DIAMOND NAT. RES. PROT. AND CONSERVATION ASS'N v. DIAMOND VALLEY RANCH, LLC , 2022 NV 43 ( 2022 )

138 Nev., Advance Opinion 43
IN THE SUPREME COURT OF THE STATE OF NEVADA
DIAMOND NATURAL RESOURCES No. 81224
PROTECTION & CONSERVATION
ASSOCIATION; J&T FARMS, LLC;
GALLAGHER FARMS LLC; JEFF
LOMMORI; M&C HAY; CONLEY LAND
& LIVESTOCK, LLC; JAMES FILED
ETCHEVERRY; NICK ETCHEVERRY;
TIM HALPIN; SANDI HALPIN; JUN 1 6 2022
DIAMOND VALLEY HAY COMPANY, ELIZABETH A BROWN
CI-ERK OlaSUPREME COURT
INC.; MARK MOYLE FARMS LLC; D.F. By
& E.M. PALMORE FAMILY TRUST; DEPUTY CLERK 0
WILLIAM H. NORTON; PATRICIA
NORTON; SESTANOVICH HAY &
CATTLE, LLC; JERRY ANDERSON;
BILL BAUMAN; DARLA BAUMAN;
ADAM SULLIVAN, P.E., NEVADA
STATE ENGINEER, DIVISION OF
WATER RESOURCES, DEPARTMENT
OF CONSERVATION AND NATURAL
RESOURCES; AND EUREKA COUNTY,
Appellants,
vs.
DIAMOND VALLEY RANCH, LLC;
AMERICAN FIRST FEDERAL, INC.;
BERG PROPERTIES CALIFORNIA,
LLC; BLANCO RANCH, LLC; BETH
MILLS, TRUSTEE OF THE MARSHALL
FAMILY TRUST; TIMOTHY LEE
BAILEY; CONSTANCE MARIE
BAILEY; FRED BAILEY; CAROLYN
BAILEY; SADLER RANCH, LLC; IRA R.
RENNER; AND MONTIRA RENNER,
Respondents.
SUPREME COURT
OF
NEVADA
tOr 1917A
Appeal from a district court order granting petitions for judicial
review in a water law matter. Seventh Judicial District Court, Eureka
County; Gary Fairman, Judge.
Reversed.
Leonard Law, PC, and Debbie Leonard, Reno,
for Appellants Jerry Anderson; Bill Bauman; Darla Bauman; Conley Land
& Livestock, LLC; D.F. & E.M. Palmore Family Trust; Diamond Natural
Resources Protection & Conservation Association; Diamond Valley Hay
Company, Inc.; James Etcheverry; Nick Etcheverry; Gallagher Farms LLC;
Tim Halpin; Sandi Halpin; J&T Farms, LLC; Jeff Lommori; M&C Hay;
Mark Moyle Farms LLC; William H. Norton; Patricia Norton; and
Sestanovich Hay & Cattle, LLC.
Allison MacKenzie, Ltd., and Karen A. Peterson, Carson City; Theodore
Beutel, District Attorney, Eureka County,
for Appellant Eureka County.
Aaron D. Ford, Attorney General, and James N. Bolotin, Senior Deputy
Attorney General, Carson City,
for Appellant Adam Sullivan, P.E., Nevada State Engineer, Division of
Water Resources, Department of Conservation and Natural Resources.
Kemp Jones, LLP, and Christopher W. Mixson and Don Springmeyer, Las
Vegas,
for Respondents Timothy Lee Bailey, Constance Marie Bailey, Fred Bailey,
and Carolyn Bailey.
Taggart & Taggart, Ltd., and David H. Rigdon and Paul G. Taggart, Carson
City,
for Respondents Ira R. Renner, Montira Renner, and Sadler Ranch, LLC.
Marvel & Marvel, Ltd., and John E. Marvel, Elko,
for Respondents American First Federal, Inc.; Berg Properties California,
LLC; Blanco Ranch, LLC; and Diamond Valley Ranch, LLC.
Beth Mills, Eureka,
in Pro Se.
SUPREME COURT
OF
NEVADA
h l`P47A
2
Blanchard, Krasner & French and Steven M. Silva, Reno; Pacific Legal
Foundation and Daniel M. Ortner, Sacramento, California,
for Amicus Curiae Pacific Legal Foundation.
BEFORE THE SUPREME COURT, EN BANC.
OPINION
By the Court, HARDESTY, J.:
Diamond Valley is a groundwater-dependent farming region
located in Eureka County, Nevada. The Diamond Valley Hydrologic Basin
is over-appropriated and over-pumped, such that groundwater withdrawals
from the Basin exceed its perennial yield (i.e., more groundwater is
withdrawn from the aquifer than what can be naturally replenished). To
address the scarcity of groundwater in Nevada's over-appropriated basins,
the Legislature enacted NRS 534.037 and NRS 534.110(7) in 2011.1 Under
NRS 534.110(7), the State Engineer may designate an over-appropriated
basin a Critical Management Area (CMA). Once designated a CMA, NRS
534.037 allows water perrnit and certificate holders (rights holders) to
petition the State Engineer to approve a Groundwater Management Plan
(GMP) that sets forth the necessary steps for removal of the basin's
designation as a CMA. In determining whether to approve the GMP, the
State Engineer is required to weigh the factors under NRS 534.037(2).
