Middle Creek Ditch Co. v. Henry

39 P. 1054, 15 Mont. 558, 1895 Mont. LEXIS 52

• Court: Montana Supreme Court
• Decided: April 1, 1895
• Status: Published

Opinion

De Witt, J.

— We are of opinion that the instrument in writing, signed by the lower appropriators in 1871, was a grant to the association of the upper appropriators, then called the Upper Middle Creek Ditch Company, of the usufruct of the water of Middle creek, as appropriated and owned by the lower appropriators at the time of the grant. Such usufruct was of the nature of real estate. (Quigley v. Birdseye, 11 Mont. 439; Barkley v. Tieleke, 2 Mont. 64; Sweetland v. Olson, 11 Mont. 27; Black’s Pomeroy on Water Rights, §§ 60, 61.)

The granting words of that instrument are, “do hereby give and grant.” The consideration of the grant was the furnishing by the upper appropriators to the lower ones of the use of a quantity of water from the West Gallatin river equal to that which the lower appropriators then owned. The consideration was delivered, in that the supply ditch was finished in June, 1872.

Respondents’ counsel argue that one cannot own the corpus of water, and therefore cannot sell the same. But the lower appropriators did not purport to own or sell the corpus of the water. They had appropriated the water for a beneficial use, and, when they sold to the upper appropriators, they described the subject of the grant as “our rights, respectively, to the use of the water naturally flowing in Middle creek, to the extent and capacity of said supply ditch of said company, and the waters actually supplied by it into Middle creek.”

The grantors, therefore, in that instrument clearly conveyed the usufruct of the water. (Gould on Waters, § 304.) They did not convey the lands upon which the water had been formerly used, nor did they convey the ditches in which it had flowed; for the land they retained themslves, and the ditches would have been of no value to the purchasers, who were about to use the water at a place higher up the creek. One has a right to change the place of diversion of water, and also the beneficial use thereof. (Woolman v. Garringer, 1 Mont. 535.) That was done in this case by the conveyance of 1871. The use was not enlarged or extended by that conveyance. The grantors conveyed, and, of course, could convey» only the use which they owned (Columbia Min. Co. v. Holter, 1 Mont. 296; Creek v. Bozeman Water Works Co., ante, p. 121), and this they did in apt terms. The instrument of 1871 was good as a conveyance between the parties thereto.

Sections 235 and 237, division 5, of the General Laws provides as follows:

“Sec. 235. Conveyances of land, or of any estate or interest therein, may be made by deed, signed by the person from whom the estate or interest is intended to pass, being of lawful age, or by his lawful agent or attorney, and acknowledged or proved and recorded as hereinafter directed.”

“Sec. 237. Every conveyance in writing whereby any real estate is conveyed, or may be affected, shall be acknowledged or proved and certified in the manner hereinafter provided.”

The instrument in question was not acknowledged, so as to entitle it to record, nor was it recorded, but section 258, division 5, of the General Laws, provides as follows: “Every conveyance of real estate, and every instrument of writing setting forth an agreement to convey any real estate, may be effected, proved, acknowledged, and certified in the manner prescribed in this act to operate as notice to third persons, shall be recorded in the office of the recorder of the county in which such real estate is situated, but shall be valid and binding between the parties thereto without such record.”

This court said in Taylor v. Holter, 1 Mont. 688: “The acknowledgment to a deed is no part of the deed, and, as between the parties to the instrument, a deed is good without acknowledgment, the acknowledgment and record being required for the protection and benefit of third persons.”

We are therefore satisfied that the contract of 1871, as between the parties thereto, conveyed to the upper appropriators the usufruct of the water as then owned by the lower appropriators.

But respondents argue that the instrument was not a conveyance as to respondents, because they were appropriators of the use of said water without notice of the conveyance mentioned, by reason of the fact of its not being recorded; and that the instrument, not being a conveyance, must be construed as an abandonment by the lower appropriators of the use of the water. The district court took this view, and excluded all evidence of appropriations made by the signers of that contract prior to the date of that instrument. These questions we will now consider.

Was the instrument void as to the respondents? A conveyance which may be good between the parties is void as to certain other persons for certain reasons.

Section 260, division 5, of the General Laws provides as follows: “Every conveyance of real estate within this state hereafter made which shall not be recorded as provided for in this chapter shall be deemed void as against any subsequent purchaser in good faith and for a valuable consideration of the same real estate, or any portion thereof, where his own conveyance shall be first duly recorded.”

