Colorado Supreme Court
2 East 14th Avenue
Denver, CO 80203

              
 
 
                   

Appeal from District Court
Water Division 2, 09CW142
Water Division 1, 09CW272
Water Division 5, 09CW186
Opposers/Appellants:
Grand Valley Water Users Association, Orchard
Mesa Irrigation District and Ute Water Conservancy
District, acting by and through the Ute Water
Activity Enterprise; Colorado River Water
Conservation District; Basalt Water Conservancy
District; Board of County Commissioners of Eagle
County; Board of County Commissioners of Pitkin
County; Dick Wolfe, P.E., State Engineer; David
Nettles, P.E., Division Engineer for Water Division
1; Steve Witte, P.E., Division Engineer for Water
Division 2, and Alan Martellaro, P.E., Division
Engineer for Water Division 5
v.

COURT USE ONLY

Applicant/Appellee:
Busk-Ivanhoe, Inc. a Colorado Corporation
Attorneys for Opposers/Appellants Grand Valley
Water Users Association, Orchard Mesa
Case No.: 2014SA303
Irrigation District, and Ute Water Conservancy
District acting by and through the Ute Water
Activity Enterprise
Kirsten M. Kurath, #24649
Mark A. Hermundstad, #10357
WILLIAMS, TURNER & HOLMES, P.C.
200 North 6th Street, P.O. Box 338
Grand Junction, CO 81502

 Telephone Number: (970) 242-6262
Facsimile Number: (970) 241-3026
kmkurath@wth-law.com
mherm@wth-law.com
Attorneys for Opposers/Appellants Colorado
River Water Conservation District, Basalt Water
Conservancy District and Board of County
Commissioners of Eagle County, Colorado
David C. Hallford, #10510
Christopher L. Geiger, #32333
Scott Grosscup #35871
BALCOMB & GREEN, P.C.
P.O. Box 790
Glenwood Springs, CO 81602
Telephone Number: (970) 945-6546
Facsimile Number: (970) 945-8902
dhallford@balcombgreen.com,
chrisg@balcombgreen.com,
sgrosscup@balcombgreen.com
OPENING BRIEF OF GRAND VALLEY WATER USERS ASSOCIATION,
ORCHARD MESA IRRIGATION DISTRICT, UTE WATER
CONSERVANCY DISTRICT, ACTING BY AND THROUGH THE UTE
WATER ACTIVITY ENTERPRISE, COLORADO RIVER WATER
CONSERVATION DISTRICT, BASALT WATER CONSERVANCY
DISTRICT AND BOARD OF COUNTY COMMISSIONERS OF EAGLE
COUNTY, COLORADO

 CERTIFICATE OF COMPLIANCE
I hereby certify that this brief complies with all requirements of C.A.R. 28
and C.A.R. 32, including all formatting requirements set forth in these rules.
Specifically, the undersigned certifies that:
The brief complies with C.A.R. 28(g).
It contains 9317 words.
The brief complies with C.A.R. 28(k).
The brief contains statements concerning both the standard of review and
preservation of the issue for appeal.
I acknowledge that my brief may be stricken if it fails to comply with any of the
requirements of C.A.R. 28 and C.A.R. 32.
/s/ Kirsten M. Kurath
Kirsten M. Kurath

 TABLE OF CONTENTS
PAGE
I. Statement of the issues presented for review. ...................................................1
II. Statement of the case. .......................................................................................1
A. Nature of the case and the course of proceedings. ...........................................1
B. Statement of facts. ............................................................................................4
C. Standard of review. .........................................................................................12
III. Summary of Argument. ..................................................................................12
IV. Argument........................................................................................................14
A. A storage water right is separate and distinct from a direct flow water right 14
1. C.R.S. § 37-83-101 does not create a right to store transmountain water
without a decree.....................................................................................................16
2. C.R.S. § 37-82-106 does not authorize the undecreed storage of
transmountain water for later use.. ........................................................................17
3. Thornton does not hold that transmountain water can be stored without a
decreed storage right... ..........................................................................................19

i

 4. Undecreed storage in the basin of import can enlarge the scope of a
transmountain direct flow water right and adversely affect water users in the
basin of export... ....................................................................................................20
B. The scope of the original appropriation of the Busk-Ivanhoe System water
rights did not include storage on the East Slope... ................................................22
1. The Original Decree does not include East Slope storage... ............................22
2. Evidence considered in interpreting a water right decree is limited to the
record in the original adjudication….. ..................................................................25
3. Characterizing the use of transmountain water as a supplemental supply does
not create a decreed storage right ..........................................................................30
4. Historical operations cannot expand the scope of the original appropriation..32
C. The decreed historical beneficial use of all amounts of water diverted under a
water right sought to be changed must be proven .................................................34
D. A change of water right cannot perpetuate a past injury or enlargement of the
right........................................................................................................................36
V. Conclusion. ......................................................................................................39

ii

 TABLE OF AUTHORITIES
PAGE
Cases
Burlington Ditch Reservoir & Land Co. v. Metro Wastewater Reclamation Dist.,
256 P.3d 645 (Colo. 2011) ...............................................................12, 32, 35, 36, 38
Cent. Colo. Water Conservancy Dist. v. City of Greeley, 147 P3d. 9 (Colo.
2006) ......................................................................................................25, 27, 28, 29
Cherokee Metro Dist. v. Simpson, 148 P.3d 142 (Colo. 2006) .........................27, 29
City and County of Denver v. Fulton Irrigation Ditch Co., 179. Colo. 47, 506 P. 2d
144, (Colo.1972) ................................................................................................18, 22
City of Thornton v. Bijou Irrigation Co., 926 P.2d 1 (Colo. 1996) .......16, 18, 19, 22
Comstock v. Larimer and Weld Co., 58 Colo. 186, 145 P. 700 (1914) ...................33
Empire Lodge Homeowners’ Ass’n. v. Moyer, 39 P.3d 1139 (Colo. 2001) ......32, 35
Enlarged Southside Irrigation Ditch Co. v. John’s Flood Ditch Co., 116 Colo. 580,
183 P.2d 552 (1947) .................................................................................................35
Farmers Highline Canal & Reservoir Co. v. Golden, 129 Colo. 575, 272 P.2d 629
(1954) .......................................................................................................................34
Fort Lyon Canal Co. v. Chew, 33 Colo. 392, 81 P. 37 (1905) ................................35

iii

 Greeley & Loveland Irrigation Co. v. Farmers Pawnee Ditch Co., 58 Colo. 462,
146 P. 247 (1915) .....................................................................................................14
Handy Ditch Co. v. Greeley & Loveland Irrigation Co., 86 Colo. 197, 280 P. 481
(1929) ...........................................................................................................14, 15, 34
High Plains A&M, LLC v. Se. Colorado Water Conservancy Dist., 120 P.3d 710
(Colo. 2005) .............................................................................................................35
In re Water Rights of the City and County of Denver v. Englewood, 304 P. 3d 1160
(Colo. 2013) .............................................................................................................18
In re Water Rights of Tonko v. Mallow, 154 P.3d 397 (Colo. 2007) .......................27
New Loveland & Greeley Irrigation & Land Co. v. Consolidated Home-Supply
Ditch & Reservoir Co., 27 Colo. 525, 62 P. 366 (1900) ...................................14, 30
New Mercer Ditch Co. v. Armstrong, 21 Colo. 357, 40 P. 989 (1895) ...................25
N. Sterling Irrigation Dist. v. Simpson, 202 P.3d 1207 (Colo. 2009) .....................32
Orchard City Irrigation Dist. v. Whitten, 146 Colo. 127, 361 P2d. 130
(1961) ...........................................................................................................25, 33, 34
Pueblo West Metro. Dist. v. Southeastern Colorado Water Conservancy District,
717 P.2d 955 (Colo. 1986) .......................................................................................38
Santa Fe Trail Ranches Prop. Owners Ass’n. v. Simpson, 990 P.2d 46 (Colo.
1999) ............................................................................................................32, 38, 39
iv

 Seven Lakes Reservoir Co. v. New Loveland & Greeley Irrigation & Land Co.,
40 Colo. 382, 93 P. 485 (1907) ................................................................................15
Steffens v. Rinebarger, 765 P.2d 1002 (Colo. 1988) .........................................38, 39
Trail’s End Ranch, LLC v. Simpson, 91 P.3d 1050 (Colo. 2004)............................38
Upper Eagle Reg’l Water Auth. v. Wolfe, 203 P.3d 1203 (2010) ............................38
Upper Gunnison River Water Conservancy District v. Crystal Creek Homeowners
Ass’n., 838 P.2d 840 (Colo. 1992) ...........................................................................14
Water Supply & Storage Co. v. Curtis, 733 P.2d 680 (Colo. 1987) ........................20
Weibert v. Rothe Bros., Inc., 618 P.2d 1367, 1371 (Colo. 1980) .............................. 3
Widefield Water & Sanitation Dist. v. Witte, 2014 CO 81 ................................12, 39

v

 TABLE OF AUTHORITIES
PAGE
Statutes
C.R.S. § 37-82-106 ......................................................................................16, 17, 20
C.R.S. § 37-83-101 ..................................................................................................16
Treatises
KINNEY ON IRRIGATION AND WATER RIGHTS §843 at 1477 (2d ed. 1912) ..............15
Law Review Articles
Wiel, Mingling of Waters, 29 HARV. L. REV. 137, 139 (December 1915) ..............17

vi

 I.