Here, Diamond Valley was designated a CMA, and its rights
holders submitted a GMP to the State Engineer for approval. Although the
'See 2011 Nev. Stat., ch. 265, §§ 1 & 3, at 1383-84 & 1387.
SUPREME COURT
OF
NEVADA
.j 1047A
3
GMP deviated somewhat from the guiding principle underlying Nevada's
water law statutes—the doctrine of prior appropriation, which dictates that
priority is assigned based on first in time, first in right to put the water to
beneficial use—the State Engineer approved the Diamond Valley GMP.
The crux of this case, then, concerns whether NRS 534.037 and NRS
534.110(7) allow the State Engineer to approve a GMP that deviates frorn
the doctrine of prior appropriation. We hold that the Legislature
unambiguously gave the State Engineer discretion to approve a GMP that
departs from the doctrine of prior appropriation and other statutes in
Nevada's statutory water scheme. Thus, we conclude that the State
Engineer's decision to approve the GMP was not erroneous. As we further
conclude that the State Engineer's factual fmdings in support of his decision
were supported by substantial evidence, we reverse the district court's order
granting respondents consolidated petitions for judicial review and
reinstate the State Engineer's decision.
FACTS AND PROCEDURAL HISTORY
We have previously recognized that groundwater "in Diamond
Valley, Nevada, is over-appropriated and has been pumped at a rate
exceeding its perennial yield for over four decades." Eureka County v.
Seventh Judicial Dist. Court (Sadler Ranch), 134 Nev. 275, 276, 417 P.3d
1121, 1122 (2018). Each year, roughly 76,000 acre-feet of groundwater is
withdrawn from the Basin's aquifer, yet its perennial yield is only 30,000
acre-feet. Even more concerning, up to 126,000 acre-feet of water rights
have been permitted in the Basin. If the State Engineer limited pumping
in the Basin to its perennial yield, any appropriations made after roughly
May 1960 would have junior priority and be subject to curtailment.
Similarly, any water rights appropriated before that date would have
SUPREME COURT
seniority and would not be subject to curtailment.
OF
NEVADA
101 lU7A .1
-
7 V3ZA
4
As noted, in 2011, the Legislature enacted NRS 534.037 and
amended NRS 534.110 to allow the State Engineer to approve a GMP that
helps resolve groundwater shortages in over-appropriated basins like
Diamond Valley, which was designated a CMA in 2015. In 2018, a majority
of rights holders in Diamond Valley petitioned the State Engineer to
approve their proposed GMP for the Basin. After holding a public hearing
and allowing written comments, the State Engineer approved the GMP.
State Engineer Order No. 1302 (Jan. 11, 2019). The GMP created a 35-year
plan to reduce the amount of pumping from the Basin at 5-year intervals.
The GMP reduced the amount of water that rights holders can use based on
the priority of the holders rights. However, the GMP deviated from the
doctrine of prior appropriation by requiring all water rights holders to
reduce their withdrawals from the Basin—not just junior rights holders.
Respondents, who are senior rights holders in the Basin, filed
petitions for judicial review, which the district court consolidated.
Respondents sought to invalidate the GMP on the ground that its deviance
from water-law principles, such as the doctrine of prior appropriation, and
from Nevada's statutory water scherne made the plan legally erroneous.
The district court concluded that the GMP violated (1) the doctrine of prior
appropriation by forcing senior appropriators to reduce their water use;
(2) the beneficial use statute, NRS 533.035, by allowing unused
groundwater to be banked or transferred; and (3) two permitting statutes,
NRS 533.325 and NRS 533.345, by allowing appropriators to change the
point or manner of diversion without filing an application with the State
Engineer. The district court concluded that NRS 534.037 and NRS
534.110(7) do not give the State Engineer discretion to approve a GMP that
deviates from the foregoing principle and statutes. Because the district
5
court decided that the State Engineer's legal conclusions were erroneous, it
concluded that Order No. 1302 was arbitrary and capricious. Thus, the
district court granted respondents consolidated petitions for judicial review
and invalidated Order No. 1302. Nonetheless, the district court found that
the State Engineer's analysis of the factors under NRS 534.037(2) was
supported by substantial evidence.
The State Engineer and several rights holders in the Basin
(collectively, appellants) now appeal. They argue that the Legislature
unambiguously gave the State Engineer discretion to approve a GMP that
deviates from the doctrine of prior appropriation and other provisions in
Nevada's statutory water scheme, so long as the State Engineer considers
the factors enumerated in NRS 534.037(2) and determines that the GMP
will remove the basin's designation as a CMA. Respondents contend the
district court's order should be affirmed because the GMP reduces their
water rights based on an erroneous interpretation of the law.
At oral argument, we asked respondents if they presented any
evidence to the State Engineer during the GMP approval process showing
whether—and to what extent—their water rights were affected by the GMP.
