HomeMy WebLinkAbout2023SA258 - City, Et Al V. Lazy D Grazing Association, Et Al. - 10 - Opposers-Appellants City Of Sterling And City Of Fort Collins Joint Opening Brief
Colorado Supreme Court
2 East 14th Avenue
Denver, CO 80203
Appeal from the District Court
Water Division 1, 2020CW3113
In Re the Application for Water Rights of Lazy D Grazing
Association, in Weld County
Opposers-Appellants:
City of Sterling and City of Fort Collins
v.
Applicant-Appellee:
Lazy D Grazing Association, and
Opposers-Appellants:
Basin Lands, LLC; Bijou Irrigation Company; Bijou Irrigation
District; Cache La Poudre Water Users Association; City of
Boulder; City of Englewood; City of Greeley, acting by and
through its Water and Sewer Board; City of Thornton; L.G.
Everist, Inc.; Northern Colorado Water Conservancy District;
Mary Estabrook; State Engineer and Division Engineer for
Water Division No. 1; and United Water and Sanitation
District.
Attorneys for City of Sterling, Colorado:
Alan E. Curtis, #34571
Nicoli R. Bowley, #58709
WHITE & JANKOWSKI LLC
1333 W. 120th Ave., Suite 302
Westminster, Colorado 80234
Phone: (303) 595-9441
Email: alanc@white-jankowski.com
nicolib@white-jankowski.com
Attorney for the City of Fort Collins, Colorado:
FORT COLLINS CITY ATTORNEY’S OFFICE
Eric R. Potyondy, #38243
300 LaPorte Avenue
Fort Collins, Colorado 80521
Phone: (970) 416-2126
Email: epotyondy@fcgov.com
Supreme Court Case No.:
2023SA258
OPPOSERS-APPELLANTS CITY OF STERLING AND CITY OF FORT COLLINS’
JOINT OPENING BRIEF
Opposers-Appellants the City of Sterling and the City of Fort Collins (the
Cities) file their opening brief.
CERTIFICATE OF COMPLIANCE
The undersigned certify 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 certify:
The brief complies with C.A.R. 28(g). It contains 8,404 words, which is less
than the 9,500 word limit.
The brief complies with the standard of review and preservation requirements
set forth in C.A.R. 28(a)(7)(A). It contains under a separate heading before the
discussion of the issue, a concise statement: (1) of the applicable standard of
appellate review with citation to authority; and (2) whether the issue was preserved,
and, if preserved, the precise location in the record where the issue was raised and
where the court ruled, not to an entire document.
The undersigned acknowledge that the brief may be stricken if it fails to
comply with any of the requirements of C.A.R. 28 and C.A.R. 32.
WHITE & JANKOWSKI LLC
By: ______________________________
*Alan E. Curtis, #34571
Nicoli R. Bowley, #58709
ATTORNEYS FOR CITY OF
STERLING
FORT COLLINS CITY
ATTORNEY’S OFFICE
By: ______________________________
Eric R. Potyondy, #38243
ATTORNEY FOR CITY OF FORT
COLLINS
i
TABLE OF CONTENTS
ISSUES PRESENTED ON APPEAL ..................................................................... 1
STATEMENT OF THE CASE ............................................................................... 2
1. Nature of the Case. .............................................................................................. 2
2. Relevant Facts and Procedural History. ........................................................... 3
3. Ruling, Judgment, or Order Presented for Review. ........................................ 4
SUMMARY OF ARGUMENT ............................................................................... 4
ARGUMENT ............................................................................................................ 5
1. The Water Court Erred in Ruling Subsection 305(6)(b) Gives the State
Engineer Authority to Determine Groundwater Is Nontributary. ..................... 5
a. Standard of Review. ........................................................................................... 5
b. The Water Court Had Exclusive Jurisdiction Over Lazy D’s Nontributary
Claim. ...................................................................................................................... 5
c. Colorado Statutes Must Provide Express Authority for the State Engineer to
Make Nontributary Determinations. ....................................................................... 6
d. Subsection 305(6)(b) Does Not Authorize the State Engineer to Make
Nontributary Determinations. ................................................................................. 7
e. Allowing the State Engineer to Issue Legal Conclusions Regarding
Nontributariness Under Subsection 305(6)(b) Violates Due Process . ................... 9
f. The State Engineer’s Determination of Facts Exceeds His Statutory Authority .
..............................................................................................................................13
g. The Water Court Erred by Relying on the State Engineer’s Erroneous
Interpretation of Subsection 305(6)(b). ................................................................14
2. The Water Court Erred in Shifting the Burden of Proof from Lazy D
Having to Prove Its Nontributary Claim to the Cities Having to Prove the
Subject Groundwater Is Tributary. .....................................................................15
a. Standard of Review. .........................................................................................15
b. Lazy D Had the Exclusive Burden to Prove Its Nontributary Claim by Clear
and Convincing Evidence. ....................................................................................15
ii
i. Standard of Proof: Nontributary Groundwater . ...........................................16
ii. Burden of Proof: Clear and Convincing Evidence. .....................................17
c. Subsection 305(6)(b) Only Authorizes the State Engineer to Make Limited
Factual Findings. ..................................................................................................18
d. Evidence on the Relevant Facts Rebuts the State Engineer’s Factual Findings
Under Subsection 305(6)(b). ................................................................................19
e. The Water Court Erred in Analyzing the Issue to be Resolved at Trial . .........21
3. The Water Court Erred by Applying the Wrong Standard to the Cities’
Rebuttal of the State Engineer’s Determination of Facts. .................................23
4. The Water Court Erred by Speculating and Relying on Personal
Knowledge and Information Not in Evidence. ....................................................28
a. Standard of Review. .........................................................................................28
b. Only Admitted Evidence Can Be Relied on by the Water Court. ...................28
c. The Water Court Erred by Relying on Information Not in Evidence . ............31
5. The Water Court’s Determination the Subject Groundwater Is
Nontributary Was Based on Faulty Legal Premises and Is Erroneous. ...........34
a. Standard of Review. .........................................................................................34
b. The Court Must Issue Specific Findings Regarding Reliability of Expert
Testimony. ............................................................................................................35
c. By Applying the Wrong Legal Standards and Relying on Information Outside
the Record, the Water Court’s Findings Are Erroneous . .....................................37
d. The Water Court’s Errors Will Affect Other Water Cases and Nontributary
Claims, Including Those Currently Pending Before the Water Court. ................38
CONCLUSION .......................................................................................................39
iii
TABLE OF AUTHORITIES
Cases
Am. Water Dev., Inc. v. City of Alamosa, 874 P.2d 352 (Colo. 1994) ....................16
Anderson v. Lett, 374 P.2d 355 (Colo. 1962). .........................................................30
Bd. of Cty, Comm’rs of County of Arapahoe v. Crystal Creek Homeowners’ Ass’n,
14 P.3d 325 (Colo. 2000) .....................................................................................38
Budget Rent-A-Car Corp. v. Martin, 855 P.2d 1377 (Colo. 1993) .........................35
Chatfield E. Well Co. v. Chatfield E. Prop. Owners Ass’n , 956 P.2d 1260 (Colo.
1998) .....................................................................................................................34
City & Cty. of Broomfield v. Farmers Reservoir & Irrigation Co., 239 P.3d 1270
(Colo. 2010) ............................................................................................................ 6
City & Cty. of Denver v. Eggert, 647 P.2d 216 (Colo. 1982). .......................... 29, 34
City of Aurora ex rel. Util. Enter. v. Simpson, 105 P.3d 595 (Colo. 2005) 13, 35, 36
City of Englewood v. Burlington Ditch, Reservoir & Land Co., 235 P.3d 1061
(Colo. 2010) ............................................................................................... 5, 28, 34
Colo. Ground Water Comm’n v. N. Kiowa-Bijou Groundwater Mgmt. Dist., 77
P.3d 62 (Colo. 2003).........................................................................................2, 15
Colo. Water Conservation Bd. v. City of Central, 125 P.3d 424 (Colo. 2005) ......... 7
Colo. Water Conservation Bd. v. Upper Gunnison River Water Conservancy Dist.,
109 P.3d 585 (Colo. 2005) ................................................................ 20, 21, 25, 27
Consol. Home Supply Ditch & Reservoir Co. v. Town of Berthoud , 896 P.2d 260
(Colo. 1995) ..........................................................................................................35
Cornelius v. River Ridge Ranch Landowners Ass’n , 202 P.3d 564 (Colo. 2009) ..... 6
Dahman v. Ford Leasing Dev. Co., 492 P.2d 875 (Colo. App. 1971) ....................18
Danielson v. Castle Meadows, Inc., 791 P.2d 1106 (Colo. 1990) ............................. 7
E. Cherry Creek Valley Water & Sanitation Dist. v. Greeley Irrigation Co., 348
P.3d 434 (Colo. 2015) ............................................................................................ 6
El Paso Cty. Bd. of Equalization v. Craddock, 850 P.2d 702 (Colo. 1993) ..... 14, 15
Empire Lodge Homeowners’ Ass’n v. Moyer, 39 P.3d 1139 (Colo. 2001) ...... 6, 7, 9
Freedom Colo. Info., Inc. v. El Paso Cty. Sheriff’s Dep’t , 196 P.3d 892 (Colo.
