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Bitterroot River Protective Association, Inc. v. Bitterroot Conservation District

November 17, 2008

BITTERROOT RIVER PROTECTIVE ASSOCIATION, INC., PLAINTIFF AND APPELLANT, MONTANA DEPARTMENT OF FISH, WILDLIFE AND PARKS, INVOLUNTARY PLAINTIFF AND APPELLANT,
v.
BITTERROOT CONSERVATION DISTRICT, A POLITICAL SUBDIVISION OF THE STATE OF MONTANA, DEFENDANT AND APPELLEE,
WALTER R. BABCOCK, BITTERROOT SPRINGS RANCH, TUCKER CROSSING RANCH, AND VALLEY SPRINGS RANCH, INTERVENORS - THIRD PARTY PLAINTIFFS AND APPELLEES,
MARNELL CARRAO ASSOCIATES, INC., INTERVENOR - THIRD PARTY PLAINTIFF AND APPELLEE,
JOHN & KATHY LEWIS, MILLIE & CASEY DIEFFER, EDITH L. & SKIP WARK, EDWIN C. & JUDITH HEBNER, SUSAN A. & LARRY LEVENSTEIN, MICHAEL & PAULETTE SPAULDING, EVELYN L. LOCKE, DAVID J. ODELL, GREG & NANCY TRANGMOE, JOHN & PATRICIA COOK, JOHN & ELIZABETH FOX, ETNA DITCH COMPANY, WEBFOOT DITCH COMPANY, AND UNION DITCH COMPANY, INTERVENORS AND APPELLEES,
MONTANA FARM BUREAU FEDERATION, INTERVENOR AND APPELLEE,
v.
RAVALLI COUNTY COMMISSIONERS, THIRD PARTY DEFENDANT AND APPELLEE.



APPEAL FROM: District Court of the Twenty-First Judicial District, In and For the County of Ravalli, Cause No. DV-03-476 Honorable Ted L. Mizner, Presiding Judge.

The opinion of the court was delivered by: Justice Jim Rice

Argued and Submitted: October 10, 2007

¶1 Appellant Bitterroot River Protective Association ("BRPA") appeals the January 12, 2006 Opinion and Order of the Twenty-first Judicial District Court, Ravalli County, affirming the determination of the Board of Supervisors of the Bitterroot Conservation District ("BCD" or "Board") that the Mitchell Slough, a body of water in the Bitterroot Valley, is not a "natural, perennial-flowing stream" under the Natural Streambed and Land Preservation Act of 1975, commonly known as the "310 Law" after its original legislative designation as Senate Bill 310. The BRPA, along with the Montana Department of Fish, Wildlife and Parks ("FWP"), also appeals the District Court's May 10, 2006 Opinion and Order holding that the Mitchell Slough is not subject to Montana's statutes governing stream access for public recreational use, referred to by the District Court and commonly as the "Stream Access Law" or "SAL." We affirm in part and reverse in part.

¶2 As the above introduction notes, this appeal comprises two cases, the first applying the 310 Law and the second applying the SAL, to the Mitchell Slough. We address the following dispositive issues in these cases:

¶3 I. The 310 Law case:

A. Did the District Court err in upholding the process used by the BCD in determining the Mitchell Slough's status under the 310 Law?

B. Did the District Court err by upholding the BCD's declaratory ruling that the Mitchell Slough is not subject to the 310 Law?

¶4 II. The Stream Access Law case:

A. Did the District Court err by adopting verbatim Appellee's Walter E. Babcock, et al. and the Montana Farm Bureau Federation's proposed findings of fact?

B. Did the District Court err by requiring Appellants to prove by a "clear preponderance" that the Mitchell Slough is a natural water body, and in its application of that burden of proof?

C. Did the District Court err by concluding the Mitchell Slough is not a "natural water body" for purposes of the SAL, and therefore not subject to public recreational access?

PROCEDURAL BACKGROUND

¶5 In 1999, the BCD received a letter inquiring whether 310 Law permits were required for work done within the bed and banks of the Mitchell. The answer to this question necessitated a determination of whether the Mitchell was a "natural, perennial-flowing stream" under the 310 Law. The BCD unsuccessfully sought the intervention of the Department of Natural Resources and Conservation, the Department of Environmental Quality, or FWP to make this determination. Following these "three strikes," the BCD initiated its own process, publishing notices related thereto in the Ravalli Republic in December of 2000 and January of 2001.

