercise of Water
Right").
11. Sections 2, 7, and 8 raise certain other questions: what is the status of
rights acquired by condemnation or purchase, or by prescription, especially where
these rights were obtained from all related riparian users and are not merely co-
extensive with a particular riparian right? It is arguable that the "existing valid
rights" guarantee meant to provide for these rights. But as indicated before, this
point might prove too much.
Another question arises because section 2 limits "public purpose" uses to a
"reasonable use", presumably in relation to other users. Under Michigan law,
navigation and fishing and hunting rights are paramount on public waters. It is not
clear whether the phrase "reasonable use" in section 2 means to imply the type of
equalitarian treatment which riparians are entitled to in relation to each other and,
thus, destroys the paramount status of public rights. On the other hand, section 2
does not limit "public purpose" uses to public waters. Moreover, there is no public
right to sanitation under Michigan law. The stream pollution control laws do not
take away a riparian's right to complain against pollution by nonriparians. Nor is
a riparian obligated to let enough water pass to dilute the pollution by nonriparians.
Yet that may be one of the consequences of the public purpose provisions in section 2.







DUE PROCESS AND EASTERN PROPOSALS


These two aspects of the due process issue are reflected in the two ap-
proaches taken by state and federal court cases passing upon legislative
modifications of riparian rights in other states. A number of cases hold
that, even though the riparian law was to some extent the law of the state
prior to the decision in question, a riparian owner has no vested right for
constitutional purposes that is coextensive with particular water alloca-
tion rules established by the general common law or by judicial prece-
dents in the state. These cases will be discussed first. Thereafter, this
paper will deal with a second group of opinions which look at legislative
modification of water rights as an impairment of property; a number of
decisions viewing modification of rights to other natural resources as an
impairment will also be discussed briefly. This second group of decisions
includes both these which hold the particular modification involved to be in-
valid, either with or without considering the police power, as well as other
cases which justify the impairment of property rights as a valid exercise
of the police power.


II.

The cases upholding modification of riparian rights on the theory that
a riparian has no fixed rights in the particulars of the riparian system of
allocation, since the state's law is always subject to change by judicial
opinion or legislation, frequently rely on the particular wording of the
state's common law adoption statute. Though these cases have all arisen
in the western states, the reasoning employed in them is not necessarily
inapplicable in many eastern states, since the wording of the adoption
statutes in the jurisdictions where modifications have been upheld is not
uncommon.12 These western cases do not draw any fixed line. All permit

12. In Michigan, territorial statutes of 1809 and 1810 provided that neither the
English statutes or French customary or ordinance law, nor the laws of the North-
west or Indiana Territory should govern in the territory. See 1 Powell, Real Prop-
erty, 72 (1949). A leading case declaring the common law in effect to a certain
extent was a water law case, Lorman v. Benson, 8 Mich. 18 (1860): "Practically
the common law has prevailed here, in ordinary matters, since our government
took possession; and the country has grown up under it.... Ito inquire into its ori-
Sgin] would open inquiry more curious than useful... Our statutes, without this
I substratum, [of the common law] would not only fail to provide for the great mass
of affairs, but would lack the means of safe construction. We are of opinion that
questions of property, not clearly excepted from it, must be determined by the
common law, rendered inapplicable only by such circumstances as render it in-
applicable to our local affairs" (Emphasis supplied.) It might be argued that the
tendency to' reject earlier precedent on the part of the Territorial Legislature and
the absence of a common law adoption statute gives the Michigan Legislature even
greater freedom to modify the judge-made law.






LAW OF WATER ALLOCATION


modifications subsequent to the patenting of the land. In some cases the
opinions emphasize that only unused rights are affected, and some cases
involve facts where this is so though the opinions fail to stress the point.
Other cases, however, uphold modifications of both used and unused rights.
All one can say is that the extent of permissible change probably depends
on how drastic it is. Change must not be so drastic that, in the light of
past decisions and changing circumstances, it could not reasonably have
been expected to occur in the course of the gradual development of the law.
The most recent case is State ex rel. Emery v. Knapp,13 decided in
1949, in which the Kansas Court upheld that state's appropriation law of
1945 14 against possible objections that the property of riparians was
taken without due process of law. The principal justification offered by
the court for upholding the legislative change of the status of riparians
was Kansas' common law adoption statute, 15 which reads as follows:
The common law as modified by constitutional and statutory law, judicial de-
cisions, and the conditions and wants of the people, shall remain in force in aid
of the General Statutes of this state; but the rule of the common law, that statutes
in derogation thereof shall be strictly construed, shall not be applicable to any
general statute of this state, but all such statutes shall be liberally construed
to promote their object. (Emphasis supplied.)

While not too explicit, the court's opinion in the Emery case seems to
imply that under this common law adoption statute common law rights
were held by riparians subject to legislative change. 16 Riparians, there-
fore, did not have vested rights for constitutional purposes coextensive
with the particular provisions of riparian law at any specific point in its
development. According to the adoption statute, as interpreted by the
court, their rights were always subject to modification by the legislature,
at least to the extent required by the conditions and wants of the people.
Despite this very broad theory implicit in the opinion, the Emery case
is not too strong a precedent for upholding the Michigan law. The opinion

13. 167 Kan. 546, 207 P. 2d 440 (1949).
14. Kan. Gen. Stats. 82a-701-82a-722 (1949).
15. Kan. Gen. Stats. 77-109 (1949).
16. This 1868 statute had previously been discussed in a leading Kansas case,
Clark v. Allaman, 71 Kan. 206, 80 Pac. 571 (1905), vigorously defending riparian
rights against opposing claims based on the appropriation doctrine. The court had
held in this earlier case that appropriation rights were not recognized in Kansas
prior to the first appropriation statute in 1886 and that the appropriation statutes
could not destroy already vested common law rights without violating the Federal
Constitution, 71 Kan. at 239, 80 Pac. at 583. The court indicated that the 1868 statute
curiously seems to prevent the courts-but not the legislature-from repealing any
part of the "settled law" of the state derived from the common law. 71 Kan. at 230,
80 Pac. at 580.







DUE PROCESS AND EASTERN PROPOSALS


never makes clear to what extent the legislature may modify riparian
rights, and the change in the status of riparians under the Kansas law is
not as extensive as the possible modifications which would be effected by
adoption of the Michigan proposal. As the Michigan law, the Kansas law
preserves used rights, which it defines as rights under which beneficial
use had been made at some time within three years prior to enactment of
the law.7 But under the Kansas law, used rights are not assigned retro-
active priority and do not seem to be subject to forfeiture upon nonuse
after the enactment of the statute; furthermore, unused rights, lost be-
cause of nonuse prior to the statute, though not protected by injunction,
seem to entitle their holders to damage awards under a general clause in
the statute which provides that all injured common law claimants may
bring a suit for damages. This clause is specially emphasized by the
court in one part of its opinion.
This emphasis on the damage remedy explains certain other statements
in the opinion which at first glance seem to offer poor reasons for upholding
the statute. For example, the court states that the "heart of the statute" is
a declaration that "All water... is hereby dedicated to the use of the peo-
ple... subject to the control and regulation" of the appropriation law, and
the court characterizes all specific provisions dealing with riparian rights
as mere matter of procedure. 18 This view must be based largely on a
conclusion that all the statute does in modifying riparian rights is to elim-
inate the injunction remedy previously available to nonusing riparians de-
siring to commence a use of water. Substantive rights are preserved be-
cause the common law claimant can still sue for damages.
The court's emphasis on the available damage remedy also explains
why the opinion seems to treat the statute's effect on riparian rights as
no more than the result of a further step in the same direction as the
change from a "natural flow" to a "reasonable use" rule, which some of its
own previous decisions 19 has adopted without the aid of legislation:
[The declaration that all water is dedicated to the use of the people]... forms
the basis of a different approach to the solution of questions concerning water
rights than we have had in some of our opinions. Heretofore, we have approached
the questions largely on the basis of individual interest alone. Under this decla-
ration and other provisions of the act we now approach them upon the basis of

17. The Kansas law thereby eliminates unused rights, which include both those
rights never put to use as well as rights once used but not within three years of en-
actment. These two types of unused rights may raise somewhat different constitu-
tional questions. A similar situation arises with regard to rights for other than
Domestic, power, recreation, and fishing purposes under the Michigan proposal, as
riparians lose such rights where never used or where once used but subsequently
Abandoned under the test of section 23.
18. 167 Kan. at 555, 207 P. 2d at 447.
19. See Clark v. Allaman, 71 Kan. 206, 80 Pac. 571 (1905).







LAW OF WATER ALLOCATION


the interest of the people of the state without losing sight of the beneficial use
the individual is making or has the right to make of the water. Unused or un-
usable rights predicated alone upon theory become of little if any importance.
Broad statements found in some of our opinions, such as 'Every man through
whose land a stream of water runs is entitled to the flow of that stream without
diminution or alteration'... must be disregarded or modified to harmonize with
this declaration. The change is an appropriate one for the legislature to make.
(Emphasis supplied.)20

In other words, the legislature has the power firmly to establish the
change in Kansas from a "natural" flow to a "reasonable use" rule. It may
abrogate the effect of broad "natural flow" statements found in some
Kansas cases by eliminating the injunctive remedy with respect to non-
users who do not contemplate immediate use of the water. The legislature
may take the further step of denying equitable relief even to riparians who
do contemplate immediate use. However, the new approach of the Kansas
statute does not lose sight of the "beneficial use the individual is making
or has the right to make of the water". To the extent that he is using wa-
ter, the statute preserves the individual's right to continue using it. As
to the right of a riparian to use water in the future, the statute gives him
a chance to become an appropriator. Or, if the riparian cannot do so be-
cause senior appropriators are using the entire supply, he may sue for
damages.
Thus, while the Emery case seems to hold the riparian rights are not
"vested" to the full extent established by previous precedent and are sub-
ject to legislative modification, the modification actually effected here,
insofar as it abrogated any rights, eliminated only the natural flow right
which, as was said, some Kansas cases had already done. As to any bther
modifications, the statute, unlike the Michigan proposal, effected a change
only in the available remedy-or, as the court put it, only in a mere mat-
ter of procedure, not of substance. On its facts and in the light of some of
the language in the opinion, therefore, the Emery case does not directly
support the power of the legislature to change riparian rights as drastic-
ally as the Michigan proposal seems to do.
However, when the likely effectiveness of the damage remedy is further
analyzed, a possibility emerges which might make the Emery case more
important than it seems. At the time of the Emery case, a somewhat sim-
ilar type of change effected by the Kansas statute had previously occurred
in Nebraska. In McCook Irrigation Co. v. Crews, 21 and Cline v. Stock, 22
the Nebraska Court, relying on statutes giving the power of eminent do-
main to irrigation and power projects as works of internal improvement,
but without the aid of the type of provision found in the Kansas law, had
granted irrigation appropriators injunctions against upstream riparians,
20. 167 Kan. at 555, 207 P. 2d at 447-48.
21. 70 Neb. 109, 96 N.W. 996 (1903), rev'd, 70 Neb. 115, 102 N.W. 249 (1905).
22. 71 Neb. 70, 98 N.W. 454 (1904), rev'd, 71 Neb. 79, 102 N.W. 265 (1905).






DUE PROCESS AND EASTERN PROPOSALS


and had refused to grant downstream riparians injunctions against up-
stream irrigation appropriators. The court held that appropriators for
irrigation do not need to condemn riparian rights before commencing their
appropriations. They can proceed to use water and protect their use by
injunction, and they are only liable for damages to the extent of a ripar-
ian's injury. The McCook opinion also indicated that the rights of a non-
using riparian may be "infinitesimal", and that his damages are likely to
be only "nominal".23
At first it is difficult to see why a nonusing riparian who contemplates
an immediate use should not receive a substantial amount in a permanent
damage suit. Later in the paper several reasons are offered.24 For pres-
ent purposes, it is sufficient to indicate that one possible reason which the
court in the McCook case might have had in mind may be that, in a suit
for permanent damages, the riparian's inability to obtain an injunction will
be taken into consideration, and his damages will be declared nominal be-
cause, no matter what uses he might contemplate, he could not possibly
carry them out. If this view were ultimately adopted in Kansas, the Kan-
sas statute will in effect have eliminated riparian rights to the extent
they were not used within three years prior to enactment. It will thus have
effected some of the changes which might possibly result from the adoption
of the Michigan proposal.
Whatever doubts may remain about the importance of the Emery case,
there are a number of other opinions which uphold more explicitly the
legislature's freedom to modify riparian law and to re-define the extent
of the riparian's "title" to use water. Some of these cases have dealt with
legislative changes occurring under circumstances where riparian law
had never been applied by the court but seemed unwittingly to have been
adopted by the common law adoption statute, and other cases have involved
circumstances where prior to the modification a number of cases had held
that the riparian system was part of the law of the state.
Arizona is an example of a western Territory where the riparian sys-
tem never had been recognized by the courts. In Boquillas Land & Cattle
Co. v. Curtis, 25 would-be water users claimed riparian rights on the ba-
sis of the Howell Code of 1864, which contains the Territory's common
law adoption statute:
The common law of England, so far as it is not repugnant to, or inconsistent,
with the constitution and laws of the United States, or the bill or rights or laws
of the Territory, is hereby adopted, and shall be the rule of decision in all the
courts of this Territory.26

23. 70 Neb. at 123, 102 N.W. at 252.
24. See part IV, infra. See Doyle, Water Rights in Nebraska, 20 Neb. L. Rev. 16,
L 22 (1941).
25. 11 Ariz. 128, 89 Pac. 504 (1907). See also Clough v. Wing, 2 Ariz. 371, 17
Pac. 453 (1888); Austin v. Chandler, 4 Ariz. 346, 42 Pac. 483 (1895).
26. Howell Code, ch. LXI, 7 (1864).