Respondents answered, "[N]o, it was not quantified." We then inquired
whether respondents requested the State Engineer make those calculations
before approving the GMP. Respondents conceded that "[t] hey did not raise
it as an issue in their written comments." Finally, we asked respondents
whether they presented any calculus to the district court showing that any
of their water rights were affected by the GMP. Respondents answered, "I
don't think it was raised as a specific issue."
SUPREME COURT
Of
NEVADA
(0) 1917A
6
DISCUSSION
Standard of review
"The decision of the State Engineer is prima facie correct, and
the burden of proof is upon the party attacking the same." NRS 533.450(10).
We perform the same review as the district court; thus, when we review a
district coures order reversing the State Engineer's decision, "we determine
whether the [State Engineer['s decision was arbitrary or capricious." King
v. St. Clair, 134 Nev. 137, 139, 414 P.3d 314, 316 (2018). A "capricious
exercise of discretion is one . . . 'contrary to the evidence or established rules
of law.'" State v. Eighth Judicial Dist. Court (Armstrong), 127 Nev. 927,
931-32, 267 P.3d 777, 780 (2011) (citation omitted) (quoting Capricious,
Black's Law Dictionary (9th ed. 2009)). "IWJe review purely legal questions
[de novo,[ without deference to the State Engineer's ruling." Pyramid Lake
Paiute Tribe of Indians v. Ricci, 126 Nev. 521, 525, 245 P.3d 1145, 1148
(2010). However, "[w]e review the State Engineer's factual findings for an
abuse of discretion and will only overturn those findings if they are not
supported by substantial evidence." Sierra Pac. Indus. v. Wilson, 135 Nev.
105, 108, 440 P.3d 37, 40 (2019). "Substantial evidence is that which a
reasonable mind could find adequate to support a conclusion." Kolnik v.
State, Emp't Sec. Dep't, 112 Nev. 11, 16, 908 P.2d 726, 729 (1996)-
NRS 534.037 and NRS 534.110(7) plainly and unambiguously allow the
State Engineer to approve a GMP that departs from the doctrine of prior
appropriation and other statutes in Nevada's water scheme
Appellants argue that NRS 534.110(7) unambiguously allows
the State Engineer to approve a GMP that departs from the doctrine of prior
appropriation. They also argue that a GMP may depart from other portions
of Nevada's statutory water scheme so long as the State Engineer weighs
the factors under NRS 534.037(2) and determines that the GMP will remove
7
the basin's designation as a CMA. Respondents assert that NRS 534.110(7)
unambiguously provides that the State Engineer shall order priority-based
curtailment if a GMP has not been approved for the basin, but any GMP
must comply with the doctrine of prior appropriation. Respondents
alternatively argue that, if the statute is ambiguous, the presumption
against implied repeal and legislative history show that the Legislature did
not intend to repeal the doctrine of prior appropriation.
The State Engineer concluded that NRS 534.037 and NRS
534.110(7) allow the approval of a GMP that departs from the doctrine of
prior appropriation and other parts of Nevada's statutory water scheme.
Because the State Engineer's conclusion invokes a question of law, we
review it de novo. Pyramid Lake Paiute Tribe, 126 Nev. at 525, 245 P.3d at
1148. "Where a statute is clear and unambiguous, this court gives effect to
the ordinary meaning of the plain language of the text without turning to
other rules of construction." Chandra v. Schulte, 135 Nev. 499, 501, 454
P.3d 740, 743 (2019). We look beyond a statute's plain text only "if it is
ambiguous or silent on the issue in question." Allstate Ins. Co. v. Fackett,
125 Nev. 132, 138, 206 P.3d 572, 576 (2009). "[When a statute is
susceptible to more than one reasonable interpretation, it is
ambiguous . . . ." Zohar v. Zbiegien, 130 Nev. 733, 737, 334 P.3d 402, 405
(2014). Where a legal question invokes multiple statutes, we "construe
[them] as a whole, so that all provisions are considered together and, to the
extent practicable, reconciled and harmonized." Cromer v. Wilson, 126 Nev.
106, 110, 225 P.3d 788, 790 (2010).
Because we have not yet interpreted NRS 534.037 and NRS
534.110(7), we must now ascertain the meaning of these statutes. Under
NRS 534.110(7)(a), the State Engineer "[m] ay designate as a critical
8
management area [(CMA)1 any basin in which withdrawals of groundwater
consistently exceed the perennial yield of the basin." Once the basin
receives CMA designation, a majority of the rights holders in the basin may
petition the State Engineer for "approval of a groundwater management
plan [(GMP)] for the basin." NRS 534.037(1). The GMP "must set forth the
necessary steps for removal of the basin's designation as a [CMA]." Id.Then, the State Engineer "shall consider" seven factors to determine
whether to approve the GMP:
(a) The hydrology of the basin;
(b) The physical characteristics of the basin;
(c) The geographic spacing and location of the
withdrawals of groundwater in the basin;
(d) The quality of the water in the basin;
(e) The wells located in the basin, including,
without limitation, domestic wells;
(f) Whether a groundwater management plan
already exists for the basin; and
(g) Any other factor deemed relevant by the
State Engineer.
