Empire West Side Irrigation District v. Stratford Irrigation District

10 Cal. 376
California Supreme Court·Decided December 16, 1937·No. L. A. No. 15982·Published

Opinion

WASTE, C. J.

This is an action for declaratory relief by which it is sought to have interpreted and made certain the provisions of a contract relative to the water and water rights represented by shares of stock in a mutual water company. From a decree construing the same favorably to the defendants, the plaintiffs have appealed.

It appears that in 1905 a corporation known as the Empire Investment Company, hereinafter referred to as the land company, was the owner of a large tract of land in Kings County, containing in excess of 18,000 acres and lying on both sides of the Kings River and riparian to it. As a riparian owner the land company possessed the right to its proportional share of the water of the river. In addition, the land company also owned 8% shares of stock in the Lemoore Canal and Irrigation Company, a mutual water company, which ownership entitled it to receive from that company a specified quantity of water for use on its lands. In order to facilitate a proposed subdivision and sale of the lands, the land company organized the defendant Empire Water Company and transferred to the latter its irrigation works and, without transferring its riparian right, authorized and empowered the water company as its agent to divert the riparian water to which it was entitled and supply the same to its lands, in accordance with the terms of a contemporaneously executed agreement, for an annual charge of one dollar an acre. The land company also transferred to the water company its 8% shares of stock in the Lemoore mutual water company, as agent or trustee, for the purpose of distributing the water represented thereby in accordance, likewise, with the provisions of the contemporaneously executed agreement.

The arrangement so outlined was made by a deed and written contract, bearing date of January 8, 1906, between the land company and the water company. It is expressly provided in the deed that it is not the intention to convey to the water company any riparian right, but that such right shall remain a part of and appurtenant to the lands. The contract recites that it is the desire of the parties to make a binding and permanent arrangement whereby the system for supplying the lands with water may be maintained, and water be delivered perpetually to all of the lands of the land company for use thereon by it and by persons succeeding to its title. Upon completion of this arrangement, the land [379] company proceeded with its subdivision project and succeeded in selling substantially all of its lands. Reference was made in the sales contracts and deeds to th'e aforesaid contract between the land and water companies.

No question here arises as to the distribution of the riparian water among the numerous purchasers. The sole issue concerns the distribution of the so-called Lemoore water represented by the 8% shares of stock in the mutual water company. It is the contention of the plaintiffs and appellants, all of whom own portions of the original ranch lying on the west side of the Kings River, that said Lemoore water, like the riparian water, was intended to be, and is, distributable ratably to both west and east side owners. The defendants and respondents all of whom are east side owners, contend, on the other hand, that the Lemoore water, unlike the riparian water, was intended to be, and is, distributable exclusively to those lands lying on the east side of the Kings River. The solution of this controversy, obviously, turns upon a construction of the provisions of the 1906 contract between the land and water companies. As already stated, the trial court construed the same in accordance with the contention of the respondents, or east side owners.

In passing, it should be stated that this action is representative in character, the appellants and respondents representing, respectively, all west and east side owners. It should also be stated that other actions have been prosecuted from time to time in which various provisions of the deed and contract between the land and water companies have been, either directly or indirectly, brought before the courts for consideration. (Stratton v. Railroad Com.., 186 Cal. 119 [198 Pac. 1051]; Quist v. Empire Water Co., 204 Cal. 646 [269 Pac. 533]; Braley v. Empire Water Co., 130 Cal. App. 532 [20 Pac. (2d) 75].) None of such actions involved the precise point here presented and, therefore, any reference therein to the same was wholly unnecessary to the disposition of such actions and oloiter.

Respondents, however, refer us to the so-called Ferrasei proceeding instituted in 1913 before the railroad commission of this state by certain west side owners to have it determined that they, as well as east side owners, were entitled to share in the ratable distribution of the Lemoore water, here in dispute. That proceeding, involving the identical [380] issue here presented, was directed against the water company but many east side owners intervened.

The commission, after hearing, ruled, as did the trial court herein, in favor of the east side owners who, as respondents upon this appeal, now cite said ruling, which failed to come under the scrutiny of the courts by way of writ of review or otherwise, as res judicata of the present controversy. Appellants contend, on many grounds, that the order of the railroad commission is not determinative or res judicata of the present controversy.

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Empire West Side Irrigation District v. Stratford Irrigation District, 10 Cal. 376 (Cal. 1937).

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Related

Baird v. Ocequeda
67 P.2d 1055 (California Supreme Court, 1937)
Braley v. Empire Water Co.
20 P.2d 75 (California Court of Appeal, 1933)
Epstein v. Gradowitz
243 P. 877 (California Court of Appeal, 1925)
Quist v. Empire Water Co.
269 P. 533 (California Supreme Court, 1928)
Stratton v. Railroad Commission
198 P. 1051 (California Supreme Court, 1921)