Justice EID delivered the Opinion of the Court.
This appeal addresses orders of the District Court for Water Division No. 2 regarding the administration of water on Alvarado Creek in Custer County. Applicants-Appellants Catherine Boyer LoPresti and Peter LoPresti ("LoPrestis") and Opposers-Appellants City of Fountain and Widefield Water and Sanitation District ("Fountain & Widefield") claim the water court erred in voiding a rotational no-call agreement titled the "Beardsley Decree." Opposers-Appellees John Brandenburg, Douglas and Nancy Brandon, Dilley Family Trust, James D. Hood, Ronald Keyston, Arlie Riggs, Schneider Enterprises, Inc., Dr. Charles Schneider, and Mund Shaikly (collectively "Brandenburg") argue that the Beardsley Decree was an improperly noticed change in water rights, and as such the water court correctly declared it void.
We now hold that the Beardsley Decree is a valid rotational no-call agreement because, by its plain language, it does not sanction a change in water rights. Accordingly, we reverse the judgment of the water court.
Alvarado Creek flows east from the Sangre de Cristo Mountains and splits into two distributary channels at a fork. The southern channel is called Alvarado Creek and the northern channel is called the North Fork of Alvarado Creek ("North Fork").
Four water rights along the stream system are at issue in this appeal: W.A. Bell No. 1 ("Bell No. 1"), Legard No. 5, Legard No. 11, and Legard No. 12 (Bell No. 1, Legard Nos. 5, 11, and 12, collectively the "Four Ditches"). These four water rights were adjudicated on March 12, 1896, in what was formerly known as Water District No. 13. All four water rights are located downstream of the control structure. For each decreed water right at issue, the source's name and the claimant's name have changed since the 1896 adjudication as described by Table 1.
In 1908, George Beardsley (then owner of the Legard Nos. 5, 11, and 12), sued Allen Bates (then owner of the Bell No. 1), the Water Commissioner, and others to resolve a dispute over the use of his water rights. Beardsley alleged that Alvarado Creek and the North Fork were distinct stream systems.
The Beardsley Decree prevented litigation over water rights decreed to the Four Ditches for almost eighty-eight years. But long-running
This appeal involves two water court cases. First, in Case No.1996CW228, the LoPrestis filed an application for a change of several water rights on the stream system including the Legard Nos. 5, 11, and 12. Several parties opposed the LoPrestis' application. On August 3, 2000, John Brandenburg filed a motion for partial summary judgment seeking to void the Beardsley Decree by arguing it was an improperly noticed change in water rights.
On October 12, 2000, the water court granted the motion for partial summary judgment in a written order that declared the Beardsley Decree void ("2000 Order"). The 2000 Order found that the Beardsley Decree "constitutes judicial sanction of Beardsley and Bates switching water back and forth between streams to meet their own needs, with the consequent changes in points of diversion from those specified in their respective decrees. This was not in accord with [applicable law because] the notice provision of the then controlling statute [relating to a change in water rights] was not fulfilled."
The second case, 1999CW77, filed by John Brandenburg, Arlie Riggs, Frank Dilley, and Ronald Keyston
Based on this allegation, Brandenburg argued that water rights holders on Alvarado Creek downstream of the control structure should not be able to call for the delivery of water that would naturally have flowed into the North Fork. Brandenburg took this position even though the 1896 adjudication of water rights on the stream system decreed priorities under the assumption that Alvarado Creek and the North Fork shared a common source of supply. Brandenburg lost at the injunction hearing, and the water court granted the State's request for a mandatory injunction to install the control structure on his property.
Because 1996CW228 and 1999CW77 shared some common issues, the water court consolidated those issues in one trial to the court on March 14-15, 2001. After trial, the water court took the case on advisement. By an order dated December 5, 2001 ("2001 Order"), the water court determined that Alvarado Creek and the North Fork have a common source of supply based on the evidence presented at trial.
The 2001 Order, however, did not resolve the LoPrestis' 1996 application for change of water rights, so Brandenburg moved for summary judgment to dismiss the LoPrestis' application. The water court denied Brandenburg's motion for summary judgment on October 15, 2003.
Brandenburg resurrected 1996CW228 on March 1, 2010, when he filed a Motion to Dismiss for Failure to Prosecute and for Entry of Rule 54(b) Certification. See C.R.C.P. 54(b) (permitting entry of final judgment on fewer than all pending claims). On April 30, 2010, the water court denied Brandenburg's motion to dismiss for failure to prosecute, but granted his motion for Rule 54(b) certification to permit immediate appeal of the issue involving the validity of the Beardsley Decree.