LAW OF WATER ALLOCATION


The court held that the common law rule of riparian rights had never been
recognized in Arizona. The court added, however, that even if riparian
rights had been so recognized, this adoption statute (which on its face does
not seem to contain as strong a modification clause as the Kansas adoption
law) would not prevent their elimination by the legislature, at least to the
extent that they had not been put to use:

If the Legislature of the territory may confer riparian rights by statute, it
seems to us clear that it may do so upon the condition that such rights thus con-
ferred may subsequently be modified or abrogated. Where the Legislature has,
subject to future legislation, conferred riparian rights to the use of water from
flowing streams upon riparian owners, the latter cannot be said to be vested in
such a sense as that they may not be subsequently abrogated by statute, at any
rate, when the riparian owner has made no use of the water permitted him at
common law.27 (Emphasis supplied.)

When this case came before the Supreme Court of the United States,28
Mr. Justice Holmes similarly concluded that riparian rights had never
been recognized in Arizona. But he, too, indicated that such rights were
not beyond legislative change or abrogation, even if it were held that the
legislature's general adoption of the common law included the rule of ri-
parian rights:
... We agree with the territorial court that, construed with the rest of the code,
(the adoption statute).. is far from meaning that patentees of a ranch on the
San Pedro are to have the same rights as owners of an estate on the Thames.
In the first place, this is merely the adoption of a general system as against
another general system (the Spanish-Mexican), that had been in force.... If
there were nothing more in the code, it would be going a great way to say that
such a broad phrase forbade the court to hold that the common law was adapt-
able... It might be argued, with force, that an amendment, inserting the words
'So far only as consistent with and adapted to the natural and physical conditions
and the necessities of people thereof,' merely expressed what was implied
before. Rev. Stats. 1887, Sec. 2935 and the like might be urged with regard to
Section 3198 of the Revised Statutes of 1887, which... declared that 'common
law doctrine of riparian water rights' should not obtain.29

Perhaps the Territorial Court's emphasis on unused rights and the
fact that the case occurred in a jurisdiction where riparian law had never
been applied weakens the authority of the Boquillas decision for purposes
of justifying the changes contemplated by the Michigan law. But there are
other instances where western courts, without the aid of special legislation,

27. 11 Ariz. at 137, 89 P. at 507.
28. 213 U.S. 339 (1909).
29. Id. at 345-46. See also Prima Farms Co. v. Proctor, 30 Ariz. 96, 245 Pac.
Holmes made clear, however, that his decision that riparian rights had never
been recognized left it unnecessary to consider "whether, in any event, the







DUE PROCESS AND EASTERN PROPOSALS


have effected the abrogation or modification of riparian rights, though
these rights previously had been judicially recognized. While these cases
did not always involve explicit constitutional determinations, they do help
to illustrate the wide range of flux in a riparian's so-called "vested"
right. In one jurisdiction, Nevada, the court was willing to overrule an
earlier decision in order to accomplish the ultimate rejection of riparian
law. 30 In jurisdictions like Texas and Washington, where both riparian
and appropriation rights are recognized, the judiciary has been willing to
modify riparian rights to make more water available to appropriators.
While, as shall be seen later on, the Texas courts have held certain modi-
fications of riparian rights unconstitutional, 31 some Texas decisions have
gone so far as to limit riparian rights to the ordinary flow and have held
that waters above the line of "highest ordinary flow" are flood waters to
which riparians have no claim superior to that of appropriators. 32 Because
of the peculiar conditions of rainfall and run-off prevailing in Texas, the
"highest ordinary flow" usually amounts to a relatively small portion of
annual stream flow. Moreover, Texas has limited riparian owners to
whatever portion of the ordinary flow is reasonably sufficient for their
needs and has made any excess available to appropriators.33 California
and Washington do not permit riparians to store water for any great length
of time.34 Of course, these limitations in the amount of use are, at best,
analogous only to the Section 5 restrictions in the Michigan proposal and
do not support that proposal's additional modifications of riparian rights.
But in Washington, the Supreme Court has effected a more extensive re-
duction of riparian rights. Despite an earlier history of defending "vested"
riparian rights against encroaching appropriations, 35 that Court in 1923
began to make final and conclusive adjudications awarding to riparian
owners only that amount of water which they were already beneficially
using or which they proved they would use within a reasonable time


[adoption] statute could be supposed to confer property rights not previously pos-
sessed and not subject to legislative change'.
30. Jones v. Adams, 19 Nev. 78, 6 Pac.. 442 (1885), overruling Vansickle v.
Haines, 7 Nev. 249 (1872).
31. See note 46 infra.
32. Motl v. Boyd, 116 Tex. 82, 286 S.W. 458 (1926). Similar restrictions apply in
Nebraska. Crawford v. Hathaway, 67 Neb. 325, 93 N.W. 781 (1903). Decisions to the
same effect inWashington and California, Longmire v. Yakima Highlands Irr. & L. Co.,
95 Wash. 302, 162 P. 782 (1917); Gallatin v. Corning Irr. Co., 163 Cal. 405, 126 P. 864
(1912). Bothwere later modified in favor of better methods of controlling riparians.
33. Biggs v. Lee, 147 S.W. 709 (Tex. Civ. App. 1912), writ of error dismissed,
150 S.W. xix. (1912).
34. Herminghaus v. Southern Calif. Edison Co., 200 Cal. 81,252 P. 607 (1926); Seneca
Consol. Gold Mines Co. v. Great Western Power Co., 209 Cal. 206, 287 P. 93 (1930).
35. Benton v. Johncox, 17 Wash. 277, 49 P. 495 (1897); Nielson v. Sponer, 46
Wash. 14, 89 Pac. 155 (1907).


I







LAW OF WATER ALLOCATION


after the adjudication. 36 However, it should be noted that this change is
analogous to the Michigan proposal only to the extent of that proposal's
effect on unused rights.
One important case supports the constitutionality of the Michigan pro-
posal to a greater extent than all the decisions discussed thus far. In In
re Hood River 37 the Oregon Supreme Court upheld sections of the 1909
Water Code which preserved riparian rights only to the extent of use at
the time of its enactment or shortly prior thereto. 38 The opinion pointed
out that the Oregon riparian law had always been a modified version. The
Court emphasized that, at the time of the patent of the land held by the
riparian claimants in the case and at the time of the adoption of the com-
mon law in Oregon in 1864, the appropriation system was also in effect;
riparians were not the exclusive water users; many previous cases had
dealt only with conflicts between riparians and did not settle their rights
against appropriators; and that the very existence of the appropriation
system should have been an indication that riparian rights were subject
to modification. While "vested" established rights, including those of ri-
parians, had been preserved by all Oregon laws prior to the 1909 Code,
the Court held that the legislature nevertheless had the power in 1909 to
re-define the scope these "vested" rights were to have in conflicts between
riparians and appropriators:
The very essence of the common law is its flexibility and adaptability. It does
not consist of fixed rules, but is the best product of human reason applied to the
premises of the ordinary and extraordinary conditions of life, as from time to
time they are brought before the courts. Although the common law is homo-
geneous, yet it finds widely different expression in different jurisdictions. If
the common law should become so crystalized that its expression must take on
the same form wherever the common-law system prevails, irrespective of
physical, social or other conditions peculiar to the locality, it would cease to be
the common-law of history, and would be an inelastic and arbitrary code. It is
one of the established principles of the common law, which has been carried
along with its growth, that precedents must yield to the reason of different or
modified conditions.
The common law having been partially adopted by statutes, it is plain that the
common-law rule as to "continuous flow" of a stream or riparian doctrine,
may be changed by statute, except as such change may affect some vested right.

36. In re Rights to Use Waters of Sinlahokin Creek, 162 Wash. 635, 299 P. 649
(1931); State v. American Fruit Growers, 135 Wash. 156, 237 P. 498 (1925); Proctor
v. Sim, 134 Wash. 606, 236 P. 114 (1925); Brown v. Chase, 125 Wash. 542, 217 P. 23
(1923).
37. 114 Ore. 112, 227 Pac. 1065 (1924).
38. Oregon Laws 1909 c.216 1 and 70 (2)-(3); Ore. Rev. Stat. 557. 120,
539.010(1),(2) (1953) (1909 Code sections as amended). The statute allowed additional
time to riparians who had already begun construction of water-using facilities.


__







DUE PROCESS AND EASTERN PROPOSALS


S.. Those obtaining title to land take the same subject to the laws prevailing ...
When the state conveyed the lands to the [riparian's] predecessors the law pre-
L vailing in this state authorized an appropriator, subject to rights existing at the
time of his appropriation, to take water from the streams of the state for a
beneficial use, and convey the same to nonriparian land, provided he could
legally obtain access to the stream. No one has any property in the water it-
self, but a simple usufruct.
It was within the province of the legislature, by the act of 1909, to define a
vested right of a riparian owner, or to establish a rule as to when and under
what condition and to what extent a vested right should be deemed to be created
in a riparian proprietor. (Emphasis supplied.)39

The Hood opinion thus explicitly sanctions the modification of unused
rights by retroactive legislative re-definition. The change was as exten-
sive as the modification of riparian rights other than Class A rights con-
templated by the Michigan proposal. Moreover, the Hood case and subse-
quent Oregon cases indicate that the 1909 Code also effected a further
modification of the rights it preserved. Although the statute itself pre-
serves rights and does not rank them retroactively in terms of their pri-
ority, as the Michigan proposal does, the Hood case, as well as cases
prior and subsequent thereto, have held that a riparian who claims a spe-
cific amount of water on the basis of use begun at a particular time
waives his riparian status and claims as an appropriator. It also has been
held that all rights obtainable in an adjudication must be for a given quan-
tity of water. Thus, used rights receive effective protection in Oregon
only after they are converted to appropriative rights, as in the case of the
Class B rights under the Michigan proposal.
There is, however, one remaining important difference between the
Michigan proposal and the modifications considered by the Hood case and
other cases discussed thus far. These cases all occurred in states where
the riparian and appropriation systems had already existed side by side.
It can, therefore, be argued that in these states modifications of riparian
rights in favor of appropriators were not as drastic a change in the law
as that effected by the Michigan proposal. The contention could be made
that Michigan and other eastern states never had an appropriation law and
did not allocate water to nonriparians. Therefore, in Michigan the effect
of the proposal is to take water from riparians and allocate it to entire
newcomers, whereas in the western states the changes in question
effected merely a readjustment between two groups of water users who
acquired their rights by different, previously recognized methods. As
will be seen, this argument is also applicable to many of the police power
cases which will be discussed presently. Its final evaluation must await
consideration of these cases.

39. 114 Ore. 180-81, 227 Pac. at 1086-1087.






-






LAW OF WATER ALLOCATION


Aside from the possibility that modification of riparian rights in favor
of appropriators may not be permissible in a state which never had the
appropriation system, the cases thus far discussed do not establish a
definite line beyond which the legislature may not go. It is clear that the
change may occur after the land is patented. And except for an offhand re-
mark in the opinion of the Arizona Territorial Court in the Boquillas case,
the cases sustain modifications of both used and unused rights. Several of
the opinions, however, stress a previous trend to modify the common law
and the existence of local conditions which call for further change. Thus,
the only limitation on the legislature's power seems to be that the change
must be one which can be reasonably anticipated in the light of the trend
of past decisions and the wants and needs of the people under ever-changing
conditions. The extent to which a riparian right is "vested" cannot be ex-
pressed with a greater degree of certainty.