Statement of the issues presented for review.
A. Whether the water court erred in ruling that transmountain water may be
stored in the basin of import for later use without a decreed storage right.
B. Whether the water court erred by looking beyond the record of the original
adjudication to determine the scope of the original appropriation.
C. Whether the water court erred by including water conveyed to other entities
as a “storage fee” in the amount of the changed water right.

II.

Statement of the case.
A. Nature of the case and the course of proceedings.
Applicant/Appellee, Busk-Ivanhoe, Inc. (“Busk-Ivanhoe”) filed an

application seeking to change its one-half interest in water rights decreed to the
Busk-Ivanhoe System to allow use within the City of Aurora’s municipal system.
The Busk-Ivanhoe System is a transmountain diversion from the Frying Pan River
basin (basin of export) in Water Division 5 on the west slope of the Continental
Divide (“West Slope”) through the Ivanhoe Tunnel into the Arkansas River basin
(basin of import) in Water Division 2 on the east slope of the Continental Divide
(“East Slope”).
The Opposers/Appellants, Grand Valley Water Users Association, Orchard
Mesa Irrigation District, Ute Water Conservancy District, acting by and through
1

 the Ute Water Activity Enterprise, Colorado River Water Conservation District,
Basalt Water Conservancy District, and Board of County Commissioners of Eagle
County, Colorado, are located on the West Slope. Opposers/Appellants own,
operate or use water rights in Water Division 5, and represent constituents with
water rights. Ex. at 5267-5284. 1 The Opposers/Appellants coordinated their
opposition with Opposer/Appellant Pitkin County and shared fact and expert
witnesses at trial.
Prior to trial, Busk-Ivanhoe asserted that, because of the transmountain
nature of the Busk-Ivanhoe System, it needed to only establish the historical
diversions under the water rights without any analysis of the historical beneficial
use of the water. R. at 3431-3432. The water court disagreed and entered an order
ruling that “[t]he imported nature of the water does not exempt Applicant from the
bedrock principles of Colorado water law” governing changes of water rights. It
required Busk-Ivanhoe to “prove not only historical diversions but also historical
beneficial use of the rights to be changed in accordance with the original decree in

1 The

electronic record certified by the Division 2 Water Court contains no ID
numbers, but consists of the following five .pdf files: Clerk’s Record, Exhibits, and
Transcripts Vol. I through V. References to the record identify the relevant .pdf
page number of the relevant record .pdf file designated as R. at [page number], Ex.
at [page number] or Tr.I-V at [page number]:[lines].
2

 order to carry its burden of proof in this action.” Id. That order is not appealed by
any party.
During trial, however, Busk-Ivanhoe claimed historical use credit for water
placed into undecreed East Slope storage. Furthermore, it claimed credit for water
transferred to reservoir owners as payment for such storage without any evidence
that the “storage fee” water was beneficially used. Nevertheless, the water court
ruled in favor of Busk-Ivanhoe for the full amounts claimed.
The water court erred when it ignored its prior holding that changes of
transbasin water rights are subject to the same decreed beneficial use standards as
changes of in-basin rights. “[T]he right to change a water right is limited to that
amount of water actually used beneficially pursuant to the decree at the
appropriator's place of use.” R. at 3430. (emphasis in original) (citing Weibert v.
Rothe Bros., Inc., 618 P.2d 1367, 1371 (Colo. 1980)).
The water court ruled that a storage decree is not necessary to store
transmountain direct flow water rights in the basin of import. This and other broad
legal conclusions by the water court treat the storage of transmountain direct flow
water rights differently than the storage of in-basin direct flow water rights and
allow transmountain water rights to be enlarged to the injury of water users in the
basin of export.
3

 B. Statement of facts.
The Busk-Ivanhoe System consists of the Ivanhoe Reservoir, Ivanhoe
Tunnel, Lyle Ditch, Pan Ditch and Hidden Lake Creek Ditch, all located on the
West Slope in Water Division No. 5. Ex. at 8. A map of the Busk-Ivanhoe System
(Ex. at 97) is provided in the Addendum. The original appropriators were L.G.
Carlton and A.E. Carlton, referred to collectively as “Carlton”.
The Ivanhoe Reservoir is located on Ivanhoe Creek on the West Slope. The
three ditches divert water from small tributaries of the Frying Pan River and
deliver water to Ivanhoe Reservoir for storage and subsequent release into the
Ivanhoe Tunnel, or they can deliver water by direct flow through the Ivanhoe
Tunnel into Lake Creek in the headwaters of the Arkansas River Basin. Tr. I at
203:7-18.
The Busk-Ivanhoe System water rights were decreed on January 9, 1928 in
Civil Action 2621 (“Original Decree”). Ex. at 287-296. The Pan and Hidden Lake
Creek Ditches were decreed conditional. After two diligence proceedings in
Garfield County District Court, Civil Action 3082 (Ex. at 5074-5135) and Civil
Action 4033 (Ex. at 3881-3903), the final Busk-Ivanhoe System as decreed is as
follows (R. at 4477):

4

 For storage prior to export:
Ivanhoe Reservoir
Ivanhoe Creek
Lyle Ditch
Pan Ditch
Hidden Lake Creek Ditch

1200 acre feet
Entire flow of the stream
200 c.f.s.
25 c.f.s.
70 c.f.s.

For direct export via the Ivanhoe Tunnel:
Ivanhoe Reservoir
Lyle Ditch
Pan Ditch
Hidden Lake Creek Ditch

35 c.f.s.
50 c.f.s.
25 c.f.s.
70 c.f.s.

The Original Decree does not describe a right, or describe any intent, to store
water in any reservoir other than Ivanhoe Reservoir on the West Slope. In
describing the Busk-Ivanhoe System as a whole, the Original Decree (Ex. at 289,
¶5) states:
that said ditches, reservoir, and tunnel, constitute a single
system for the diversion of water from Hidden Lake
Creek, Pan Creek, Lyle Creek, and Ivanhoe Creek, all
tributaries of the Colorado River by the way of the
Roaring Fork River, Frying Pan Creek, and South Frying
Pan Creek, into said Ivanhoe Reservoir, the storage of the
same therein at times when storage is permissible, the
transmission of the same there through during the entire
irrigation season of each year, and the carriage of both
the stored water and that derived from direct flow
through the Continental Divide by means of said Ivanhoe
Tunnel onto the Eastern Slope of said Continental Divide
where the same is discharged at the east portal of said
tunnel into Lake Fork Creek, a tributary of the Arkansas
River, and later diverted from said streams and used in
5

 the irrigation of lands within the State of Colorado lying
along said streams and susceptible of irrigation
therefrom.
In describing the use of the Ivanhoe Reservoir and Tunnel, the Original
Decree (Ex. at 292, ¶7) states:
that all of the water so diverted and discharged into said
Lake Fork Creek, both stored water and direct flow, has
been allowed to flow down the natural channel of said
creek and of the Arkansas River and has been diverted
therefrom, less losses in transit determined as provided
by the laws of the State of Colorado…. (emphasis
added).
In decreeing the Ivanhoe Reservoir as a storage reservoir, the Original
Decree (Ex. at 293-294, ¶1) adjudicated the right to:
release said water so stored and carry the same into said
Lake Fork Creek and thereafter divert the same
therefrom or from the Arkansas River, less losses in
transit to be determined as provided by the laws of the
State of Colorado…. (emphasis added).
In decreeing the Ivanhoe Reservoir and Tunnel as a ditch system for
diverting water as a direct flow from Ivanhoe Creek, the Original Decree (Ex. at
292, ¶2) adjudicated the right to:
discharge same into said Lake Fork Creek and thence
into the Arkansas River, and thereafter divert the same
therefrom, less losses in transit to be determined as
provided by the laws of the State of Colorado….
(emphasis added).
6