2008) .....................................................................................................................24
Front Range Feedlots, LLC v. Rein, 528 P.3d 494 (Colo. 2023) ............................35
Gerner v. Sullivan, 768 P.2d 701 (Colo. 1989) .......................................................18
Giffen v. State, City & Cty. of Denver Acting By & Through Bd. of Water
Comm’rs, 690 P.2d 1244 (Colo. 1984) ................................................................17
Huddleston v. Bd. of Equalization of Montezuma Cty., 31 P.3d 155 (Colo. 2001) 13,
14
iv
Humphrey v. Sw. Dev. Co., 734 P.2d 637 (Colo. 1987) ..........................................38
In re Water Rights of Double RL Co., 54 P.3d 908 (Colo. 2002) ............................10
Krueger v. Ary, 205 P.3d 1150 (Colo. 2009) ...........................................................19
La Jara Creamery & Live Stock Ass’n v. Hansen, 83 P. 644 (Colo. 1905) ............17
Lowder v. Tina Marie Homes, Inc., 601 P.2d 657 (Colo. App. 1979) ....................29
Masters v. People, 58 P.3d 979, 988 (Colo. 2002) ..................................................35
Monte Vista Canal Co. v. Centennial Irrigating Ditch Co., 135 P. 981 (Colo. 1913)
..............................................................................................................................29
Navajo Dev. Co., Inc. v. Sanderson, 655 P.2d 1374 (Colo. 1982) ..........................10
Pagosa Area Water & Sanitation Dist. v. Trout Unlimited, 170 P.3d 307 (Colo.
2007) .............................................................................................................. 28, 34
People v. G.H. Hard Land Co., 117 P. 141 (Colo. 1911) ........................................29
People v. King, 16 P.3d 807 (Colo. 2001) ...............................................................24
People v. Shreck, 22 P.3d 68 (Colo. 2001) ....................................................... 35, 36
People v. Taylor, 618 P.2d 1127 (Colo. 1980) ........................................................17
Platte Valley Irrigation Co. v. Buckers Irrigation, Milling & Improvement Co., 53
P. 334 (Colo. 1898)...............................................................................................17
Prestige Homes, Inc. v. Legouffe, 658 P.2d 850 (Colo. 1983) ......................... 30, 31
Safranek v. Town of Limon, 228 P.2d 975 (Colo. 1951) .................................. 15, 18
Santa Fe Trail Ranches Prop. Owners Ass’n v. Simpson, 990 P.2d 46 (Colo. 1999)
................................................................................................................................ 6
Sierra Mining Co. v. Lucero, 194 P.2d 302 (Colo. 1948) ................................ 29, 30
Simpson v. Bijou Irrigation Co., 69 P.3d 50 (Colo. 2003) ..................................7, 15
State Farm Mut. Auto. Ins. Co. v. Johnson, 396 P.3d 651 (Colo. 2017) .................35
Stonewall Estates, v. CF&I Steel Corp., 592 P.2d 1318 (Colo. 1979) ............. 13, 18
Tivolino Teller House, Inc. v. Fagan, 926 P.2d 1208 (Colo. 1996) ........................14
Todd v. Bear Valley Vill. Apartments, 980 P.2d 973 (Colo. 1999) .........................10
Wolfe v. Jim Hutton Educ. Found., 344 P.3d 855, 859 (Colo. 2015) ........... 5, 19, 35
Statutes
C.R.S. § 37-82-101(2) ..............................................................................................16
C.R.S. § 37-90-103(10.5) .................................................................................. 16, 22
C.R.S. § 37-90-137 .................................................................................................... 8
C.R.S. § 37-90-137(2)(b)(I)(A) ................................................................................. 8
C.R.S. § 37-90-137(4) ............................................................................................7, 8
C.R.S. § 37-92-102(1)(b) .........................................................................................16
C.R.S. § 37-92-103(11) ............................................................................................16
C.R.S. § 37-92-103(12) ............................................................................................19
v
C.R.S. § 37-92-203(1) ..........................................................................................6, 19
C.R.S. § 37-92-302(2)(a) ........................................................................................... 8
C.R.S. § 37-92-305(6)(b) ................................................................................. passim
Other Authorities
COLO. CONST. art. XVI, §§ 5-6 .................................................................................. 2
Rules
C.R.C.P. 26(a)(2) .................................................................................................9, 10
C.R.C.P. 81(a) ............................................................................................................ 6
C.R.E. 201 ................................................................................................................29
C.R.E. 301 ......................................................................................................... 19, 20
1
ISSUES PRESENTED ON APPEAL
1. Whether the District Court for Water Division 1 (Water Court) erred in ruling
C.R.S. § 37-92-305(6)(b) (Subsection 305(6)(b)) gives the Colorado State
Engineer (State Engineer) authority to determine groundwater is nontributary.
2. Whether the Water Court, based on its interpretation and application of
Subsection 305(6)(b), erred in ruling the burden of proof shifted from Applicant-
Appellee Lazy D Grazing Association (Lazy D) having to prove its nontributary
claims by clear and convincing evidence to the Cities having to prove the
groundwater at issue (Subject Groundwater) is tributary.
3. Whether the Water Court, based on its interpretation and application of
Subsection 305(6)(b), erred in the standard it applied to the Cities’ rebuttal of the
State Engineer’s Determination of Facts, dated March 31, 2021 (State Engineer’s
Determination of Facts).
4. Whether the Water Court erred by speculating and relying on personal knowledge
and information not in evidence.
5. Whether the Water Court determined the Subject Groundwater is nontributary
based on faulty legal premises, inappropriate weight accorded to expert testimony
and evidence, and is manifestly erroneous.
2
STATEMENT OF THE CASE
1. Nature of the Case.
In a water court proceeding, determination of whether groundwater is
nontributary is a water matter under the sole jurisdiction of the water court. This is
a significant issue because a nontributary determination permanently removes the
subject water from the constitutional priority system and as a supply for other water
users. See generally COLO. CONST. art. XVI, §§ 5-6.
Lazy D sought a nontributary determination for the Subject Groundwater
comprising nearly two million acre-feet of Upper Laramie Aquifer groundwater
underlying over 24,000 acres of land, asserting the Subject Groundwater is
hydraulically disconnected from all natural streams, including their underflow and
tributary waters (Nontributary Claim). See Court File (CF) 4-13; 98-107; 2819;
2760. Approval of Lazy D’s Nontributary Claim would remove this massive amount
of water from the constitutional priority system and as a supply for other water users.
See generally COLO. CONST. art. XVI, §§ 5-6.
At trial, Lazy D was required to overcome Colorado’s long -standing
presumption that all groundwater is tributary by providing clear and convincing
evidence supporting its Nontributary Claim. E.g., Colo. Ground Water Comm’n v.
N. Kiowa-Bijou Groundwater Mgmt. Dist., 77 P.3d 62, 70 (Colo. 2003).
3
Factual findings by the State Engineer under Subsection 305(6)(b) regarding
permits to construct wells and the amount of available groundwater are presumed to
be true unless rebutted. However, Lazy D had the sole burden to provide clear and
convincing evidence supporting its Nontributary Claim. No reported cases address
the interpretation and application of Subsection 305(6)(b).
2. Relevant Facts and Procedural History.
Lazy D’s Nontributary Claim was filed with the Water Court on July 31, 2020,
and amended November 30, 2020. CF 4-13; 98-107. The Cities, State Engineer, and
others filed statements of opposition. CF 14-18; 23-27; 65-69.
Prior to trial, the State Engineer stipulated to a proposed decree granting Lazy
D’s Nontributary Claim. CF 483-510; 518-535. The State Engineer did not provide
expert disclosures and, other than a brief opening statement by counsel, did not
participate at trial.
A five-day trial to the Water Court was held April 10-12 and 24-25, 2023. The
Cities presented a joint case at trial, including expert testimony. See generally CF
1292-2753. Certified trial transcripts were completed after trial and filed with the
Water Court. Citations below include both the CF page number and, where
applicable, a transcript (TR) citation.
