People of the State of California v. United States

180 F.2d 596, 1950 U.S. App. LEXIS 2471

• Court: Court of Appeals for the Ninth Circuit
• Decided: February 6, 1950
• Docket: 12184
• Status: Published

Opinions

HALL, District Judge.

This appeal involves t'he limited questions arising from the order of the trial court denying the motion of the State of California to intervene under Federal Rules of Civil Procedure, rule 24, 28 U.S.C.A., in a suit where the United States, as plaintiff, seeks to quiet title as against the defendant, Sierra Valley Water Company (a public service corporation of the State of California) to 60 c. f. s. of the Little Truckee River, which arises and flows wholly within the State of California, but which empties into the Truckee River, an interstate stream so far as California and Nevada are concerned.

After denial of motions to dismiss, the Water Company filed its answer and counter-claim, and, by leave of court, a cross-complaint, naming as defendants therein the United States, the Washoe County Irrigation District, alleged to be organized under the laws of the State of Nevada and doing business and owning and holding property in the State of California, and the Sierra Pacific Power Company, alleged to be a Maine corporation, doing business and owning and holding property in the State of California. Thereafter, the State of California filed its motion for leave to intervene, on the ground that the subject matter of the action could not be “adequately protected by the defendant, Sierra Valley Water Company, and, that the proposed intervenor would be adversely affect-¹ ed by a decree awarding plaintiff herein the relief prayed for in its complaint, or any relief.” In accordance with the procedural requirements of F.R.C.P. 24(c), the State of California accompanied its motion with a copy of its proposed pleading, designated to be an answer.

The fact that the litigation in the District Court is in its preliminary stages, and that the questions brought here for review are narrowed to a determination of whether or not the State of California may be heard as a party in suit, either as of right or in the exercise of sound judicial discretion, suggests the inadvisability of any extended statement of the conflicting claims appearing in the limited record¹ before ns.

It is necessary, however, to briefly state the contentions of the State and the United States as appears from the pleadings and briefs.

It is asserted that the defendant Water Company, as licensee of the State of California, diverts 60 c. f. s. of water of the Little Truckee River just above its confluence with the Truckee River, and takes the water from the watershed into another watershed (the Sierra Valley) wholly within the State of California, where it is used for irrigation purposes upon the lands of the Shareholders of the Water Company and others, and sucih as remains re-enters the waters of the -Feather River system, being wholly within the State of California, for use downstream.

The' United States claims ownership² and seeks to quiet title to such waters by virtue of prior right, ,(1) -as trustee of the lands and waters of the Pyramid Lake Indian Reservation lying entirely within the State of Nevada, (2) as appropriator of waters in the Truckee River for reclamation of the Newlands Reclamation Project located entirely in the State of Nevada, and, (3) as riparian owner of tihe waters of the Little Truckee River by virtue of its ownership of public lands for forest or other purposes which lie along and border -upon the Little Truckee River in the State of California.

The State of California claims its right to intervene as parens patriae, and as prior absolute owner³ of the water in suit -by virtue of its constitution and the -laws of the State of California relating to water and water rights which latter were codified in 1943 in what is now known as the Water Code of California, the pertinent provisions of each are set forth in the margin.⁴

As will be observed, the Constitution of the State of California provides in Art. XIV, Sec. 1, that the use of all water then or thereafter appropriated is a public use subject to regulation and control of the State in the manner provided by law; and, in the same article by Sec. 3, it is declared that because of conditions existing in the State, the general welfare requires that the water resources of the State be put to beneficial use to the fullest extent to which they are capable and that the conservation of such waters is to be exercised with a view to the reasonable and beneficial use thereof in the interest of the people and for the public welfare. The Water Code provides, among other things (Sec. 102), that “all water within the State is the property of the people of the State,” and that a license to use water is “effective for such time as the water actually appropriated under it is used for a useful and beneficial purpose in conformity with this division but no longer.” (Sec. 1627)