 This same language is repeated for the Lyle Ditch, Pan Ditch and Hidden
Lake Creek Ditch for use with the Ivanhoe Reservoir and Tunnel for diverting
water as a direct flow from Lyle Creek, Pan Creek or Hidden Lake Creek. Ex. at
294-295, ¶3 and ¶4.
None of the evidence from Civil Action No. 2621 describes a right or intent
to store water on the East Slope.2 In the petition, Carlton states his intent to “carry
said waters through said Ivanhoe Tunnel into Lake Fork Creek, a tributary of the
Arkansas River, and from thence into the Arkansas River and down said river onto
land in the State of Colorado lying along said Arkansas River and susceptible of
irrigation therefrom….” Ex. at 1704 (emphasis added). In the statement of claim
(Ex. at 1720, ¶4), Carlton swore that:
The water diverted into said Ivanhoe Reservoir as
hereinabove set forth is and will be released therefrom by
claimant at will and carried through said Ivanhoe Tunnel
and discharged into said Lake Fork Creek down which it
has and will be allowed to flow into the Arkansas River
and from thence into the headgate of various ditches and
canals along said Arkansas River where said water has
been and will be beneficially used in the irrigation of
lands in the State of Colorado lying under said ditches
and canals which are insufficiently supplied with water
under the priorities appertaining directly to said ditches
and canals. (emphasis added).

2

There is no transcript of testimony from Civil Action No. 2621 in the record.
7

 The map and ditch statements filed by Carlton with the Office of the State
Engineer were exhibits in Civil Action No. 2621. Ex. at 289, ¶5. The map and
tunnel statement for the Ivanhoe Reservoir and Ivanhoe Tunnel states: “the water
from said Tunnel is discharged into Lake Fork Creek, whence it flows easterly and
southerly about ten miles to the Arkansas River; from which it is taken by ditches
for irrigation purposes….” Ex. at 274 (emphasis added).
The map and ditch statement for the Hidden Lake Creek Ditch states: “The
water from said ditch is discharged into Ivanhoe Reservoir, thence thru (sic)
Ivanhoe Tunnel and Lake Fork Creek into the Arkansas River from which it is
taken for irrigation purposes….” Ex. at 283 (emphasis added). The same language
is in the statement for the Pan Ditch. Ex. at 286. The map of the Lyle Reservoir
which shows the Lyle Ditch states that water “is discharged thru Lyle Creek, Lyle
Ditch, Ivanhoe Reservoir, Ivanhoe Tunnel and Lake Fork Creek to the Arkansas
River, from which it is taken by ditches for irrigation purposes.” Ex. at 285
(emphasis added).
In 1935, the Busk-Ivanhoe Company, owned by Carlton, filed a statement of
claim in the first diligence proceeding before the Garfield County District Court in
Civil Action No. 3082. Ex. at 3844-3849. In the petition, Carlton asserts that the
company and its grantors have constructed the Hidden Lake Creek Ditch and have
8

 “caused water to be carried through said ditch and said Ivanhoe Reservoir and
Tunnel and from thence to be discharged into the Lake Fork Creek from thence
into the Arkansas River and thereafter beneficially applied and used, as provided in
said decree.” Ex. at 3846-3847, ¶5 (emphasis added). William A. McKenzie, an
agent for Carlton, was asked what happened to the ditch water. He testified (Ex. at
1720, ¶4):
The ditch, of course, discharges into Ivanhoe Reservoir
and from the reservoir it is carried through the tunnel in a
flume which has a carrying capacity of approximately 85
cubic feet per second, and then it is discharged into Lake
Fork Creek, tributary of the Arkansas River; it then is run
down the Arkansas River and taken out at various ditches
between Pueblo and the Colorado State Line….
(emphasis added).
He made no mention of having stored any of the water in the Arkansas River basin
before delivery down that river.
During the second diligence proceeding before the Garfield County District
Court in Civil Action No. 4033, the High Line Canal Company (“High Line”)
owned the Busk-Ivanhoe System. Ex. at 3899. The final decree in Civil Action
No. 4033 does not describe how the water was used by High Line, but adopts and
confirms the prior findings in Civil Actions No. 2621 and 3082. Ex. at 3900, ¶6.
In 1971, High Line sold an undivided one-half interest in the Busk-Ivanhoe
System to the Pueblo Board of Water Works (“PBWW”). R. at 4350, ¶13(f).
9

 PBWW obtained a change decree for its interest in the Busk-Ivanhoe System water
rights in Case No. 90CW340, Water Division 5 (consolidated with Case No.
90CW052, Water Division 2). Id. 3
Busk-Ivanhoe is a mutual ditch company created by High Line shareholders
to own its retained one-half interest in the Busk-Ivanhoe System. Tr. I at 61-62.
From late 1986 through 2001, the City of Aurora acquired all of the Busk-Ivanhoe
shares and now owns the remaining undivided one-half interest in the BuskIvanhoe System. R. at 4350, ¶13(g).
No evidence was introduced showing that Carlton, Busk Ivanhoe Company,
High Line or Busk-Ivanhoe obtained a decree to store water diverted under the
Busk-Ivanhoe System on the East Slope. However, water was stored in Sugar Loaf
Reservoir, and later in Turquoise Reservoir, which inundated the smaller Sugar
Loaf Reservoir. Tr. I at 174-175. These reservoirs are located on Lake Fork Creek
above its confluence with the Arkansas River. Ex. at 1991. Busk-Ivanhoe and its
predecessors paid a storage fee to the reservoirs’ owners, Colorado Fuel & Iron
Company (“CF&I”) and later the Bureau of Reclamation (“BOR”), equal to twenty
percent of the total amount of water stored therein under the Busk-Ivanhoe System.
Tr. I at 232:5-9; Tr. II at 57: 20-25.
3

The portion of the Busk-Ivanhoe System water rights owned by the PBWW is not
the subject of the water court’s decree in this case nor this appeal. R. at 4344, ¶3.
10

 No reliable record quantifies the amount of water delivered to or from
storage in a particular year or the amount stored for use in a subsequent year. Tr.
III at 127-133 & 215-216; Ex. at 4858. The Opposers/Appellants’ experts
calculated the average annual amount of Busk-Ivanhoe’s storage to be 773 acre
feet. Tr. III at 132:14-25, 133:1-24; Ex. at 4858. This annual calculation does not
reflect any month to month storage and therefore is a conservative calculation of
total undecreed storage. Id. Busk-Ivanhoe’s expert did not quantify storage, but
calculated the annual average storage fee for the Busk-Ivanhoe water to be 718
acre feet. Ex. at 1451 (Column 8 minus Column 7, 2416-1698=718: see Note 8)
No evidence established that storage fee water was used by Busk-Ivanhoe or
its predecessors in accordance with the Original Decree. Tr. II. at 121:9-23.
The water court ruled that a storage decree was not necessary to store BuskIvanhoe water on the East Slope and permitted the stored water to be included in
Busk-Ivanhoe’s changed rights. R. at 4363 and 4367, ¶63.
The water court also permitted the water paid as a storage fee to be included
in the Busk-Ivanhoe changed rights. R. at 4374, ¶88 and 4375, ¶91.
Opposers/Appellants appeal the decree allowing Busk-Ivanhoe to benefit, to
the detriment of West Slope water users, from the undecreed storage of BuskIvanhoe System water.
11

 C. Standard of review.
This Court reviews the water court’s legal conclusions and interpretation of
prior decrees de novo. Burlington Ditch Reservoir & Land Co. v. Metro
Wastewater Reclamation Dist., 256 P.3d 645, 661 (Colo. 2011). The issues on
appeal were properly preserved. R. at 3973-3983 and 4248-4260; Tr. I at 177-179;
185-190; 214:13-16; 218:21-25; 220:12-14; 223:9-11; and 225:2-4.
III.