Conceding that the respondents attempted to appropriate the use of the water without knowledge of the conveyance of 1871 from the lower appropriators to appellant’s predecessors, would the respondents then, either in the letter or the spirit of section 260, come within the description of persons named in that section as those against whom the conveyance is void; that is to say, are the respondents subsequent purchasers in good faith, for a valuable consideration, of the same real estate; and, if so, had they their own conveyance recorded prior to any record by appellant? Asking this question seems to answer it One purpose of the recording law is notice. If one does not record his conveyance he runs the risk of suffering a penalty. If his grantor conveys to a second and other grantee, and the second grantee first records his conveyance, the first grantee, if the conditions named in section 260 exist, suffers the loss of his estate. This is a penalty provided by law for not recording. We cannot presume that there is any other penalty. (Bird v. Dennison, 7 Cal. 299, 308, 309; Hunter v. Watson, 12 Cal. 363; Perkins v. Thornburgh, 10 Cal. 192, and cases cited; Belloc v. Rogers, 9 Cal. 128; Smith v. Williams, 44 Mich. 240; 20 Am. & Eng. Ency. of Law, 572, note 1.) The penalty for not recording being as we have indicated, we are then reduced to this inquiry in this case: It being the general rule that the conveyance is good, and there being an exception to this rule, the question is, Do the respondents fall within the exception? We are of opinion that the word “ purchaser,” as used in section 260, is not employed in the broad sense as indicating all acquisitions of title other than by descent. We think that the word as here used means simply a buyer in the popular sense of that term. The whole spirit of the recording laws indicates this. We think the section means a buyer of the same property from the same grantor, in good faith, and for a valuable consideration, and such- a buyer as records his conveyance prior to any record of conveyance to the first buyer.

An appropriator of the use of water subsequent to a convey-anee of the use of the same water by an owner thereof to his grantee is not such a buyer of the same real estate as is contemplated by the language of section 260. Such a subsequent appropriator does not buy from the same grantor. Indeed, he does not buy at all. He appropriates under certain rules of statute and decision, and thus obtains title. The last portion of section 260 seems to us to be particularly fatal to respondents’ contention. In order that a second purchaser may come in ahead of a prior one, the second purchaser’s conveyance must be first duly recorded. The respondents had no conveyance which they first' duly recorded, or recorded at all. If it be argued that their appropriation was in the nature of a conveyance of the usufruct of the water then publici juris, it may he replied that there was no law at the time of those transactions providing for requiring a recording of such appropriation, nor does it appear that any such record was made. (Moxon v. Wilkinson, 2 Mont. 421.)

"We cannot at all understand how it can be contended that the respondents are, under the provisions of section 260, division 5, of the General Laws, in the position of subsequent purchasers for value of the same real estate as was conveyed to the grantees in the contract of 1871, or that they are in any position to invoke the benefit of the provisions of section 260. And, if they are not able to stand upon the provisions of section 260, they cannot claim title to the use of the water conveyed by the lower appropriators to the upper appropriators, except subject to the rights and priorities of said lower appropriators.

Our consideration of the case thus far seems to determine that the lower appropriators did not abandon the use of the water by reason of their contract of 1871. Abandonment is a matter of intention. (Atchison v. Peterson, 1 Mont. 561; McCauley v. McKeig, 8 Mont. 389; Tucker v. Jones, 8 Mont. 225.)

It was said by Terry, C. J., Field, J., concurring, in Stevens v. Mansfield, 11 Cal. 366: " We think the ruling of the court below clearly erroneous. Admitting the interest of plaintiff in the premises such as could be divested by abandonment, there can be no such thing as abandonment in favor of a particular individual, or for a consideration; such act would be a gift or sale. An abandonment is ‘the relinquishment of a right, the giving up of some thing to which we are entitled.’ (Bouvier’s Law Dictionary.) ‘Abandonment must be made by the owner, without being pressed by any duty, necessity, or utility to himself, but simply because he desires no longer to possess the thing; and, further, it must be made without any desire that any other person shall acquire the same; for, if it were made for a consideration, it would be a sale or barter, and, if without consideration, but with an intention that some other person should become the possessor, it would be a gift.’ (Bouvier’s Law Dictionary.)”

That court also said in McLeran v. Benton, 43 Cal. 467: “The elements of an abandonment are quite different from those of a sale; and where for any reason a transaction fails as á sale it cannot be converted into an abandonment. There is no such thing as an abandonment to particular persons, or for a consideration.” (Stevens v. Mansfield, supra; Richardson v. McNulty, 24 Cal. 343. See, also, an extensive collection of cases in appellant’s brief.)