4
3. Ruling, Judgment, or Order Presented for Review.
Following trial, the Water Court entered its Findings of Fact and Conclusions
of Law (Order) on August 18, 2023 (CF 2754-2786) and Findings of Fact,
Conclusions of Law, and Decree of the Water Court (Decree) on September 6, 2023
(CF 2816-2830). The Cities appeal certain rulings in the Order and Decree.
SUMMARY OF ARGUMENT
As discussed above, determination of whether groundwater is nontributary in
a water court proceeding is under the water court’s exclusive jurisdiction, and a party
claiming groundwater is nontributary has the exclusive burden to prove the
groundwater is nontributary by clear and convincing evidence. This burden does not
change based on findings of fact submitted by the State Engineer under Subsection
305(6)(b).
The Water Court misinterpreted and misapplied Subsection 305(6)(b),
determining the unauthorized legal determination in the State Engineer’s
Determination of Facts that the Subject Groundwater was nontributary must be
rebutted by the Cities.
In doing so, the Water Court: (a) ceded its exclusive jurisdiction to determine
whether groundwater is nontributary to the State Engineer; and (b) unlawfully
required the Cities to prove the groundwater at issue was tributary. These errors and
5
the Water Court’s analysis shifted the burden of proof from Lazy D to the Cities,
contrary to Colorado law.
The Water Court’s misinterpretation and misapplication of Subsection
305(6)(b), combined with erroneous reliance on information not in evidence,
resulted in an erroneous approval of Lazy D’s Nontributary Claims and established
a legal standard in Water Division 1 that is contrary to Colorado law. These legal
errors will impact other nontributary claims pending before the Water Court.
ARGUMENT
1. The Water Court Erred in Ruling Subsection 305(6)(b) Gives the State
Engineer Authority to Determine Groundwater Is Nontributary.
a. Standard of Review.
This Court reviews “questions of water law and ‘the water court’s legal
conclusions de novo.’” Wolfe v. Jim Hutton Educ. Found., 344 P.3d 855, 859 (Colo.
2015) (citing City of Englewood v. Burlington Ditch, Reservoir & Land Co., 235
P.3d 1061, 1066 (Colo. 2010)). “The water court errs when it misconstrues and
misapplies the law.” Id.
b. The Water Court Had Exclusive Jurisdiction Over Lazy D’s Nontributary
Claim.
“Water judge[s] have exclusive jurisdiction of water matters . . . . Water
matters include determinations of rights to nontributary groundwater outside of
6
designated groundwater basins.” C.R.S. § 37-92-203(1). Water matters are special
statutory proceedings governed by the water court rules and statutes. See E. Cherry
Creek Valley Water & Sanitation Dist. v. Greeley Irrigation Co., 348 P.3d 434, 440
n.5 (Colo. 2015) (citing C.R.C.P. 81(a)); City & Cty. of Broomfield v. Farmers
Reservoir & Irrigation Co., 239 P.3d 1270, 1275 n.4 (Colo. 2010) (citing C.R.C.P.
81(a) and Cornelius v. River Ridge Ranch Landowners Ass’n, 202 P.3d 564, 569
(Colo. 2009)).
c. Colorado Statutes Must Provide Express Authority for the State Engineer to
Make Nontributary Determinations.
This Court has confirmed the State Engineer’s authority stems from the
Legislature, and “when the General Assembly so intends, the statutory language
creating such authority appears expressly.” Empire Lodge Homeowners’ Ass’n v.
Moyer, 39 P.3d 1139, 1154 (Colo. 2001) (emphasis added). “It is the role of the
General Assembly, not the State Engineer or the courts, to provide amendments to
the current statutes if additional State Engineer administrative authority is
desirable.” Id. at 1153 n.17. “Our state legislature and courts, however, have never
accepted the proposition that water officials may determine the water rights of
citizens . . . .” Santa Fe Trail Ranches Prop. Owners Ass’n v. Simpson , 990 P.2d 46,
58 (Colo. 1999).
7
d. Subsection 305(6)(b) Does Not Authorize the State Engineer to Make
Nontributary Determinations.
This Court’s “fundamental responsibility in interpreting a statute is to give
effect to the General Assembly’s purpose and intent in enacting the statute.” Empire
Lodge, 39 P.3d at 1152. “To determine legislative intent, ‘we look first to the
language of the statute and apply its plain and ordinary meaning, if possible.’” Colo.
Water Conservation Bd. v. City of Central, 125 P.3d 424, 434 (Colo. 2005) (citation
omitted).
“If the legislative intent is clear from the plain language of the statute, the
courts must give effect to the statute according to its plain language.” Danielson v.
Castle Meadows, Inc., 791 P.2d 1106, 1111 (Colo. 1990). If several interrelated
statutes are involved, the court “must endeavor to give consistent, harmonious, and
sensible effect to the statutory scheme as a whole.” Simpson v. Bijou Irrigation Co.,
69 P.3d 50, 59 (Colo. 2003).
Subsection 305(6)(b) states:
In the case of wells described in section 37-90-137(4), the referee or
water judge shall consider the state engineer’s determination as to
such groundwater as described in section 37-92-302(2) in lieu of
findings made pursuant to section 37 -90-137, and shall require
evidence of compliance with the provisions of section 37-92-302(2)
regarding notice to persons with recorded interests in the overlying
land. The state engineer’s findings of fact contained within such
8
determination shall be presumptive as to such facts, subject to
rebuttal by any party.
C.R.S. § 37-92-305(6)(b).
Subsection 305(6)(b) relates to State Engineer determinations under C.R.S. §
37-92-302(2) which are made in lieu of findings made pursuant to C.R.S. § 37 -90-
137. C.R.S. § 37-92-302(2)(a) primarily concerns notice to landowners and, for
applications for determinations of rights to groundwater from wells described in
C.R.S. § 37-90-137(4), references the State Engineer’s determination “as to the facts
of such application.” C.R.S. § 37-90-137 governs procedures to obtain permits to
construct wells outside designated groundwater basins and provides new wells are
subject to initial approval by the State Engineer through an application and permit
process.
Under C.R.S. § 37-90-137, the State Engineer is authorized to issue well
permits if “there is unappropriated water available for withdrawal by the proposed
well and that the vested water rights of others will not be materially injured.” C.R.S.
§ 37-90-137(2)(b)(I)(A). This requires the Water Court to consider factual findings
under Subsection 305(6)(b) “in lieu of findings made pursuant to” C.R.S. § 37 -90-
137(4), concerning permits to construct wells and the amount of groundwater
available.
9
None of these statutes expressly authorize the State Engineer to make the legal
determination reserved exclusively to the Water Court that the Subject Groundwater
meets the nontributary standard of C.R.S. § 37-90-103(10.5) by clear and convincing
evidence. See Empire Lodge, 39 P.3d at 1153 n.17 and 1154. Despite this, the State
Engineer’s Determination of Facts purported to make legal conclusions regarding
whether the Subject Groundwater is nontributary. CF 145-152 (State Engineer’s
Determination of Facts).
e. Allowing the State Engineer to Issue Legal Conclusions Regarding
Nontributariness Under Subsection 305(6)(b) Violates Due Process .
The State Engineer’s Determination of Facts was filed on March 31, 2021,
approximately four months after the amended application was filed and before
Lazy D circulated engineering reports to the Cities and other parties on April 30,
2021. CF 131; 145-152. The State Engineer’s Determination of Facts was not
disclosed under Colorado Rules of Civil Procedure (C.R.C.P.) Rule 26(a)(2) and
Rule 11 of the Uniform Local Rules for All State Water Court Divisions (Water
Court Rules). See CF 312-317; 359-364; 367. This resulted in no opportunity for the
Cities or other parties to provide comments or opinions addressing the analyses in
the State Engineer’s Determination of Facts.
The State Engineer’s Determination of Facts was based on version 2 of
Lazy D’s expert report submitted in this case , which was subsequently superseded
10
by version 6 of the same report provided with Lazy D’s initial expert disclosures .
CF 2029-2030, TR 4/12/23, 71:18-72:12.
The C.R.C.P. and the Water Court Rules contain detailed requirements
ensuring all expert opinions and supporting information are disclosed to
participating parties so they can adequately prepare for trial . See, e.g., C.R.C.P.
26(a)(2); Water Court Rule 11. These procedures and protections make sense
considering the importance of water in our arid state and water rights as property
rights. See In re Water Rights of Double RL Co., 54 P.3d 908, 912 (Colo. 2002);
Navajo Dev. Co., Inc. v. Sanderson, 655 P.2d 1374, 1377 (Colo. 1982). This Court
has anticipated:
that cases may arise in which a party fails to make the expert witness
disclosures required by Rule 26, lacks substantial justification for such
failure, and yet seeks to be allowed to present such witnesses at trial.