Before addressing the merits, we consider whether 54(b) certification was appropriate in this case given that the orders certified were entered over eight years prior to certification.
The water court certified the 2000 Order and the 2001 Order pursuant to Rule 54(b) on April 30, 2010. There was no objection made below to the timeliness of Brandenburg's 54(b) motion, and no party raises the timeliness issue before us. However, we find it initially troubling that a trial court certified, as final under 54(b), orders it entered over eight years before. Thus, we raise the timeliness issue on our own.
On its face, Rule 54(b) does not contain a time limitation for filing a motion seeking certification. Courts have taken different approaches to the timeliness issue. For example, in interpreting the federal counterpart to our 54(b),
Schaefer v. First Nat'l Bank, 465 F.2d 234, 236 (7th Cir.1972) (emphasis added).
Here, the substantial delay between the entry of the orders and the filing of the Rule 54(b) motion was occasioned entirely by the LoPrestis' lack of pursuit of the case. It was only after years had elapsed with no activity in the case that Brandenburg filed a motion to dismiss for failure to prosecute, or, in the alternative, for Rule 54(b) certification. Indeed, Brandenburg had no reason to file a 54(b) motion given that he had prevailed in the orders; it appears that he filed it merely as a way of moving the case along.
We now turn to the substantive issue presented in this case: whether the water court properly declared the Beardsley Decree void. We find that the water court erred, and hold that the Beardsley Decree is a valid rotational no-call agreement because, based on its plain language, it does not sanction a change in water rights.
We review the water court's legal conclusions on summary judgment de novo. City of Englewood v. Burlington Ditch, Reservoir & Land Co., 235 P.3d 1061, 1066 (Colo. 2010). We also review de novo the water court's interpretation of a contract. Lake Durango Water Co. v. Pub. Utils. Comm'n, 67 P.3d 12, 20 (Colo.2003).
Brandenburg first argues that the water court correctly found the Beardsley Decree to be an illegal change of water rights based on its plain language.
(Emphasis added). Brandenburg interprets the Decree to mean that the LoPrestis were permitted to divert and use "all of said waters" at any "point or points" as they desire when the call rotates to them. We disagree.
The phrase "all of said waters" should not be read in isolation, as Brandenburg proposes, but rather in the context of the whole Decree. Indeed, the phrase is previously defined in the Decree as: "all of the waters naturally flowing in said creeks . . . to the extent that the same have been decreed in and by the decree of the District Court . . . to the [Four] [D]itches. . . ." Based on the definition, the phrase "all of said waters" means only those waters decreed to the Four Ditches. As further support for this interpretation, the Decree permits diversion only "to the extent that" the water flowing in the stream system has been decreed to the Four Ditches "severally and respectively."
The Decree's terms therefore do not permit the LoPrestis to divert all of the available water in the stream system down Alvarado Creek or the North Fork to "any point or points." Instead, under the Decree, the LoPrestis can only call for a diversion down Alvarado Creek or the North Fork to deliver water to satisfy their ditches in priority. This call is limited to the maximum amount decreed, "severally and respectively," to each individual ditch pursuant to the 1896 adjudication.
Brandenburg next argues that, even if the Beardsley Decree does not sanction an illegal change of water rights, it still fails as an improper water loan violative of section 37-83-105(1), C.R.S. (2011), which provides that:
To bolster his position, Brandenburg draws an analogy between the present case and Fort Lyon Canal Co. v. Chew, 33 Colo. 392, 81 P. 37 (1905). The analogy, however, is inapposite.
Fort Lyon involved an agreement under which senior water rights owners with no present need for water loaned their senior water rights to junior water rights holders. 33 Colo. at 403-04, 81 P. at 40. This allowed junior water rights holders to bypass other more senior water rights holders on the same stream system. 33 Colo. at 405, 81 P. at 41. Such a loan is unlawful, without proper notice and approval, because it skirts the priority system and may injuriously affect other water rights. § 37-83-105(1); Fort Lyon, 33 Colo. at 405, 81 P. at 41.
