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Mullinix v. Killgore's Salmon River Fruit Co.

Supreme Court of Idaho

April 1, 2015

DARYL K. and LINDA L. MULLINIX, husband and wife, Plaintiffs-Counterdefendants-Respondents,
v.
KILLGORE'S SALMON RIVER FRUIT CO., an Idaho corporation, Defendant-Counterclaimant-Appellant

2015 Opinion No. 37

Appeal from the District Court of the Second Judicial District of the State of Idaho, Idaho County. Hon. John R. Stegner, District Judge.

The district court's order that Mullinix pay an annual water delivery fee to Killgore is vacated. In all other respects, the district court's second amended final judgment is affirmed. This case is remanded for further proceedings consistent with this Opinion. Costs on appeal to Mullinix.

Sawtooth Law Offices, PLLC, Boise, attorneys for appellant. Bryce S. Farris argued.

Barker, Rosholt & Simpson, LLP, Boise and J. A. Wright, Grangeville, attorneys for respondents. Albert P. Barker argued.

W. JONES, Justice. Chief Justice BURDICK, Justices EISMANN, J. JONES and HORTON CONCUR.

OPINION

Page 287

W. JONES, Justice

I. Nature of the Case

This appeal involves Respondents Daryl and Linda Mullinix's (collectively " Mullinix" ) right to use Appellant Killgore's Salmon River Fruit Co.'s (Killgore) pipeline to convey water from Joe Creek. Both parties have water rights pursuant to partial decrees from the Snake River Basin Adjudication (SRBA) to obtain water from Joe Creek. The parties also entered into a private Settlement Agreement, which required that Mullinix's point of diversion was below Killgore's point of diversion on Joe Creek. After the parties entered into this Agreement, Mullinix filed a complaint against Killgore seeking to use Killgore's pipeline to convey water. Killgore counterclaimed. After a bench trial, the district court ordered that Mullinix could use Killgore's pipeline, but Mullinix had to install a weir below Killgore's weir to satisfy the point of diversion clause in the Agreement. The water from Mullinix's weir would then join Killgore's pipeline to reach Mullinix's property. After the district court issued its order, Killgore prevented Mullinix from obtaining an easement on the property of a nonparty to install the weir. As a result, the district court ordered that Mullinix could forgo the separate point of diversion and instead install a tap on Killgore's pipeline as it crossed Mullinix's property. Killgore appeals to this Court. We affirm in part, vacate in part, and remand.

II. Factual and Procedural Background

A. Property At Issue

In the 1960s, James and Josephine Killgore acquired property in Idaho County

Page 288

along the Salmon River known as the Horseshoe Group of placer mining claims located in Sections 23 and 24 T. 27 N., R. 01 E. About twenty acres of this property was conveyed to Mullinix through the following conveyances together with all appurtenances: (1) warranty deed from James and Josephine to Louis and Maude Weise; (2) warranty deed from Maude Weise to James and Kathryn Green and Roy and Irma Green; (3) warranty deed from Roy and Irma Green to James and Kathryn Green; (4) quitclaim deed from James and Kathryn Green to Greenco II, Inc.; and (5) warranty deed from Greenco II, Inc. to Mullinix. This parcel eventually conveyed to Mullinix is hereinafter referred to as the Killgore-Mullinix parcel.

Killgore is an Idaho corporation with its principal place of business in Idaho County. James and Josephine incorporated Killgore in 1974. In 1974 and 1997, James and Josephine quitclaimed their interests in the Horseshoe Group placer mining claims to Killgore. In 2000, 2004, and 2009, Killgore filed subdivision plats with the county. Killgore's property has been subdivided into fifty-one lots in Killgore's Horseshoe Bend Estates. Other than approximately forty-five acres, Killgore has sold lots in the subdivisions to third parties or transferred ownership to related persons.

B. History of Property's Water Rights

1. Joe Creek Water Rights

Wilber Van Wey owned a parcel of land on the Salmon River in the Horseshoe Bend area. In 1929, the Idaho Department of Water Resources (IDWR, formerly the Department of Reclamation) issued Van Wey a license for 2 cubic feet per second (cfs) of water from Joe Creek, a tributary of the Salmon River, to irrigate twenty-nine acres of land.

An open ditch conveying water from Joe Creek to Killgore's property had existed since James and Josephine purchased the property in the 1960s. The water was conveyed by the open ditch from Joe Creek to a reservoir on Killgore's property. This ditch went across the property of a nonparty Ernest and Judith Robinson and the Killgore-Mullinix parcel. This water from Joe Creek was delivered to the Killgore-Mullinix parcel for one irrigation season in 1966.