When these circumstances arise close to the trial date, it is likely that
the failure to disclose will cause prejudice to the opposing party.
Todd v. Bear Valley Vill. Apartments, 980 P.2d 973, 979 (Colo. 1999).
In this case, the State Engineer’s Determination of Facts was not properly
disclosed, the State Engineer presented no expert witness to be examined or cross -
examined, and the State Engineer’s counsel raised issues regarding the purported
presumptive effect of the State Engineer’s Determination of Facts on the first day of
trial:
11
So the initial determination of fact that the state engineer does . . . is the
state engineer satisfied that the water’s nontributary. If he doesn’t make
that determination of fact . . . the tributary presumption continues.
CF 1308, TR 4/10/23, 17:9-15.
But we do think the presumption of nontributariness made in that
determination of facts is presumptive on the Court.
Id. at 1309, 18:1-3.
[Y]ou can consider all the evidence and decide whether the
presumption has been rebutted . . . .
Id. at 1311, 20:16-18.
Lazy D argued in connection with the Cities’ C.R.C.P 41(b) Motion that the
Cities “have the burden of moving forward with evidence to rebut the state
engineer’s finding which support of nontributary determination. If the Opposers fail
to rebut the findings, then the facts are taken as true and are sufficient to satisfy the
Applicant’s burden.” CF 2145-2146, TR 4/12/23, 187:20-188:1. The Water Court
agreed:
Now, the state engineer went on to say that the groundwater is
nontributary . . . . But the finding of fact is that the water at issue here
will not cause a depletion of the flow of the natural stream at a great
greater than one-tenth of one percent of the annual rate of withdrawal.
And once that determination is in the record under 37-92-305
subsection (6)(b), I agree . . . that is sufficient to trigger the presumption
and to shift the burden to the Opposers to rebut that finding of fact.
CF 2157, TR 4/12/23, 199:12-24.
12
In denying the Cities’ C.R.C.P 41(b) Motion the Water Court ruled: “the
standard on a motion to dismiss . . . is whether judgment in favor of the defendants
. . . is justified on the evidence presented. And based on the state engineer’s
determination alone is not.” CF 2160, TR 4/12/23, 202:10-15.
On the final day of trial, the Water Court suggested the effect of the State
Engineer’s Determination of Facts was that the Cities should have been treated as
the proponent of a tributary claim: “I didn’t proceed this way, but we could have had
Sterling and Fort Collins go first and then have the applicant go, and then we would
be in rebuttal case. That’s not how we did things.” CF 2685, TR 4/25/23, 130:5-8.
See also CF 2761 (Order at 8) (emphasis added) (stating the Cities did not prove the
Subject Groundwater was tributary):
the opposers’ expert . . . opines that a hydraulic connection exists
between the Upper Laramie Aquifer and the nearby surface alluvial
systems [but] did not quantify this hydraulic connection . . . such that
withdrawals will cause depletions of more than an annual rate greater
than one-tenth of one percent of the annual rate of withdrawal.
The Water Court’s conclusion that Subsection 305(6)(b) authorizes the State
Engineer to make nontributary determinations subject to rebuttal is both contrary to
the statutes and case law discussed above and was prejudicial to the Cities . This is a
particular concern where water is determined to be nontributary and permanently
13
removed from the constitutional priority system and as a source of supply for other
water users.
“If one assumes that water judicially declared to be non -tributary is in fact
tributary, the effect upon earlier decreed tributary priorities can be marked, if not
devastating.” Stonewall Estates, v. CF&I Steel Corp., 592 P.2d 1318, 1320 (Colo.
1979). “Where surface water is overappropriated [including the South Platte River
Basin], Colorado law presumes that groundwater depletions through well -pumping
result in injury to senior appropriators absent a showing to the contrary.” City of
Aurora ex rel. Util. Enter. v. Simpson, 105 P.3d 595, 607 (Colo. 2005).
f. The State Engineer’s Determination of Facts Exceeds His Statutory Authority.
The State Engineer’s Determination of Facts was not limited to findings “in
lieu of findings made pursuant to section 37-90-137,” as required by Subsection
305(6)(b). Instead, the State Engineer’s Determination of Facts purported to make
legal conclusions regarding whether the Subject Groundwater is nontributary. CF
145-152.
As discussed above, the State Engineer has no authority to make these legal
determinations, which is reserved exclusively to the water court. See CF 1127-1128
(the Cities’ Trial Brief at 13-14). See generally Huddleston v. Bd. of Equalization of
Montezuma Cty., 31 P.3d 155, 160 (Colo. 2001) (courts are not bound by an agency’s
14
interpretation of statutes when they are misconstrued or misapplied); El Paso Cty.
Bd. of Equalization v. Craddock, 850 P.2d 702, 704-05 (Colo. 1993) (“Courts, of
course, must interpret the law and are not bound by an agency decision that
misapplies or misconstrues the law.”).
The State Engineer’s Determination of Facts was also not limited to “in lieu
of findings made pursuant to section 37-90-137,” as required by Subsection
305(6)(b). For instance, the State Engineer’s Determination of Facts includes a
discussion of the City of Fort Collins’ water rights and the asserted sources of water
for them. CF 148-149 (State Engineer’s Determination of Facts ¶ 6).
The State Engineer’s Determination of Facts also purported to make the
ultimate legal determination of whether the Subject Groundwater is nontributary. CF
149 (State Engineer’s Determination of Facts ¶ 7). The State Engineer has no
authority to make such factual findings and legal determinations about the legal
classification of the Subject Groundwater.
g. The Water Court Erred by Relying on the State Engineer’s Erroneous
Interpretation of Subsection 305(6)(b).
Courts are not bound by an agency’s interpretation of statutes when they are
misconstrued or misapplied. See Huddleston, 31 P.3d at 160; Tivolino Teller House,
Inc. v. Fagan, 926 P.2d 1208, 1215 (Colo. 1996). “Courts, of course, must interpret
15
the law and are not bound by an agency decision that misapplies or misconstrues the
law.” El Paso Cty. Bd. of Equalization, 850 P.2d at 704-05.
As discussed above, Subsection 305(6)(b) does not authorize the State
Engineer to make nontributary determinations. Despite this, the Water Court relied
on Lazy D’s and the State Engineer’s arguments Subsection 305(6)(b) provides this
authority. CF 1127-1128 (the Cities’ Trial Brief at 13-14); CF 2157, TR 4/12/23,
199:12-24; CF 2768 (Order at 15); CF 2784-2785 (Order at 31-32); CF 2818 (Decree
¶ 8). As discussed below, the Water Court’s erroneous acceptance of these
arguments resulted in further legal error.
2. The Water Court Erred in Shifting the Burden of Proof from Lazy D Having
to Prove Its Nontributary Claim to the Cities Having to Prove the Subject
Groundwater Is Tributary.
a. Standard of Review.
See Section 1.a. above.
b. Lazy D Had the Exclusive Burden to Prove Its Nontributary Claim by Clear
and Convincing Evidence.
“All ground water in Colorado . . . is presumed to be tributary absent clear and
convincing evidence to the contrary.” Colo. Ground Water Comm’n., 77 P.3d at 70.
See, e.g., Simpson, 69 P.3d at 59 n.7; Safranek v. Town of Limon, 228 P.2d 975, 977
(Colo. 1951).
16
i. Standard of Proof: Nontributary Groundwater .
C.R.S. § 37-90-103(10.5) defines nontributary groundwater as:
groundwater, located outside the boundaries of any designated
groundwater basins in existence on January 1, 1985, the
withdrawal of which will not, within one hundred years of
continuous withdrawal, deplete the flow of a natural stream,
including a natural stream as defined in sections 37-82-101(2)
and 37-92-102(1)(b), at an annual rate greater than one -tenth of
one percent of the annual rate of withdrawal.
For purposes of determining whether groundwater is nontributary, the “flow
of a natural stream,” includes both the surface flow of streams and the underflow
and tributary waters of natural streams described in C.R.S. §§ 37-82-101(2) and 37-
92-102(1)(b). Am. Water Dev., Inc. v. City of Alamosa, 874 P.2d 352, 371-72 (Colo.
1994).
“Underground water” . . . for the purpose of defining the waters of a
natural stream, means that water in the unconsolidated alluvial aquifer
of sand, gravel, and other sedimentary materials and all other waters
hydraulically connected thereto which can influence the rate or
direction of movement of the water in that alluvial aquifer or natural
stream.