III.

One also cannot be certain how far a riparian's right-once it is found
to be "vested"-may be modified under the police power in the face of ob-
jections that the Fourteenth Amendment and similar state constitutional
provisions are violated. Occasional assertions that, according to many
Supreme Court decisions, there can be no Federal constitutional objec-
tions to a state's modification of its water law are based on cases that are
not as far reaching as they are sometimes thought to be. A number of
these cases deal merely with the power of the states to control navigable
waters. 40 Statements in other cases are mere dicta and, at any rate, are
not specifically focused on the extent to which a change in law may impair
"vested" rights.41 Cases allowing a change merely have permitted a state
to authorize condemnation by declaring that certain uses serve a public

40. Fox River Paper Co. v. Commission, 274 U.S. 651 (1927) (statute regulating
damming of navigable streams by riparians); Seattle v. Oregon and Washington R.R.,
255 U.S. 56 (1921) (state court denial of riparian rights in navigable waters); St.
Anthony Falls Water Co. v. Board of Water Commissioners, 168 U.S. 349 (1897) (up-
holding Wisconsin statute allowing diversion of water for municipal supply as proper
use of navigable or public stream).
41. Probably the most quoted of these statements was in United States v. Rio
Grande.Dam & Irrigation Co., 174 U.S. 690 (1899), where the United States sought to
enjoin construction of a dam on the Rio Grande and an appropriation of water under
the laws of the territory of New Mexico on the ground of impairment to navigability.
The court indicated that the only restriction on such changes concerned the rights of
the Federal Government relating to the public domain and to navigable waters:
The unquestioned rule of the common law was that every riparian owner was
entitled to the continued natural flow of the stream. It is enough, without other


__







DUE PROCESS AND EASTERN PROPOSALS


purpose or have dealt with laws which were construed as protecting holders
of rights previously superior by providing for compensation.4
One United States Supreme Court opinion frequently cited contains very
powerful language which does seem to sanction actual modification of ri-
parian rights but under very special circumstances. In Hudson Water Co.
v. McCarter 43 the Supreme Court of the United States upheld a New Jer-
sey statute prohibiting the diversion of water from an intrastate stream
for use in another state. It was not clear whether this diversion would
have been permissible under state law even without the statute. But Mr.
Justice Holmes was willing to assume that without special legislation out-


citations or quotations, to quote the language of Chancellor Kent, 3 Kent Com.
1 439.....
While this is undoubted, and the rule obtains in those States in the Union which
have simply adopted the common law, it is also true that as to every stream
within its dominion a State may change this common law rule and permit the
appropriation of the flowing waters for such purposes as it deems wise....
Although this power of changing the common law rule as to streams within its
dominion undoubtedly belongs to each State, yet two limitations must be recog-
nized: First, that in the absence of specific authority from Congress a State
cannot by its legislation destroy the right of the United States, as the owner of
lands bordering on a stream, to the continued flow of its waters; so far at least
as may be necessary for the beneficial uses of the government property. Sec-
ond, that it is limited by the superior power of the General Government to se-
cure the uninterrupted navigability of all navigable streams within the limits
of the United States ....." Id. at 702-03.
See also Connecticut v. Massachusetts, 282 U.S. 660, 670 (1931); Arkansas v.
Tennessee, 246 U.S. 158, 176 (1918); United States v. Cress, 243 U.S. 316, 319-
20 (1917); Kansas v. Colorado, 206 U.S. 46, 94 (1907).
42. Clark v. Nash, 198 U.S. 361, 370 (1905); O'Neill v. Leander, 239 U.S. 244,
254 (1915). U.S. v. Gerlach Live Stock Co., 339 U.S. 725 (1950). See also Craw-
ford Co. v. Hathaway, 67 Neb. 325, 359, 93 N.W. 781, 792 (1903) for interpretation
that the Supreme Court cases do not permit retroactive divesting of riparian rights.
See also, Comment, 7 So. Calif. L. Rev. 330, 337, n. 54 (1934). For interpretations
tending to come to the opposite conclusion see Amory v. Commonwealth, 321 Mass.
240, 246-47, 72 N.E. 2d, 549, 554 (1947); In re Hood River, 114 Or. 112, 227 P.
1065, 1084 (1924); In re Willow Creek, 74 Ore. 592, 623, 144 Pac. 505, 516 (1914);
Trelease, Coordination of Riparian and Appropriative Rights to the Use of Water,
33 Texas L. Rev. 24, 66-67 (1954); Coates, Present and Proposed Legal Control of
Water Resources in Wisconsin, 1955 Wis. L. Rev. 256, 290-1 (1953); Thompson &
Fiedler, Some Problems Relating to Legal Control of Use of Ground Water, 30
Jnl. Amer. Water Works Ass'n 1049, 1080-89 (1938); Water Resources of Virginia,.
Report of the Virginia Advisory Legislative Council, p. 132-33 (1955).
43. 209 U.S. 349 (1908).






\ *_________







LAW OF WATER ALLOCATION


of-state diversion was permissible. At least, by way of alternative ground,
he upheld the statute as a proper police power measure.
All rights tend to declare themselves absolute to their logical extreme. Yet all
in fact, are limited by the neighborhood or principles of policy which are other
than those on which the particular right is founded, and which become strong
enough to hold their own when a certain point is reached. The limits set to
property by other public interests present themselves as a branch of what is
called the police power of the State. The boundary at which the conflicting in-
terests balance cannot be determined by any general formula in advance, but
points in the line, or helping to establish it, are fixed by decisions that this or
that concrete case falls on the nearer or farther side....
It sometimes is difficult to fix boundary stones between the private right of
property and the police power when, as in the case at bar, we know of few de-
cisions that are very much in point. But it is recognized that the State, as
quasi-sovereign and representative of the interests of the public has a standing
in court to protect the... water ... within its territory, irrespective of the as-
sent or dissent of the private owners of the land most immediately concerned
... Whatit may protect by suit in this court from interference in the name of
property outside of the State's jurisdiction, one would think that it could pro-
tect by statute from interference in the same name within.
The problems of irrigation have no place here. Leaving them on one side, it
appears to us that few public interests are more obvious, indisputable and in-
dependent of particular theory than the interest of the public of a State to main-
tain the rivers that are wholly within it substantially undiminished, except by
such drafts upon them as the guardian of the public welfare may permit for the
purpose of turning them to a more perfect use. This public interest is omni-
present wherever there is a State, and grows more pressing as population
grows. It is fundamental, and we are of opinion that the private property of ri-
parian proprietors cannot be supposed to have deeper roots. Whether it be
said that such an interest justifies the cutting down by statute, without compen-
sation, in the exercise of the police power, of what otherwise would be private
rights of property, or that apart from statute those rights do not go to the
height of what the defendant seeks to do, the result is the same... The private
right to appropriate is subject not only to the rights of lower owners but to the
initial limitation that it may not substantially diminish one of the great founda-
tions of public welfare and health.44

It seems that no all-encompassing generalization is possible. The out-
come of a police power case cannot be readily predicted. The particular
problem the legislature seeks to cope with and the particular methods
adopted determine the decision to a certain extent. The general rule is
that the legislation must be reasonably necessary to accomplish the ends
sought. But every legislative action reasonably necessary for the accom-


44. Id. at 355-56.







DUE PROCESS AND EASTERN PROPOSALS


plishment of proper legislative ends does not free a state from the obliga-
tion to compensate injured property holders. The line is not easily drawn.
The question is one of degree. The best one can hope to find in the search
for precedent are "boundary stones."
Most of the state court cases which seem to invalidate legislative modi-
fication of used and unused riparian rights do not clearly indicate that a
statute such as the Michigan proposal reaches beyond the bounds of the
police power. In some cases the invalidated law does not on the whole in-
volve the type of change the Michigan proposal contemplates, and these
cases sometimes assert that police power regulation of riparian rights is
possible by a properly drafted measure. Other cases discuss vested rights
and the police power only in dicta, and still others simply mention the im-
portance of vested rights without consideration of the police power justi-
fication.
For example, in Texas, a jurisdiction where, as previously noted, the
courts themselves have somewhat narrowed the scope of riparian rights 45,
the Court of Civil Appeals in the 1931 case of Freeland v. Peltier 46
seemed to hold unconstitutional provisions of a 1917 statute, on the whole
affecting only unused rights, which declared that an appropriator, after
three years' use, was to acquire a title by limitation against all other
claimants, including riparians. The decision, in holding the provision in-
applicable to riparians, seems to be based on constitutional considerations,
but it is not too explicit and contains no mention of the police power. Sim-
ilarly, in a holding significant for both used and unused rights, the North
Dakota Court held in Bigelow v. Draper 47 that a constitutional provision
to the effect that "all flowing streams and natural water courses shall for-
ever remain property of the State for mining, irrigation and manufacturing


45. See note 32 supra.
46. 44 S.W. 2d 404, 407-8 (Tex. Civ. App. 1931). The statute in question is
Vernon's Tex. Civ. State. Ann. 7592 (1954). This case should be compared with
two other Texas decisions. The 1917 statute also provided that the Board of Water
Engineers could determine relative rights to the use of water. This portion of the
statute was declared unconstitutional in Board of Water Engineers v. McKnight, 111
Tex. 82, 229 S.W. 301 (1921), as an invalid attempt to vest judicial authority in the
executive branch without specific constitutional sanction. The same contention was
later made with respect to gas and oil conservation statutes. The court in upholding
these latter statutes in Corzelius v. Harrell, 143 Tex. 509, 186 S.W. 2d 961 (1945),
distinguished the McKnight case on the ground that at the time of the enactment of
the 1917 statute, June 19, 1917, a constitutional amendment adopted on August 21,
1917, declaring the conservation of natural resources to be public rights and duties,
was not yet in effect. As to the possible significance of the amendment for water
Slaw changes in general, see Corpus Christi v. Pleasanton, 154 Tex. 289, 276 S.W.
2d 798 (1955); Comment, 2 So. Texas L. J. 74 (1955).
47. 6 N.D. 152, 69 N. W. 570 (1896).







LAW OF WATER ALLOCATION


purposes" was not "framed to divest the rights of riparian owners." The
court said that if the provision were differently construed it would violate
the due process clause of the Fourteenth Amendment. However, the opin-
ion left open the possibility of valid police power modification of riparian
rights, as, for example, by legislation prohibiting a group of riparians
from uniting to use water for purposes which would result in the utter de-
struction of a stream. In 1913 the South Dakota Court stated, 48 without
differentiating between used and unused rights, that a 1907 law dedicating
all waters to the public, requiring a fee for a permit to use water, com-
pelling payment by users of the cost of hydrographic surveys, and pro-
viding for loss of rights after three years nonuse, could not constitutionally
be applied to riparians. However, these statements were not necessary to
the outcome of the case, and the South Dakota legislature has since felt
free to enact legislation modifying riparian rights. A 1955 appropriation
statute 49 preserves riparian rights only to the extent to which they were
put to beneficial use within a specified period prior to enactment. This
law has not yet been tested before the courts.50
One of the strongest statements against a particular police power modi-
fication of both used and unused riparian rights is the opinion in the 1926
California case of Herminghaus v. Southern California Edison Company. 1s
At least since 1886 California has been a state where riparians have been
accorded maximum protection in contests with appropriators.52 While
48. St. Germain Irrigating Co. v. Hawthorne Ditch Co., 32 S. Dak. 260, 143 N.W.
124 (1913). A South Dakota statute seemed to have specifically adopted the riparian
law. S. Dak. Code 61.0101 (1939), adopted from a previous territorial statute,
Terr. Dak. Civ. Code 255. This statute was repealed by a recently enacted ap-
propriation law. See note 50 infra. Cf. Madison v. Rapid City, 61 S.D. 83, 246 N.W.
283 (1932) (indicating that statute imposing tax on artesian wells as waste pre-
vention measure is constitutional). See note 65 infra.
49. S.D. Sess. Laws 1955, ch. 430, 61.0102 (7).
50. In California a statute providing for loss of riparian rights after ten years
nonuse was held unconstitutional under specific constitutional provisions; see note
61 infra, Tulare Irr. Dist. v. Lindsay Strathmore Irr. Dist. The case has little
general significance.
In Nebraska the court strongly upheld riparian rights in Crawford Co. v. Hath-
away, 67 Neb. 325, 93 N.W. 781 (1903), but it at the same time upheld statutes de-
claring irrigation and power projects to be works of internal improvement and that,
in a taking of riparian rights for such a project, the riparian's injury would be the
measure of his damages. This case gave rise to the later development virtually
eliminating unused rights discussed supra, p. 451. An earlier case held that a stat-
ute limiting riparian rights to streams less than 20 feet wide was unconstitutional.
Clark v. Cambridge Irrigation Co., 45 Neb. 798, 64 N.W. 239 (1895). This case
seems to foreclose impairment of used rights still in use without compensation.
51. 200 Cal. 81, 852 Pac. 607 (1926).
52. The famous case clearly establishing the riparian doctrine in California is
Lux v. Haggin, 69 Cal. 255, 10 P. 674 (1886).