¶6 On January 24, 2001, the BRPA petitioned the District Court for an alternate writ of prohibition to stop the BCD from determining whether the Mitchell Slough was subject to the 310 Law, asserting that the BCD did not have jurisdiction to do so. The District Court denied the BRPA's petition for writ, and thereafter the BRPA sought a writ of prohibition from this Court. We denied that request in Bitterroot River Protection Association v. Bitterroot Conservation District, 2002 MT 66, 309 Mont. 207, 45 P.3d 24 (hereinafter "BRPA I"). The BCD then continued its administrative declaratory ruling process, leading to the determination that the Mitchell is not a "natural perennial-flowing stream" and thus not subject to the 310 Law.

¶7 In November 2003, the BRPA sought declaratory relief and judicial review of the BCD's decision in the Twenty First Judicial District Court, Ravalli County, Hon. Ted L. Mizner, presiding. In its First Amended Complaint, the BRPA alleged four counts. Count I challenged the process employed by the BCD, Count II challenged the BCD's decision on the evidence and as an abuse of discretion, and Count III alleged that the BCD's 310 Law decision violated the Public Trust Doctrine. Count III was dismissed prior to trial and is not at issue on appeal. Based upon the administrative record and the parties' motions for summary judgment, the District Court entered an order on Counts I and II on January 12, 2006, affirming the BCD's 310 Law determination.

¶8 Count IV claimed that the waters of the Mitchell were open to recreational access under the SAL. A five-day bench trial was conducted in July 2005 on the stream access issue, and on May 10, 2006, the District Court filed an order holding that the Mitchell Slough was not subject to public access.

¶9 The posture of the parties and the issues in which they are participants are complex. The BCD is a party to the 310 Law issue only, by virtue of the appeal of its administrative decision. A group of individuals and ranch owners along the Mitchell Slough, Walter R. Babcock, Bitterroot Springs Ranch, John and Kathy Lewis, et al., intervened in the action, cross-claiming for a declaration that the Mitchell was not subject to the SAL. Landowner Marnell Corrao Associates, Inc., likewise intervened, contesting the status of the segment of the Mitchell passing through its property. The three primary irrigations companies, Etna Ditch, Webfoot Ditch and Union Ditch, and the Montana Farm Bureau likewise intervened. The Intervenors, along with the aforementioned landowners, about 25 in total, will be collectively referred to herein as the "Landowners." Landowners supported the decision of the BCD. The BRPA moved for joinder of FWP, who was a party in the proceeding before the BCD but did not appeal, as an "involuntary plaintiff" pursuant to M. R. Civ. P. 19(a). Given its failure to appeal from the BCD's decision, joinder of FWP was denied for the 310 Law case, but was granted for the SAL case. Certain of the Landowners filed a third-party complaint against Ravalli County alleging that the Mitchell Slough was not under the jurisdiction of the SAL, seeking to enjoin issuance of further portage permits on the Mitchell. After the parties stipulated to a stay of the County's intended portage hearings, it does not appear that the County further participated in the matter. Before this Court, Montana Trout Unlimited ("MTU") has filed an amicus brief supporting the BRPA's position on the 310 Law issue. Thirteen outdoor recreation organizations (collectively "Sportsmen's Groups") have filed a joint amicus brief supporting Appellants' positions on the stream access issue. Four stockgrower and resource organizations (collectively "Stockgrowers") have filed an amicus brief supporting Appellees' position on the stream access issue.

¶10 The BRPA appealed the District Court's decision upholding the BCD's 310 Law determination. The BRPA and FWP appeal the District Court's decision regarding stream access on the Mitchell Slough.

FACTUAL BACKGROUND

¶11 Two factual records were originally developed, one before the BCD for the 310 Law case, and the other before the District Court in the trial of the SAL case. The factual recitation here is drawn generally from both records, and more specific facts are referenced in the respective discussions under each case.