C.R.S. § 11)
Under Colorado law, natural streams include perennial, ephemeral, and
intermittent natural streams and their underflow and tributary waters. C.R.S. §§ 37 -
82-101(2), 37-92-102(1)(b), 37-92-103(11). “Those acquainted with the arid region
know that some of the most important and well -defined streams become almost, and
17
sometimes entirely, dry during a portion of the year . . . .” Platte Valley Irrigation
Co. v. Buckers Irrigation, Milling & Improvement Co., 53 P. 334, 336 (Colo. 1898).
This Court has recognized the “well-known fact that some streams in this
state, after running for less or greater distances on the surface, sink, and by a well -
defined subterranean channel flow for a number of miles, and then come to the
surface again.” La Jara Creamery & Live Stock Ass’n v. Hansen, 83 P. 644, 645
(Colo. 1905) (citation omitted). For this reason, water and precipitation intercepted
before reaching an aquifer are part of and tributary to the natural stream. See Giffen
v. State, City & Cty. of Denver Acting By & Through Bd. of Water Comm’rs, 690
P.2d 1244, 1247 (Colo. 1984).
For all the foregoing reasons, the Water Court was required to consider all
natural streams that may be affected, including ephemeral and intermittent streams
and their underflow and tributary waters, in connection with Lazy D’s Nontributary
Claim.
ii. Burden of Proof: Clear and Convincing Evidence.
“Proof by ‘clear and convincing evidence’ is proof which persuades the trier
of fact that the truth of the contention is ‘highly probable.’ It is evidence which is
stronger than a ‘preponderance of the evidence.’” People v. Taylor, 618 P.2d 1127,
1136 (Colo. 1980) (citations omitted). Colorado courts have defined “‘clear and
18
convincing evidence’ as being ‘evidence which is stronger than a preponderance of
the evidence and which is unmistakable and free from serious or substantial doubt.’”
Dahman v. Ford Leasing Dev. Co., 492 P.2d 875, 877 (Colo. App. 1971).
The burden of proof on a party claiming that certain groundwater is
nontributary has also been described as clear and satisfactory evidence :
Under our Colorado law, it is the presumption that all ground water. . .
finds its way to the stream in the watershed of which it lies, is tributary
thereto, and subject to appropriation as part of the waters of the stream.
. . . The burden of proof is on one asserting that such ground water is
not so tributary, to prove that fact by clear and satisfactory evidence.
Stonewall Estates, 592 P.2d at 1320 (emphasis added) (quoting Safranek, 228 P.2d
at 977).
Both the “clear and convincing” and “clear and satisfactory” burdens of proof
are more stringent than a “preponderance of the evidence” burden of proof. See
Gerner v. Sullivan, 768 P.2d 701, 703 (Colo. 1989). At trial, Lazy D had the
exclusive burden of proving its Nontributary Claim based on evidence unmistakable
and free from serious or substantial doubt. See Dahman, 492 P.2d at 877.
c. Subsection 305(6)(b) Only Authorizes the State Engineer to Make Limited
Factual Findings.
As discussed above, the State Engineer is only authorized under Subsection
305(6)(b) to make limited factual findings regarding well permitting and the amount
of groundwater that are presumptive but subject to rebuttal. Further, any purported
19
legal conclusions in the State Engineer’s Determination of Facts are not authorized
by Subsection 305(6)(b) or any other statute and were to be made under the exclusive
jurisdiction of the Water Court without any deference to the State Engineer. C.R.S.
§§ 37-92-103(12), -203(1).
d. Evidence on the Relevant Facts Rebuts the State Engineer’s Factual Findings
Under Subsection 305(6)(b).
When there are presumptive facts regarding well permitting and the amount
of groundwater appropriately established pursuant to Subsection 305(6)(b), there is
an initial burden of going forward with the evidence to rebut th ose presumed facts.
See generally Colorado Rule of Evidence (C.R.E.) 301. Once the initial burden of
going forward with the evidence is met, any associated presumptions “do not
continue in the case.” Krueger v. Ary, 205 P.3d 1150, 1158 (Colo. 2009).
Lazy D argued the standard for rebutting these presumptions should be similar
to cases involving abandonment of water rights under C.R.S. § 37 -92-402(11). See
CF 1261-1262 (citing Wolfe, 344 P.3d 855); 2146. In those abandonment cases, once
there is a presumption under C.R.S. § 37-92-402(11) a water right has been
abandoned, the burden of moving forward shifts to the water right holder to show an
intent to not abandon. Wolfe, 344 P.3d at 859.
As discussed in Section 1.e. above, the Water Court applied this same logic to
the State Engineer’s Determination of Facts, erroneously concluding Subsection
20
305(6)(b) allows the State Engineer to determine groundwater is nontributary,
subject to rebuttal, which then required the Cities to prove the Subject Groundwater
was tributary.
As a result, the Water Court erred by requiring the Cities to prove what is
already presumed under Colorado law: that the Subject Groundwater is tributary.
See Section 1.e. above. Based on an erroneous interpretation of Subsection
305(6)(b), the Water Court treated the Cities as the proponent of a tributary claim
with the burden of proof on that issue in violation of C.R.E. 301, which states:
[A] presumption imposes upon the party against whom it is directed the
burden of going forward with evidence to rebut or meet the
presumption, but does not shift to such party the burden of proof in the
sense of the risk of non-persuasion, which remains throughout the trial
upon the party on whom it was originally cast .
C.R.E. 301 (emphasis added). The Water Court’s ruling cannot be correct because it
means that the Cities’ burden of moving forward with the evidence would be greater
than their ultimate burden in this case.
The applicable standard is the initial burden of going forward with evidence
is met if any party presents evidence on the relevant facts identified by the statute.
Colo. Water Conservation Bd. v. Upper Gunnison River Water Conservancy Dist.
(CWCB), 109 P.3d 585, 596-97 (Colo. 2005). See CF 1271-1272 (the Cities’
21
proposed findings at 7-8). Unlike the Water Court’s ruling, this standard avoids
shifting the ultimate burden of proof from the applicant to opposing parties.
In CWCB, this Court considered the presumptive factual findings of another
state water agency (the Colorado Water Conservation Board) and how such facts
may be rebutted. After considering the applicable statute and C.R.E. 301, this Court
concluded:
if no party presents any evidence to the water court on the statutory
factors, then the water court must presume the CWCB’s findings on
those factors correct. However, should any party present evidence on
the statutory factors, the presumptive effect of the CWCB’s findings
has been rebutted, and the water court must then weigh the evidence
before it.
CWCB, 109 P.3d at 596 (emphasis added).
e. The Water Court Erred in Analyzing the Issue to be Resolved at Trial.
The Water Court misstated the issue at trial as “the extent to which well
withdrawals on the Lazy D Ranch of groundwater from the Upper Laramie Aquifer
will affect surface stream flow.” CF 2760 (Order at 7). See also CF 2781(Order at
28): “The ultimate question the court must answer is whether withdrawals from the
Upper Laramie Aquifer underlying the Lazy D Ranch will cause depletions in the
stream flow of surface waters.”
Instead, the legal question before the Water Court was whether Lazy D proved
its Nontributary Claims, by providing clear and convincing evidence the Subject
22
Groundwater was completely hydraulically disconnected from all natural streams,
including their underflow and tributary waters.
As incorrectly framed by the Water Court, both Lazy D and the Cities were
required to have the burden of proof regarding Lazy D’s Nontributary Claim or,
alternatively, that a preponderance standard applied to Lazy D’s claims in this case:
Crawford noted that in some of the wells that Niccoli investigated the
static water level was higher than the bottom of the Spring Creek and
Lone Tree Creek alluvial systems. Crawford opined that this static
water level, which he also referred to as the potentiometric head,
represents the level at which groundwater exists within the Upper
Laramie Aquifer. This opinion forms the basis of Crawford’s ultimate
opinion that the Upper Laramie Aquifer is hydraulically connected with
the Spring Creek and Lone Tree Creek systems. But the court is not
persuaded. The court instead finds Niccoli’s opinions about the
relationship of the water levels observed in the wells and the Upper
Laramie Aquifer to be more reliable and better supported, and therefore
more credible.
CF 2772-2773 (Order at 19-20) (emphasis added).
To meet the nontributary standard of C.R.S. § 37-90-103(10.5), Lazy D was
required to prove by clear and convincing evidence withdrawal of the Subject
Groundwater would not “deplete the flow of a natural stream . . . at an annual rate
greater than one-tenth of one percent of the annual rate of withdrawal.” C.R.S. § 37-
90-103(10.5) (emphasis added).