A







DUE PROCESS AND EASTERN PROPOSALS


riparians were limited to a reasonable use in relation to each other,53
they could demand that a junior appropriator not diminish or in any other
way affect the natural flow of the stream.54 Downstream riparians fre-
quently benefited from a natural irrigation of their land by overflowing
flood waters at certain times of the year, and the courts readily granted
riparians injunctions to protect their rights to the natural flow of these
flood waters when junior appropriators attempted to impound them at up-
stream points. But to benefit from this right a riparian had to have a great
quantity of water flow by his land so that the stream would overflow; most
of this water was not actually used for irrigation but served only to lift a
very small portion of the total flow onto the riparian land, and after it had
done its lifting job it frequently flowed on unused to the sea. California,
by a 1913 statute, had sought to remedy this situation somewhat by limiting
the use of a water for natural irrigation on certain lands to a yearly
amount of 2% acre-feet per acre. 55 It was this statute which the
Herminghaus case held to be unconstitutional in the following language:
It may be conceded that the phrase "police power of the state' has, as to its
scope and meaning, been subjected to quite a severe strain of recent years in the
endeavor to expand it as to cover all sorts of legislation sought to be enacted in
the asserted interest of modern progress, but we have yet to be referred to a
S case wherein it has been judicially so far expanded as to invest the legislative
department of this state with arbitrary power to destroy vested rights... when
...employed in the useful and in nowise harmful production of wealth, and when
such use and the product thereof cannot be said or shown to be inimical to public
health or morals or to the general welfare, but, on the contrary, must be con-
ceded to be beneficial to each and all of these..., The extent to which such ri-
parian land owners need and use and are entitled to have the benefit of the flow
and overflow of such waters under their vested riparian rights therein is a mat-
ter which depends upon the circumstances of each particular case; upon location,
aridity, rainfall, soil porosity, responsiveness, adaptability to particular forms
of production, and many other elements, which render the question essentially
one for judicial inquiry...
If the state were here assaying to uphold an effort on its part to work out impar-
tially, unselfishly, and in the interests of the whole people some general plan or
system for the equitable adjustment of rights and uses in its flowing streams
with a view to conservation, development, and distribution of the dynamic forces
Sand generative and fertilizing fructabilities of their waters, it might well be ar-
gued that public policy, public interest, and a most liberal interpretation of the
police powers of the state might rightfully be invoked in support of such an
effort. "56

53. Ibid.
54. Miller & Lux v. Madera Canal Irrigation Co., 155 Cal. 59, 99 Pac. 502
S(1909).
55. Cal.Sess. Laws 1913, c. 586, 42.
56. 200 Cal. at 117-20, 252 Pac. at 622-23.


i






LAW OF WATER ALLOCATION


It is readily seen that even this very forceful opinion did not object to
police power modification of used and unused rights as such. The opinion
stated that a fair and equitable modification truly designed to benefit the
economy and conserve water might be upheld. Only the specific modifica-
tion before the court was objectionable, and that because it did not take
into account particular circumstances and deprived the courts of the power
to do so. The Herminghaus case did not say explicitly that determinations
of reasonableness of riparian uses cannot be taken out of the hands of the
courts and delegated to an administrative agency. It has been held in
California and other states and by the Supreme Court of the Unites States
that the determination of water rights in the light of particular circum-
stances need not always be in the hands of the courts, at least not in the
first instance. 57 Administrative agencies can be empowered to do a great
deal of the initial fact-finding and water allocation, and the few cases
which have ruled otherwise occurred prior to the development of modern
administrative law and procedure. s8 Even where the legislation general-
izes to a certain extent on what constitutes a reasonable use, thus taking
away a certain amount of discretion from the courts and administrative
agencies, the legislation is not always invalid. That the Herminghaus re-
marks about legislative generalization were addressed only to a particular
generalization under particular circumstances is borne out by other Cali-
fornia cases which have upheld legislation limiting losses of ground water
used for irrigation to a specific percentage and restricting the use of
ground water to domestic, irrigation, and fish propagation purposes only.59
Other developments in California tend to support the conclusions that
the Herminghaus objections to use of the police power refer only to the
particular legislation before it. A 1928 California Constitutional Amend-
ment 60 fared better. While this amendment did not bestow new quasi-
judicial power on administrative agencies, it did compel the courts to

57. For a lower court decision in California see Bray v. Superior Court, 92
Cal. App. 428, 268 Pac. 374 (1928). For other decisions see Pacific Livestock Co.
v. Lewis, 241 U.S. 440 (1916); Vineyard Land & Stock Co. v. District Court, 42 Nev.
1, 171 Pac. 166 (1918); Farm Investment Co. v. Carpenter, 9 Wyo. 110, 61 Pac.
258 (1900).
58. Bear Lake County v. Budge, 9 Idaho 703, 75 Pac. 614 (1904) (inadequacy of
notice provisions); Ormsby County v. Kearney, 37 Nev. 314, 142 Pac. 803 (1914)
(initial but not conclusive determination valid); Bd. of Water Engineers v. McKnight,
111 Tex. 82, 229 S.W. 301 (1921) (discussed supra note 46; see Hutchins, Special
Procedures for Adjudication of Water Rights and Supervision of Diversion: General
Survey of Types of Procedures in the Western States Water Law Conference, Univ.
of Texas, May 1956).
59. Ex part Maas, 219 Cal. 422, 27 P. 2d 373 (1933); for an earlier decision
see Ex parte Elam, 6 Cal. App. 233, 91 Pac. 811 (1907).
60. Cal. Const. art. 14 3, enacted in direct response to the Herminghaus de-
cision two years earlier.






DUE PROCESS AND EASTERN PROPOSALS


modify both used and unused riparian rights. The amendment provided,
among other things, that a riparian's right in relation to that of a junior
appropriator was henceforth not to extend to the natural flow or to waste-
ful and unreasonable uses as had previously been the case, but was to be
limited to the reasonable beneficial use of water. The provision read as
follows:
It is hereby declared that because of the conditions prevailing in this State the
general welfare requires that the water resources of the State be put to benefi-
cial use to the fullest extent to which they are capable, and the waste and un-
reasonable use or unreasonable method of use of water be prevented, and that
the conservation of such water is to be exercised with a view to a reasonable
and beneficial use thereof in the interest of the people and for the public welfare.
The right to water, or to the use or flow of water in or from any natural stream
or water course, is and shall be limited to such water as shall be reasonably re-
quired for the beneficial use to be served, and such right does not and shall not
extend to the waste or unreasonable use or unreasonable method of use or un-
reasonable method of diversion of water. Riparian rights in a stream... attach
to but to no more than so much of the flow thereof as may be required or used
consistently with this section, for the purposes for which such lands are or may
be made adaptable, in view of such reasonable and beneficial uses; provided,
however, that nothing herein contained shall be construed as depriving any ri-
parian owner of the reasonable use of water of the stream to which his land is
riparian under reasonable methods of diversion and use; or of depriving any ap-
propriator of water to which he is lawfully entitled. This section shall be self-
executing, and the 'Legislature may also enact laws in the furtherance of the
policy in this section contained.'

In Gin Chow v. Santa Barbara, 61 decided in 1933, the California Supreme
Court held that this amendment modified the degree of protection accorded
riparian rights by earlier decisions. But the court went on to say that the
amendment constituted a "legitimate exercise of the police power" not vi-
olative of the due process clause of the Fourteenth Amendment, or in con-
flict with other provisions of the State Constitution:
... [The amendment] is the highest and most solemn expression of the people of
the state in behalf of the general welfare. The present and future well-being and
prosperity of the state depend upon the conservation of its life-giving waters...
S The amendment purports only to regulate the use and enjoyment of a property
right for the public benefit, for which reason the vested right theory cannot
stand in the way of the operation of the amendment as a police measure. A
vested right cannot be asserted against it because of conditions once obtaining.

61. Gin Chow v. Santa Barbara, 217 Cal. 673, 22 P. 2d 5 (1933). See also Tulare
Irrigation Dist. v. Lindsay Strathmore Irrigation Dist., 3 Cal. 2d 489, 45 P. 2d 972
(1935); Peabody v. Vallejo, 2 Cal. 2d 351, 40 P. 2d 486 (1935).
62. 217 Cal. at 701, 703, 22 P. 2d at 16-17.






LAW OF WATER ALLOCATION


While this language is very broad, the fact remains that the California
amendment is analogous, at best, only to the Section 5 restrictions of the
Michigan proposal. Moreover, the amendment imposed these restrictions
on riparian rights in a State where the appropriation and riparian systems
have existed side by side. What was involved was an adjustment between
riparians and appropriators. One is thus met again by the argument
mentioned in the previous section, that the situation in an eastern state is
entirely different, because the excess water made available by restrictions
on riparian rights is not allocated to others who are also entitled to a
share of the common supply, but to newcomers. As indicated earlier, this
argument can be made about many of the cases allowing modifications of
water rights on police power grounds, and it will be examined more tho-
oughly in a succeeding section of this paper. For the moment, it serves
to point up possible doubts about the scope of the Gin Chow case.
Further doubts about the importance of the Gin Chow Case are raised
by the opinion of the United States Supreme Court in United States v.
Gerlach Live Stock Co. 63 The court had to decide whether, subsequent to
the 1928 amendment, lower riparians should be compensated for loss of
the benefit of natural irrigation due to diversion of water by an upstream
federal irrigation project. Mr. Justice Jackson, answering in the affirma-
tive, pointed out that Congress, in authorizing the project, did not intend
to interfere with vested water rights. He then held that the California
amendment, despite the absence of clear-cut California decisions, must
have intended to withdraw only equitable remedies against junior appro-
priators from riparians not making a "reasonable beneficial" use of.the
water; the damage remedy must have been preserved; otherwise, one
would have to reach the unlikely conclusion that California intended to
take valuable property rights without compensation. The opinion is so
eloquent that it becomes difficult to avoid quoting certain passages at
length:
Riparianism, pressed to the limits of its logic, enabled one to play dog-in-the-
manger. The shore proprietor could enforce by injunction his bare technical
right to have the natural flow of the stream, even if he was getting no substantial
benefit from it. This canine element in the doctrine is abolished. "The right to
water or to the use or flow of water in or from any natural stream or water
course in this State is and shall be limited to such water as shall be reasonably
required for the beneficial use to be served..." This limitation is not trans-
gressed by the awards in question which only compensate one for the actual bene-
ficial use. Any hazard to claimants' cause lurks in the following clause: "and
such right does not and shall not extend to the waste or unreasonable use or un-
reasonable method of diversion of water." Since riparian rights attach to, and
only to, so much of the flow of the San Joaquin as may be put to beneficial use
consistently with this clause, claimants can enforce no use of wasteful or unrea-
sonable character.
63. 339 U.S. 725 (1950).






DUE PROCESS AND EASTERN PROPOSALS


We assume for purposes of this decision that the prodigal use, inseparable from
claimants' benefits, is such that the rights here asserted might not be enforced
by injunction. But withholding equitable remedies... does not mean that no right
exists. There may still be a right invasion of which would call for indemnifica-
tion ...
... [T]he public welfare, which requires claimants to sacrifice their benefits to
broader ones from a higher utilization, does not necessarily require that their
loss be uncompensated any more than in other takings where private rights are
surrendered in the public interest. The waters of which claimants are deprived
are taken for resale largely to other private land owners not riparian to the river
and to some located in a different water shed. Thereby private lands will be
made more fruitful, more valuable, and their operation more profitable. The
reclamation laws contemplate that those who share these advantages shall,
through water charges, reimburse the Government for its outley. This project
anticipates recoupment of its cost over a forty-year period. No reason appears
why those who get the water should be spared from making whole those from
whom they are taken. Public interest requires appropriation; it does not require
expropriation. We must conclude that by the Amendment California unintention-
ally destroyed and confiscated a recognized and adjudicated private property
right, or that it remains compensable although no longer enforcible by injunc-
tion.64 (Emphasis supplied.)