NRS 534.037(2). If a basin has been designated as a CMA for 10 consecutive
years, then NRS 534.110(7) dictates that "the State Engineer shall order
that withdrawals . . . be restricted in that basin to conform to priority
rights, unless a groundwater management plan has been approved for the
basin pursuant to NRS 534.037." (Emphases added.)
Construing NRS 534.037 and NRS 534.110(7) together, we
conclude that these statutes plainly and unambiguously allow the State
Engineer to approve a GMP so long as the State Engineer concludes that
the GMP (1) "seas] forth the necessary steps for removal of the basin's
designation as a [CMAL" see NRS 534.037(1), and (2) is warranted under
SUPREME COURT
OF
NEVADA
,O, i.)47A
9
the seven factors enumerated in NRS 534.037(2).2 Moreover, NRS
534.110(7) plainly states that the State Engineer shall order curtailment by
priority unless a GMP has been approved for the basin—indicating that a
GMP could, but does not necessarily have to, comply with the doctrine of
prior appropriation. Thus, NRS 534.110(7) permits regulation in a manner
inconsistent with the doctrine of prior appropriation if a GMP has been
approved for the basin. Because these statutes plainly allow the State
Engineer to approve a GMP based on the preceding criteria,3 and because
they are silent as to other aspects of Nevada's statutory water scheme, we
reject respondents position that a GMP must strictly comply with the
2Insofar as respondents assert that our plain meaning interpretation
is inconsistent with the presumption against implied repeal, we disagree.
Under the implied-repeal canon, we presume that the Legislature does not
intend to overturn existing law unless it does so expressly in the statutory
text. See Wilson v. Happy Creek, Inc., 135 Nev. 301, 307, 448 P.3d 1106,
1111 (2019). However, the presumption against implied repeal does not
apply where "the later act covers the whole subject of the earlier one and is
clearly intended as a substitute." Posadas v. Nat'l City Bank, 296 U.S. 497,
503 (1936). When a basin is designated as a CMA and a petition by a
majority of rights holders is made to have a GMP approved, it is clear NRS
534.037 and NRS 534.110(7) are intended to exempt a GMP that meets the
statutory requirements from other provisions in Nevada's statutory water
scheme. Thus, the presumption against implied repeal does not apply to
this analysis.
3 Before approving a GMP, the State Engineer must also comply with
the public hearing and notice provisions of NRS 534.037(3). As the district
court found, the record indicates that the State Engineer complied with
these provisions before approving Order No. 1302. Insofar as respondents
argue that the State Engineer did not comply with NRS 534.037(3), we
reject this argument because respondents did not cite relevant portions of
the record to support their assertions. See NRAP 28(a)(10)(A); Allianz Ins.
Co. v. Gagnon, 109 Nev. 990, 997, 860 P.2d 720, 725 (1993) (stating that we
need not consider arguments unsupported by citations to the record).
SUPREME COURT
OF
NEVADA
tO1 1447A
10
doctrine of prior appropriation. Moreover, because NRS 534.037 and NRS
534.110(7) are clear, there is no need to consult extratextual sources—such
as legislative history or the statutory canons—to disambiguate these
statutes. See generally Ratzlaf v. United States, 510 U.S. 135, 147-48 (1994)
(explaining that legislative history should not be used to "cloud a statutory
text that is cleae).4 Thus, we conclude that the State Engineer's legal
conclusions were not erroneous: NRS 534.037 and NRS 534.110(7) allow the
State Engineer to approve a GMP that departs from the doctrine of prior
appropriation, so long as the State Engineer complies with the foregoing
statutory criteri a.
Our conclusion is supported by Nevada law providing that
statutory law may impair nonvested water rights. Cf. NRS 533.085(1);
Andersen Family Assocs. v. Ricci, 124 Nev. 182, 188, 179 P.3d 1201, 1204-
05 (2008) (explaining that statutory law may not impair vested water rights
(i.e., rights appropriated before 1913)). Extrapolating on this law, the
Legislature has authority to modify the statutory scheme regulating
nonvested water rights. We recently explained that the doctrine of prior
appropriation is a fundamental principle in various statutory provisions.
See Mineral County v. Lyon County, 136 Nev. 503, 513, 473 P.3d 418, 426
(2020). Thus, it follows that the Legislature may create a regulatory scheme
'Even if NRS 534.110(7) were ambiguous, the rule of the last
antecedent supports our interpretation. See Barnhart v. Thomas, 540 U.S.
20, 26 (2003) (explaining that the rule of the last antecedent means that "a
limiting clause or phrase . . . should ordinarily be read as modifying only
the noun or phrase that it immediately follows"). NRS 534.110(7)'s limiting
clause—"unless a groundwater management plan has been approved"—
immediately follows the text's mandate that withdrawals be restricted to
conform to priority rights. Thus, it follows that the approval of a GMP
allows the State Engineer to regulate a basin on a basis other than priority.