It is alleged in the answer of the State that the use of the diverted water by the Water Company is for irrigation purposes upon lands of the stockholders of the Water Company (a mutual company), and “after such use it becomes available for and is used upon a large acreage of land in Sierra Valley,” which latter acreage belongs to landowners who are not members of the Water Company and cannot be represented by it and are not parties to the action; that the lands of Water Company landowners and of such non-party landowners constitute nearly one-half of the irrigated lands within the applicable Water-master Service Area set up under the State Water Code; that the State has no other source of water to substitute for the water in suit; that the loss of the water involved would put such an amount of land out of production as to seriously affect a California population of 15,000 people and the economy of two counties of the State of California and their tax structure, as well as the dairying industries and other businesses and establishments located in six towns within the area,, the success of which is dependent upon successful agriculture in Sierra Valley, which is basically dependent upon the water in suit. And further; that such loss of water would so seriously affect the State Watermaster service as to make the cost prohibitive to maintain that service for such lands as might be able to obtain any water within the Watermaster area. It is further alleged that after such use by the Water Company and other landowners in Sierra Valley, about 60% of the water in suit enters the headwaters of the Feather River System and is used in that System entirely within the State of California. All these matters are alleged to he of public interest and State concern, and, that it is the right, if not the duty, of the State, under the above-mentioned requirements of the Constitution and laws of the State of California, to protect them in this litigation as they are necessarily involved in any decree which might award the plaintiff the relief asked for in the complaint, or any relief, and, that the Water Company can only assert in court the rights of its shareholders and cannot adequately protect the State’s interest in its public welfare as above described. In addition to the foregoing allegations, the State alleged that the real party in interest in the litigation is not the United States, but the Sierra Pacific Power Company⁵ whose interest does not lie in getting the water into Nevada for the Pyramid Indians, nor for the Newlands Reclamation Project, but solely to have the continuous flow of the Little Trucked River over Boca Dam (below the Water Company’s diversion on the Little Truckee River) for the purpose of generating electric power for sale in the State of Nevada.

It is contended by the United States that, (1) the order denying intervention is not appealable; (2) the State cannot intervene as of right, and that there was no abuse of discretion in disallowing the intervention; and, (3) the pleading filed by the State in effect is a claim against the Government and the United States has not consented to be sued.

The order denying intervention is a final order under Title 28 U.S.C.A. § 1291 (1948), and ;is appealable. State of Washington v. United States, 9 Cir., 1936, 87 F.2d 421, 431. The.only apparent remedy open to the State, if' intervention is denied, and if the United States would prevail, would be to then sue the State of Nevada in the Supreme Court of the United States, but by that time the water would be gone and the damage done to the State. For all practical purposes there is no “other appropriate proceeding” open to the intervenor than to assert the rights of the State in the present suit. Thus the order denying intervention is a “final” order, and is appealable.

The contention of the United States that the State of California cannot intervene as a matter of right must be rejected. The State of California is entitled to intervene as of right on each of the claimed grounds, not only in its proprietary capacity as asserted absolute owner of the water in suit, but also in its capacity as parens patriae.

This is a quiet title suit. Water is property. In California it is regarded as one of the most valuable species of property. The State, by its declaration of ownership, in its Constitution and laws, is in no lesser position than a private individual would be who had a recorded deed to property. A plaintiff seeking to quiet title in such instance could not do so by merely suing a tenant without joining the owner. If such \yere attempted, the owner would have a right to intervene. So here the State, in this instance, has a right to intervene, where it has declared by law its absolute ownership of the water, and only its licensee is joined as a party.

It is difficult to see how the United States could secure a judicial determination of the claims it asserts in the complaint without consideration and determination of the validity of the provisions of the Constitution and Laws of the State of California whereby California undertakes to declare its absolute ownership of waters in the State. To deny the State the right to intervene in this case would be to deny the State the right to defend those provisions of its Constitution and Laws. As stated in Percy Summer Club v. Astle, C. C.N.H.1901, 110 F. 486, 488, “It would be especially unbecoming for the federal courts to pass on a great question in which a sovereign state of the Union has a direct interest, if not as lord paramount, at least • as representing all its citizens, without affording it an opportunity to be heard before the legal proceedings in which the question is involved are concluded.” In Hudson County Water Co. v. McCarter, 1908, 209 U.S. 349, 28 S.Ct. 529, 52 L.Ed. 828, 14 Ann.Cas. 560; the court had under consideration a statute of New Jersey making it unlawful to transport "the waters of New Jersey into any other State. The Court said, 209 U.S. at pages 355-356, 28 S.Gt. at page 531: “But it is recognized that the state, as quasi-sovereign and representative of the interests of the public, has a standing in court to protect the atmosphere, the wáter, and the forests within its territory, irrespective of the assent or dissent of the private owners of the land most immediately concerned. State of Kansas v. Colorado, 185 U.S. 125, 141, 142, 22 S.Ct. 552, 46 L.Ed. 838, 844, 845, s.c. 206 U.S. 46, 99, 27 S.Ct. 655, 51 L.Ed. 956, 975; State of Georgia v. Tennessee Copper Co., 206 U.S. 230, 238, 27 S.Ct. 618, 51 L.Ed. 1038, 1044 [11 Ann.Cas. 488], What it may protect by suit in this court from interference in the name of property outside of the state's jurisdiction, one would think that it could protect by statute from interference in the same name within.”'