At first glance, the last quoted sentence seems to draw a line beyond
which the police power cannot impair riparian rights. The court seems to
say that the damage remedy cannot be taken away without violating the
Fourteenth Amendment. But the Fourteenth Amendment is not actually
mentioned, and the whole context of the discussion seems to be one of spec-
ulation on what California was likely to have intended in the light of con-
siderations of fairness, rather than a context of serious constitutional
consideration. Moreover, it is not clear whether Mr. Justice Jackson
meant to speak of the effect on both used and unused rights or whether he
had only used rights in mind.' It should also be noted that the sentence in
question speaks of "adjudicated" rights. This is a reference to a part of
the opinion not quoted, where it is pointed out that the particular riparian
rights in issue in the Gerlach case had been protected by an earlier Cali-
fornia decision. Perhaps Mr. Justice Jackson, in speaking of expropria-
Stion, meant to apply this strong language only to those specific rights which
had, prior to the 1928 amendment, been upheld in the course of litigation.
Still, one cannot be sure, and the Gerlach case may foreshadow important
limitations on the states' police power.
In seeming contrast to the Gerlach case, many decisions by the Supreme
Court of the United States and by federal and state courts have upheld a
wide range of police power regulations of the extraction of ground water
and oil and gas, which regulations have affected both used and unused rights
64. Id. at 751-53.






LAW OF WATER ALLOCATION


and did not preserve a damage remedy for the deprived "owner." With
respect to ground water, judicially approved police power measures have
included imposition of a tax on artesian wells to prevent waste,65 authori-
zation of public officials to repair and/or plug wasteful artesian wells at
the owner's expense, 66 the previously mentioned restriction on the use
of artesian water by allowing only domestic, fish propagation and irriga-
tion uses and limiting irrigation uses so that the water lost could not ex-
ceed a maximum percentage, 67 and prohibition of pumping of ground
water for the sole purpose of extracting gas for public sale.68 In connec-
tion with oil and gas regulation, the courts have upheld prohibitions of
gasflaring at the wellhead, 69 restrictions on the use of sweet gas for the
production of carbon black, 70 regulations of the use of vacuum pumps, 71
and well spacing, 72 gas-oil ratio,73 proration,74 and compulsory uniti-
zation 75 laws.76 These statutes have generally been upheld on the basis of
two theories: the state has the power to protect relative rights of owners



65. Madison v. Rapid City, 61 S.D. 83, 246 N.W. 283 (1932). See note 48 supra.
66. Eccles v. Ditto, 23 N.M. 235, 167 Pac. 726 (1917).
67. Ex parte Maas, 219 Cal. 422, 27 P. 2d 373 (1933); Ex parte Elam, 6 Cal.
App. 233, 91 Pac. 811 (1907).
68. Lindsley v. Natural Carbonic Gas Co., 220 U.S. 61 (1911); Hathorn v. Natural
Carbonic Gas Co., 194 N.Y. 326, 87 N.E. 504 (1909); People v. New York Carbonic
Acid Gas Co., 196 N.Y. 421, 90 N.E. 441 (1909).
69. Ohio Oil Co. v. Indiana, 177 U.S.190 (1900).
70. Henderson Co. v. Thompson, 300 U.S. 258 (1937); Walls v. Midland Carbon
Co., 254 U.S. 300 (1920).
71. Gilmer Oil Co. v. Commission, 183 Okla. 95, 80 P. 2d 312 (1938); Peterson
v. Grayce Oil Co., 37 S.W. 2d 367 (Tex. Civ. App. 1931). See also Manufacturers
Gas and Oil Co. v. Indiana Natural Gas & Oil Co., 155 Ind. 461, 57 N.E. 912 (1900).
72. Patterson v. Stanolind Oil & Gas Co., 182 Okla. 155, 77 P. 2d 83 (1938),
appeal dismissed, 305 U.S. 376 (1939); Marrs v. City of Oxford, 32 F. 2d 134 (8th
Civ. 1929); Oxford Oil Co. v. Atlantic Oil Prod. Co., 22 F. 2d 597 (5th Civ. 1927),
cert. denied, 277 U.S. 585 (1928).
73. Bandini Petroleum Co. v. Superior Court, 110 Cal. App. 123, 293 Pac. 899
(1930), aff'd, 284 U.S. 8 (1931).
74. Champlin Refining Co. v. Commission, 286 U.S. 210 (1932); Russel v. Walker,
160 Okla. 145, 15 P. 2d 114 (1932).
75. See, e.g. Palmer Oil Corp. v. Phillips Petroleum Co., 204 Okla. 543, 231
P. 2d 997 (1951), appeal dismissed sub nom. Palmer Oil Corp. v. Amerada Petro-
leum Corp., 343 U.S 390 (1952). See also Woody v. Commission, 265 P. 2d 1102
(1954); Hunter Co. v. McHugh, 202 La. 97, 11 So. 2d 495 (1942), appeal dismissed,
320 U.S. 222 (1943).
76. Huber v. Merkel, 117 Wis. 355, 94 N.W. 354 (1903), and Gas Products Co.
v. Rankin, 63 Mont. 372, 207 Pac. 993 (1922) are unfavorable cases in this
general area of legislation. See text and notes 80 and 82 infra.






DUE PROCESS AND EASTERN PROPOSALS


in a common source of supply, 77 and the state may take measures to pre-
vent physical waste and assure maximum recovery and use of an impor-
tant resource; 78 in the oil and gas cases the state also has the power to
prevent economic waste, 79 which occurs when the market becomes de-
pressed because of oversupply.
The decisions adverse to regulation of ground water or oil and gas ex-
traction are not controlling for purposes of this study. There is at least
one decision in a rule-of-capture state denying the state's power to regu-
late wasteful use of artesian wells. 80 The opinion rests, however, on the
theory that the statute interfered with the overlying owner's absolute right
to capture water no matter what the effect on his neighbor. The riparian
owner has no such absolute right to stream water. Moreover, the case is
not in accord with the general trend of decisions upholding regulation of
ground water waste without regard to the particular ground water use
rule prevailing in the state. 8l Similarly, while certain oil and gas regu-
lations have been held invalid because of the particular oil and gas owner-
ship theory prevailing in the state, 82 most federal and state decisions
have upheld a great variety of oil and gas measures regardless of particu-
lar "ownership" theories. 83 These cases generally involve measures
which have as their purpose both conservation in the public interest and
the protection of common rights of private owners, but some of the opin-
opinions have upheld measures solely on the ground that correlative private
interests are protected, without relying on any benefit derived by the gen-
eral public. 84 And, while there is an implication in a 1909 New York

77. The leading case is Ohio Oil Co. v. Indiana, 177 U.S. 190 (1900). For use of
this doctrine together with the waste prevention theory, see cases cited notes 70-75
supra. For groundwater cases see Lindsley v. Natural Carbonic Gas Co., 220 U.S.
61 (1911); Ex Parte Maas, 219 Cal. 422, 27 P. 2d 373 (1933); Ex Parte Elam, 6
Cal. App. 233, 91 Pac. 2d 811 (1907); Eccles v. Ditto, 23 N.M. 235, 167 Pac. 726
(1917); People v. New York Carbonic Acid Gas Co., 196 N.Y. 421, 90 N.E. 441
(1909); Hathorn v. Natural Carbonic Gas Co., 194 N.Y. 326, 87 N.E. 504 (1909).
78. See cases cited in notes 70-75 supra. For groundwater cases see Madison
v. Rapid City, 61 S.D. 83, 246 N.W. 283 (1932); Eccles v. Ditto, 23 N.M. 235, 167
Pac. 726 (1917).
79. Phillips Petroleum Co. v. Oklahoma, 340 U.S. 190 (1950); Bay Petroleum
Corp. v. Commission, 36 F. Sup. 66 (P.D. Kan. 1940).
80. Huber v. Merkel, 117 Wis. 355, 94 N.W. 354 (1903).
81. See cases cited notes 66 and 68 supra.
82. Gas Products Co. v. Rankin, 63 Mont. 372, 207 P. 993 (1922).
83. Henderson Co. v. Thompson, 300 U.S. 258 (1937); Walls v. Midland Carbon
Co., 254 U.S. 300 (1920). See Walker, Property Rights in Oil and Gas and Their
Effect Upon Police Regulation of Production, 16 Texas L. Rev. 370 (1938).
84. Corzelius v. Harrell, 143 Tex. 509, 186 S.W. 2d 961 (1945); Republic Natu-
ral Gas Co. v. State, 198 Okl. 350, 180 P. 2d 1009 (1947), appeal dismissed, 334
U.S. 62 (1948) (court refused to pass on question because Commission order not






LAW OF WATER ALLOCATION


ground water opinion 85 that a pure conservation measure which does not
at the same time protect common rights might be unconstitutional, there
are more recent oil and gas cases which have held that where there is a
conflict between the goal of protecting private rights and the public inter-
est goal of conservation and economic welfare, the public interest goal
must prevail.86
Despite the broad range of the aforementioned cases, it is arguable
that they are not very strong authority for upholding the Michigan proposal.
Some of the possible objections are similar to those mentioned in connec-
tion with the Gin Chow case. It might be argued that the type of regulation
is not analogous, except perhaps to the extent that in certain instances it
may seem similar to the Michigan proposal's Section 5 limitation on
amount and method of use, and perhaps to that proposal's restriction of
Class A rights to certain types of use. But even this analogy does not
fully hold true, because the restrictions upheld in the aforementioned
cases benefit all or some individuals having a common interest in the re-
source, while the Michigan proposal's Section 5 and Class A restrictions
make the excess water available to newcomers. In addition, it can be ar-
gued that though some of the aforementioned cases stress the public inter-
est in waste prevention as more important than the interests of private
individuals in the protection of their rights in a common resource, what
is involved in them is the prevention of waste of an exhaustable and not a
renewable resource, such as stream and lake water.
Two cases have dealt with ground water statutes more analogous to
certain aspects of the Michigan proposal than the waste regulation meas-
ures discussed above. In Southwest Engineering Co. v. Ernst,87 decided
in 1955, the Arizona Court passed on the validity of a statute authorizing
administrators to prohibit new irrigation wells in basins where existing
uses exceeded annual re-charge and the amount of remaining storage was
necessary to maintain the level of existing use. The statute was upheld,
despite the fact that in Arizona groundwater was not subject to appropria-
tion but governed by the American rule of reasonable use. Part of the
opinion reads as follows:
Where the public interest is thus significantly involved, the preferement of that
interest over the property interest of the individual even to the extent of its

final). Cf. Commission v. Rowan Oil Co., 152 Tex. 439, 259 S.W. 2d 173 (1953)
(non-wasteful wells cannot be shut to protect rights of wasteful wells).
85. People v. New York Carbonic Acid Gas. Co., 196 N.Y. 421, 90 N.E. 441
(1909).
86. Commission v. Rowan Oil Co., 152 Tex. 439, 259 S.W. 2d 173 (1953); Thomp-
son v. Consolidated Gas Utilities Corp., 300 U.S. 55 (1937); Denver Producing &
Refining Co. v. State, 199 Okla. 171,184 P.2d 961 (1947); Julian Oil & Royalties
Co. v. Capshaw, 145 Okla. 237, 292 Pac. 841 (1930); Gulf Land Co. v. Atlantic Re-
fining Co., 134 Tex. 59, 131 S.W. 2d 73 (1939).
87. 79 Ariz. 403, 291 P. 2d 764 (1955).






