Sagewillow, Inc. v. Idaho Department of Water Resources, 138 Idaho 831

Summary

The Idaho Supreme Court reviewed an Idaho Department of Water Resources order declaring that Sagewillow, Inc.'s water rights had been forfeited in whole or in part through nonuse. The court held that the Department incorrectly applied Idaho's resumption-of-use doctrine, including by treating the mere existence of junior appropriators as sufficient to defeat the doctrine. The court vacated the order and remanded for further proceedings.

Holdings

1. The mere existence of junior appropriators does not establish a claim of right sufficient to defeat the resumption-of-use defense. After a five-year period of nonuse, resumption of use prevents forfeiture if it occurs before a third party claims the water through proceedings to declare forfeiture, a valid water right with an earlier priority date, or beneficial use under an existing water right.
2. The party asserting forfeiture bears the burden of proving it by clear and convincing evidence, and the agency must make findings addressing that standard and any properly raised defense, including whether water was available for use.
3. A final order approving a water-right transfer is not res judicata on forfeiture or abandonment if those issues were not actually raised in the transfer proceeding. Collateral estoppel likewise does not apply to forfeiture or abandonment issues that were not actually litigated and decided.
4. Neither equitable estoppel nor quasi-estoppel prevented the Department from later reviewing the validity of the water right and declaring forfeiture.
5. The Department was properly a party to the judicial-review proceeding because Idaho's Administrative Procedure Act defines party to include an agency named as a party.

Questions Presented

1. Whether the Department correctly applied Idaho's resumption-of-use doctrine.
2. Whether substantial and competent evidence supported the Department's findings that Sagewillow's water rights had been forfeited.
3. Whether the Department erred in voiding a water-right transfer previously approved in 1992 under res judicata, collateral estoppel, or estoppel principles.
4. Whether the Department was authorized to participate as a party in judicial review of its own contested-case decision.

Disposition

vacated