Land & Water Law Review Volume 19 Issue 1 Article 4 1984 Water Law - The State Engineer's Authority with Reference to Change of Use, Place of Use, Point of Diversion, and Means of Conveyance of Water Embraced by Water Permits - Green River Development Company v. FMC Corporation Patrick J. Crank Follow this and additional works at: https://scholarship.law.uwyo.edu/land_water Recommended Citation Crank, Patrick J. (1984) "Water Law - The State Engineer's Authority with Reference to Change of Use, Place of Use, Point of Diversion, and Means of Conveyance of Water Embraced by Water Permits - Green River Development Company v. FMC Corporation," Land & Water Law Review: Vol. 19 : Iss. 1 , pp. 59 - 70. Available at: https://scholarship.law.uwyo.edu/land_water/vol19/iss1/4 This Note is brought to you for free and open access by Law Archive of Wyoming Scholarship. It has been accepted for inclusion in Land & Water Law Review by an authorized editor of Law Archive of Wyoming Scholarship. Crank: Water Law - The State Engineer's Authority with Reference to Chan CASE NOTES WATER LAW-The State Engineer's Authority with Reference to Change of Use, Place of Use, Point of Diversion, and Means of Conveyance of Water Embraced by Water Permits. Green River Development Company v. FMC Corporation, 660 P.2d 339 (Wyo. 1983). Ranchers in Sublette County initiated agricultural development of cer- tain arid lands by obtaining water permits in 1908, 1910, 1920 and 1921 to approximately 10,100 acres.1 The Green River Development Company ac- quired the permits in 1948. At the time the petitioner, Green River Development Company, filed for amendment of the water permits, 7,410 acres had actually been developed according to the initial development plan. However, the federal government had denied desert land entries 2on part of the land upon its determination that the land was not irrigable. Pacific Power and Light Company arranged to purchase Green River Development Company's interest in the original permit water which had not previously been beneficially utilized.8 In 1977, Green River Develop- ment Company filed a petition with the State Engineer requesting the transfer of the unused permits: 1. to Pacific Power and Light Company; 2. changing the use from agricultural to industrial; 3. changing the use of 131.22 cfs of permit water during the irrigation season to 20.18 cfs year-round for industrial purposes; 4. changing the point of diversion from upper Sublette County to cen- tral Sweetwater County; 5. changing the place of use from ranch land in Sublette County, to a power plant in Sweetwater County, some 134 miles away; and, 6. changing the means of conveyance from ditch to pipeline while retaining the earlier appropriation priority dates, 1908, 1910, 1920 and 1921. 4 Several ranchers and other industrial appropriators contested the transfers. The State Engineer invoked section 41-4-514(a) of the Wyoming Statutes, which states that the State Engineer is authorized "to amend any permits ...for the purpose of correcting errors or otherwise, when in his judgment such amendment appears desirable or necessary .... ",6 The State Engineer, after extensive hearings on the transfer of these particular water permits, calculated that 2,000 acre feet per year would be ap- propriate. After his determination that a "25% conveyance loss" would 1. Green River Dev. Co. v. FMC Corp., 660 P.2d 339, 342 (Wyo. 1983). 2. Id. 3. Id. 4. Id. at 340-341. 5. Wyo. STAT. § 41-4-514(a) (Supp. 1983) states in part: The State Engineer is hereby authorized, upon written petition of the owner, to amend any permit to appropriate water prior to adjudication by the State board of control for the purpose of correcting errors or otherwise, when in his judg- ment such amendment appears desirable or necessary. The total area of lands may not exceed the area described in the original permit. Published by Law Archive of Wyoming Scholarship, 1984 1 Land & Water Law Review, Vol. 19 [1984], Iss. 1, Art. 4 LAND AND WATER LAW REVIEW Vol. XIX also be appropriate, the State Engineer authorized all of the requested changes for 1,500 acre feet per annum providing, however, that the water must be diverted only during the 92 days between May 1st and July 31st of each year.6 The contesting appropriators appealed the Engineer's decision to the State Board of Control. The petitioner, Green River Development Com- pany, appealed the decision to the district court in Sweetwater County. The Board of Control reversed the State Engineer's decision and the State Engineer appealed to the district court. The district court consolidated the cases and affirmed the Board of Control. The decision was appealed to the