DUE PROCESS AND EASTERN PROPOSALS


destruction is a distinguishing characteristic of the exercise of the police power.
The principle which we recognize here as controlling rests upon historic prece-
dent extending back into the common law... and has had continuous recognition
almost to the present moment.
..there is a preponderant public concern in the preservation of the lands pres-
ently in cultivation as against those potentially reclaimable, and that where as
here the choice is unavoidable because a supply of water is not available for
both, we cannot say that the exercise of such choice, controlled by considera-
tions of social policy which are not unreasonable, involves a denial of due
process. 88
The Arizona statute is analogous to the Michigan proposal only to the
extent that that proposal eliminates unused rights where there is insuffi-
cient water for Class A, Class B, and appropriative rights with an earlier
priority. The Ernst case is not very good authority for upholding
Michigan proposal's provision for retroactive priority amongst Class B
users. And while the Arizona statute is more drastic than some of the
previously discussed groundwater and oil and gas waste provision meas-
Sures, in that it cuts off entirely the rights of some to protect the interest
of others, those others are not newcomers in the way that some of the ap-
propriators under the Michigan proposal might be. Moreover, the Arizona
statute, like some of the oil and gas conservation laws, involves to a large
extent the conservation of an exhaustible resource.
It is also arguable that the Arizona statute does not change the judicial
groundwater allocation rules of the state as drastically as the Michigan
proposal would change the riparian law. The groundwater reasonable use
rule, unlike the riparian rule as that rule is often understood, has on the
whole been interpreted to permit one who uses the water on his own land
to make a reasonable use even if the result is to cut off the supply of a
neighboring landowner. In other words, reasonable use by one who uses
water on his own land is judged solely in terms of the relation of the water


88. 79 Ariz. at 409-10, 291 P. 2d at 768-69. The outcome in this case was to
some extent anticipated by the comment of the Arizona Court in Bristor-v. Cheat-
ham, 75 Arizona 227, 234-35, 255 P. 2d 173, 177-78 (1953) dealing with the power
of the Legislature to change the law from the reasonable use rule to prior appro-
Spriation.
It is claimed that if we do not change the law, ground waters will be exhausted
and the legislature is shackled and powerless to enact a ground water code. If
S the legislature is shackled, it is the constitution that imposes the impediment.
The court has no right to pull the rug from under the owner and release the
constitutional obstructions, if any. It is the court's duty to protect constitution-
al rights. Possibly the only source of power the legislature possesses is the
police power for the general welfare.... We do not mean to say whether or to
what extent such police power may be used to affect the rights involved herein.
That is not before us. Should it ever be presented we will decide the matter.






470 LAW OF WATER ALLOCATION

to the needs of the land on which it is being used, not in relation to the
needs of others. The argument can therefore be made that the Arizona
statute does not take away the rights of the nonuser because he really has
no right where a neighbor is free to cut off the supply. This argument has
many weaknesses and was not stressed by the Arizona court since the
court had frequently held that a land holder owns the percolating water
under the surface of his land. 89 Still, this argument has substantial back-
ing by authority in view of its similarity to arguments offered by opinions
in partial justification for upholding ground water, and oil and gas, waste
prevention measures. In contrast to the hazardous position in which each
land holder finds himself under the ground water reasonable use rule, a
riparian's rights supposedly cannot as readily be cut off by his neighbor,
since the reasonable use of each is measured in part by the reasonable
needs of the other. To the extent that the Michigan proposal impairs this
substantial right, it goes beyond the Arizona statute.
This reason for discounting the significance of the Ernst case finds
some support in City Mill Company v. Commission, 90 decided in 1929,
where the Supreme Court of Hawaii held that the denial of a ground water
use permit because the supply was already overdrawn constituted a viola-
tion of the Fourteenth Amendment. The opinion's principal ground was
that the police power cannot be invoked to cut off one landowner while
others may continue to make full use of the water. While the court did not
believe that it had to decide the question of what judge-made rule was to
govern a landowner's right to use ground water in Hawaii, the opinion did
indicate that probably the rule of correlative rights would be deemed to
prevail. This rule is similar to the riparian rule in relating the amount
of water each is allowed to use to the amount needed by others. Still, there
are many reasons why the case is not a strong precedent against the valid-
ity of the Michigan proposal. The correlative rights doctrine, on the
whole, is more of an equalitarian distribution doctrine than the riparian
law under which it is at least theoretically possible to cut off another's
use where the interfering use is decidedly more beneficial to the public
interest. This cutting off is especially possible in Michigan where the
courts on the whole have not apportioned water between riparians but, in
the case of equally reasonable uses, have tended to prefer the upper user.
Moreover, the Hawaii Court, in addition to leaning towards the correlative
rights doctrine, seemed to favor the theory that overlying landowners
were, in a certain sense, "owners" of the ground water supply. The ri-
parian doctrine does not include the notion that riparian owners are
"owners" of stream water; their rights are generally said to be usufruc-
tuary. Furthermore, the Hawaii Court was especially concerned by the

89. Campbell v. Willard, 45 Ariz. 221, 42 P. 2d 403 (1935); Howard v. Perrin,
8 Ariz. 347, 76 Pac. 460 (1904), aff'd, 200 U.S. 71 (1906).
90. 30 Hawaii 912 (1929).







DUE PROCESS AND EASTERN PROPOSALS


fact that new users were refused permits while previous users were guar-
anteed permanent rights. As will be shown in greater detail below, this
does not necessarily hold true under the Michigan proposal, which pro-
vides a number of grounds on which prior appropriators can be cut off to
let in new users.
The strongest case upholding the type of changes contemplated by the
Michigan proposal on police power grounds is the decision of the Ninth
Circuit in California-Oregon Power Co. v. Beaver Portland Cement Co."
In that case the constitutionality of the 1909 Oregon Water Code 92 was
was again put to the test and again upheld. It will be recalled that that
code, as interpreted by the Hood case, modified both used and unused
rights in a manner similar to the Michigan proposal.93 The Ninth Circuit
opinion makes several important points. First, it asserts that not only
conservation of the physical resource but the general economic welfare of
the community is the proper object of water rights modification under the
police power:
The question is whether or not the modification of riparian rights effected by
the statute of 1909... could reasonably be regarded as essential to the accom-
plishment of ends sought... That those ends may properly include the economic
welfare of the community, as well as its peace, health, and safety is, well estab-
lished... It cannot be doubted that the economic welfare of the people of Oregon
was one of the principal aims sought to be permitted by the Water Code ... 94

Second, the opinion treats water rights under the riparian law as userights,
the modification of which, by subsequent legislation, has generally been
more readily upheld than retroactive alterations of other incidents of own-
ership of real property:

Under the common law, the right of the riparian owner is to the usufruct of the
water and not to the water itself. Legislation limiting the right to its use is in
itself no more objectionable than legislation forbidding the use of real property
for certain purposes. Euclid v. Ambler... To argue, as plaintiff does, that ri-
parian rights are real property rights which attach to the land, does not put such
I rights beyond the reach of the police power. 95
Third, the opinion treats the reallocation of water between riparians and
appropriators not as the reduction of the rights of one group for the bene-
fit of the other but as a fair adjustment between claimants to a common

91. 73 F. 2d 555 (1934). See 9 Temp. L.. 354 (1935); 2 U. Chi. L. Rev. 658
(1935).
92. Ore. Laws 1909, c. 216 1, 70(2), (3); as amended, Ore. Rev. Stat.
537.120, 539.010 (1), (2) (1953).
93. See pp. 454-455 supra.
94. 73 F. 2d at 567.
95. Ibid.







LAW OF WATER ALLOCATION


supply, which, as was previously seen, has frequently been held to be a
proper object of police power legislation. From what is quoted below it
will also be seen that to a certain extent it is not too clear whether the
court treats the statute as effecting a readjustment between riparians and
appropriators or only among riparians who after the enactment of the
statute were forced to claim as appropriators. In other words, some of
the opinion's reasoning seems applicable to a change from riparian to ap-
propriation law in the East where no appropriation law exists at the time
of the change.
That the common-law rights to the relative use of certain natural resources may
be modified in the interest of securing fairer distribution thereof as well as of
preventing physical or economic waste is established by Champlain Refining Co.
v. Oklahoma...
The modification of riparian rights which the act of 1909 has effectuated is not
so drastic a change as to amount to taking of property without due process of
law... At common law, the usufruct of the property owner was not absolute; it
was conditioned on the equal right of every other riparian owner to the use of
the water. By the Oregon legislation, his usufructuary privileges were not de-
stroyed; his right of access to and to the equal use of the waters for ordinary
domestic purposes were preserved... [As to the other uses] on the one hand, his
unrestricted right reasonably to use his fair share of the waters for beneficial
purposes is now subordinated to a prior appropriation... On the other hand, he
is no longer limited in such beneficial use to his fair proportion of the waters
... and as a riparian owner, he is in a peculiarly advantageous position to exer-
cise the right of appropriation. The statute cannot be said to take away property
from one in order to give it to another, even though the effect of the operation
of the statute in a specific case may be so to transfer the privilege of making
some specific use of the water. 96

The Supreme Court of the United States upheld the Ninth Circuit deci-
sion on other grounds. 97 One of the questions in the California-Oregon
case was whether enactment of the Desert Land Act of 1877 98 meant that
the 1885 patent for the riparian land involved in this case conveyed a right
to use water only for domestic purposes. The Circuit Court held that the
Desert Land Act did not so limit the riparian rights of the particular pat-
entees, and the Court therefore reached the issue of whether Oregon could
invoke the police power to modify nondomestic riparian rights. The Su-
preme Court of the United States held that the Desert Land Act applied to
the particular patentees and that water rights connected with patents sub-
sequent to 1877 were not fixed but were held subject to whatever law the

96. Ibid. at 568-69.
97. California-Oregon Power Co. v. Beaver Portland Cement Co., 295 U.S. 142
(1935).
98. 19 Stat. 377 (1877); 43 U.S.C. 321-39 (1952).






DUE PROCESS AND EASTERN PROPOSALS 473

thirteen affected states might impose. Since the Oregon Court had already
held that patents after 1877 conveyed riparian rights only for domestic
use, 99 the Supreme Court never reached the police power issue. This
weakens the authority of the Ninth Circuit opinion to the extent that the
police power justification became unnecessary under the Supreme Court's
authoritative interpretation of the Desert Land Act. But one need not con-
clude that the Supreme Court took the position it did because it was embar-
rassed by the constitutional questions raised and did not want to pass on
them. More was at stake than the Oregon law. It is far more likely that
the Court was motivated by a desire to interpret the Desert Land Act so
as to assure all the states with lands affected by that Act that they were
free to adopt whatever water law they wished with respect to patentees of
the public domain who received their patents after 1877. Moreover, the
strongest argument against using the Ninth Circuit case as authority for
allowing changes contemplated by the Michigan proposal is the by now fa-
miliar contention that the Oregon case, unlike the Michigan proposal, in-
volved the readjustment of the rights between two groups who, prior to the
statute, had or at least could obtain legal interests in a common source of
supply. Though, as was seen, the opinion does not stress this point at all
times and, on the contrary, seems at one point to uphold modification of
riparian rights on grounds that would be applicable in eastern states,
nevertheless the factual context was one of readjustment between holders
of riparian and appropriative rights to a common supply.
To summarize, the police power cases do not show that modification of
used and unused riparian rights is necessarily beyond the scope of legis-
lative power. The proper objectives of the exercise of the police power
include conservation of physical resources, improvement of the economic
welfare of the community, and protection of the relative rights of those
who hold interests in a common supply. Despite the fact that the oil cases
and some ground water cases deal only with an exhaustible resource, the
Ninth Circuit, Gin Chow and McCarter cases indicate that the physical
conservation objective may involve a renewable resource. The difference
between an exhaustible and renewable resource is, after all, not so great.
Once the time factor is added to the equation they are in many ways
analogous.
Of course, as the Ninth Circuit put it, the modification effected must be
one which "could be reasonably regarded as essential to the accomplish-
ment of the ends sought." Section 1 of the Michigan proposal* declares

L 99. Hough v. Porter, 51 Ore. 318, 95 Pac. 732, (1908), petition for rehearing
denied, 102 Pac. 728 (1909). The United States Supreme Court in the California-
Oregon Power Co. case agreed with the Hough case interpretation of the Desert
Land Act but held that each state was free to apply any law to the post-1877 patent-
ees. For criticism of the Supreme Court opinion see 24 Calif. L. Rev. 349 (1936).
See p. 479.






