Coors Brewing Co. v. City of Denver

2018 CO 63, 420 P.3d 977
CourtSupreme Court of Colorado
DecidedJune 25, 2018
Docket17SA55, Coors
StatusPublished
Cited by4 cases

This text of 2018 CO 63 (Coors Brewing Co. v. City of Denver) is published on Counsel Stack Legal Research, covering Supreme Court of Colorado primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Coors Brewing Co. v. City of Denver, 2018 CO 63, 420 P.3d 977 (Colo. 2018).

Opinion

JUSTICE GABRIEL delivered the Opinion of the Court.

¶ 1 This case concerns Coors Brewing Company's application to amend its decreed augmentation plans to authorize the reuse and successive use of return flows from water that Coors diverts out of priority pursuant to those plans. The City of Golden opposed this application, arguing that Coors could not proceed by amendment but must adjudicate a new water right to reuse or make successive use of the return flows. On competing motions for determinations of questions of law, the water court ruled that (1) any amount of water not beneficially used by Coors for the uses specified in its decreed augmentation plans must be returned to the stream; (2) Coors's decreed augmentation plans did not authorize the reuse or successive use of such water; and (3) Coors may not obtain the right to reuse or make successive use of such water by way of amendment to its augmentation plans but could only obtain such rights by adjudicating a new water right.

¶ 2 Coors appeals, arguing that the water court erred in (1) holding that Coors may not proceed by amendment but must adjudicate a new water right; (2) concluding that water unconsumed by Coors's initial use must be returned to the stream and is subject to appropriation by other water users; and (3) interpreting Coors's augmentation plan decrees to require permanent dedication of return flows to the stream.

¶ 3 We now affirm. Like the water court, we conclude that in order to obtain the right to reuse and make successive use of the return flows at issue, Coors must adjudicate a new water right and may not circumvent this requirement by amending its decreed augmentation plans. We further conclude that the diversion of native, tributary water under an augmentation plan does not change its character. Accordingly, the general rule, which provides that return flows belong to the stream, applies. Finally, we conclude that the water court correctly construed Coors's augmentation plans.

I. Facts and Procedural History

¶ 4 Between 1977 and 2007, Coors sought and obtained three augmentation plan decrees. These decrees allowed Coors to divert water from Clear Creek out of priority for use within Coors's Golden brewery and industrial complex, conditioned on Coors's releasing enough replacement water to avoid injury to senior rights. Much of the water that Coors diverts pursuant to the decreed augmentation plans is consumed by Coors's brewery operations. Water not consumed by the brewery is run through Coors's wastewater treatment plant and is then delivered to Clear Creek.

¶ 5 Beginning in the 1970s, Coors, with the approval and oversight of the State and Division Engineers, maintained a program to lease the water delivered to Clear Creek (the "return flows") to other water users. Coors apparently operated this program with the understanding that once it fully replaced its out-of-priority diversions, it had no further obligation under its augmentation decrees because Clear Creek would have been made whole (i.e., Clear Creek would then have contained the same amount of water at the replacement water delivery point as it would have had without Coors's diversions). Coors further understood that at this point, any "excess" water released from Coors's wastewater treatment plant would have served only to overcompensate the stream, and Coors believed that it could reuse or lease such water to other users downstream.

¶ 6 In 2014, however, the State Engineer chose not to approve a new lease of Coors's return flows to Martin Marietta Materials, Inc., effectively terminating Coors's long-time leasing practice. Coors and Martin Marietta challenged the Engineer's decision before the water court, arguing that the return flows at issue could be reused or successively used by Coors, as it had done for many years. The Engineer disagreed, arguing that Coors's augmentation plans did not specify that Coors could reuse or successively use its return flows. The parties then filed cross-motions for determinations of questions of law.

¶ 7 The water court ultimately agreed with the State Engineer. The court began by noting that Coors's decreed augmentation plans allowed only a single use of the water diverted by Coors, and this use was limited to the purposes specified in the decrees. Because the plans did not authorize the reuse or successive use of such water, the court found that Coors was required to return unconsumed native water from Coors's initial use back to the stream and could not lease the return flows absent a subsequent decree authorizing the reuse or successive use of that water.

¶ 8 In reaching this conclusion, the court rejected Coors's contention that native water withdrawn from a stream that is fully replaced under an augmentation plan is like developed, foreign, or non-tributary water and thus could be fully consumed, reused, or successively used. The court observed that the fact that Coors diverts native, tributary water out of priority by adding replacement water to the stream under its decreed augmentation plans does not change the character of the water that is diverted from native water to something akin to foreign, developed, or non-tributary water. In the court's view, Coors therefore could not apply the water at issue to uses beyond those specified in its decrees, and the reuse or successive use that Coors sought was not so specified.

¶ 9 The court further rejected Coors's argument that other users had no expectation of return flows from fully augmented diversions and therefore the one-use rule need not apply. The water court opined that this court had addressed and rejected a similar argument in Water Supply and Storage Co. v. Curtis , 733 P.2d 680 (Colo. 1987). There, the applicant argued that an original appropriator should be recognized to have the right to reuse and make successive uses of water if the further use of the water was initiated immediately after the first beneficial use so that other users had no expectations regarding, and did not come to rely on, the return flows. Id. at 682-83 . This court disagreed, observing first that once the beneficial use on which a water right is based has taken place, any unconsumed waters remain waters of the state and were subject to appropriation. Id. at 683 . We then noted that the proper inquiry was whether the applicant had established by appropriation a right in the return flows. Id. On the facts there before us, we concluded that the applicant had not done so. Id.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Cite This Page — Counsel Stack

Bluebook (online)
2018 CO 63, 420 P.3d 977, Counsel Stack Legal Research, https://law.counselstack.com/opinion/coors-brewing-co-v-city-of-denver-colo-2018.