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Ranches v. Farmers Cooperative Canal Co.

Supreme Court of Montana

October 3, 2017

Danreuther Ranches CLAIMANT
Farmers Cooperative Canal Company; Teton Cooperative Canal Company; Eldorado Cooperative Canal Company;United States of America (Bureau of Indian Affairs); Danreuther Ranches OBJECTORS Farmers Coop Canal Company. COUNTEROBJECTORS

          Submitted on Briefs: August 2, 2017

         APPEAL FROM: Montana Water Court, Cause No. 41O-209 Honorable Douglas Ritter, Water Judge

          For Appellants: John E. Bloomquist, Abigail J. St. Lawrence, Bloomquist Law Firm P.C., Helena, Montana

          For Appellee: Stephen R. Brown, Katelyn J. Hepburn, Garlington Lohn & Robinson, PLLP, Missoula, Montana


          Mike McGrath Chief Justice.

         ¶1 This is an appeal from the Water Court's August 30, 2016 "Order Regarding Danreuther Ranches Water Right Claims." We affirm in part and reverse in part.

         ¶2 We restate the issues on appeal as follows:

Issue One (Canal Companies): Whether the Water Court erred in its orders regarding Danreuther Claim Nos. 41O 156802-00; 41O 156804-00; 41O 156805-00; and implied Claim No. 30106965.
Issue Two (Danreuther cross-appeal): Whether the Water Court erred in its orders regarding Danreuther Claim No. 41O 156804-00.


         ¶3 The following facts are taken from the Water Court's decision. This appeal concerns certain water rights of the Danreuther Ranch, located along the Teton River north of Carter, Montana. Lands in that area generally require irrigation to produce crops and the Teton River is the only reliable source of surface water with the exception of a spring in Captain Nelse's Coulee. Danreuther Ranch raises crops, hay and livestock, and seeks to irrigate 182.8 acres north of the River and 69.7 acres south of the River. The Ranch also claims stockwater from the River and from the Coulee spring.

         ¶4 The Danreuther Ranch was part of the Edward Reichelt ranch that began in 1888 with the acquisition of land and water rights along the Teton River. In 1935 Edward divided his ranch between his two sons, Dan and Bruno, and Danreuther is the successor in interest to Dan. Danreuther filed statements of claim in the water adjudication process, for irrigation and stockwater. The claims are based upon an 1874 claim statement by Nelson Vieux; notices of appropriation filed in 1914 by Horace Hibbard and Helen Hibbard; and a notice of appropriation filed in 1921 by Clara Lamphear.

         ¶5 Danreuther's most senior water claims are based upon activity beginning in 1874 by an early settler named Nelson Vieux, who came to the Fort Benton area in the 1860s and settled on land along the Teton River. Vieux's settlement was about 20 miles west of Fort Benton and became a regular second-night stop for freight wagons traveling the Whoop-Up Trail to Canada.[1] It was located at the mouth of the Nelse Coulee (named for Vieux) that provided the heavy freight wagons a passage out of the Teton River valley. The peak activity on the Trail was between 1874 and 1883, and the Water Court found that there was "significant development" at the Vieux ranch during this time. Vieux applied for a homestead in 1882.

         ¶6 On February 19, 1874, Vieux filed a written notice with Teton County stating that he intended to "claim and appropriate" water from the Teton River "for irrigating and agricultural purposes." He also claimed the right to float logs down the River to his settlement, unimpeded by any dams or obstructions upstream. The 1874 Vieux filing did not provide any other information about the intended use of water. According to Chouteau County tax records, Vieux did not claim any improvements on his land until 1881, but he paid taxes on "over 100 head of livestock every year." The Water Court found that the evidence did not support a conclusion that Vieux was irrigating crops until "the 1880s" and that there was no "compelling evidence" that Vieux was irrigating at an earlier date.

         ¶7 The Water Court found that the "best evidence" that Vieux was irrigating came in his May 7, 1887 homestead claim filing. Vieux stated that he moved his family to the Teton River land in 1880, when he "established a permanent residence, and took up farming." The 1887 filing states that Vieux farmed nine acres in 1880 and farmed 50 acres by 1887. The Water Court determined that since "cultivation in this area is pointless without irrigation, " the evidence of cultivation is "a strong indication of irrigation." In addition, Vieux claimed ownership of farming equipment including plows, harrows, scythes, a rake and a mowing machine. The homestead claim filings also support ownership of 100 open range cattle and 60 open range horses, with four horses, three cows and some chickens and hogs "on the homestead." The Water Court found that this was consistent with the tax records showing that Vieux was keeping livestock and using the Teton River for their water source. Vieux received a homestead patent on 160 acres that is now part of the Danreuther Ranch.

         ¶8 The Water Court concluded that the preponderance of the evidence showed that Vieux appropriated stockwater from the Teton River and from a spring in Nelse's Coulee as early as 1874. The Water Court also concluded that the preponderance of the evidence showed that Vieux was irrigating nine acres by 1880; that he had increased that to 50 acres by 1887; and that these water appropriations were made on his settlement on the Teton River.[2]

         ¶9 The Water Court found that in 1888 Edward Reichelt acquired a homestead on the Teton River downstream from Nelson Vieux. Reichelt developed his own water rights and acquired property and water rights from others including Vieux, Horace Hibbard, Helen Hibbard, and Clara Lamphear. In 1904 Reichelt secured rights of way for ditches over neighboring lands and on January 25, 1905, he filed a notice of appropriation for 10 cubic feet of water per second (cfs) from the Teton River. The "Reichelt Ditch" has since been the only ditch on the north side of the Teton River capable of carrying water from the River to Reichelt's various parcels of land. Reichelt acquired the Vieux property and water rights by 1914. He combined the Vieux rights with other rights and ran them through the Reichelt Ditch for irrigation. By 1922 Reichelt acquired the Hibbard properties and water rights.

         ¶10 In 1935 Reichelt split his ranch between his sons Dan and Bruno. Dan's upstream parcel later became the Danreuther Ranch after succession to his daughter Janet who married into the Danreuther family. Danreuthers later filed statements of claim for the Vieux, Horace Hibbard (4 cfs) and Helen Hibbard (1 cfs) water rights for use on the upper ranch. Bruno's part of the Reichelt Ranch is still in the Reichelt name, and it claims water rights developed by Edward Reichelt. These Danreuther and Reichelt water rights are all distributed for irrigation through the Reichelt Ditch.

         ¶11 The Water Court reviewed the conflicting testimony by opposing experts concerning the amount of land that the Danreuthers irrigated through the Reichelt Ditch system. While much of the testimony was based upon analysis of aerial photographs from the 20th century, Danreuther's expert additionally conducted field examination of the ditches. Based upon the aerial information and the field inspection, Danreuther's expert determined that "182.80 acres is within the historical range of irrigation on the Danreuther property." The Water Court determined that the combination of aerial photograph survey with field examination of the sites was important and "provides additional credibility" to the conclusions. The Department of Natural Resources and Conservation (DNRC) review of Danreuther's claims also supported the conclusion ...

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