Summary of Argument.
Direct flow water rights and storage water rights are separate and distinct

types of water rights. Colorado law provides no rationale to treat the storage of
transmountain water in the basin of import any differently than the storage of inbasin water.4 Undecreed storage of transmountain water can enlarge a
transmountain direct flow right to the injury of water users in the basin of export.
The amount of water diverted under an absolute water right that can be
changed to different types and places of use with the original priority date “is
subject to a calculation of historical beneficial consumptive use lawfully made
under the decreed prior appropriation.” Burlington Ditch, 256 P.3d at 662
(emphasis added). See also Widefield Water & Sanitation Dist. v. Witte, 2014 CO
4 The

term “transmountain” is used throughout to refer to the type of transbasin
diversion that takes water across the Continental Divide. The term “in-basin” is
used to refer to water diverted and used within the same river basin.
12

 81. The water court agreed in its pre-trial ruling that changes of transmountain
diversion and in-basin rights are treated the same.
The water court was charged with determining the lawful historical use of
the Busk-Ivanhoe water rights in accordance with the Original Decree.5 Use that is
inconsistent with the decreed uses may not be used to calculate that historical use.
The Original Decree does not include East Slope storage and does not evidence
any intent to store water on the East Slope. The record in Civil Action No. 2621 is
devoid of any such discussion, and Carlton never obtained a decreed storage right
on the East Slope. The water court misinterpreted the law and erroneously looked
beyond the record in the original adjudication to conclude that no storage decree
was necessary and then included water stored and water traded to others within the
amount of the changed right. Historical operations cannot expand the scope of an
original appropriation.
To prevent the perpetuation of a pre-existing injury or enlargement of the
water rights, the volume of Busk-Ivanhoe’s changed water rights must be limited
to only the amount of water that was historically put to direct beneficial use for
irrigation in accordance with the Original Decree.
5 Because

the water was imported, the Opposers/Appellants agree that the amount
of the water right to be changed was not limited to the amount of the consumptive
use. The amount of the consumptive use was relevant in considering whether there
had been any waste or excess use of the water.
13

 IV.

Argument.

A. A storage water right is separate and distinct from a direct flow water
right.
Direct flow rights and water storage rights are two separate and distinct
types of water rights. Upper Gunnison River Water Conservancy District v.
Crystal Creek Homeowners Ass’n., 838 P.2d 840, 852 (Colo. 1992), citing Handy
Ditch Co. v. Greeley and Loveland Irr. Co., 86 Colo. 197, 280 P. 481 (1929);
Greeley & Loveland Irrigation Co. v. Farmers Pawnee Ditch Co., 58 Colo. 462,
146 P. 247 (1915); New Loveland & Greeley Irrigation & Land Co. v.
Consolidated Home-Supply Ditch & Reservoir Co., 27 Colo. 525, 531, 62 P. 366,
368 (1900). A direct flow right may be diverted in priority only when the water
can be put directly to the decreed beneficial use. Thus, a water right decreed for
direct flow cannot be diverted in priority when it is not immediately needed for its
decreed purposes. Handy Ditch, 280 P. at 482 (plaintiff entitled to water for its
immediate needs according to its priorities for direct irrigation, but cannot claim
storage rights thereunder). If an appropriator wants to store transmountain water
that is not needed for immediate use under a senior priority, a storage right must be
decreed.
A water user with a decree for direct irrigation cannot store the water for
future use because such storage would “unlawfully extend or enlarge plaintiff’s
14

 appropriation for direct irrigation, to the detriment of junior appropriators.” Id. 6
“It is, therefore, held that reservoirs cannot be added to an irrigation system if
thereby other appropriators’ rights would be materially injured by such addition
and the storage of water instead of the immediate use of the same.” KINNEY ON
IRRIGATION AND WATER RIGHTS §843 at 1477 (2d ed. 1912).
Undecreed storage of a direct flow water right allows water without a
current demand to be diverted that would otherwise be left in the stream and
available for junior water users. The impact on junior water users is exactly the
same whether the diversion to undecreed storage is from in-basin or transmountain
sources.
This Court has never held that transmountain water may be stored in the
basin of import prior to beneficial use without a decreed storage right. There is no
legal basis for a lesser standard for transmountain diversions than is applied to inbasin diversions. Yet the water court concluded that a decreed right to store in the
basin of import was unnecessary. R. at 4363 and 4367, ¶63. It misconstrued
6

But see Seven Lakes Reservoir Co. v. New Loveland & Greeley Irrigation & Land
Co., 40 Colo. 382, 93 P. 485 (1907) (permitting storage of direct irrigation right for
use later in the same season.) This case is inconsistent with the subsequent case
law cited, supra. It also is distinguished from the case at bar because no evidence
was presented by Busk-Ivanhoe that all water stored on the East Slope was used
during the same irrigation season. In fact, the experts on both sides assumed stored
water was carried over year to year. Tr. III at 132:14-19; Tr. V at 54:3-9.
15

 C.R.S. § 37-83-101, ignored C.R.S. § 37-82-106, misinterpreted a footnote in City
of Thornton v. Bijou Irrigation Co., 926 P.2d 1 (Colo. 1996), and incorrectly
concluded that storage in the basin of import cannot adversely affect water users in
the basin of export. R. at 4356-4357, 4363, ¶34, ¶36 and ¶50(b).
1.

C.R.S. § 37-83-101 does not create a right to store
transmountain water without a decree.

C.R.S. § 37-83-101 provides that: “whenever any person or company
diverts water from one public stream and turns it into another public stream, such
person or company may take the same amount of water again, less a reasonable
deduction for seepage and evaporation, to be determined by the state engineer.”
The water court held that this statute created a right to “recapture” water imported
from another stream at “any structure or location.” R. at 4356, ¶34. This is
incorrect. The statute created the right to move water from one stream into another
and use the receiving stream to convey the water to a place of use, less a transit
loss. This statute describes precisely how Carlton told the Garfield County District
Court he intended to deliver this water for irrigation by using a natural stream to
convey the water to its end use. He said he intended to divert water from the West
Slope creeks to “Lake Fork Creek and thence the Arkansas River, and thereafter
divert the same therefrom, less losses in transit to be determined as provided by the
laws of the State of Colorado.” Ex. at 293-294.
16

 2.

C.R.S. § 37-82-106 does not authorize undecreed storage of
transmountain water for later use.

The water court stated that “[i]mporters of transmountain water have
historically been accorded wide latitude in the use of such water.” R. at 4356, ¶34.
This “wide latitude” means water users in the basin of import have no right to rely
upon the return flow from the use of transmountain water. As early as 1915
commentators discussed that “[t]he mill-owner may cease to operate his conduit
across the divide, or may cease to operate his mill, or his water wheels, or may
change his location, or otherwise take away or alter, in whatever way he pleases,
the artificial source of the flow into Second River.” Wiel, Mingling of Waters, 29
HARV. L. REV. 137, 139 (December 1915) (water users cannot rely upon imports to
their basin). Although the water court quoted this commentary, it failed to limit its
application to the effect an importer’s actions have on water users in the basin of
import. R. at 4356, ¶34 and 4357, ¶37.
This “wide latitude” has been codified in C.R.S. § 37-82-106 (1):
Whenever an appropriator has lawfully introduced
foreign water into a stream system from an unconnected
stream system, such appropriator may make a succession
of uses of such water by exchange or otherwise to the
extent that its volume can be distinguished from the
volume of the streams into which it is introduced.
(emphasis added).