Despite this, the Water Court’s incorrect framing of the legal issue to be
resolved at trial, coupled with the previously-discussed legal errors, led to the Water
23
Court’s improperly focus on what the Cities’ expert witness did not testify to or
analyze, namely that the Cities’ expert did not prove the Subject Ground water was
tributary by proving the inverse of C.R.S. § 37-90-103(10.5). CF 2761 (Order at 8)
(“the opposers’ expert . . . . did not quantify this hydraulic connection . . . such that
withdrawals will cause depletions of more than an annual rate greater than one-tenth
of one percent of the annual rate of withdrawal.”) (emphasis added).
Moreover, this specific analysis was irrelevant because Lazy D’s theory at
trial was that the Subject Groundwater was completely hydraulically disconnected
from all natural streams, including their underflow and tributary waters. Thus, any
hydraulic connection, including the one shown by the Cities’ expert defeated
Lazy D’s Nontributary Claim.
The Water Court erred by shifting the ultimate burden of proof on issues
regarding Lazy D’s Nontributary Claim from Lazy D to the Cities, and not limiting
the presumption under Subsection 305(6)(b) to statutorily-authorized factual
findings by the State Engineer.
3. The Water Court Erred by Applying the Wrong Standard to the Cities’
Rebuttal of the State Engineer’s Determination of Facts.
In the Order, the Water Court ruled the Cities failed to rebut the State
Engineer’s Determination of Facts: “The court finds that the opposers have not
rebutted the presumption that the Engineer’s findings of fact are true.” CF 2781
24
(Order at 28). “The court has made the finding here that the opposers did not rebut
the State Engineer’s Determination of Facts, which found the subject groundwater
is nontributary.” CF 2784-2785 (Order at 31-32) (emphasis added). However, the
Water Court erred in these rulings.
The Order did not identify any legal standard by which the Cites’ rebuttal
evidence was to be evaluated. See CF 2781; 2784; (Order at 28; 31). The Water
Court instead made a conclusory ruling without citing any standard or providing any
analysis. See Freedom Colo. Info., Inc. v. El Paso Cty. Sheriff’s Dep’t , 196 P.3d 892,
901 (Colo. 2008) (inferring legal standard applied by lower court that failed to
identify the legal standard, and finding lower court failed to apply proper standard).
An appellate court . . . has “the responsibility to ascertain whether the
trial court’s legal conclusion[s][are] supported by sufficient evidence
and whether the trial court applied the correct legal standard.” If the
record is insufficient for this purpose, then the appellate court must
remand the case to the trial court for further findings of historical fact.
When, however, no controlling facts are in dispute, the appellate court
may review the issue de novo because “the legal effect of undisputed
controlling facts is a question of law.”
People v. King, 16 P.3d 807, 812 (Colo. 2001) (citations omitted).
To the extent any standard was applied, the Water Court applied the incorrect
standard. Had the Water Court applied the correct standard, it would have reached a
different conclusion, as the Water Court heard and admitted evidence from both
25
Lazy D and the Cities regarding the relevant, statutorily-authorized facts included in
the State Engineer’s Determination of Facts. See CWCB, 109 P.3d at 596-97.
First, Lazy D rebutted the State Engineer’s Determination of Facts in its case-
in-chief. As discussed above, the State Engineer’s Determination of Facts was based
on version 2 of Lazy D’s expert report submitted in this case. These analyses were
superseded by version 6 of the same expert report provided with Lazy D’s initial
C.R.C.P. 26(a)(2) disclosures. CF 2029-2030, TR 4/12/23, 71:18-72:12. Lazy D
presented and relied on version 6 of its expert report at trial, rebutting the analyses
in the State Engineer’s Determination of Facts.
Second, the Cities presented extensive evidence rebutting the analyses in the
State Engineer’s Determination of Facts.1 CF 1273-1275 (the Cities’ proposed
findings at 9-11, summarizing evidence). This included the Cities’ expert testimony
and analysis demonstrating the Subject Groundwater is tributary to several surface
streams. E.g., CF 2326, TR 4/24/23, 104:15; CF 2379, 157:10-14; CF 2448, 226:1−5
(the Cities’ expert witness testimony demonstrating the Subject Groundwater did not
meet the definition of nontributary groundwater in C.R.S. § 37-90-103(10.5) and is
tributary to Spring Creek, Lone Tree Creek, and other natural streams).
1This evidence also applied to the ultimate question of whether Lazy D proved by
clear and convincing evidence that the Subject Groundwater was nontributary.
26
This also included the Cities’ expert testimony and analysis regarding Spring
Creek and the City of Fort Collins’ Meadow Springs 1 and 2, rebutting the
unauthorized nontributary determination in the State Engineer’s Determination of
Facts. CF 1274-1275 (the Cities’ proposed findings at 10-11); CF 2270-2271, TR
4/24/23, 48:2-49:19; CF 2298, TR 4/24/23, 76:2-8 (the Cities’ expert witness
testimony that the Spring Creek and Meadow Springs 1 and 2 are hydraulically
connected to the Upper Laramie Aquifer, based on site visits and other information).
Further, the Cities provided expert testimony rebutting claims in the State
Engineer’s Determination of Facts regarding Fort Collins’ well with Well Permit
No. 287480. CF 2707, TR 4/25/23, 152:2-10, 13-17 (identifying points of
disagreement with the State Engineer’s analysis of the well, its lithology, and the
surrounding hydrogeology, including the State Engineer’s statements regarding the
depth of the Spring Creek alluvium in this location, and the well having been
“completed in” the Upper Laramie Aquifer).
These portions of the State Engineer’s Determination of Facts were also the
subject of Lazy D’s evidence and testimony (including cross-examination) of Lazy
D’s expert witness. CF 1274-1275 (the Cities’ proposed findings at 10-11); CF 2040-
2041, TR 4/12/23, 82:10-17, 83:12-16; CF 2042, TR 4/12/23, 84:2-4; CF 2044, TR
4/12/23, 86:2-14 (Lazy D’s expert testimony and exhibits presented at trial showing
27
the well with Well Permit No. 287480 is not completed in the Upper Laramie
Aquifer nor through the alluvium of Spring Creek as claimed in the State Engineer’s
Determination of Facts but passes through the Upper Laramie Aquifer and is
completed in the Laramie-Fox Hills Aquifer.).
Finally, the Cities provided extensive evidence regarding the available
amount of the Subject Groundwater. CF 1274-1275 (the Cities’ proposed findings at
10-11); CF 2280-2281, TR 4/24/23, 58:24-59:2; 59:7-9; CF 2044-2045, TR 4/12/23
86:18-87:14 (expert testimony regarding modifications to the amount of the Subject
Groundwater from the State Engineer’s Determination of Facts).
In short, it is unclear what standard (if any) the Water Court applied to rebuttal
of the State Engineer’s Determination of Facts, despite the fact that significant
evidence was presented by both Lazy D and the Cities. Under the appropriate
standard set forth in CWCB, 109 P.3d at 596-97, the Water Court should have ruled
that any relevant, statutorily-authorized findings in the State Engineer’s
Determination of Facts were rebutted and the presumption as to those facts no longer
continued in the case.
28
4. The Water Court Erred by Speculating and Relying on Personal Knowledge
and Information Not in Evidence.
a. Standard of Review.
The Water Court’s legal conclusions and mixed questions of law and fact are
reviewed de novo. City of Englewood, 235 P.3d at 1066; Pagosa Area Water &
Sanitation Dist. v. Trout Unlimited, 170 P.3d 307, 313 (Colo. 2007). The Water
Court’s factual findings are binding on appeal “unless they are so clearly erroneous
as to find no support in the record.” City of Englewood, 235 P.3d at 1066 (citations
omitted).
b. Only Admitted Evidence Can Be Relied on by the Water Court.
The evidence admitted at trial is the basis for the Water Court’s rulings on
disputed issues of fact and, to an extent, mixed questions of fact and law. See
generally C.R.E. The C.R.E., C.R.C.P, and Water Court Rules all set forth detailed
procedures regarding how information must be identified and disclosed prior to trial,
presented and offered at trial, and ultimately admitted as evidence to form the basis
for the Water Court’s rulings. These rules protect litigants’ fundamental due process
rights by allowing notice and an opportunity to be heard on disputed matters, which
29
affect significant property rights. See City & Cty. of Denver v. Eggert, 647 P.2d 216,
224 (Colo. 1982).
[C]ourts cannot go outside of the record and speculate as to the effects
of what might be shown had evidence been adduced, but can only
determine matters from the allegations and proofs submitted to them.