In the case at bar the evidence is that the parties did not intend to abandon the use of the water which they had appropriated. Their acts indicated precisely the contrary intention. They conveyed, by an instrument in writing sufficient for the purpose, the use of the water for a valuable consideration. This is not an abandonment. (Cases supra.)

We have investigated this case, and arrived at the conclusion which we think should obtain without yet discussing the case of Barkley v. Tieleke, 2 Mont. 59. That case demands some attention at this point. It seems to have been relied upon by the district court in making the ruling which we have determined was error. There- is language in Barkley v. Tieleke, supra, which seems to have been construed to be an expression of opinion that, because a deed for the right to the use of water was not acknowledged, that the same was void. Perhaps that language by itself was sufficient to justify the ruling of the district court.

The court, in that opinion, quoted from finding 7, page 63, language to the effect that the persons constructing certain ditches, by certain unsealed and unacknowledged paper writ-jugs, purported to convey tbeir respective interests therein to certain persons other than plaintiff’s grantors, who, by like paper writings, transferred the same to plaintiff’s grantors, who took possession thereunder (and not by appropriation) prior to the appropriation by the defendant. The court then, in the opinion in that case, said, on page 64:

“The conveyance or transfers of the property to plaintiff’s grantors alone was not sufficient under our statutes to convey the property to them, but the attempt so to do by imperfect conveyances, if it did not operate as an absolute or equitable conveyance, clearly operated as a surrender or an abandonment of their right, title, and interest, acquired by appropriation, which was the digging of the ditches in question.”

Respondents’ counsel contend that the court then e held in that case that an unacknowledged deed was void. But it is seen in the opinion that the court invoked the doctrine of abandonment for the benefit of a grantee in a deed alleged to he imperfect. But we cannot believe that the court in that case intended to hold that an unacknowledged deed was void under our statute. The same statutes which we have quoted above as sections 235, 237, 258, and 260 of the present laws have been upon the statute book since 1864. These sections are sections 1,3, 23, and 25, on page 479 of the Bannack Laws, and are sections 1,3, 23, and 25 of the Laws of 1872, page 396, et seq.

Barkley v. Tieleke, supra, was decided about two years after Taylor v. Holter, 1 Mont. 688. The opinion in Taylor v. Holter referred to the sections of the law which we have above quoted, and held, as heretofore quoted in this opinion, and which we repeat, as follows: “The acknowledgment to a deed is no part of the deed, and, as between the parties to the instrument, a deed is good without acknowledgment, the acknowledgment and record being required for the protection and benefit of third persons.”

Barkley v. Tieleke, was decided by two of the same learned justices who sat in the case of Taylor v. Holter. But the court, in Barkley v. Tieleke, did not mention the decision in Taylor v. Holter, and it is hardly to be presumed that the justices, sitting in both cases, intended to overrule the doctrine announced so short a time before in Taylor v. Holter.

It is evident from later decisions of this court that it was not thought that Barkley v. Tieleke, supra, had held that a deed is void if it were unacknowledged. For it was held in Belk v. Meagher, 3 Mont. 75: “It is evident that the object and purpose of the certificate of acknowledgment and also of proof of the execution of a deed, as the statute contemplates, is to authorize the deed to be recorded. In the absence of a certificate, and there being no proof of the execution of the deed, the same cannot be recorded; but either a certificate of acknowledgment, or proof of execution under the statute, so authenticates the deed as to qualify it for record. And so, when there is proof of acknowledgment and a certificate thereof annexed or attached to the conveyance, no witnesses are required and the conveyance is entitled to be recorded. And when there is no certificate of acknowledgment, but proof of the execution of the deed can be made by the subscribing witnesses thereto in the manner provided by the statute, then the conveyance is also entitled to record. The object of the record of a deed, and hence of the certificate of acknowledgment and proof of the execution thereof, is to impart notice to third persons. And hence it follows that neither the certificate of acknowledgment nor the attestation of subscribing witnesses are necessary to the validity of a deed, as between the parties thereto, and in no case where there is proof of acknowledgment and certificate thereof annexed or attached to a deed, and the same has been admitted to record by virtue of such certificate, are subscribing witnesses necessary to the validity of such a deed as to third persons.”