17

 This statute recognizes the right to reuse and successively reuse imported
water only after it has first been put to its lawfully decreed beneficial use. To
accomplish reuse, an importer may “recapture” the return flows or effluent from
the use of the imported water.
The term “recapture” has never been used to mean that imported water may
be stored without a storage decree prior to any decreed use. Instead, it describes
managing return flows or effluent from the initial decreed use of imported water
for reuse. The “right to recapture” after use is not the equivalent of a right to store
prior to use.
Consistent with [C.R.S. § 37-82-106 (1)], this Court has
recognized transmountain water users’ rights to reuse and
to make successive use of imported transmountain water
to the maximum extent feasible to ‘minimize the amount
of water removed from Western Colorado.’
In re Water Rights of the City and County of Denver v. Englewood, 304 P. 3d
1160, 1164 (Colo. 2013) (quoting City and County of Denver v. Fulton Irrigation
Ditch Co., 179. Colo. 47, 54, 506 P. 2d 144, 148 (Colo.1972)) (emphasis added).
Allowing reuse of West Slope water by an East Slope importer achieves “the
goal of minimizing the amount of water imported.” Thornton, 926 P.2d at 67-68
(emphasis added). Holding that transmountain water can be stored without a

18

 decree prior to any beneficial use has the exact opposite effect as it will maximize
the amount of water taken from the West Slope.
If there is no limit on the number of “buckets” an importer can store a direct
flow water right in before use, then the importer can maximize the amount of water
taken from the West Slope rather than minimize its diversions. Busk-Ivanhoe’s
own expert explained that storing transmountain water in the basin of import
without a storage decree meant the importer was not subject to any storage carryover volume limitations and could accumulate water in as many different
reservoirs as the importer controlled. Tr. II at 87:12-25 & 88-91:1-9.
3.

Thornton does not hold that transmountain water can be
stored without a decreed storage right.

In Thornton, this Court noted that imported water “was independent of the
priority system already in place on the stream.” Thornton, 926 P. 2d at 66, FN. 59.
The water court said this means “a decree authorizing storage in a reservoir after
importation is not necessary, as there would be no need to obtain a priority (i.e., a
decree) for recapture or storage of water in the basin of import.” R. at 4356-4357,
¶36. The water court got this wrong. The discussion in Thornton was in the
context of recognizing the right of an importer to his return flows, seepage and
effluent. In-basin water users do not have such rights without obtaining a decree

19

 that recognizes an independent appropriation for such reuse. Water Supply &
Storage Co. v. Curtis, 733 P.2d 680, 685 (Colo. 1987).
The statement in Thornton about imported water being independent of the
priority system means only that the use of imported water is not subject to
satisfying calls in the basin of import and an importer may reuse the water to
extinction. It does not mean that an importer can expand the circumstances during
which transmountain water can be diverted from the basin of export by adding
storage to a direct flow right.
Furthermore, the right to reuse imported water is limited to water lawfully
introduced into a disconnected stream system. C.R.S. § 37-82-106(1). The water
stored by Busk-Ivanhoe without any decreed storage right was not diverted from
the West Slope under Busk-Ivanhoe’s decreed priority, and therefore was not
lawfully introduced onto the East Slope.
4.

Undecreed storage in the basin of import can enlarge the
scope of a transmountain direct flow water right and
adversely affect water users in the basin of export.

In concluding a transmountain appropriator does not need a storage decree to
store imported water before beneficial use, the water court incorrectly found that
such storage only affects water users in the basin of import. R. at 4357, ¶37. An
importer may change “the time, place or manner in which these waters are used,
20

 even if junior appropriators are adversely affected,” but this principle applies only
against water users in the basin of import. A transmountain appropriator cannot
change the timing or manner of use of the imported water if it adversely affects
junior water users in the basin of export because these water users rely on water
from the same stream system from which the diversions are made.
The water court concluded that storage in the basin of import only affects the
time and/or manner of use of the water and not the timing of the diversions and,
therefore, affects only the basin of import. R. at 4357, ¶37. However, storing
water in the basin of import does affect the timing and volume of water that can be
diverted from the basin of export. If a transmountain appropriator obtains a
decreed right to irrigate 1,000 acres on the East Slope, the scope of the
appropriation is the volume necessary to irrigate crops on 1,000 acres. If the
importer irrigates his 1,000 acres but also stores additional water under the same
priority, there has been an expansion of the original appropriation to the detriment
of water users in the basin of export. The amount of water diverted now exceeds
the amount necessary to irrigate the 1,000 acres, and the period of time in which
the water is diverted has enlarged to times when there is no irrigation demand by
the original appropriator. It does not matter whether the stored water is

21

 transmountain or in-basin – junior users downstream from the diversion are
adversely impacted exactly the same way.
Both experts’ analyses assumed that water was carried over in storage year
to year, allowing the Busk-Ivanhoe System to divert more water than was
necessary for its immediate beneficial use. Undecreed storage on the East Slope
enlarged the original appropriation for irrigation to the detriment of water users on
the West Slope and is contrary to the goal, recognized in Fulton, supra and
Thornton, supra, of minimizing the amount of water taken from the West Slope.
B. The scope of the original appropriation of the Busk-Ivanhoe System
water rights did not include storage on the East Slope.
Having incorrectly concluded that Carlton did not need a storage decree for
East Slope storage, the water court found that such storage was not an expansion of
use because Carlton always intended to store the water on the East Slope. This
conclusion is contrary to the Original Decree and relies upon extrinsic evidence not
before the Garfield County District Court in Civil Action No. 2621.
1.

The Original Decree does not include East Slope storage.

The water court found that the Original Decree was silent on the issue of
East Slope storage. R. at 4359, ¶38(i). The water court found the “silence” could
be explained, at least in part, because the Garfield County District Court did not
have the authority to issue a storage decree in the Arkansas River basin. R. at
22

 4362, ¶50. Although the Garfield County District Court did not have the authority
to award a storage priority for Arkansas River basin water, it had the authority to
decree how water diverted from the Colorado River basin was to be delivered and
used and whether it could be stored on the East Slope prior to use.
The Original Decree is not silent at all about how the water was to be
delivered and used. It details how water diverted under each of the Busk-Ivanhoe
System structures is brought through the Ivanhoe Tunnel, put into Lake Fork
Creek, thence into the Arkansas River and subsequently diverted for irrigation, less
the appropriate transit loss. To say the Original Decree is silent about storage is
like saying the Original Decree is silent as to whether the water may be used for
municipal purposes. A water right decree does not describe all the ways a water
right cannot be used; it only describes all the ways a water right can be used.
The most logical reason why the Original Decree is “silent” about East
Slope storage is that Carlton never told the court that he was storing or intended to
store any of the water on the East Slope prior to beneficial use. This conclusion is
supported by, and is consistent with, the complete lack of any mention of East
Slope storage in the record in Civil Action 2621.
Despite making multiple references to the Original Decree being silent on
the East Slope storage issue (R. at 4358-4359, ¶38(e), (f), (g) & (i)), the water
23

 court states that some handwritten and stricken language in the Original Decree
supports an inference that the water would not be immediately used. R. at 4361,
¶44. In the decretal paragraphs 2, 3 and 4, inserted typed language, “for direct
irrigation”, was crossed out and the handwritten words, “as direct flow”, were
inserted. Ex. at 294-295. These three paragraphs describe portions of the BuskIvanhoe System when the same are to be used as a “ditch system” for direct flow
through the Ivanhoe Tunnel without storing the water in Ivanhoe Reservoir. The
addition of “as direct flow” at the beginning of these paragraphs distinguishes the
use of the ditches for “direct flow” rights from the use of the ditches to place water
into the Ivanhoe Reservoir for storage. This same language is used in the Original
Decree to describe all the components of the Busk-Ivanhoe System and the
“carriage of both the stored water and that derived from direct flow through the
Continental Divide by means of said Ivanhoe Tunnel….” Ex. at 289, ¶5 (emphasis
added).
Distinguishing between “stored” water and “direct flow” water is consistent
with the Original Decree, which recognized both West Slope storage rights and
direct flow rights. These edits only describe how the water will be diverted
through the Ivanhoe Tunnel – either as direct flow into the tunnel or as water
released from storage in Ivanhoe Reservoir. It was correct to use the term “direct
24

 flow” in discussing the type of right. Later, the Original Decree describes
specifically how the water is to be conveyed to irrigation use, and no mention of
storage is made. The water court erred by relying on extrinsic evidence to assume
that the Original Decree must have included a storage right on the East Slope, even
though the Original Decree contained a detailed discussion of how the imported
water would be put to use without any mention of East Slope storage.
2.

Evidence considered in interpreting a water right decree is
limited to the record in the original adjudication.