The personal knowledge of the judge who tries the case cannot meet
the requirements of the law that proof of necessary facts shall be made.
Monte Vista Canal Co. v. Centennial Irrigating Ditch Co ., 135 P. 981, 985 (Colo.
1913). See also People v. G.H. Hard Land Co., 117 P. 141, 145 (Colo. 1911)
(“Courts cannot go outside the record and speculate.”).
A court may take judicial notice of a fact that has not been formally supported
by evidence and therefore assume its truth for purposes of the pending case, but only
if the fact is one that is “not subject to reasonable dispute.” C.R.E. 201. A fact is “not
subject to reasonable dispute” if it is “generally known within the territorial
jurisdiction of the trial court” or “capable of accurate and ready determination by
resort to sources whose accuracy cannot reasonably be questioned.” Id.
Judicial notice is typically used to introduce into evidence very simple,
obvious facts that are common sense, e.g., the time of sunset or climatological
conditions. See, e.g., Lowder v. Tina Marie Homes, Inc., 601 P.2d 657, 659 (Colo.
App. 1979) (wind velocity in Boulder was subject to judicial notice); Sierra Mining
30
Co. v. Lucero, 194 P.2d 302, 303 (Colo. 1948) (calendar days and dates are subject
to judicial notice).
However, “Courts cannot indulge in arbitrary deductions from scientific laws
as applied to evidence except where the conclusions reached are so irrefutable that
no room is left for entertainment by reasonable minds of any other conclusion .”
Anderson v. Lett, 374 P.2d 355, 357 (Colo. 1962).
For example, in Prestige Homes, Inc. v. Legouffe, 658 P.2d 850 (Colo. 1983),
this Court held the Court of Appeals, in reviewing a Department of Labor and
Employment referee’s order denying a workmen’s compensation claim, erred when
it judicially noticed medical treatises that had neither been offered or admitted into
evidence nor cited by either party’s medical expert and subsequently relied on those
treatises. 658 P.2d at 853-854. This Court held:
The court in effect assumed the role of an expert medical witness by
discrediting [one expert witness’s opinion] based on independent
research and interpretation of medical texts which properly should be
interpreted only by experts in the appropriate field.
Id. at 854.This Court also held “[t]o accept the court’s substitution of its own fact
findings for those of the referee in this instance would expand the judicial notice rule
far beyond its intended scope.” Id.
31
Finally, this Court held that:
Even if the [proposition] were widely recognized within the relevant
community, the fact that two medical experts [had] a reasonable dispute
over the conclusion to be reached from that proposition [made] the
court of appeals’ disregard of the referee’s findings clearly erroneous.
Id.
c. The Water Court Erred by Relying on Information Not in Evidence.
At trial, Lazy D and the Cities presented extensive documentary evidence and
lay and expert testimony regarding Lazy D’s Nontributary Claim and related issues.
However, in the Order, the Water Court expressly cited and relied upon numerous
sources not offered or admitted into evidence , admitting to having independently
researched disputed factual issues outside the record. CF 2765 (Order at 12 n.2)
(“After falling down a rabbit hole researching [the difference between hydrology
and hydraulics] (one of many such rabbit holes encountered in drafting this order), I
found the following (likely apocryphal) story . . . .”).
In the Order, the Water Court cites numerous documents related to Lazy D’s
Nontributary Claim never offered or admitted into evidence which formed many of
the bases of the Water Court’s analyses and rulings. These documents not included
in the trial record but expressly identified in the Order include:
32
• CF 2757 (Order at 4 n.1): Citation to an online version of Encyclopedia
Britannica related to the nature of geological materials in certain geological
formations related to the Subject Groundwater.
• CF 2757 (Order at 4 n.1): Citation to Thomas Harter, et al., Adjudicating
Groundwater 19-20 (National Judicial College, Dividing the Waters; 2018)
(hereafter, Adjudicating Groundwater), regarding the nature of geological
materials in certain geological formations related to the Subject Groundwater.
• CF 2758 (Order at 5): Use of a figure from and citation to Adjudicating
Groundwater at 19-20, regarding the size of certain geological materials in
certain geological formations related to the Subject Groundwater.
• CF 2762-2763 (Order at 9-10): Block quote from Adjudicating Groundwater
at 19-20, regarding the meaning of the term “saturated,” which was a disputed
issue at trial related to the Subject Groundwater.
• CF 2763 (Order at 10): Citation to online version of Ground Water Glossary,
U.S. GEOLOGICAL SURVEY, related to the definition of “unsaturated zone,”
which was a disputed issue at trial related to the Subject Groundwater.
• CF 2763-2764 (Order at 10-11): Block quote from Herman Bower & Thomas
Maddock, III, Making Sense of the Interactions Between Groundwater and
Streamflow: Lessons for Water Masters and Adjudicators, RIVERS, Vol. 6, No.
33
1, at 28 (1997), regarding the interaction of groundwater and streamflow,
which was a key issue at trial.
• CF 2764 (Order at 11): Block quote and citation to Gary S. Johnson,
Hydrologic Complications of Conjunctive Management , 47 IDAHO L. REV.
205, 206 (2011), related to hydraulic connection, which was a key issue trial.
• CF 2765 (Order at 12 n.2): Block quote from an unidentified source regarding
the difference between hydrology and hydraulics, which relates to disputed
factual issues at trial.
• CF 2766 (Order at 13): Block quote, figure, and citation to Thomas C. Winter,
et al., Ground Water and Surface Water, A Single Resource, U.S. GEOLOGICAL
SURVEY CIRCULAR 1139, at 6 (1999) related to unsaturated zones and the flow
of streams, which were key issues at trial.
• CF 2772 (Order at 19): Quote from and citation to Paschke, Suzanne, ed.,
Groundwater Availability of the Denver Basin Aquifer System, Colorado , U.S.
GEOLOGICAL SURVEY PROFESSIONAL PAPER 1770 at 17 (2011), regarding
certain geological formations associated with the Subject Groundwater.
The above are specific instances where the Water Court cited to and relied on
documents not offered or admitted into evidence. It is unclear if, or the extent to
which, the Water Court’s independent research regarding issues presented at trial
34
affected other findings in the Order. Any findings based on review of materials
outside the record are erroneous. City of Englewood, 235 P.3d at 1066.
The Water Court’s reliance on information not included in the trial record
deprived the Cities of fundamental due process rights. “‘The essence of procedural
due process is fundamental fairness.’” See City & Cty. of Denver, 647 P.2d at 224
(citation omitted). This information, which informed the Water Court’s rulings in
the Order was not presented at trial, and the Cities had no opportunity to address,
rebut, and present their own evidence regarding this information.
The Water Court’s independent research and use of information outside the
trial record bypasses the detailed and necessary procedural protections embodied in
the C.R.E., C.R.C.P., and Water Court Rules in a manner not permitted under
Colorado law.
5. The Water Court’s Determination the Subject Groundwater Is
Nontributary Was Based on Faulty Legal Premises and Is Erroneous.
a. Standard of Review.
Whether groundwater is nontributary is a mixed question of law and fact. See
Chatfield E. Well Co. v. Chatfield E. Prop. Owners Ass’n , 956 P.2d 1260, 1271-72
(Colo. 1998). Mixed questions of law and fact are reviewed de novo. See Pagosa,
170 P.3d at 313. There is deference to a trial “court’s factual findings unless they are
35
clearly erroneous and not supported by the record.” State Farm Mut. Auto. Ins. Co.
v. Johnson, 396 P.3d 651, 654 (Colo. 2017).
However, the Water Court “errs when it misconstrues and misapplies the
law.” Wolfe, 344 P.3d 855 at 859. Similarly, faulty legal premises for factual findings
undermines them and may require further proceedings. See, e.g., Consol. Home
Supply Ditch & Reservoir Co. v. Town of Berthoud, 896 P.2d 260, 267 (Colo. 1995);
Budget Rent-A-Car Corp. v. Martin, 855 P.2d 1377, 1383 (Colo. 1993).
“Trial courts are vested with broad discretion to determine the admissibility
of expert testimony . . . , and exercise of that discretion will not be overturned unless
manifestly erroneous.” Masters v. People, 58 P.3d 979, 988 (Colo. 2002). A water
court “abuses its discretion when its ruling is manifestly arbitrary, unreasonable, or
unfair, or based on a misapprehension of the law.” Front Range Feedlots, LLC v.
Rein, 528 P.3d 494, 501 (Colo. 2023) (citation omitted).
b. The Court Must Issue Specific Findings Regarding Reliability of Expert
Testimony.
C.R.E. 702 governs admission of scientific evidence and expert testimony.