¶12 The Mitchell Slough is located in Ravalli County, Montana, east of the Bitterroot River between Hamilton and Stevensville. Tucker Headgate directs water from the East Fork of the Bitterroot River into the Mitchell. The water travels through and across private property in a north/northeasterly direction, covering a linear distance of approximately ten miles before rejoining the Bitterroot River. The Mitchell Slough itself meanders along a pathway approximately 16 miles in length. The Mitchell splits into its own east and west channels, which both flow northerly in a parallel fashion and empty into the Bitterroot River. Ditch companies and private water users have historically used water from the Mitchell Slough for irrigation, stockwater, and fish and wildlife purposes, and have routinely taken actions upstream of Tucker Headgate to ensure an even supply of water into the East Fork of the Bitterroot River, thereby also ensuring the consistent flow of water for diversion by the Tucker Headgate into the Mitchell. This activity has been ongoing for decades, for most of a century. Approximately 4,300 acres are irrigated from the Mitchell's flow every season.

¶13 The point of diversion for water moving from the East Fork into the Mitchell Slough used to be a quarter-mile downstream from its present location. In 1915, the three primary ditch companies using water from the Mitchell Slough constructed a concrete diversion structure in the East Fork to direct a dependable supply of water into the Mitchell. However, in the mid-twentieth century, the ditch companies constructed Tucker Headgate upstream from the natural entry into the Mitchell Slough and dug a quarter-mile canal to create a new connection from the East Fork to the Mitchell's channel via Tucker Headgate. The BCD found that, after surface water is diverted through this canal, it "ultimately flows into a historic natural channel" known as the Mitchell.

¶14 Rivers and streams throughout Montana have been manipulated for centuries, and the Bitterroot River and Mitchell Slough are no exception. Bruce Anderson, Landowners' expert hydrologist, testified that many Montana rivers have been channelized and riprapped, and have had weirs and diversion structures placed in them, for years. Anderson testified that the surface waters and groundwater in the Bitterroot Valley had been significantly altered by humans in many places. Likewise, the BCD relied on the expert report of Water Consulting, Inc., which noted that tributaries formerly drained from the Sapphire Mountains into the Bitterroot River floodplain but have been permanently severed and intercepted for irrigation purposes and no longer reach the Bitterroot River. Water is now impounded at Painted Rock Reservoir and released as necessary into the Bitterroot.

¶15 Similarly, throughout the length of the Mitchell, residents have reconstructed the bed and banks of the watercourse, narrowed its channel, increased water velocities, and improved aesthetics and the fish and wildlife habitats. Certain portions of the Mitchell Slough have been rerouted, redirected, and controlled by humans to the extent that the Mitchell Slough does not follow the same path it may otherwise have naturally followed without intervention. The Mitchell has also been unnaturally elevated and bermed to access certain terraces lying to the east of the Bitterroot River. Periodic maintenance is required at Tucker Headgate and in certain locations within the Mitchell to clean sediment and gravel plugs from the watercourse. Nonetheless, though the extent is disputed, the Mitchell remains in partially the same location as in 1872, when the Government Land Office (GLO) Survey Map designated the Mitchell as the "Right Fork of the St. Mary's Fork of the Bitterroot River."

¶16 One major source of contention between the parties centers on the water flowing through the Mitchell which enters, not from Tucker Headgate, but from flows, drains and ditches that discharge water into the Mitchell at various points along its path. The amount of water entering the Mitchell at Tucker Headgate is less than the amount of water exiting at its confluence with the Bitterroot River, despite the fact that the Mitchell serves multiple diversions, including the Union, Etna, and Webfoot irrigation ditches. Discharges of irrigation wastewater and return flows from waters diverted upstream on the Bitterroot River enhance the flow of the Mitchell. The District Court found that "[t]hese flows [into the Mitchell] would not exist but for the activity of humans to 'import' the water into the Mitchell drainage area." These irrigation wastewater and return flows contribute to the Mitchell Slough year-round. Even in February and March, when no irrigation is taking place, the amount of water flowing out of the Mitchell into the Bitterroot River is approximately double the amount flowing into the Mitchell Slough from the Bitterroot River at Tucker Headgate.