A water court decree is “construed in the light of the facts which gave it
birth and limited by the issue it resolved.” Orchard City Irrigation Dist. v.
Whitten, 146 Colo. 127, 135, 361 P.2d 130, 134 (1961) (“The statement of claim
presents the issue. The decree is limited by the issue it resolves.”) This Court has
consistently held that statements of claim and trial transcripts are admissible to
construe or interpret water decrees. Cent. Colo. Water Conservancy Dist. v. City of
Greeley, 147 P3d. 9, 16 (Colo. 2006).
Statements of claim “are proper to be introduced along with the decree to
enable the court to interpret or construe the latter in light of the claimant’s own
assertion of his demand.” New Mercer Ditch Co. v. Armstrong, 21 Colo. 357, 362,
40 P. 989, 990 (1895) (emphasis added).

25

 The Original Decree was based upon the record before the Garfield County
District Court in Civil Action No. 2621. Nothing in the record contains an
assertion from Carlton that he needed or intended to store the water after diverting
it through the Ivanhoe Tunnel and prior to delivery for irrigation. Likewise,
nothing in the record states that Carlton intended to trade twenty percent of the
water stored on the East Slope as storage rental fees.
The same is true for the diligence proceedings. Nothing in the records in
those proceedings suggests that the Garfield County District Court was ever
advised that water was being stored and traded to others. In fact, the only
testimony in the record, Mr. McKenzie’s in Civil Action No. 3082, was that the
water was “discharged into Lake Fork Creek, …, it then is run down the Arkansas
River and taken out in various ditches between Pueblo and the Colorado State
line.” Ex. at 1697.
However, the water court did not limit its review to the record before the
Garfield County District Court in Civil Action No. 2621 or even the two diligence
proceedings. It considered evidence not in any record. The water court concluded
that storage was part of the original appropriation because: 1) Carlton filed a map
and statement for Lake Fork Reservoir on the East Slope (even though that
reservoir was never built or decreed) (R. at 4362, ¶46); 2) High Line’s corporate
26

 minutes discuss storage of Busk-Ivanhoe water on the East Slope (R. at 4362, ¶47);
and 3) the water had been stored (R. at 4362, ¶50). The problem with this
approach is twofold: this evidence was never before the Garfield County District
Court and historical operations cannot expand existing decreed rights.
The water court cited to In re Water Rights of Tonko v. Mallow, 154 P.3d
397, 405 (Colo. 2007), Central Colorado, 47 P.3d at 16-17 and Cherokee Metro
Dist. v. Simpson, 148 P.3d 142, 146-147 (Colo. 2006), but its reliance on these
cases is misplaced.
In Tonko, this Court made the statement that:
Early decrees often stated a flow rate of diversion and a
number of acres to be irrigated, but did not specify that
the water had to be used on certain parcels of land. The
water court may examine documents and take evidence
about the facts and circumstances surrounding entry of a
decree, in order to determine the decree's setting, intent,
meaning, and effect when adjudicating the applicant's
water use right or ascertaining the existence of an
undecreed invalid enlargement of the decreed water
right.
Tonko, 154 P.3d at 405. This statement is dicta because the issue in Tonko was
whether the water court had erred in dismissing the change case on issue
preclusion grounds. More importantly, the change case in Tonko did not concern
the original appropriator’s intent or the scope of the original appropriation
(irrigation use and number of acres were clearly defined, the location of the acres
27

 was not), but whether use of the water on the applicant’s lands was different than
those originally decreed, and whether the use on the applicant’s lands was an
inconsequential change with no enlargement of the right. Tonko does not hold that
the appropriator’s intent or the scope of an appropriation can be determined from
extrinsic evidence not before the original court.
In Central Colorado, the original 1882 decree adjudicated a right to 931
c.f.s. for irrigation and domestic purposes but did not expressly limit the number of
acres irrigated. In a change case, the evidence showed that at the time of the
original decree the appropriator irrigated 344 acres, that he had started irrigating
more acres by 1893 and that his successors were irrigating at least 700 acres by
1920. Central Colorado, 147 P.3d at 12. The water court had to determine the
extent of lawful historical use. The appropriator’s 1879 trial testimony was that he
owned “at least 300 acres that lie under the ditch on the same side of the river that
can be irrigated from this ditch. I have irrigated all of this land that needs
irrigation.” Id. Relying on this testimony, the water court found that the lawful
use of the 1882 decree was limited to the irrigation of those 344 acres. This Court
held that the water court correctly relied on the “unmistakable” testimony of the
appropriator regarding his intended use and that “[a]ny use beyond that
appropriation, for however long a period, is not ‘historic use’ for purposes of
28

 establishing the lawful historic use of the [water right] and constitutes an unlawful
enlargement.” Id. at 23. Central Colorado did not sanction reliance on extrinsic
evidence that was not before the adjudicating court for determining the scope of an
appropriation.
The water court cited Cherokee Metro for the general proposition that it can
look at “surrounding facts and circumstances to determine the intent of the parties
and the meaning of the instrument.” R. at 4358, ¶38(f). But Cherokee Metro
involved the meaning of a provision in a stipulated decree. Courts interpret
stipulated decrees as they would a contract and extrinsic evidence is admissible to
prove the contracting parties’ intent when there is ambiguity in the contract.
Cherokee Metro, 148 P.3d at 146. The Original Decree was not a stipulated decree
and the water court never held that the Original Decree was ambiguous. Cherokee
Metro does not allow the meaning of a water decree entered after a trial to the
court, or the scope of the original appropriation as adjudicated by that decree, to be
determined from evidence that was not before the adjudicating court.
Carlton may have intended to store the water on the East Slope prior to use,
but intent alone does not create a decreed water right. “Mere intention of an
appropriator to build a reservoir, and make it a part of a general system of

29

 appropriating water, is, of itself, insufficient to constitute a vested right to store
water therein.” New Loveland, 62 P. at 367.
The documentary evidence the water court relied upon in finding an original
intent to store water on the East Slope before decreed use, the Lake Fork Reservoir
map and statement and the High Line corporate minutes, was not presented to the
Garfield County District Court in Civil Action No. 2621. Nothing in the record
notified the court or any West Slope water user that the scope of the Busk-Ivanhoe
System water rights included storage on the East Slope.
3.

Characterizing the use of transmountain water as a
“supplemental supply” does not create a decreed storage
right.

Carlton’s statement of claim said the water would be used as a
“supplemental water supply”. Ex. at 1720, ¶5. The water court concluded that “in
the Arkansas Basin in the 1920s a supplemental supply of water in effect meant
water stored in a reservoir." R. at 4361, ¶43. There was no evidence in Civil
Action No. 2621 regarding which ditches along the Arkansas River would be
utilizing the Busk-Ivanhoe System. Rather, the Garfield County District Court
found that “there are large bodies of land…inadequately supplied with water…towit, more than 80,000 acres.” Ex. at 292, ¶8. It is impossible, based on the
original record, to ascertain how these ditches would utilize the water or just what
30

 Carlton meant by “supplemental water supply”. Instead, the water court looked
beyond the record and considered extrinsic evidence, including the opinion
testimony of Busk-Ivanhoe’s expert. R. at 4361, ¶43. Busk-Ivanhoe’s expert
opined that storage was necessary to maximize the value of the water rights. Tr. II
at 58:13-16.
Even if today’s view of the most effective use of the Busk-Ivanhoe System
includes East Slope storage, that does not mean a storage right was decreed. The
water court found that Carlton intended to store the water and that such intent was
understood by the Garfield County District Court and “reflected in its decree.” R.
at 4361, ¶43. Carlton may have intended to store the water on the East Slope, but
there is no legal or factual basis for finding this was understood by the Garfield
County District Court or reflected in the Original Decree. The Original Decree
never mentions East Slope storage. How can the “silent” Original Decree “reflect”
an intent to store?
Only decreed rights have a secured place in the priority system. Intent and
storage alone, without a decree, equates to a junior storage right and not one that
can be included in the quantification of Busk-Ivanhoe’s senior priorities.

31

 4.

Historical operations cannot expand the scope of the
original appropriation.