Again this court said, in McAdow v. Black, 4 Mont. 485: “ Neither was it necessary that the power of attorney should have been certified, acknowledged, and recorded to have made it good as between the mortgagor and mortgagee, in the mortgage executed in pursuance thereof. The mortgage in question might have been enforced against Black, the mortgagor named therein. He could not have attacked the power of attorney because not acknowledged or recorded. In the case of Taylor v. Holter, supra, this court held that ‘the acknowledgment to a deed is no part of the deed, and, as between the parties to the instrument, a deed is good without acknowledgment, the acknowledgment and record being for the protection of third parties/ ”

Therefore, we cannot concede that Barkley v. Tieleke, intended to hold that a deed was void because it lacked acknowledgment and recording. But, if that case did so intend to hold, it is in conflict with all the other prior and subsequent decisions of this court upon that subject, and cannot be approved in this respect.

Assuming that the deeds mentioned in Barkley v. Tieleke were void for some reason, it is found that the court held, as to the main proposition in the case, as follows: “If the conveyances to plaintiff’s grantors did not in fact transfer such an interest as entitled them to all the rights of their grantors, then the right was abandoned, and the possession thereof taken by plaintiff’s grantors was as much an original appropriation of the waters of Indian creek as if they had originally constructed the first ditches to divert the same. Such possession^ even if it did not determine the ownership, under the act of Congress of March, 1866, does, nevertheless, vest in the plaintiff such an equitable interest as to entitle him to maintain this action.”

In the report of the case in 4 Morrison’s Mining Reports, page 666, it is interpreted by the annotator as follows: “Where the owner of a ditch attempts to convey the same by a deed which is void, but places the grantee in possession, who continues to use the ditch, it operates as an abandonment of his appropriation by the grantor and as a new appropriation by the grantee, dating from the change of possession.”

The author of Black’s Pomeroy on Water Rights interprets the case as holding as follows: “ In both these instances, as has already been shown, no interest passes to the transferees; they do not succeed to any priority held by their assignor; their rights of priority date only from the time of their own possession and user.” (Black’s Pomeroy on Water Rights, § 97, footnote.)

The case is also interpreted in Buck’s Digest of Montana Reports as holding as follows: “ Held, in the above case, that an attempt by the original appropriators of a water right to convey the same to plaintiff’s grantors by imperfect convey-anees at least operated, as against them, as a surrender or abandonment, and would also estop them from claiming the same after possession had been transferred to their intended grantees; and that the latter could be regarded, under the circumstances, as owners by recapture and appropriation.” (Buck’s Digest, 227.)

.Returning again to the case at bar, if the attempted conveyance of 1871 from the lower appropriators to the upper appropriators had been void the decision in Barkley v. Tieleke, supra, might have been invoked to hold that the grantees in such void conveyance took an abandoned right to the usufruct of the water, and must date their priorities from the time of the performance of acts subsequent to such abandonment. But, as we have shown, the instrument of 1871 was not void as to its grantees, or as to the respondents as third persons, and the doctrine of Barkley v. Tieleke, supra, is not applicable.

The motion which the court granted was to strike out all evidence introduced by plaintiff tending to prove any of the water rights of the lower appropriators who signed the contract of 1871. From what we have heretofore said it appears that this action was clearly error. Appellant had the right to trace its title to the use of the waters back to the appropriations of its grantors, who conveyed their rights to appellant’s predecessors by the conveyance of 1871. As a result of this ruling of the court the appellant was compelled to rely for its priorities of right only upon acts of appropriation performed by it subsequent to 1871. This let some of the respondents into priorities superior to appellant’s rights, which it would have obtained if the court had considered the evidence which it struck out. For this error of the court we are of opinion that the judgment must be reversed.

Appellant also objects that the court struck out evidence of appropriations by some other of appellant’s predecessors in interest who did not sign the instrument of 1871. But from an inspection of the motion as made, and the ruling of the court thereupon, both of which are set forth in the statement preceding this opinion, it appears that the court did not strike out this evidence.

This case consumed three weeks in trial. Perhaps it is a matter of regret that judgment cannot be ordered entered at this time. But that seems to be impossible. The error complained of occurred in the midst of the trial, upon the question of admissibility of the evidence, and to go back to the place where the error occurred necessitates a new trial. (Woolman v. Garringer, 2 Mont. 405; Collier v. Erwin, 2 Mont. 557; Barkley v. Tieleke, supra.)

The judgment of the lower court is therefore reversed, and the case is remanded for a new trial.

Reversed.

HtjNT, J., concurs.