The converse is equally true. If a state may enact a statute, such as California has, it may appear in court and defend that statute. California has an undoubted right to intervene to protect and assert the validity of its enactment on that subject.

The right of the State to intervene as parens patriae is equally clear.

Each state primarily depends upon its natural resources for its existence. And, as previously stated, water is regarded as perhaps the most valuable natural resource in California.

In suits between different states concerning water the Supreme Court has repeatedly held that the states have a right to appear as parens patriae regardless of the rights of individual and private appropriators or users of water.

In State of Kansas v. Colorado, 185 U.S. 125, at page 142, 22 S.Ct. 552, at page 558, 46 L.Ed. 838, the Court, in speaking of its previous ruling in State of Missouri v. Illinois, 180 U.S. 208, 21 S.Ct. 331, 45 L.Ed. 497, said: “As will be perceived, the court there ruled that the mere fact that a state had no pecuniary interest in the controversy would not defeat the original jurisdiction of this court, which might be invoked by the state as pwrens patriae, trustee, guardian or representative of all or a considerable portion of its citizens; and that the threatened pollution of the waters of a river flowing between states, under the authority of one of them thereby putting the health and comfort of the citizens of the other in jeopardy, presented a cause of action justiciable under the Constitution.”

In State of Wyoming v. Colorado, 1922, 259 U.S. 419, 42 S.Ct. 552, 66 L.Ed. 999, it was contended, among other things, that actually the real parties in interest were the private appropriators of the water. As to that contention, the Court said, 259 U.S. at page 468, 42 S.Ct. at page 558:

“As respects Wyoming, the welfare, prosperity, and happiness of the people of the larger part of the Laramie Valley, as also a large portion of the taxable resources of two counties, are dependent, on the appropriations in that state. Thus the interests of the state are indissolubly linked with the rights of the appropriators. To the extent of the appropriation and use of the water in Colorado a like situation exists there.”

In State of Kansas v. Colorado, 1907, 206 U.S. 46, at page 99, 27 S.Ct. 655, at page 668, 51 L.Ed. 956, the Court said, in speaking of the status of Kansas in that suit:

“It is not acting directly and solely for the benefit of any individual citizen to protect his riparian rights. Beyond its property rights it has an interest as a state in this large tract of land bordering on the Arkansas river. Its prosperity affects the general welfare of the state. The controversy rises, therefore, above a mere question of local private right and involves a matter of state interest, and must be considered from that standpoint. State of Georgia v. Tennessee Copper Co., 206 U.S. 230, 27 S.Ct. 618, 51 L.Ed. 1038 [11 Ann. Cas. 488].”

For similar expressions see: State of Georgia v. Tennessee Copper Co., 1907, 206 U.S. 230-237, 27 S.Ct. 618, 51 L.Ed. 1038, 11 Ann.Cas. 488; Hudson County Water Co. v. McCarter, supra; People of State of New York v. New Jersey, 1921, 256 U.S. 296-301, 41 S.Ct. 492, 65 L.Ed. 937; State of New Jersey v. New York, 1931, 283 U.S. 336, 342, 51 S.Ct. 478, 75 L.Ed. 1104; State of Wyoming v. Colorado, 1936, 298 U.S. 573, 585, 56 S.Ct. 912, 80 L.Ed. 1339; State of Colorado v. Kansas, 1943, 320 U.S. 383, 394, 64 S.Ct. 176, 88 L.Ed. 116.

Nevada is not here seeking the water. It is the United States which are seeking it for the purpose of taking it into the State of Nevada. If Nevada were seeking it, could it be doubted that the State of California would be entitled to appear as a party in a suit involving these same rights ? And, with the United States seeking to take the water for use in Nevada, which would achieve the same result as if Nevada were seeking it, can it be doubted that the State of California is at least entitled to be heard . as to its rights and claims on behalf of its citizens ?

It cannot be overlooked that the ' Power Company is a party to this suit as a cross-defendant of the Water Company. In view of the allegations 'contained in the cross-complaint of the Water Company and the State’s proposed answer in intervention, the State of California has, as the proper representative of the public-welfare, a right to be heard as an intervenor between these two proposed private users of its waters, .aside from all other considerations.