¶17 The BCD concluded that the Mitchell Slough is "partly man-made and partly within an historic channel of the Bitterroot River." The BCD also concluded that there is "significant ground water in the area of the Mitchell," and "some of the water in the Mitchell results from ground water, the likely source of which is diverted or irrigation water." Additionally, the BCD concluded that "the Mitchell flows are mainly from water directly diverted to it at the Tucker Headgate or indirectly diverted to it from man-made drainage ditches, although it would likely flow at some level and some places in the absence of the above-mentioned diversions." Both the BCD and the District Court concluded that without the current diversion of water into the East Fork of the Bitterroot River and then into the Mitchell Slough by Tucker Headgate, and without the water contributions from irrigation wastewater and return flows, the Mitchell Slough would not sustain a natural, perennial flow. The Mitchell has never run dry, and 310 Law permits have previously been issued on the Mitchell.

STANDARDS OF REVIEW

¶18 We review agency declaratory rulings "in the same manner as decisions or orders in contested cases" under the Montana Administrative Procedures Act (MAPA). Section 2-4-501, MCA; accord § 2-3-113, MCA; BRPA I, ¶ 18. This applies to the BCD's declaratory ruling on the applicability of the 310 Law. Thus, our review is guided by the standards of review set forth in § 2-4-704, MCA. "When reviewing an agency decision, a district court may not substitute its judgment for that of the agency as to the weight of the evidence on questions of fact." Ray v. Montana Tech of the U. of Mont., 2007 MT 21, ¶ 24, 335 Mont. 367, ¶ 24, 152 P.3d 122, ¶ 24 (citing § 2-4-704(2), MCA). Instead, the district court reviews an agency's decision to determine if the agency's findings of fact were clearly erroneous and whether its conclusions of law were correct. Ray, ¶ 24. We apply the same standard to our review of a district court's decision to affirm an agency decision. Ray, ¶ 24. In reviewing conclusions of law under § 2-4-704, MCA, we determine whether the agency's interpretation of the law is correct. Steer, Inc. v. Dept. of Revenue, 245 Mont. 470, 474, 803 P.2d 601, 603 (1990). The BCD argues that its decisions are entitled to deference. However, while long-standing statutory interpretations by agencies are entitled to "respectful consideration," Montana Power Co. v. Montana Public Service Commission, 2001 MT 102, ¶ 25, 305 Mont. 260, ¶ 25, 26 P.3d 91, ¶ 25, and we have acknowledged the value of the BCD's expertise in the review of 310 determinations, BPRA I, ¶ 19, "no discretion is involved when a tribunal arrives at a conclusion of law-the tribunal either correctly or incorrectly applies the law." Steer, 245 Mont. at 474, 803 P.2d at 603. With regard to the SAL case, we apply the same standards with regard to findings of fact and conclusions of law entered by the district court following trial, reviewing the findings for clear error and the conclusions for correctness.

DISCUSSION

I. The 310 Law case

¶19 A. Did the District Court err in upholding the process the BCD used in determining the Mitchell Slough's status under the 310 Law?

¶20 The BRPA argues that the process the BCD used in rendering its 310 Law determination regarding the Mitchell was inadequate, especially because constitutional rights involving natural resources were implicated in the matter. The BCD responds that it was not required to comply with any particular process or procedure, such as a MAPA contested case proceeding, and that it complied with constitutional mandates by affording the public, including the BRPA, a reasonable opportunity to participate prior to making its decision.

¶21 Article II, Section 8, of the Montana Constitution provides that "[t]he public has the right to expect governmental agencies to afford such reasonable opportunity for citizen participation in the operation of the agencies prior to the final decision as may be provided by law." Section 2-3-101, MCA, referencing "the mandate of Article II, section 8," provides that citizens are to be "afforded reasonable opportunity to participate . . . ." Section 2-3-111(1), MCA, provides that "[p]rocedures for assisting public participation must include a method of affording interested persons reasonable opportunity to submit data, views, or arguments, orally or in written form, prior to making a final decision that is of significant interest to the public." The essential elements of public participation are notice and an opportunity to be heard. Section 2-3-103(1)(a), MCA.