SUPFIEME COURT
OF
NESOACA
11
111,1 i)43A
that modifies the use of water appropriated after 1913 in a manner
inconsistent with the doctrine of prior appropriation. Accordingly, we reject
respondents argument that the State Engineer's legal conclusions in Order
No. 1302 were erroneous5 and therefore arbitrary and capricious.6
5Respondents argue that Order No. 1302 is erroneous because it does
not assess whether the GMP affected vested water rights (i.e., rights
appropriated before 1913), and the interference with their vested surface
water rights invokes constitutional concerns. Order No. 1302 explained
that before the GMP was approved, several parties in the Basin received
mitigation rights for the loss of their senior surface water rights.
Respondents' appellate briefs, however, do not cite portions of the
administrative record to show that they presented the State Engineer with
evidence to show that the GMP would affect their specific surface water
rights or that they had not received adequate mitigation rights. See Allianz,
109 Nev. at 997, 860 P.2d at 725 (stating that we need not consider
arguments unsupported by citations to the record); see also Dubray v. Coeur
Rochester, Inc., 112 Nev. 332, 337 n.2, 913 P.2d 1289, 1292 n.2 (1996)
(stating that an argument is waived on appeal if it was not raised before the
hearing officer). From this record, we are unable to conclude that the State
Engineer acted capriciously because it is unclear the extent to which the
GMP affected respondents' vested water rights. Although we decline to
address respondents' arguments, our holding does not preclude respondents
from asserting a future constitutional claim if the GMP actually affected
their vested rights. We reiterate that our holding is limited to nonvested
water rights because statutory law may not impair vested water rights.
NRS 533.085(1).
6Because our interpretation of NRS 534.037 and NRS 534.110(7)
concludes that a GMP is valid so long as the State Engineer makes
appropriate findings under NRS 534.037(2) and determines that the GMP
will remove the basin's designation as a CMA, we conclude that
respondents' remaining arguments—including those pertaining to
beneficial use and permitting requirements—are meritless. The State
Engineer did precisely what the foregoing statutory provisions require
before approving this GMP.
12
This leads to a needed discussion of the dissenting opinions. We
begin by reiterating that NRS 534.037 and NRS 534.110(7), based on the
foregoing analysis, are unarnbiguous. Insofar as the dissenting opinions
cite the canon of constitutional avoidance and legislative history to interpret
NRS 534.110(7), both interpretive tools cannot be consulted when, as here,
the statutory text is plain and unambiguous.7 See generally Ratzlaf, 510
U.S. at 147-48 (explaining that legislative history should not be used when
the text is clear); see also Warger v. Shauers, 574 U.S. 40, 50 (2014) (stating
that the avoidance canon cannot be used if statutory text is unambiguous).
Because these statutes are unambiguous, we decline to resort to legislative
history or the avoidance canon.
We reiterate that our holding, consistent with the plain
meaning of NRS 534.110(7), applies only to priority rights and does not
impair vested water rights. Thus, although our dissenting colleagues
contend that we have abrogated existing water law, our holding qualifies—
rather than abrogates—the prior appropriation and beneficial use doctrines
only in the context of priority rights existing in an over-appropriated basin
that has been designated a CMA. Moreover, the GMP here ratably reduces
water usage such that senior appropriators are still allowed more water
7 We are unable to determine whether Justice Pickering concludes
that NRS 534.110(7) is ambiguous. Compare Dissenting op., post. at 2
(Pickering, J., dissenting) ("To the extent that the majority's reading is
reasonable, then, this legal text is at best ambiguous, which opens the door
to legislative history?), with id. at 12 ("For these reasons, and the additional
reasons stated in Chief Justice Parraguirre's dissent, which I join except as
to its finding of ambiguity, I respectfully dissent." (emphasis added)). In
any event, Justice Pickering's dissent consults grammatical canons to
interpret NRS 534.110(7), see id. at 3-4, but the parties briefs do not cite
these canons. Thus, we are unpersuaded that our plain meaning
interpretation of NRS 534.037 and NRS 534.110(7) is incorrect.
SUPREME COURT
OF
NEVADA
13
than junior appropriators, and in that regard, still honors priority rights
and therefore does not abrogate them.
We must separately address Justice Pickering's dissent for
three reasons. First, it interprets NRS 534.037 and NRS 534.110(7) in a
manner that would render these statutes nugatory. Her dissent explains
that we erred by not considering these statutes "in the larger context of NRS
534.110 and NRS Chapters 533 and 534 as a whole." Dissenting op., post.
at 7 (Pickering, J., dissenting). It specifies that, lafflowing the State
Engineer to approve a GMP that deviates from the prior appropriation and
beneficial use doctrines puts NRS 534.037 and NRS 534.110(7) into direct
conflict with the rest of NRS Chapters 533 and 534." Id. at 8. We disagree.