The Government’s contention that to permit the State to intervene would; of necessity, compel the State of Nevada to seek to intervene and, in event such intervention were allowed, the court would.be divested of jurisdiction- as it would then be a suit between two states with jurisdiction lying only with the Supreme Court, cannot at this posture of the case be taken into consideration. Whether Nevada could -join in the litigation is a question that is not now present. Should it seek to" join as an intervenor, it will then be time enough to consider that question.

The Government also makes the contention that this is a suit against the Government and, there being no. statute authorizing it, the Court does not have jurisdiction. The short answer to that is that the Government chose the forum in which it is ■seeking to quiet title to the water. The State is asserting an interest in the subject matter as the absolute owner of the water, and as parens patriae on behalf of all -its citizens. That is a sufficient interest in the subject matter to entitle it to be heard, just as much as if the State were joined by the United States originally as a defendant. U. S. v. Great Northern R. Co., D.C.Mont.1949, 32 F.Supp. 651, is not in point. The one attempting to intervene there was a private person whose rights are certainly not as great as that of the State as parens patriae in the maintenance of the welfare of its citizens. Moreover, in that case on appeal, McDonald v. United States, 119 F.2d 821, this Court did not follow the -ruling of the trial court but based its approval of the denial of the right of intervention on the ground that the private intervenoFs rights were adequately represented apd.the point was not touched in the opinion of the Supreme Court in the same case, 315 U.S. 262, 62 S.Ct. 529, 86 L.Ed. 836.

The 'State of California being entitled to intervene as of right, it follows that there was error in denying the application of the State to intervene.

Judgment reversed.

1 . The record on appeal consists. only of the complaint of the United States, as amended; the answer, counter-claim and cross-complaint of the defendant Water Company; the motion to intervene of the State of California and its proposed answer, and the response of the United States to the motion of California to intervene.

2 . Whether the United States owns or can own water or only the right to use water for beneficial purposes and if it can do so without regard to the laws of the State of California, as well as whether the claim of the United States to the water is in its sovereign capacity or proprietary capacity, or both, are questions whiqh are not necessary to determine. And, in view of the fact that they are or may become questions involved in the merits of the case, it is intended that nothing in this opinion shall be indicative of this court’s view thereon.

3 . While the State, in its opening brief, disclaimed any effort on its part to seek a decree in its favor in respect to any portion of the waters involved, the whole argument of the State is based upon the constitutional provisions of the State of California, herein elsewhere referred to, and the provisions of the Water Code appropriating all waters in the State of California to the people of the State. For that reason, it must be assumed that the statement appearing in the brief of the State, to the effect that it is not seeking title to the waters, is either a misstatement or not a complete statement of its position. In its reply brief, the posi- . tion taken by the State consistent with its argument, is stated as follows: “It does claim that it owns the waters within the State and maintains control over them subject to the rights of appropriators under license from it. Such license is .subject to forfeiture for non-use, in which event the water rights revert to the State.”

4 . “Water a public use. The use of all water now appropriated, or that may hereafter be appropriated, for sale, rental, or distribution, is hereby declared to be a public use, and subject to the regulation and control of the State, in the manner to be prescribed by law; * * (Constitution of California, Article XIV, Section 1 (1879).)

“Conservation of water. It is hereby declared that because of the conditions prevailing in this State the general welfare requires that the water resources of the State be put to beneficial use to the fullest extent of which they are capable, and that the waste or unreasonable use or unreasonable method of use of water be prevented, and that the conservation of such waters is to be exercised with a view to the reasonable and beneficial use thereof in the interest of the people and for the public welfare. * * * ” (Constitution of California, Article XIV, Section 3 (1928).)

“Water State property: Acquisition of right to use water by appropriation. Ail water within the State is the property of the people of the State, but the right to the use of water may be acquired by appropriation in the manner provided by law.” (California Water Code, Division 1, Chapter 1, Section 102.)

“Use of water for useful and beneficial purpose. A license shall be effective for such time as the water actually appropriated under it is used for useful and beneficial purpose in conformity with this division but no longer.” (California Water Code, Division 2, Part 2, Section 1627.)

5 . It is alleged that Sierra Pacific Power Company, formerly the Truckee River General Electric Company, is a corporation incorporated under the laws of the State of Maine and doing business within the State of California.