Wyoming Supreme Court.7 The Wyoming Supreme Court held that section 41-4-514(a) did not authorize the Wyoming State Engineer to amend water permits with respect to change of use, place of use, point of diversion, or means of conveyance. Further, the court held that the only way such transfers could be made according to Wyoming Statutes is through utiliza- tion of the statutes" which deal with transfers of fully adjudicated water rights.9 THE STATE ENGINEER'S AUTHORITY OVER WATER PERMITS At this point in the article it is useful to differentiate between a "water right" and a "water permit." In the case of a "water right," the water has actually been beneficially applied to the land in question.10 The water em- braced by a "water permit" has never been beneficially applied.11 Wyoming's statutory requirements with regard to water permits are covered by sections 41-4-501 through 41-4-517.12 Of particular importance to the Green River case was section 41-4-514(a)'3 of the Wyoming Statutes. 6. 660 P.2d at 342. 7. Id. at 342-343. 8. Wyo. STAT. §§ 41-3-104 and 41-3-114(a) (1977). 9. 660 P.2d at 355. Although the Green River court stated that water permits are not transferable in Wyoming, it is evident that water permits are freely transferable in Wyoming as long as they are sold with the land they are appurtenant to. If water permits have been properly transferred, they will retain their original appropriation dates. This broad language of the decision must be limited to situations in which an appropriator at- tempts to transfer water permits without transferring the land the water permits are ap- purtenant to. Although Justice Thomas agrees with the majority decision, he compares article 8, section 2 and article 8, section 5of the Wyoming Constitution and proposes that the State Engineer is not vested with any discretionary power inthe administration of the waters of the State of Wyoming. He concludes that all of the discretionary power in administration of waters is vested with the Board of Control. From this proposition, it could be argued that the Board of Control has the power to modify water permits in the way in which the State Engineer did in the Green River case; however, this discussion is beyond the scope of this case note and will not be pursued further. Id. at 355 (Thomas, J., specially concurring). 10. Wyoming Hereford Ranch v. Hammond Packing Co., 33 Wyo. 14, 236 P. 764,770 (1925). 11. Green River Dev. Co. v. FMC Corp., 660 P.2d 339, 348 (Wyo. 1983). See infra text accom- panying note 51. 12. WYo. STAT. §§ 41-4-501 to -517 (1977). These statutes outline the necessary procedures in applying for and receiving a water permit in Wyoming. For a brief discussion of the statutes, see 660 P.2d at 349-350. 13. Wyo. STAT. § 41-4-514(a) (Supp. 1983). See supra note 5 for the text of the relevant section. https://scholarship.law.uwyo.edu/land_water/vol19/iss1/4 2 Crank: Water Law - The State Engineer's Authority with Reference to Chan 1984 CASE NOTES The predecessor statute was originally passed by the Wyoming State Legislature in 1913 and it provided only for the correction of errors in land descriptions. 14 The 1913 statute authorized the State Engineer upon the written application of the owner of any water permit, to amend such permit by changing the description of land therein and to correct any misdescrip- tions or erroneous descriptions in such permits.' 5 The statute was further amended in 1929,16 1931,17 and reached its present form in 1945.18 The Wyoming Supreme Court has interpreted section 41-4-514(a) or its predecessor statutes on two occasions. 19 Scherck v. Nichols20 considered whether the 1929 statute would give the State Engineer authority to amend a water permit by correcting a land description. Noting that the 1913 law explicitly mentioned the correction of land descriptions, the court21 stated that the amendment merely broadened the scope of correction. The best interpretation of section 41-4-514 prior to the Green River case is contained in John Meier and Son, Inc. v. Horse Creek Conservation District of Goshen County.22 The Hawk Springs Conservation District, in order to clarify rights it held under both fully adjudicated water rights and water permits (some of the water had not yet been beneficially applied), fil- ed a petition seeking a change and amendment of its permits and cer- tificates to set out the right to store water pumped from its wells as an inci- dent of their use.2 3 The District alleged that the phrase, "as supplemental water," contained in the certificates and permits was ambiguous and therefore that the State Engineer and Board of Control had power to 2 4 amend the certificates and permits.