Lyman Creek, LLC v. City of Bozeman

          Submitted on Briefs: August 21, 2019

          District Court of the Eighteenth Judicial District, In and For the County of Gallatin, Cause No. DV-18-854B Honorable Rienne H. McElyea, Presiding Judge

          For Appellant: Jack G. Connors, Jacqueline R. Papez, Doney Crowley P.C., Helena

          For Appellee: Peter G. Scott, Peter G. Scott Law Offices, PLLC, Bozeman, Montana

          For Amicus Curiae: Meg K. Casey, Laura S. Ziemer, Patrick A. Byorth, Trout Unlimited, Bozeman, Montana

          OPINION

          Laurie McKinnon, Justice.

         ¶1 Lyman Creek, LLC (Lyman) appeals an order of the Eighteenth Judicial District Court, Gallatin County, granting City of Bozeman's (City) motion to dismiss.

         ¶2 We affirm. We restate the dispositive issue as follows: Does § 85-2-114, MCA, of the Montana Water Use Act (Act) preclude an implied private right of action for judicial enforcement of the Act?

         FACTUAL AND PROCEDURAL BACKGROUND

         ¶3 Lyman Creek is a perennial stream in Gallatin County that flows through private property owned by Lyman. Both Lyman and the City own water rights sourced by Lyman Creek.

         ¶4 In March 2018, Lyman submitted a complaint to the Montana Department of Natural Resources and Conservation (DNRC) containing allegations of unpermitted water use by the City. DNRC has not taken any enforcement action on Lyman's complaint. On August 6, 2018, Lyman filed a complaint in District Court alleging the City was in violation of the Act and seeking injunctive relief and attorney fees.

         ¶5 Lyman asserted that § 85-2-125(2), MCA, which allows a party to recover costs when enjoining the use of water by a person that does not have a water right, expressly provides a private right of action to enforce the Act. Lyman reasoned that § 85-2-125(2), MCA, would be meaningless if there is no private right of action to obtain injunctive relief. Lyman's complaint requested injunctive relief under the Act and § 27-19-102, MCA. Additionally, Lyman argued that even if § 85-2-125(2), MCA, does not expressly provide a private right of action to enforce the Act, that right is implied by the Act in its entirety. The City moved to dismiss Lyman's complaint for failure to state a claim pursuant to M. R. Civ. P. 12(b)(6), contending that the Act does not create a private right of action for enforcement through injunctive relief, just as it does not create a private right of action, citing Faust v. Utility Solutions, LLC, 2007 MT 326, 340 Mont. 183, 173 P.3d 1183, to enforce civil penalties. Instead, the City claimed, § 85-2-114, MCA, authorizes only DNRC, the attorney general, or the county attorneys to seek judicial enforcement of the Act, including injunctive relief. Importantly, the City acknowledged that Lyman was "not without recourse," as "the mechanism for invoking a district court's supervisory jurisdiction over water distribution is found in [§] 85-2-406, MCA."

         ¶6 The District Court granted the City's motion to dismiss under M. R. Civ. P. 12(b)(6) and dismissed Lyman's complaint. The District Court held that § 85-2-125(2), MCA, may be invoked by a party with a water right to receive costs and attorney fees in an action to enjoin the use of water by a person that does not have a water right, and that, because Lyman and the City both had water rights originating from Lyman Creek, § 85-2-125(2), MCA, was inapplicable.^[1] As the plain language of § 85-2-125(2), MCA, precluded its application, the District Court declined to consider whether § 85-2-125(2), MCA, created an express private right of action.^[2] The District Court next concluded that § 85-2-114, MCA, which allows for judicial enforcement of the Act, does not support an implied private right of action for enforcement. In analyzing the plain language of § 85-2-114, MCA, the District Court held that the legislature did not intend to create a private right of action for enforcement, but instead left enforcement of the Act to DNRC, the attorney general, or the county attorneys. Lyman appeals.

         STANDARD OF REVIEW

         ¶7 "A motion to dismiss pursuant to M. R. Civ. P. 12(b)(6) requires a district court to determine whether a claim has been adequately stated in the pleadings." Woods v. Shannon, 2015 MT 76, ¶ 9, 378 Mont. 365, 344 P.3d 413 (citing Meagher v. Butte-Silver Bow City-County, 2007 MT 129, ¶ 15, 337 Mont. 339, 160 P.3d 552). "The pleadings should not be dismissed unless it appears certain that the petitioner will be unable to recover under any set of facts which could be proven in support of his or her claim." Woods, ¶ 9 (citing Kleinhesselink v. Chevron, U.S.A., 277 Mont. 158, 161, 920 P.2d 108, 110 (1996)). "The pleadings must be construed in the light most favorable to the petitioner, and all allegations of fact contained in the pleadings are taken as true." Woods, ¶ 9 (citing Plouffe v. State, 2003 MT 62, ¶ 8, 314 Mont. 413, 66 P.3d 316).

         ¶8 A district court's decision to grant a motion to dismiss under M. R. Civ. P. 12(b)(6) operates as a conclusion of law. Faust v. Util. Solutions, LLC, 2007 MT 326, ¶ 11, 340 Mont. 183, 173 P.3d 1183 (citing Bar OK Ranch, Co. v. Ehlert, 2002 MT 12, ¶ 31, 308 Mont. 140, 40 P.3d 378). We review a district court's conclusions of law to determine whether the trial judge's interpretation of the law is correct. Carbon County v. Union Reserve Coal Co., 271 ...