To the contrary, if a GMP were required to comply with every statute in
NRS Chapters 533 and 534, there would have been no need for the
Legislature to enact NRS 534.037 and NRS 534.110(7).8
Indeed, it is dubious that the Legislature would have enacted
these statutes if it believed that existing statutory provisions allowed the
State Engineer to regulate an over-appropriated basin. If we were to adopt
Justice Pickering's construction, NRS 534.037 and NRS 534.110(7) would
be meaningless because the State Engineer would have no power—beyond
what is already conferred by NRS Chapters 533 and 534—to regulate over-
appropriated basins. Thus, these statutes would be rendered nugatory. See
Clark County v. S. Nev. Health Dist., 128 Nev. 651, 656, 289 P.3d 212, 215
(2012) ("Statutes should be read as a whole, so as not to render superfluous
8Justice Pickering's dissent also avers that NRS 534.110(7)s text
should be read "fairly" and that "a reasonable readee would reject the
majority's interpretation. See Dissenting op., post. at 3 (Pickering, J.,
dissenting). We are unpersuaded that our interpretation of NRS 534.110(7)
is untenable such that we should apply this novel interpretive method.
SUPREME COURT
OF
NEVADA
14
ol h 1947A
words or phrases or make provisions nugatory."). Because this would lead
to an absurd result, we disagree with Justice Pickering's interpretation of
NRS 534.037 and NRS 534.110(7).
Second, our dissenting colleague seemingly relies on unpassed
legislation to interpret NRS •534.110(7). Dissenting op., post. at 11-12
(Pickering, J., dissenting). Justice Pickering suggests that the State
Engineer proposed legislation in 2016 to amend NRS 534.110(7) to
expressly allow a GMP to deviate from priority regulation because NRS
534.110(7) does not allow this deviation. Id. at 11-12. Unpassed legislation,
however, has little value when interpreting a statute. See Pension Benefit
Guar. Corp. v. The LTV Corp., 496 U.S. 633, 650 (1990) (explaining that
unpassed legislation is "a particularly dangerous ground on which to rest
an interpretation of a prior statute"); see also Grupe Dev. Co. v. Superior
Court, 844 P.2d 545, 552 (Cal. 1993) (holding the same). This is because
proposed legislation that was not adopted leads to conflicting inferences. As
Justice Pickering concludes, the State Engineer may have believed that
NRS 534.110(7) did not allow a GMP to depart from priority regulation.
Dissenting op., post. at 11-12 (Pickering, J., dissenting). However, it can
just as easily be inferred that the Legislature rejected this bill because it
felt that the existing statutory text already allowed the State Engineer to
depart from priority regulation. Due to these conflicting inferences, we
conclude that the best approach here is to enforce the law as written. See
generally Zuni Pub. Sch. Dist. No. 89 v. 1:sep't of Educ., 550 U.S. 81, 119
(2007) (Scalia, J., dissenting) (explaining that "legislated texe should
prevail over "legislators intentions"). For these reasons, we conclude that
the unpassed legislation cited in Justice Pickering's dissent is
unpersuasive.
15
Third, we decline to reach constitutional questions, such as the
Takings Clause analysis identified by Justice Pickering, that are not
essential to this decision." See Nw. Austin Mun. Util. Dist. No. One v.
Holder, 557 U.S. 193, 205 (2009) (explaining that constitutional questions
should not be decided if there is another ground on which to rest the
disposition of the case). As noted, a plain meaning interpretation of NRS
534.037 and NRS 534.110(7) leads to the inescapable conclusion that the
State Engineer may approve a GMP that deviates from priority regulation.
Thus, we need not reach the Takings Clause to resolve this appeal.
Further, concluding otherwise would result in an advisory
opinion because respondents failed to show that a controversy exists. See
Capanna v. Orth, 134 Nev. 888, 897, 432 P.3d 726, 735 (2018) (explaining
that we lack the power to render advisory opinions); see also Herbst Gaining,
Inc. v. Heller, 122 Nev. 877, 887, 141 P.3d 1224, 1231 (2006) ("Alleged harm
that is speculative or hypothetical is insufficient: an existing controversy
must be present."). As noted, during oral argument, respondents conceded
that they never presented any evidence to the State Engineer or the district
court to show that the GMP here affected their vested water rights. In fact,
they conceded that any Takings Clause claim "would certainly come later."
Respondents briefs, other than a vague reference to the Takings Clause,
likewise fail to identify whether they lost any water rights under this GMP,
9We note that Chief Justice Parraguirres dissent addresses the
Takings Clause issue only as a matter of statutory interpretation, given his
finding of ambiguity in NRS 534.110(7). Justice Pickering's dissent goes
further and seemingly concludes the GMP here effectuates a taking such
that the State Engineer "is constitutionally required to provide just
compensation and process." Dissenting op., post. at 10 (Pickering, J.,
dissenting) (internal quotation marks omitted).
16
let alone whether any rights that may have been lost were vested water
rights. Given that respondents failed to preserve or assert any
constitutional claim for our review, they have not shown that an actual
controversy exists. We therefore decline to address any constitutional issue
herein because doing so would lead to an advisory opinion. As previously
emphasized, however, our holding does not preclude respondents from
seeking future relief if their vested water rights were impaired by the GMP.
Given our conclusion that the GMP was not arbitrary or
capricious, we now examine whether the State Engineer's factual findings
for Order No. 1302 were supported by substantial evidence.