LAW OF WATER ALLOCATION


that the proposal's modifications are necessary for objectives such as the
ones listed above, and under the usual judicial approach great weight will
be attached to the legislative finding. Moreover, it would not be difficult
to prove that there is a water problem in Michigan and that it is beneficial
to Michigan's economy and essential for conservation purposes to allocate
water in such a way as to achieve optimum use and encourage private in-
vestment in more beneficial uses of water. The appropriation system can
be shown to have a reasonable relation to the accomplishment of these ob-
jectives. It tends to encourage investment by establishing methods for ob-
taining more definite rights, and it tends to protect the public interest in
optimum use by removing the riparian land restriction and by empowering
an administrative agency, which should acquire a more comprehensive
view of the state's water problems than the courts are likely to have, to
allocate water to new appropriators whose uses are considered to be in
the public interest. These points may be conceded, and they will not be
the main subject of debate before the courts. At least for purposes of this
discussion it will be assumed that the Michigan proposal is reasonably re-
lated to legitimate legislative goals.
Mr. Justice Jackson's words, though perhaps not uttered in a context of
constitutional analysis, best express the more troublesome issue: do con-
ditions which require "appropriation" justify expropriation? The courts
have the ultimate power to decide this question as a matter of constitutional
policy. While many of the opinions are not too explicit, the issue seems to
be whether the law in question imposes a disproportionate burden on a few
for the benefit of others or of the general public. Where the burden on par-
ticular individuals is not too great in proportion to the benefit they receive,
the entire expense of regulation presumably does not have to be met by
general taxation or even by specific individuals who, incidentally, may de-
rive particular benefit from the legislation. Under certain circumstances
this equation can be expressed in terms of the degree of change in the
rights of individuals affected by the law. Where the change is not a drastic
one the burden is not a great one but one all individuals must expect to
bear as members of the general community. Thus, the ultimate issue in
the police power cases and the cases allowing legislative redefinition of
the extent of common law rights tends to become the same: is the change
in individual expectations affected by the law so drastic that fairness de-
mands that individuals be compensated and that the expense be met by
general taxation or special assessment, no matter how desirable or neces-
sary the law may otherwise be?
Do the cases provide one with any formula for prediction? Or, as Mr.
Justice Holmes put it, do judicial precedents at least provide one with
boundary stones which mark the line beyond which a particular police
measure or legislative redefinition of rights may not go without providing
for compensation of deprived individuals ?
In the eastern states there seem to be no analogous cases except a few







DUE PROCESS AND EASTERN PROPOSALS


ground water control cases in New York which are previously mentioned.
Eastern cases sometimes cited as unfavorable precedent seem not to be
controlling, but it may be that controlling cases may yet be found in some
of the eastern states. Of the cases sometimes cited, both in Michigan and
elsewhere, many involve legislative attempts to declare navigable what
are in fact non-navigable streams.100 Usually the issue is narrowly pre-
sented, for the declaration is often intended to favor a particular industry
rather than to achieve optimum use in the public interest.101 Thus, Michi-
gan courts have held such declarations unconstitutional when logging op-
erations seemed to get out of hand.102 If for purposes of this discussion it
is assumed that the Michigan proposal is a general public interest law,
these cases carry little weight. On the other hand, when the public inter-
est demanded that logging be encouraged, the Michigan court did not hesi-
tate to declare navigable any stream capable of floating a log.103 And in
recent years, when the public interest in recreation became important in
Michigan, the court revived the log-floating definition of public waters and
perhaps even expanded it somewhat in order to allow public fishing on a
larger number of lakes and streams. 104 Moreover, at least one Michigan
case has suggested that if the Legislature should find a public necessity,
"navigable" waters might be made available for municipal water supply
without compensating injured riparians.105 All of this suggests a great
flexibility of the law.
Other cases cited as unfavorable precedents in the eastern states are
even less controlling. Some simply hold that a municipality without speci-
fic legislation may not take water for municipal water supply to the injury
of riparians.106 The language used is to the effect that municipal use con-
stitutes a "taking." But the context of a general legislative redefinition of

100. See Marquis, Freeman & Heath, The Movement for New Water Rights
Laws in the Tennessee Valley States, 23 Tenn. L. Rev. 797, 831, n.185 (1955);
Coates, Present and Proposed Legal Control of Water Resources in Wisconsin,
1953 Wis. L. Rev. 256, 286 et seq.
101. Frequently for purposes of helping logging interests. More recent cases
are concerned with legislative attempts to extend public fishing rights, Hood v.
Murphy, 231 Ala. 408, 165 So. 219 (1936); the court indicated, however, that exclu-
sive private fishing rights in non-navigable streams are subject to police power
conservation regulation, Birmingham v. Lake, 243 Ala. 367, 10 So. 2d 24 (1942).
102. Thunder Bay River Booming Co. v. Speechly, 31 Mich. 336, 18 Amer.
Repts. 184 (1875).
103. See pp. 402-403.
104. See pp. 405-406.
105. See p. 414.
106. Similar Michigan examples deal mostly with pollution by cities or attempts
on the part of cities to prevent pollution of water supply by neighboring riparians.
See p. 414. One case also dealt with interference with riparian rights due to a city's
highway improvement project. See pp. 413-414.


I






LAW OF WATER ALLOCATION


riparian rights or of a general police power measure effecting the reallo-
cation of water is missing. Another group of cases sometimes cited as
unfavorable precedents involve statements or holdings by eastern courts
to the effect that riparian rights are not lost by mere nonuse.107 These
statements reiterate a common phrase, but as shall be seen below they
do not imply that nonuse may never be a factor justifying a limitation on
the amount of water a riparian may later use. When this limitation occurs
it could so confine the scope of his permissable use as to make it impos-
sible for him to carry out his contemplated use. The ultimate question is
whether the extent of loss a nonuser would incur under the Michigan pro-
posal differs so greatly from his expectations under riparian law as to
justify characterizing the proposal's effect as a "taking." The eastern
"unused right" cases do not provide an answer without further analysis.
The more analogous western cases reviewed in greater detail in this
paper also fail to draw a specific line. The legislation may at times not
go beyond interfering with unused rights, but many cases seem to have up-
held modifications of used rights as well. Perhaps legislation in the water-
resource field may never go beyond the adjustment of rights between groups
of users drawing on a common supply, but the stream water cases do not
always explicitly state such a limit (though it is mentioned in oil and
ground-water cases). If it is argued that the cases on the whole have not
gone beyond "readjustment situations," it might be answered that they do
not necessarily draw a line at this point. Thus, one is forced to return to
the more general formulation: does the law effect a drastic change in a
riparian's present expectations ?


IV.

In the first part of this paper it was shown why the courts might regard
the change brought about by the Michigan proposal as fairly drastic. To
balance this point of view an argument is now presented in favor of the
proposition that the Michigan modification of riparian rights is not very
severe. It will be seen in the course of this argument that the distinction
between used and unused rights takes on less importance than it was pre-
viously thought to have, and so does the criterion which seeks to limit
modification to readjustments of common rights to a common supply. The
argument for the proposition that the Michigan proposal effects no drastic
change in existing law will begin with the proposal's supposed changes in
the relation of riparians to each other. To facilitate discussion, analysis
of changes resulting from the fact that riparians are accorded equal treat-
ment with nonriparians is postponed until later.
It is arguable that the preference accorded Class A users over riparians

107. Marquis, Freeman & Heath, supra note 100, at 801 n.24.






DUE PROCESS AND EASTERN PROPOSALS


forced to become Class B users or appropriators is not a drastic change.
The existing riparian law prefers domestic uses, and there is no prece-
dent against the courts establishing preferences for additional purposes.
Most of the uses recognized by the courts up to now are included as Class
A uses. Riparian Class B users and appropriators are those who use wa-
ter for purposes which might be recognized as riparian in the future.
When this occurs, the courts might decide that the uses recognized up to
now should be preferred over newly recognized riparian uses. This is
substantially how the domestic use preference came about. For a time the
courts, under the "natural flow" doctrine, permitted a material diminution
of the flow only for domestic uses. When other uses came to be recog-
nized, "domestic uses" were accorded a preferred status. Moreover, the
riparian law is not a system of equilitarian allocation. Decisions frequently
prefer one use over another on the basis of the many elements which go
into a determination of "reasonable use." One of these elements is the
public interest. The legislative preference for Class A users should be
understood as a legislative finding that the listed uses best serve the pub-
lic interest-a finding in the area of greatest legislative competence. Fur-
thermore, the preference for Class A users is not absolute. Under Section
5 of the Michigan proposal, Class A users may not use more water than
is necessary for a "reasonable beneficial purpose", and they may not em-
ploy unreasonable methods of diversion. The "reasonable beneficial pur-
pose" concept is borrowed from western law, where the word "reasonable"
has been added to the original requirement that the use be "beneficial" in
order to put greater emphasis on the public interest in prevention of inef-
ficient and uneconomic uses in certain kinds of situations.108 Thus, water
that might be wasted or put to an uneconomic use by a Class A user might,
if not needed by other Class A users, become available to riparians who
hold Class B rights or qualify as appropriators.
Nor does the fact that riparian Class B users and appropriators lose
their rights upon five years nonuse constitute a drastic change of existing
law. The frequent statement that a riparian's right cannot be lost by non-
use 09 while an appropriator's can is an over-simplification. Riparian
rights may be lost by nonuse under doctrines of prescription and estop-
pel.110 Under riparian law as applied in Michigan and many other states,
nonusers apparently cannot enjoin users.1ll When a downstream nonuser
later wants to use water, he may be granted damages rather than an in-
junction against an existing user because of the Balancing of Conveniences
doctrine, or he may be denied both damages and injunction by a holding

108. See pp. 105-118.
109. For Michigan application, see cases holding that prescriptive right does
not run upstream, pp. 399-400.
110. See p. 398 et seq. and note 79.
111. See p. 396.






LAW OF WATER ALLOCATION


that the existing use is not an unreasonable one. Priority of use is one
factor the courts may consider in weighing the relative reasonableness of
competing uses under riparian law, and it may become all important where
there are no overriding public interest considerations. Consequently, it
could be argued that the Michigan proposal's forfeiture provisions merely
seem to regularize these diverse ways by which riparian rights can be
lost. Moreover, uses by riparians holding Class B and appropriative
rights may not be totally and irrevocably terminated upon five years non-
use. Class B users and appropriators are free to apply for new appropri-
ative rights, and, as will be shown in the succeeding paragraph, their
chance of acquiring new rights is not dependent solely on the fact that there
are no others who wanted to use the water first. Just as under the riparian
system, the nonuser's chance to make a new use under the Michigan pro-
posal depends on a variety of factors.
The notion that under the appropriation system one's right to use water
depends solely on priority in time may also be an oversimplification, es-
pecially with respect to the Michigan proposal. A Class B user must show
that he is making a reasonable beneficial use, and presumably his use can
be cut off at least temporarily any time that it fails to meet this standard.
The same holds true for appropriators in the light of the limitations im-
posed by Section 5. As previously indicated, the reasonable beneficial use
criterion in western law theoretically allows the administrator to take into
consideration the public interest in the prevention of inefficient and eco-
nomically wasteful uses. Moreover, in passing upon applications for new
rights or for changes in use under existing rights, the administrative
agency under the Michigan proposal is specifically instructed to take the
public interest into consideration. The relevant provisions of the proposal
read as follows:

Section 14. GROUNDS FOR APPROVAL OR REJECTION OF APPLICATION.
Every application that fulfills all of the requirements of this Act, and of the
rules and regulations of the Commission promulgated in pursuance thereof,
shall be approved by the Commission. Before acting upon an application, the
Commission shall consider all the circumstances of the proposed use of the
water, including the character of the land and the desirability of irrigating such
land. The Commission shall also consider whether the approval of the applica-
tion will impair any vested rights as provided for in Section 7, supra, or will
interfere with the maintenance of the flow of the stream or level of the lake, as
the case may be, reasonably necessary to safeguard the uses provided for in
Section 2, supra. Any application, the approval of which would conflict with the
public interest, as stated in Section 1, supra, or with the requirements of this
section, or which is shown not to have been made in good faith, shall be rejected
by the Commission. If two or more applications are pending for a quantity of
water that is inadequate for both or all, or which for any other reason are in
conflict, the Commission shall have the right to approve that application which


best serves the public interest. If in the opinion of the Commission there ap-







DUE PROCESS AND EASTERN PROPOSALS


pear to be assured prospective uses of the water that would better serve the
public interest or general welfare, then the Commission may reject or may
postpone the approval of an application that would not serve so well such public
interest or general welfare.
V Section 24. CHANGE IN EXERCISE OF WATER RIGHT. The holder of a
claim or license may, in cases where public interest or outstanding rights are
not adversely affected thereby, be authorized by the Commission, upon petition
of the holder, to (a) Change the point or points of diversion of the water; or
(b) Change the location of reservoirs or of works for the transmission or dis-
tribution of the water; or (c) Change the purpose for which the water is author-
ized to be used; or (d) Change, in whole or in part, the location of the gross area
within which the use of the water may be effected under the claim or licences.
(Emphasis supplied.)

Section 1, which contains a descriptive outline of what the legislature
considers to be in the public interest, reads as follows:

Section 1. DECLARATION OF STATE POLICY. The conditions within the
State of Michigan with reference to the availability of water are such that the
public welfare requires that water be put to the highest beneficial use; the use
of water for irrigation, municipal, industrial, water power, recreational, navi-
gation, and all other beneficial purposes is a matter of public interest and pub-
lic welfare; the proper use of surface waters will facilitate the conservation of
ground waters in many areas; and by encouraging the construction of pumping
plants, dams, reservoirs, conduits, and other structures to permit the proper
collection, conservation, and use of surface water, the public welfare is served.
It is therefore declared to be the policy of the State of Michigan that control of
the use of water for all beneficial purposes shall be in the State, which in the
exercise of its police powers must take such measures as shall effectuate the
best utilization of the water resources of the State. (Emphasis supplied.)