The rationale behind Fort Lyon and § 37-83-105(1) does not apply here. As previously discussed, the Decree is a settlement agreement that rotates the ability to call for water between senior rights holders on a heavily
Brandenburg does not dispute the validity of no-call agreements under City of Englewood. But he asserts that the Decree is unlike the agreement found valid in City of Englewood because, in this case, there was no bargained for exchange between the original parties to the Decree. This argument fails, in part, because "any benefit to a promisor or any detriment to a promisee at the time of the contract—no matter how slight—constitutes adequate consideration." Lucht's Concrete Pumping, Inc. v. Horner, 255 P.3d 1058, 1061 (Colo.2011). "Consideration may take the form of forbearance by one party to refrain from doing something that it is legally entitled to do." Id. Almost any form of consideration will support a valid contract, see id., and except in extreme circumstances, we do not inquire into the adequacy of consideration, id.
In this case, Bates, the owner of the Bell No. 1 in 1908, was entitled to call for water (as necessary) at a certain flow rate because he held first priority on the stream system. In the Decree, Bates agreed to forbear his right to call for water against the Legard Nos. 5, 11, and 12 on a rotating basis in exchange for settlement of litigation. Similarly, Beardsley gave up his claims against Bates, which, in all likelihood, would have injured Bates' water rights at the Bell No. 1 if proven. So, contrary to Brandenburg's urging, the Decree was formed with adequate consideration.
Finally, Brandenburg argues that the Decree has been administered as a change-in-water-rights decree, and thus we should affirm the water court's 2000 Order which found the Decree void for lack of notice because it acted as "a de facto change in points of diversion." According to Brandenburg, parties who act contrary to the plain meaning of a rotational no-call agreement such as the Decree, either intentionally or under a misunderstanding of the agreement's terms, can void, ab initio, an otherwise valid agreement. Again, we are not persuaded.
Contractual water rights are "far different" from water rights acquired by decree. Pub. Serv. Co. v. Meadow Island Ditch Co. No. 2, 132 P.3d 333, 341 (Colo.2006) (hereinafter "Public Service"). "A decreed water right is valuable property, not a mere revocable privilege." Id. While parties to a contract may obtain certain water rights, only the owner of a decreed right can obtain a change in water rights. Id. at 340 (citing Bd. of Cnty. Comm'rs v. Upper Gunnison River Water Conservancy Dist., 838 P.2d 840, 855 (Colo.1992)). Contracting away the ability to apply for a change in water rights can only be done expressly. Public Service, 132 P.3d at 341.
For instance, in Public Service, the parties settled litigation over water rights via a written agreement. Id. at 342. We declined to interpret the settlement agreement as a bargain to change the use of a water right because it was silent on the parties' intent to change the use of water. Id. In this case, the settlement agreement (i.e. the Decree) is similarly silent about the parties' intention to change decreed water rights. As such, we apply the rationale of Public Service and decline to "make a new and different contract for the parties" by deciding that the Decree is a change decree because it was allegedly administered as a change decree. Id. (citing Upper Gunnison, 838 P.2d at 855). Therefore,
After advancing his substantive arguments in support of the water court's 2000 Order, Brandenburg requested attorneys' fees under C.A.R. 39.5 and section 13-17-102(4), C.R.S. (2011), claiming the LoPrestis and Fountain & Widefield overstated the scope of review in their briefs and this appeal lacked substantial justification. We find no merit to these arguments for the reasons stated herein and reject Brandenburg's request for attorneys' fees.
For the foregoing reasons, we reverse the water court's 2000 Order that found the Beardsley Decree void. We hold that the Beardsley Decree is a valid rotational no-call agreement because, based on its plain language, it does not sanction a change in water rights.
-----------------------------------------------------------------------------------------------------Stream's 1908 2011 Decreed Name Flow Appropriation Ditch Owner Owner(s) in 1896 Modern Name Rate Date ------------------------------------------------------------------------------------------------------ Neave Creek or Fountain & Cheese Factory Alvarado W.A. Bell No. 1 Bates Widefield Creek Creek 3.71 c.f.s. 8/31/1871 ------------------------------------------------------------------------------------------------------ Neave Creek or Cheese Factory Alvarado Legard No. 5 Beardsley LoPrestis Creek Creek 3.94 c.f.s. 5/1/1873 ------------------------------------------------------------------------------------------------------ North Fork of Alvarado Legard No. 11 Beardsley LoPrestis Legard Creek Creek 4.50 c.f.s. 5/31/1872 ------------------------------------------------------------------------------------------------------ North Fork of Alvarado Legard No. 12 Beardsley LoPrestis Legard Creek Creek 4.84 c.f.s. 12/1/1873 ------------------------------------------------------------------------------------------------------ Table 1
It may be true that the parties irrigated land with water not decreed to a particular ditch. But the parties' conduct caused by a misunderstanding, unintentionally or otherwise, of the Decree's terms does not change the validity of the Decree.