The factual findings for Order No. 1302 are supported by substantial
evidence, and therefore, the State Engineer did not abuse his discretion
Appellants argue that the State Engineer's decision to approve
Order No. 1302 was supported by substantial evidence and point to the
extensive findings supporting the GMP. Respondents assert that the State
Engineer's decision to approve the GMP was unsupported by substantial
evidence because the administrative record is devoid of scientific or
technical evidence to show that the GMP would balance the Basin's
withdrawals with its perennial yield. We disagree.
We will uphold the State Engineer's factual findings for Order
No. 1302 if they are supported by substantial evidence. Sierra Pac. Indus.
v. Wilson, 135 Nev. 105, 108, 440 P.3d 37, 40 (2019). As a threshold issue,
the record indicates that the majority of the Basin's permit and certificate
holders petitioned the State Engineer to approve the GMP. See NRS
534.037(1). Thus, the State Engineer was required to weigh the factors
under NRS 534.037(2) to determine whether the GMP was valid.
Before approving the GMP as Order No. 1302, the State
Engineer made extensive findings under NRS 534.037(2). The State
17
Engineer examined the Basin's (1) hydrology, (2) physical characteristics,
(3) geographic spacing of withdrawals, (4) water quality, and (5) well
locations. After weighing these factors, the State Engineer concluded that
the proposed GMP would ultimately reduce withdrawals in the Basin to
conform to its perennial yield. Given that the State Engineer, as set forth
in his appendix, methodically considered the NRS 534.037 factors and
concluded that the GMP would reduce withdrawals to the Basin's perennial
yield—which would remove the Basin's designation as a CMA—substantial
evidence supports the decision to approve the GMP. To that end, the district
court concluded that the State Engineer properly weighed the NRS
534.037(2) factors to conclude that the GMP would balance the Basin back
to its perennial yield.
Thus, we reject respondents argument that the State
Engineer's factual findings were unsupported by substantial evidence.
Despite respondents' suggestion that the record is devoid of scientific or
technical evidence to support Order No. 1302, this contention is meritless
because of the foregoing explanation describing the State Engineer's
extensive scientific findings. The district court likewise found that the
State Engineer's findings supporting Order No. 1302 were supported by
substantial evidence. Moreover, we are not in a position to reject the State
Engineer's factual findings regarding scientifically complex matters. See
Wilson v. Pahrump Fair Water, LLC, 137 Nev. 10, 16, 481 P.3d 853, 858
(2021) (explaining that our deference to the State Engineer's judgment "is
especially warranted" when "technical and scientifically complex" issues are
involved). Because the record shows that the State Engi neer's factual
findings were supported by substantial evidence, the decision to approve
Order No. 1302 does not constitute an abuse of discretion. Accordingly, the
18
State Engineer's decision to approve Order No. 1_302 is entitled to
deference.1°
CONCLUSION
We have recognized generally that water in this state "is a
precious and increasingly scarce resource," Bacher v. Office of the State
Eng'r, 122 Nev. 1110, 1116, 146 P.3d 793, 797 (2006), arid specifically that
Diamond Valley has been an over-appropriated basin for more than four
decades, Eureka County v. Seventh judicial Dist. Court (Sadler Ranch), 134
Nev. 275, 276, 417 P.3d 1121, 1122 (2018). The Legislature enacted NRS
534.037 and NRS 534.110(7) to address the critical water shortages in
Nevada's over-appropriated basins. These statutes plainly give the State
Engineer discretion to approve a GMP that does not strictly comply with
Nevada's statutory water scheme or strictly adhere to the doctrine of prior
appropriation. The State Engineer is only required to weigh the factors
under NRS 534.037(2) and determine that the GMP sets forth the necessary
steps for the removal of the basin's designation as a CMA. Here, the State
Engineer did precisely what NRS 534.037 and NRS 534.110(7) require
before approving Order No. 3.302.
We recognize that our opinion will significantly affect water
management in Nevada. We are of the belief, however, that—given the arid
nature of tMs State—it is particularly important that we effectuate the
plain meaning of a statute that encourages the sustainable use of water.
See generally Wilson v. Happy Creek, Inc., 135 Nev. 301, 311, 448 P.3d 1106,
1114 (2019) (explaining the importance of using water sustainably). The
10Insofar as appellants raise issues not addressed herein, including
the district court's alleged reliance on evidence outside of the record, we
conclude that we need not reach them given the disposition of this appeal.
19
GMP here is a community-based solution to the long-term water shortages
that befall Diamond Valley. Because the GMP complies with NRS 534.037
and NRS 534.110(7), it is valid. Thus, we reverse the district court order
granting respondents petitions for judicial review and reinstate Order No.
1302.
J.
Hardesty
We concur:
Stiglich
J.