The water court also considered the administrative practice of allowing
storage on the East Slope. R. at 4364, ¶51. Actual storage of Busk-Ivanhoe System
water on the East Slope does not alter the analysis of the scope of the original
appropriation. “Those making water uses must obtain a decree adjudicating their
rights if they desire to have standing to enforce them.” Santa Fe Trail Ranches
Prop. Owners Ass’n. v. Simpson, 990 P.2d 46, 58 (Colo. 1999) (emphasis added).
Historical operations cannot give rise to a right to divert in excess of a decree. See
N. Sterling Irrigation Dist. v. Simpson, 202 P.3d 1207, 1214 (Colo. 2009) (one-fill
rule is an implied limitation on all storage decrees and historical operations did not
create right to exceed one annual fill). Without an adjudicated right to store water
on the East Slope consistent with its historical operations, Busk-Ivanhoe’s claim
that it always had a senior right to store fails. Id.
This Court has held repeatedly that “State Engineer acquiescence in water
use practices does not substitute for judicial determination of use rights.” Id.
(quoting Empire Lodge Homeowners’ Ass’n. v. Moyer, 39 P.3d 1139, 1156-1157
(Colo. 2001). See also Burlington Ditch, 256 P.3d at 673 (change of water right
required even after 39 years of use from undecreed point of diversion).

32

 In Orchard City, the plaintiff stored water for many years in quantities that
exceeded the decreed and physical capacity of plaintiff’s reservoir. This Court
held that ‘[s]uch storage by plaintiff, even though sanctioned, permitted or
authorized by other water officials, could not alter or modify plaintiff’s decreed
rights.” Orchard City, 361 P.2d at 137. “And even if the custom and usage
alleged were fully and satisfactorily established by competent proof, it would not
bind either the water officials or consumers of water from the same streams….”
Id. (quoting Comstock v. Larimer and Weld Co., 58 Colo. 186, 145 P. 700 (1914)
(emphasis added). The plaintiff’s asserted right had to be found in the original
decrees because the decrees “measure, limit and define both the nature and extent
of plaintiff’s rights.” Id. at 135-136. This Court held that construction of the
decrees was limited by the statement of claim and the trial testimony. Id. at 136.
Because the right to refill was not asserted in the statement of claim and not
supported by the testimony, the right to refill and exceed the decreed capacity was
not awarded by the decree.
This is precisely the circumstance before the Court now. The Original
Decree does not state that water will be stored on the East Slope prior to beneficial
use; such right or intent to store was not asserted in Carlton’s petition or statement

33

 of claim and was not supported by the trial record. Historical storage cannot create
an adjudicated right.
Colorado law has consistently required (even at the time of the Original
Decree), that an appropriator needs a storage decree for an irrigation feeder ditch to
divert water into storage. Handy Ditch, supra. Similarly, the scope of a decreed
appropriation is limited to the use asserted and proven in the original adjudication.
Orchard City, supra. These limitations must be read into the Original Decree.
Farmers Highline Canal & Reservoir Co. v. Golden, 129 Colo. 575, 580, 272 P.2d
629, 632 (1954) (all decrees are subject to constitutional and statutory provisions
and restrictions designed for the protection of junior appropriators from the same
stream). If Carlton wanted a priority to store Busk-Ivanhoe water on the East
Slope, evidence of such intent needed to be presented and a decree adjudicating
such a right obtained.
C. The decreed historical beneficial use of all amounts of water sought to
be changed must be proven.
Twenty percent of the water delivered to storage under the Busk-Ivanhoe
System was paid to CF&I (Tr. I at 232:5-9) or the BOR (Tr. V at 55:5-9) as a
“storage fee.” Busk-Ivanhoe could not prove how or if this water was ever
beneficially used, but included it in quantifying its historical beneficial use. Tr. II
at 121:9-23; Tr. III at 210:14-25, 211:1-16 & 217:12-17; Tr. V at 89-90. Despite
34

 this undecreed storage and lack of proof of the historical decreed use of the water,
the water court included this water in the amount Busk-Ivanhoe was permitted to
change. This was in error.
The owner of a priority for irrigation has no right, as
against a junior appropriator, to waste it; … nor to lend,
rent or sell to others the excess water after irrigation of
the land which was appropriated, to the detriment of
junior appropriators….
Enlarged Southside Irrigation Ditch Co. v. John’s Flood Ditch Co., 116 Colo. 580,
586, 183 P.2d 552, 554 (1947) (quoting Fort Lyon Canal Co. v. Chew, 33 Colo.
392, 81 P. 37 (1905) (emphasis added).
Even if this Court concludes that Busk-Ivanhoe had the right to store water
before beneficial use, it did not have the right to sell or trade the water it did not
use for irrigation.
A Colorado prior appropriation water right arises only by
application of a specified quantity of water to an actual
beneficial use. The anti-speculation doctrine, which has
existed in Colorado prior appropriation water law since
its inception in Territorial and early-Statehood days,
prevents unlawful enlargement, as well as curbs the
appropriation of water not needed for actual beneficial
use.
Burlington Ditch, 256 P.3d at 661 (citing Empire Lodge, 39 P.3d at 1147 and High
Plains A&M, LLC v. Se. Colorado Water Conservancy Dist., 120 P.3d 710, 713
(Colo. 2005)).
35

 The water diverted under the Busk-Ivanhoe System in excess of the decreed
irrigation use cannot be included in the amount of the changed water right. If an
appropriator tells the court he is going to use 100 c.f.s. for irrigation, but lends,
rents or sells 20 c.f.s. to someone else, that 20 c.f.s. cannot be part of a historical
use calculation. Only the 80 c.f.s. used for irrigation by the appropriator can be
claimed.
“Storage itself is not a beneficial use …. In a change of water rights
proceeding, the actual beneficial use made of the stored water must be ascertained
….” Id. at 663. The water court erred in failing to reduce the amount of BuskIvanhoe’s claimed historical beneficial use because the water paid as a “storage
fee” was not shown to have been put to its decreed beneficial use. Tr. III at 221:911.
D. A change of water right cannot perpetuate a past injury or enlargement
of the right.
Busk-Ivanhoe argued that the Opposers/Appellants are not injured by the
requested change because the amount of water to be diverted after the change will
not increase from the amount diverted before the change. However, the injury
asserted by the Opposers/Appellants has been on-going. The storage of BuskIvanhoe water in undecreed East Slope storage and in amounts not contemplated

36

 by the Original Decree has resulted in water being taken from the West Slope to
the detriment of junior appropriators.
At trial, the Opposers/Appellants’ expert testified to three types of injury to
water rights on the West Slope: 1) continuing expanded diversions of BuskIvanhoe water during times of a bypass call to senior downstream rights; 2)
continuing expanded diversions of Busk-Ivanhoe water resulting in more water
being released from the Green Mountain Reservoir Historic Users Pool; and 3)
continuing expanded diversions of Busk-Ivanhoe water when West Slope
downstream water rights are not satisfied. Tr. IV at 114:13-15 – 123:1-2; Ex. at
4806-4807. The Opposers/Appellants expert testified that the unlawful or nonbeneficial use of the Busk-Ivanhoe water had injured West Slope water rights
historically and will continue to cause injury if the change allows credit for the
unlawful use. Tr. IV at 229:11-25-230:1-7.
The Opposers/Appellants expert explained these injuries and which specific
categories of water rights suffered. But the simple fact is that every time BuskIvanhoe water was diverted under its senior priority and not put to its decreed
beneficial use while there was a West Slope call placed on or below Ivanhoe
Creek, junior West Slope rights were injured because the Busk-Ivanhoe diversions
into East Slope storage were out-of-priority and that water should have been
37

 available to the West Slope. “The General Assembly’s intent to protect vested
water rights holders from injury caused by out-of-priority diversions is based on
Colorado’s constitutional guarantee protecting the right to use water in priority.”
Upper Eagle Reg’l Water Auth. v. Wolfe, 203 P.3d 1203, 1211 (2010).
Out-of-priority diversions “necessarily injured other water users. Because
such injury occurred in the past is no reason to perpetuate such injury in the form
of a decree for a change of water rights.” Pueblo West Metro. Dist. v. Southeastern
Colorado Water Conservancy District., 717 P.2d 955, 960 (Colo. 1986) (applicant
could not “benefit from the unwarranted and unsupervised use of its water right”);
see also Steffens v. Rinebarger, 765 P.2d 1002, 1007 (Colo. 1988) (change decree
must avoid perpetuating preexisting injuries) and Burlington Ditch, 256 P.3d at
665 (unlawful enlargement begun in 1909 not permitted to continue in 2002
change of water rights).
Furthermore, the focus of a change proceeding is not solely on specific
injury to other water rights. Santa Fe Trail, 990 P.2d at 53. Even when no other
rights could be injured by a proposed change, “it is essential that the change not
also enlarge an existing right.” Trail’s End Ranch, LLC v. Simpson, 91 P.3d 1050,
1063 (Colo. 2004). A change decree can only change “the use of the water right to
the amount and time of diversions originally authorized under… [the] decree.”
38

 Santa Fe Trail, 990 P.2d at 57 (quoting Steffens, 756 P.2d at 1007). “Crucially, in
practical terms, the HCU analysis does not merely measure the amount of water
actually used over a representative period. Rather, a proper HCU analysis
measures the amount of water actually and lawfully used.” Widefield Water, 2014
CO 81, ¶21 (emphasis in original). The undecreed East Slope storage of water
diverted by Busk-Ivanhoe resulted in an unlawful enlargement of the water rights
to the injury of West Slope water users, and such enlargement and preexisting
injury cannot be perpetuated by the change decree.
V.