This declaration seems broad enough to encompass any public interest
factors the courts might at the present time consider under riparian law.
The Commission's powers under Section 14-to deny applications against
the public interest, to approve that use best serving the public interest
where pending applications are in conflict, and to reserve water for future
uses which better serve the public interest-establish a large range of dis-
cretion for the administrative agency. Within this range the public interest
criterion may be employed to modify the force of the priority. Moreover,
by extending this discretion over applications for the kind of changes many
users may sooner or later want to make because of changing conditions,
the proposed law puts the Commission in a position to review the public
interest value of various uses even after applications have been granted.
A broader review power over existing uses derives from the previously
discussed provisions requiring that all uses be both reasonable and bene-
ficial, at least to the extent that provision is later made for effective






LAW OF WATER ALLOCATION


enforcement of this requirement. And, of course, where there has been no
reasonable beneficial use for a specified period of time and the appropri-
ative or Class B right is forfeited, the administrative agency can again
consider the public interest in passing on applications for new uses of the
water.
For these reasons, a persuasive argument can be made that the Michi-
gan proposal intends priority in time to be merely one element in the ac-
quisition and protection of rights and that, as under the riparian system,
a multitude of factors are to become relevant to each ultimate determina-
tion. As was stated before, the priority in time factor is not entirely ab-
sent from the riparian system, which on the whole seeks to satisfy both
public interest and protection of investment goals. The fact that the
Michigan proposal puts greater emphasis on priority in time in order to
provide more effective machinery for investment protection does not nec-
essarily mean that the proposal amounts to a drastic departure from ex-
isting law. As investments in water become more substantial and the
uncertainty of there being sufficient water available increases, greater
emphasis on this priority factor seems within the range of the probable
development of riparian law. It might be concluded, therefore, that the
change entailed in enactment of this proposal is within the scope of the
legislative power of modification of vested rights, or, alternatively, that
it constitutes a proper exercise of the police power.
One further possible effect of the Michigan proposal on riparian rights
must not be considered. Former riparians who will have to claim as
Class B users or apply as appropriators will receive equal treatment with
users who make nonriparian uses or who use water on nonriparian land.
The nonriparian uses are those which the Michigan court up to now has
not regarded as riparian, though without foreclosing the possibility that
these uses might still be so regarded in a proper case. Section 3 of the
proposal, in listing proper purposes of use not only includes most uses
that have previously been allowed as riparian, but it also includes irriga-
tion, municipal, and industrial uses and permits long-term storage of
water, sale of water, and any "other particular beneficial use." Irrigation
has been prohibited in one Michigan case where it conflicted with pre-
ferred domestic uses, but the court did not hold that irrigation could never
be a reasonable riparian use. 112 Municipalities have at times been called
riparian owners, though their use of water for municipal supply has on
the whole been prohibited since it involves the sale of water to inhabitants
located on land not municipally owned;113 this however, is not a "riparian
use" but a "riparian land" question and will be discussed as such below.
The same holds true for the sale of water permitted by the proposal in so
far as it might involve sale by a riparian to a nonriparian. As to industrial

112. See p. 384.
113. See p. 387.






DUE PROCESS AND EASTERN PROPOSALS


uses other than power uses, they have, on the whole, not been litigated in
the courts. Short-term storage of water has been permitted, but long-
term storage has at times been prohibited by the courts, generally in
cases involving storage by loggers. The reason for the prohibition usually
was that the particular use was unreasonable, especially where the stor-
age intentionally or incidentally resulted in the flooding of another's land;
the prohibition on long-term storage was not based on the ground that such
storage could under no circumstances be a reasonable riparian use.
It thus becomes apparent the court has not held that any of the uses
listed as proper by the proposal are nonriparian or unreasonable per se.
Under existing precedents the courts are free to regard these uses as ri-
parian. The legislative authorization of the uses listed in the proposal
does not, therefore, appear to be a drastic departure from riparian law.
But this still leaves for consideration the proposal's legalization of
uses on nonriparian land. At first glance this legalization appears to be
an extremely drastic departure from riparian law. That a considerable
change was intended cannot be denied. But, in fact, nonriparians have not
in the past been entirely prohibited from using water. It seems that under
Michigan law the riparian must show injury to enjoin a nonriparian or to
collect damages.114 It is also possible that the injury must be to the ri-
parian's "reasonable use", for at least one Michigan case suggests that a
nonriparian can enjoin a riparian whose unreasonable use incidentally in-
terferes with the nonriparian's use.115 Moreover, in Michigan the Balan-
cing of Conveniences doctrine has been applied to favor a nonriparian user
in a conflict with a riparian.116
Furthermore, what constitutes ownership of riparian land is not too
clear under Michigan law. Fee and lease holders are included, and one
who owns an easement for purposes other than the use of water is ex-
cluded. But it does not seem established that one who owns merely an
easement of access to the water and easements to transport the water to
the place of use does not also have the status of the riparian land owner.
In Michigan, most nonriparian land cases where access rights were owned
by the nonriparian user involved a sale of water by the access owner to
one whose ownership interests did not include any right of property con-
tiguous to the stream. Section 5 of the Michigan proposal provided that
there can be no valid right to the use of water "unless the right to con-
struct diversion works or reservoirs upon the land acquired thereafter
shall have been acquired in a lawful manner." If "diversion" works are
construed to include irrigation ditches or water supply pipe lines or other
means of transportation, the statute requires a single contiguous legal in-
terest in land from the place of diversion to the place of use. Where this

114. See p. 396.
115. See p. 396, note 73.
S 116. Seep. 398, note 79.






LAW OF WATER ALLOCATION


legal interest is an easement the owner might, within the limits of the
present case law, still qualify as a ripatian.117 Of course, this legal inter-
est might be a license, which at times is technically not regarded as an
interest in land, but this distinction between easements and licenses in
property law is largely a formal one and w2 certainly not be too power-
ful an argument for invalidating the proposal. The only situation where
there'might not be sufficient contiguous ownership from shore to place of
use is where water is sold by a diverter to a person who has no legal in-
terest in land contiguous to the stream. But, in such a situation, all the
diverter who wishes to sell the water would have to do to comply with the
contiguous ownership requirement is to make all buyers co-owners of the
easements of access and passage for the period of the contract.
The foregoing suggests that the Michigan proposal's explicit admission
of nonriparians into the group entitled to share in the State's water supply
is not as drastic a change in the present law as might be thought. Thus the
distinction between the western cases and the situation in the East which
was stressed earlier in the paper, namely, that in the East water of which
riparians are deprived will go to entire newcomers, seems not to be en-
tirely correct. In view of the possibility-in Michigan, at least-that an
easement may be sufficient ownership, the category of true "nonriparians"
is much smaller than one is usually led to believe. And in Michigan, just
as was the case in some of the western states, riparians are preferred
over nonriparians, but the preference is not so absolute that nonriparians
have no rights at all.
Moreover, the distinction between riparians and nonriparians stems
from an era when the interrelationship between different phases of the
hydrologic cycle was not too well understood. Today it is well known that
the use of stream water influences the supply of ground water and that the
use of ground water and diffused surface water influences the supply of
stream water. In the light of these facts, one cannot call any nonriparian
a newcomer, for he is entitled to use ground water and diffused surface
water and thus is not a newcomer among those who can share in the state's
total water supply. The Michigan proposal in Section 1 recognizes the in-
terdependence of the various phases of the hydrological cycle by stating
that "the proper use of surface waters will facilitate the conservation of
ground waters in many areas." The Michigan judge-made law has grad-
ually been developing rules tending to make feasible a unified administra-

117. See p. 380. It can be seen from cases cited (p. 387 at notes 42-44) that most
of these involve situations where the "nonriparian" did not even have a right of ac-
cess. In the case in note 44 the city had a right of access but the water was sold to
those who did not. (Compare also the Monroe case p. 385, note 37 where the extent
of ownership of the carp pond operator was entirely uncertain. The court indicated
that as long as he is rightfully in possession the extent of ownership is unimportant.)


____







DUE PROCESS AND EASTERN PROPOSALS


tion of uses of water in various phases of the hydrologic cycle. Conse-
quently, the Michigan proposal might be viewed as merely a further step
toward unified administration of the state's total water supply. Viewed in
this light, so-called nonriparians were always part of the group entitled
to use water, and the Michigan proposal merely effects a readjustment
among the present members of the group of users or potential users.
Although, for ease of expression, the foregoing discussion has referred
to "riparian" and "nonriparian" as two mutually exclusive groups, like
natural redheads or brunettes, it should be pointed out that there really
are no "riparian" and "nonriparian" owners. There is, at best, only "ri-
parian" and "nonriparian" land. The so-called nonriparian can always
become a "riparian" by purchasing "riparian land" and, to a certain ex-
tent, by purchasing "riparian rights". The riparian land concept originally
was probably based on the principle that only uses of benefit to such land
are to be permitted. Domestic uses benefit riparian land and consequently
were always permitted, even under the "natural flow" theory. When
streams began to supply power for mills, the product of which was not
consumed on the riparian land but distributed to the community, mill
owners were in many eastern states not treated like riparians; instead,
they were given a limited power of eminent domain and frequently treated
as appropriators. As the concept of "natural flow" gradually gave way to
"reasonable use", a step undertaken in Michigan initially to accommodate
mill owners, it became more and more permissible to use water for pur-
poses which served the community and did not directly benefit the riparian
land. The very change to the reasonable use rule, therefore, anticipated
the abandonment of the riparian land concept, and the Michigan proposal
merely takes a step in the direction in which the common law has tended.
The proposal is not a drastic change but part of a development which rea-
sonably could have been anticipated and, therefore, does not impose dis-
proportionate deprivations on the present holders of so-called "vested"
rights.
Thus, the argument ends.

V.

Whether or not the above argument might ultimately be accepted by
eastern courts is difficult to product. It is possible, however, to make a
few suggestions to the draftsman:
1. It is advisable to eliminate the language declaring that the water of
the State is owned by the people, as well as all use of the term "appropri-
ation rights". While some courts, like the Kansas Court, have paid atten-
tion to this language, it is not likely to accomplish much beyond advertising
that the law is a drastic change. It would be better, in accord with the
gradual-change argument, to call the law an administrative "reasonable






LAW OF WATER ALLOCATION


use" law and to change the language accordingly throughout the proposal.
For example, the priority provisions would lose nothing in substance if
the administrator is empowered to issue licenses in accord with the
"reasonable use" principle which takes into consideration the "public in-
terest," "reasonable beneficial use" by each licensee, and "priority in
time." The law could then provide that, to protect investment, "priority
in time" shall be given great weight tin the allocation of water, and that
the user holding the right prior in time shall not be cut off even tempo-
rarily unless he is not making a reasonable beneficial use, and he shall
not be cut off permanently unless he has not made a reasonable beneficial
use for a specific number of years. But in granting new applications or
applications for change in the exercise of the right, the public interest
must be considered by the administrative agency, and so on.118
2. While the distinction between used and unused rights does not seem
to be too important, occasional opinions have mentioned this distinction.
It would, therefore, be advisable not to interfere with used rights too much.
At least, the retroactive priority provision with respect to Class B rights
in the Michigan proposal should be eliminated. Similar provisions which
appeared in early drafts of other eastern proposals have now been elimi-
nated.
3. The Class A provisions are also dangerous because of the possible
discrimination between riparians. Unless Class A rights include all pos-
sible riparian uses, they may not help in proving the law constitutional.
It would seem better to preserve existing rights to the extent of lawful use
at or prior to enactment, as most other eastern proposals would do. The
court is thereby left free to determine what purposes and amounts of uses
it deems lawful under riparian law and to recognize preferences for do-
mestic and such other uses as it may desire.
4. Further problems would be avoided if rights to use waters were
made available only to owners of riparian land. But the definition of ri-
parian owners could be broadened to include all who hold easements of
access and transportation. This provision is in accord with the previously
suggested scheme of the law as no more than an administrative "reason-
able use" law.
5. Finally, it would also help to have the preamble state that the law
is a first step toward unified administration of the allocation of water in
all phases of the hydrologic cycle and that the legislature must take steps
in this direction because of the paucity of case law dealing with the co-
ordination of rights to stream water, surface water, and ground water.




118. The Wisconsin proposal has several features rendering it more of an ad-
ministrative reasonable use law than an appropriation law. See pp. 90-93.




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