¶22 The BRPA does not argue that it was provided inadequate notice in this matter. Rather, the BRPA argues that after the BCD began an informal information-gathering process, it "switched to an adversarial hearing" and announced that MAPA procedures would be used and would require the BRPA to hire an attorney. After this announcement was made, the BRPA argues, the BCD failed to employ MAPA procedures because "[d]iscovery, production of documents or entry upon land wasn't allowed" and the parties could not subpoena witnesses. The BCD also restricted the BRPA's ability to cross-examine one of Landowners' experts, Barry Dutton, who submitted a report but did not appear. Thus, the BRPA argues that the BCD "contradicted its own rules" by employing MAPA-like procedures in some ways, but not others.

¶23 The BCD responds that the proceeding was "a unique, but nonetheless reasonable, method to gather information to make its declaratory ruling." BCD argues that no particular procedure was required, as in a MAPA contested case proceeding, because the proceeding was intended for the sole purpose of gathering information for its decision. According to the BCD, it "undertook a non-contested case declaratory ruling" as authorized by this Court in BRPA I which strictly adhered to the mandate of Article II, Section 8 by providing a reasonable opportunity to participate. The BCD explains that it proceeded under Montana's public participation statutes and its own rules in conducting a public hearing. BCD Rule 6(2) provides that "[i]f questions arise, about the accuracy of the perennial stream designation of these maps, the district may use water rights records, stream flow and hydrologice [sic] data and interviews with area residents and professionals. The district may also conduct a public hearing to gather information." Under BCD Rule 18(4), the BCD may hold a public hearing "when the supervisor determines a proposed project to be controversial,*fn1 or where additional information is desired prior to final action by the supervisors." Acknowledging that the process took on certain attributes of a MAPA proceeding, the BCD nonetheless argues that nothing more was required, and it was free to formulate a process that fit the demands of the task before it.

¶24 The BCD initiated the declaratory ruling process by holding an open public meeting. Individuals were allowed to provide oral and written statements, and interested persons were granted an additional seven days to submit further information. The BCD then suspended its decisionmaking process when the BRPA filed a petition for writ of prohibition challenging the BCD's authority, the litigation which led to our decision in BRPA I. Following that decision, the BCD allowed another sixty days for the submission of additional written information, and provided that any party adverse to someone presenting information would be afforded an opportunity for cross-examination. A cross-examination hearing was thereafter conducted. During the process, the BCD received 1,528 pages of information, in addition to oral statements. The Board's members each spent approximately 550 hours discussing and reviewing the information prior to issuing a declaratory ruling.

¶25 The BCD correctly notes that it was not required to hold a contested case proceeding under MAPA, because it is exempted from MAPA as a political subdivision of the State. See § 2-4-102(2)(b), MCA. As we have held, conservation districts can initiate 310 Law determinations through the use of non-MAPA declaratory rulings. BRPA I, ¶ 22. We see no reason why the BCD could not use certain procedures similar to those in a MAPA contested case proceeding, if fairly employed, without being obligated to implement all of MAPA's requirements, as the BRPA essentially contends. The BCD did not have the ability to subpoena witnesses, but it provided an opportunity to cross-examine presenters. Although the BRPA argues it was unable to cross-examine every witness it desired, this limitation cannot be faulted within the more informal declaratory process used here and, although the BCD's decision referenced the withdrawn Dutton Report without granting an opportunity for cross-examination of the author, we agree with the District Court that any error this may have constituted was harmless, given the cumulative nature of other evidence.

¶26 The BCD did appear to stutter-step in communicating its intentions about how it would conduct the statutory process we characterized in BPRA I as offering "no clear guidance." BPRA I, ¶ 16. However, in a case which was both complicated and controversial, the BCD, four members of which are locally elected, BRPA I, ¶15, n. 1, complied with its own rules, gave notice and provided an extended opportunity to submit information, permitting the BRPA and other interested persons to submit voluminous materials, offer oral opinions and statements, make objections and provide written arguments prior to the rendering of a final decision. James Haynes, now a district court judge, was appointed "Hearing Facilitator" by the BCD and did a commendable job presiding over the hearings. We conclude that the BCD's "method of affording" public participation, § ...


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