Conclusion.
The impacts of the water court’s findings and rulings are potentially far

reaching. The water court’s broad pronouncement “that a decree authorizing
storage in a reservoir after importation is not necessary, as there would be no need
to obtain a priority (i.e. a decree) for recapture or storage of water in the basin of
import” misconstrues the law. Likewise, the water court’s reliance on documents
outside the record in Civil Action No. 2621 and on historical operations allows
Busk-Ivanhoe to benefit from greater rights than those claimed by the original
appropriator and decreed in 1928. The water court’s ruling calls into question the
legal effect of transmountain storage decrees and suggests that there is no
requirement to acquire a storage decree for imported water, or even to change the
39

 use of transmountain water. As a result, transmountain diversions could be
expanded by storage in any number of undecreed reservoirs, all to the detriment of
water users in the basin of origin.
Accordingly, Opposers/Appellants request that this Court reverse the water
court and hold that East Slope storage of the water diverted under Busk-Ivanhoe’s
water rights prior to any decreed beneficial use was impermissible, that the
inclusion of the stored water and water paid as a storage fee within the amount of
the changed water right was error, and that the case be remanded with directions to
exclude any water stored on the East Slope from the quantification of the historical
use of these water rights and limit the quantification to the amount used directly for
irrigation.
Respectfully submitted this 23rd day of December, 2014.
WILLIAMS, TURNER & HOLMES, P.C.
/s/ Kirsten M. Kurath
Kirsten M. Kurath, # 24649
Mark A. Hermundstad, # 10357
Attorneys for Opposers/Appellants Grand
Valley Water Users Association, Orchard
Mesa Irrigation District, and Ute Water
Conservancy District acting by and through
the Ute Water Activity Enterprise

40

 BALCOMB & GREEN, P.C.
/s/ David C. Hallford
David C. Hallford, #10510
Christopher L. Geiger, #32333
Scott Grosscup #35871
Attorneys for Opposers/Appellants Colorado
River Water Conservation District, Basalt
Water Conservancy District and Board of
County Commissioners of Eagle County,
Colorado

41

 CERTIFICATE OF SERVICE
I hereby certify that on this 23rd day of December, 2014, a true and
correct copy of the OPENING BRIEF OF GRAND VALLEY WATER USERS
ASSOCIATION, ORCHARD MESA IRRIGATION DISTRICT AND UTE
WATER CONSERVANCY DISTRICT, ACTING BY AND THROUGH THE
UTE WATER ACTIVITY ENTERPRISE COLORADO RIVER WATER
CONSERVATION DISTRICT, BASALT WATER CONSERVANCY
DISTRICT AND BOARD OF COUNTY COMMISSIONERS OF EAGLE
COUNTY, COLORADO and the ADDENDUM were filed and served via
ICCES E-FILING to the following:
Name

Type

Attorney

Organization

Method

Alan Martellaro, P.e.,
Division Engineer For Water
Division 5

OpposerAppellant

Paul Louis
Benington

CO Attorney General

E-Service

Alan Martellaro, P.e.,
Division Engineer For Water
Division 5

OpposerAppellant

Katherine Abbott
Daniels Ryan

CO Attorney General

E-Service

Basalt Water Conservancy
District

OpposerAppellant

Christopher L
Geiger

Balcomb & Green PC

E-Service

Basalt Water Conservancy
District

OpposerAppellant

Scott A Grosscup

Balcomb & Green PC

E-Service

Basalt Water Conservancy
District

OpposerAppellant

David Carl Hallford

Balcomb & Green PC

E-Service

Board of County
Commissioners of Eagle
County

OpposerAppellant

Christopher L
Geiger

Balcomb & Green PC

E-Service

42

 Name

Type

Attorney

Organization

Method

Board of County
Commissioners of Eagle
County

OpposerAppellant

Scott A Grosscup

Balcomb & Green PC

E-Service

Board of County
Commissioners of Eagle
County

OpposerAppellant

David Carl Hallford

Balcomb & Green PC

E-Service

Board of County
Commissioners of Pitkin
County

OpposerAppellant

Timothy James
Beaton

Moses, Wittemyer,
E-Service
Harrison and Woodruff,
P.C.

Board of County
Commissioners of Pitkin
County

OpposerAppellant

Anne D. Bensard

Moses, Wittemyer,
E-Service
Harrison and Woodruff,
P.C.

Board of County
Commissioners of Pitkin
County

OpposerAppellant

Jennifer M. Dilalla

Moses, Wittemyer,
E-Service
Harrison and Woodruff,
P.C.

Busk-Ivanhoe, Inc., A
Colorado Corporation

ApplicantAppellee

John Marshall
Dingess

HAMRE RODRIGUEZ E-Service
OSTRANDER AND
DINGESS PC

Busk-Ivanhoe, Inc., A
Colorado Corporation

ApplicantAppellee

Austin C Hamre

HAMRE RODRIGUEZ E-Service
OSTRANDER AND
DINGESS PC

Busk-Ivanhoe, Inc., A
Colorado Corporation

ApplicantAppellee

Ryan P. Mclane

HAMRE RODRIGUEZ E-Service
OSTRANDER AND
DINGESS PC

43

 Name

Type

Attorney

Centennial Water And
Sanitation District

Opposer

Veronica A Sperling Buchanan and Sperling, E-Service
P.C.

Colorado River Water
Conservation District

OpposerAppellant

Christopher L
Geiger

Balcomb & Green PC

E-Service

Colorado River Water
Conservation District

OpposerAppellant

Scott A Grosscup

Balcomb & Green PC

E-Service

Colorado River Water
Conservation District

OpposerAppellant

David Carl Hallford

Balcomb & Green PC

E-Service

David L. Nettles, P.e.,
Division Engineer For Water
Division 1

OpposerAppellant

Paul Louis
Benington

CO Attorney General

E-Service

David L. Nettles, P.e.,
Division Engineer For Water
Division 1

OpposerAppellant

Katherine Abbott
Daniels Ryan

CO Attorney General

E-Service

DENVER WATER

Opposer

Daniel John Arnold

Denver Water

E-Service

DENVER WATER

Opposer

Casey S Funk

Denver Water

E-Service

Dick Wolfe, P.e., State
Engineer

OpposerAppellant

Paul Louis
Benington

CO Attorney General

E-Service

Dick Wolfe, P.e., State
Engineer

OpposerAppellant

Katherine Abbott
Daniels Ryan

CO Attorney General

E-Service

44

Organization

Method

 Name

Type

Attorney

Organization

Method

High Line Canal Company

OpposerAppellee

Robert Frederick
Krassa

Krassa and Miller LLC

E-Service

Party Suppressed

Impartial

Self-Represented

N/A

None

Steve Witte, P.e., Division
Engineer For Water Division
2

OpposerAppellant

Paul Louis
Benington

CO Attorney General

E-Service

Steve Witte, P.e., Division
Engineer For Water Division
2

OpposerAppellant

Katherine Abbott
Daniels Ryan

CO Attorney General

E-Service

/s/ Stefanie Scardigno

45