In 1966, James filed for a water right from Joe Creek. In 1972, the Robinsons granted James an exclusive easement to construct a water diversion point at Joe Creek. In 1987, Killgore piped the open ditch and buried the pipeline from its point of diversion at Joe Creek on the Robinson property to Killgore's property. The Soil Conservation Service, now the National Resources Conservation Services, provided Killgore $21,000 to pipe the ditch. Killgore did not construct the pipeline with an outlet or delivery point for the Killgore-Mullinix parcel, although the pipeline goes through the Killgore-Mullinix parcel as did the ditch. In 1988, Killgore filed a notice of claim to water right No. 79-4001 with the SRBA court to divert 2.6 cfs of water from Joe Creek to 130 acres for the beneficial use of irrigation.

2. Salmon River Water Rights

In 1966, James also applied for a water right to pump water from the Salmon River to irrigate 130 acres, including the Killgore-Mullinix parcel. In 1981, the IDWR issued James a water right license, No. 79-2094, to divert 1.5 cfs from the Salmon River for beneficial use to irrigate 130 acres.

In 1988, Killgore filed a notice of claim to water right No. 79-2094 with the SRBA court to divert 1.5 cfs of water from the Salmon River to 130 acres for the beneficial use of irrigation. In 2002, Killgore applied to transfer the point of diversion for water right No. 79-2094, which was approved by the IDWR.

3. Killgore's Horseshoe Bend Estates Water Rights

In 2007, certain lot owners of Killgore's Horseshoe Bend Estates filed applications to transfer water rights to their lots from Killgore. Killgore objected, and the IDWR did not approve the transfer. Some of these owners have irrigation agreements with Killgore, but not all of the owners receive water from Killgore's pipeline.

Page 289

C. SRBA Proceedings & Settlement Agreement

On September 10, 2007, Mullinix filed a claim for water right No. 79-2063, claiming a 1928 priority date to use 0.6 cfs of water from Joe Creek to irrigate eighteen acres of Mullinix's property. Mullinix subsequently amended this claim to 0.4 cfs for 20.1 acres. On February 6, 2008, two partial decrees were issued to Killgore: (1) water right No. 79-2094 for 1.5 cfs of water from the Salmon River to irrigate 130 acres with a priority date of 1966 and (2) water right No. 79-4001 for 2.6 cfs of water from Joe Creek to irrigate the same 130 acres with a priority date of 1965. On January 29, 2009, Mullinix was issued a partial decree for water right No. 79-2063 for 0.4 cfs of water from Joe Creek to irrigate 20.1 acres.

On June 10, 2010, the SRBA court upheld a Special Master's decision to set aside the partial decrees for water rights Nos. 79-2094, 79-4001, and 79-2063 and remanded the case for further proceedings. On March 25, 2011, Mullinix and Killgore executed a Settlement Agreement. The Agreement provided in relevant part:

1. Water Right No. 79-2063 claimed by Mullinix in the amount of 0.4 cfs for 20.1 acres diverted out of Joe Creek shall be decreed as disallowed.
2. Water Right No. 79-4001 has been administratively split into Water Right No. 79-14233 in the amount of 2.20 cfs for 110 acres in the name of Killgores and Water Right No. 79-14234 in the amount of 0.40 cfs for 20.1 acres in the name of Mullinix. . . .
3. Mullinix agrees to move the point of diversion for Water Right No. 79-14234 to a location on Joe Creek below the current diversion used by Killgores for Water Right No. 79-14233. Killgore and Mullinix shall coordinate with the [IDWR] on whether it is necessary to redescribe the point of diversion for their respective water rights within a quarter quarter-section. Neither party shall object to a change in the point of diversion of these two rights as long as the Mullinix point of diversion is below the Killgores' point of diversion.
4. Mullinix agrees not to make a call on any of Killgores' Water Right No. 79-14233 as long as Killgores are not diverting more from Joe Creek than allowed by Water Right No. 79-14233 and Idaho Law.
5. Water Right No. 79-2094 has been split by the [IDWR] into Water Right No. 79-14231 for 1.27 cfs on 110 acres owned by Killgores and into Water Right No. 79-14232 for 0.23 cfs on 20.1 acres owned by Mullinix. . . .
6. Mullinix shall move the point of diversion for Water Right No. 73-14232 downstream on the Salmon River to a point on Mullinix's property located in T 27 N, R 1E, Section 23, SENW. Killgores shall not object to this change in the point of diversion for Water Right No. 79-14232.
7. This is the complete agreement between the parties concerning the elements of the water rights at issue in these subcases and nothing in this agreement shall be construed as a determination or acknowledgement of any party's right to an easement, right-of-way or conveyance system.

On May 31, 2011, the SRBA court decreed the water rights to Mullinix and Killgore in accordance with the Agreement. The SRBA partial decrees provided that the point of diversion for Mullinix's and Killgore's water rights to Joe Creek was T27N R01E S23. In addition, the decrees provided ...


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