“The focus of a CRE 702 inquiry is whether the proffered scientific evidence is both
reliable and relevant.” City of Aurora ex rel. Util. Enter., 105 P.3d at 612 (citing
People v. Shreck, 22 P.3d 68, 77-78 (Colo. 2001)).
36
To determine whether scientific evidence is reliable under C .R.E. 702, the
“court’s inquiry should be broad in scope and consider the totality of the
circumstances presented” in the case, and the court must issue specific findings
regarding the reliability of the expert testimony. Id. “[A] trial court’s CRE 702
determination must be based upon specific findings on the record as to the
helpfulness and reliability of the evidence proffered.” People v. Shreck, 22 P.3d at
78.
In numerous instances, the Water Court did not make specific findings
supporting its determinations that Lazy D’s expert testimony was more credible or
reliable than the Cities’ expert testimony. Where the Water Court did make these
findings, including on the most critical pieces of evidence provided by the Cities, it
often improperly relied on information outside the record to supports its findings :
“Niccoli’s explanation is consistent with other authority, such as this article about
the interaction of groundwater and streamflow.” CF 2763 (Order at 10) (emphasis
added).
Crawford [the Cities’ expert] attempted to quibble about how much
water must be present in geologic materials before it is considered to
be fully saturated . . . . Niccoli’s [Lazy D’s expert] explanation that
anything less than 100% saturation . . . is consistent with other authority
and makes logical sense. For example, one authority defines saturated .
. . .
CF 2762 (Order at 9) (emphasis added).
37
As discussed above, the Water Court also misconceived the force and effect
of the testimony provided by the Cities’ experts, because the Court determined the
Cities’ experts must prove the groundwater at issue was tributary.
c. By Applying the Wrong Legal Standards and Relying on Information Outside
the Record, the Water Court’s Findings Are Erroneous.
The Water Court’s determination that the Subject Groundwater is nontributary
resulted from the series of errors discussed above. The Water Court applied incorrect
legal standards when it misinterpreted and misapplied the State Engineer’s
Determination of Facts and Subsection 305(6)(b), which resulted in an unauthorized
grant of authority to the State Engineer to determine whether groundwater is
nontributary. The Water Court compounded this initial error by also failing to apply
the correct legal standard to the Cities’ rebuttal evidence regarding the State
Engineer’s Determination of Facts.
These errors shifted the burden of proof from Lazy D to the Cities contrary to
Colorado law, creating the erroneous presumption that groundwater is nontributary
unless proven otherwise. This Court should afford no deference to the Water Court’s
determination that the Subject Groundwater is nontributary, since the Water Court
based its determination on factual findings that are erroneous and not supported by
the record. Consequently, this Court should, upon de novo review, find the Water
Court’s determination that the Subject Groundwater is nontributary is erroneous and
38
must be reversed and remanded to the Water Court for further proceedings consistent
with Colorado law.
d. The Water Court’s Errors Will Affect Other Water Cases and Nontributary
Claims, Including Those Currently Pending Before the Water Court.
Even if this Court were to determine the Water Court ultimately reached the
correct result in approving Lazy D’s Nontributary Claim, it is important to correct
the legal errors described above. This Court “may resolve an otherwise moot case if
the matter is one ‘capable of repetition, yet evading review.’ . . . [or] if “the matter
involves a question of great public importance or an allegedly recurring
constitutional violation.’” Bd. of Cty, Comm’rs of County of Arapahoe v. Crystal
Creek Homeowners’ Ass’n, 14 P.3d 325, 345 (Colo. 2000) (quoting Humphrey v.
Sw. Dev. Co., 734 P.2d 637, 639 (Colo. 1987)). For example, this Court held that a
dispute regarding water court jurisdiction under a Colorado statue “is significant for
future water court proceedings; it should be resolved to assist orderly judicial
procedures and is of public importance statewide.” Humphrey, 734 P.2d at 640.
Nontributary claims are pending before the Water Court in two cases in which
the City of Fort Collins is a party: Case No. 2019CW3200 (currently stayed pending
resolution of this appeal); and Case No. 2020CW3208 (trial scheduled for April 21
to May 9, 2025). It is also likely other nontributary claims will be made to the Water
Court in the future. The correct legal standards must be applied to these other cases.
39
CONCLUSION
Based on the foregoing, the Cities respectfully request this Court reverse and
remand the case for further proceedings consistent with the opinion of this Court.
Respectfully submitted January 9, 2024.
WHITE & JANKOWSKI LLC
By: ______________________________
*Alan E. Curtis, #34571
Nicoli R. Bowley, #58709
ATTORNEYS FOR CITY OF
STERLING
FORT COLLINS CITY
ATTORNEY’S OFFICE
By: ______________________________
Eric R. Potyondy, #38243
ATTORNEY FOR CITY OF FORT
COLLINS
40
CERTIFICATE OF SERVICE
I certify that on January 9, 2024, a true and correct copy of OPPOSERS-
APPELLANTS CITY OF STERLING AND CITY OF FORT COLLINS’
JOINT OPENING BRIEF for Case No. 23SA258 was served by e-filing via
Colorado Courts E-filing System to the parties listed below:
______________________________________
Andrea Browne, Legal Administrative Assistant
Party Name Party
Type Attorney Name/Organization
Basin Lands LLC Opposer MATTHEW MACHADO (Lyons Gaddis PC)
Bijou Irrigation
Company
Opposer BRADLEY NEIL KERSHAW (Vranesh and
Raisch)
STUART B CORBRIDGE (Vranesh and
Raisch)
Bijou Irrigation
District
Opposer BRADLEY NEIL KERSHAW (Vranesh and
Raisch)
STUART B CORBRIDGE (Vranesh and
Raisch)
Cache La Poudre
Water Users
Association
Opposer DANIEL KENNETH BROWN (Fischer Brown
Bartlett Larsen and Irby PC)
WHITNEY PHILLIPS COULTER (Fischer
Brown Bartlett Larsen and Irby PC)
City of Boulder Opposer JESSICA LYNN PAULT-ATIASE (Boulder
City Attorney’s Office)
LISA M THOMPSON (Trout Raley)
MICHAEL A KOPP (Trout Raley)
City of
Englewood
Opposer GEOFFREY M WILLIAMSON (Berg Hill
Greenleaf & Ruscitti LLP)
MEGAN CHRISTENSEN (Berg Hill Greenleaf
& Ruscitti LLP)
PATRICK MICHAEL HAINES (Berg Hill
41
Party Name Party
Type Attorney Name/Organization
Greenleaf & Ruscitti LLP)
PETER D NICHOLS (Berg Hill Greenleaf &
Ruscitti LLP)
City of Fort
Collins
Opposer ERIC RYAN POTYONDY (City Attorney’s
Office)
City of Greeley
Acting By And
Through
Opposer CAROLYN F BURR (Welborn Sullivan Meck
& Tooley, P.C.)
DANIEL JAMES BIWER (City of Greeley)
JAMES MERLE NOBLE (Welborn Sullivan
Meck & Tooley, P.C.)
City of Thornton Opposer KARA NICOLE GODBEHERE (City of
Thornton)
Division 1
Engineer
Division
Engineer
DIVISION 1 WATER ENGINEER (State of
Colorado DWR Division 1)
Lazy D Grazing
Assoc
Applicant BRADLEY CHARLES GRASMICK
(Lawrence Custer Grasmick Jones and
Donovan LLP)
RICHARD T LI PUMA (Lawrence Custer
Grasmick Jones and Donovan LLP)
RYAN MATTHEW DONOVAN (Lawrence
Custer Grasmick Jones and Donovan LLP)
WESLEY SAGE KNOLL (Lawrence Custer
Grasmick Jones and Donovan LLP)
Lg Everist Inc Opposer MATTHEW LAKE MERRILL (MERRILL
LAW LLC)
Mary Estabrook Opposer 1903 S Greeley Hwy 110, Cheyenne, WY
82007, United States (Regular Mail)
Northern
Colorado Water
Conservancy
District
Opposer BENNETT WILLIAM RALEY (Trout Raley)
LISA M THOMPSON (Trout Raley)
MICHAEL A KOPP (Trout Raley)
42
Party Name Party
Type Attorney Name/Organization
State Engineer State
Engineer
COLORADO DIVISION OF WATER
RESOURCES (State of Colorado - Division of
Water Resources)
State Engineer
And Water Div 1
Engineer
Opposer EMILIE BLAKE POLLEY (CO Attorney
General)
United Water And
Sanitation District
Opposer ANN MARIE RHODES (The Law Office of
Tod J Smith)
TOD JAY SMITH (The Law Office of Tod J
Smith)