Cadish
Herndon
20
PARRAGUIRRE, C.J., with whom SILVER, J., agrees, dissenting:
I respectfully dissent from my colleagues for two reasons. First,
I disagree that NRS 534.037 and NRS 534.110(7) plainly and
unambiguously allow the State Engineer to approve a Groundwater
Management Plan (GMP) that departs from the doctrine of prior
appropriation. Rather, NRS 534.037 is silent on the issue and NRS
534.110(7) is ambiguous because it is subject to two equally plausible
interpretations. Thus, this court must look beyond the text of these statutes
to the canons of statutory construction, as well as to legislative history, both
of which show that the Legislature did not intend to abrogate 155 years of
water law when enacting NRS 534.037 and NRS 534.110(7). Moreover, the
majority's interpretation of these statutes could raise constitutional doubts.
Second, Order 1302 erroneously abdicates the beneficial use requirement
and fails to consider whether curtailment will impair vested surface water
rights. For these reasons, I would hold that Order 1302 is capricious, and
thus, I respectfully dissent.
FACTS
As explained by the majority, this GMP seeks to reduce
groundwater withdrawals in the Diamond Valley Basin. In doing so, the
GMP requires senior appropriators to use less water than they are entitled
to under the doctrine of prior appropriation. For instance, if a senior
appropriator was entitled to 100 acre-feet of water per year, the GMP allows
that appropriator to use only 67 acre-feet per year during the first 5 years
of the plan. Meanwhile, a junior appropriator, who is not entitled to any
water under the doctrine of prior appropriation, would be allowed to use 54
acre-feet of water per year during the first 5 years of the plan. By year 35
of the GMP, the same senior appropriator would be allowed only 30 acre-
feet of water per year, whereas the same junior appropriator would be
allowed 24 acre-feet of water. Further, the GMP creates a novel water-
banking system that allows appropriators to buy, sell, or lease their water
rights to other appropriators, even if the water rights have not been put to
beneficial use.
DISCUSSION
Standard of review
On a petition for judicial review, "we determine whether the
[State Engineeds decision was arbitrary or capricious." King v. St. Clair,
134 Nev. 137, 139, 414 P.3d 314, 316 (2018). A decision that is contrary to
established law is capricious. State v. Eighth Judicial Dist. Court
(Armstrong), 127 Nev. 927, 931-32, 267 P.3d 777, 780 (2011) (citation
omitted).
The doctrine of prior appropriation
Before turning to NRS 534.037 and NRS 534.110(7), a
discussion of the prior appropriation doctrine is necessary to show why the
Legislature did not intend to abrogate long-standing law. Nevada's water
law is founded on a fundamental principle—prior appropriation. However,
the majority considers the doctrine of prior appropriation a mere "guiding
principle." See Majority op., ante at 4. This description of the doctrine
understates the importance it has played in the development of the Western
United States, and even more importantly, in the development of Nevada's
water-law jurisprudence.
This court adopted the doctrine of prior appropriation 155 years
ago by explaining that the first appropriator of water has a right to use that
water to the extent of the original appropriation. See Lobdell v. Simp.son, 2
Nev. 274, 277-78 (1866). Our adherence to the doctrine of prior
appropriation has been unwavering. As we restated recently, "Nevada's
water statutes embrace prior appropriation as a fundamental principle."
SUPREME COURT
OF
NEVADA
2
Mineral County v. Lyon County, 136 Nev. 503, 513, 473 P.3d 418, 426 (2020)
(emphasis added) (explaining that water rights are given subject to existing
rights based on the date of priority). Thus, we held that adjudicated water
rights cannot be reallocated unless the reallocation comports with the
doctrine of prior appropriation. Id. at 520, 473 P.3d at 431. The United
States Supreme Court likewise acknowledges that Nevada follows the prior
appropriation doctrine. See Cappaert v. United States, 426 U.S. 128, 139
n.5 (1976) ("Under Nevada law water rights can be created only by
appropriation for beneficial use."). Moreover, the Legislature expressly
provided that the doctrine applies to groundwater. See NRS 534.020.
In sum, the doctrine of prior appropriation is more than just a
"guiding principle." The prior appropriation doctrine—for over a century—
has been fundamental to water law in Nevada.
NRS 534.110(7) does not allow the State Engineer to approve a GMP that
departs from the doctrine of prior appropriation
The majority concludes that NRS 534.037 and NRS 534.110(7)
unambiguously allow the State Engineer to approve a GMP that departs
from the prior appropriation doctrine. I disagree because NRS 534.037 does
not speak to the doctrine of prior appropriation, much less authorize the
State Engineer to disregard the doctrine. Further, as explained below, the
canon against implied repeal, legislative history, and the canon of
constitutional avoidance show that the Legislature did not intend for NRS
534.110(7) to authorize such an action by the State Engineer.
NRS 534.110(7) is ambiguous
We look beyond a statutes text only "if it is ambiguous."
Allstate Ins. Co. v. Fackett, 125 Nev, 132, 138, 206 P.3d 572, 576 (2009).
"Where a statutes language is ambiguous . . . the court must look to
legislative history and rules of statutory interpretation to determine its
SUPREME COURT
meaning." Orion Portfolio Servs. 2, LLC v. County of Clark, 126 Nev. 397,
OF
NEVADA
3
l(l 1417A •-•"
-471,
-1.:,
402, 245 P.3d 527, 531 (2010). "A statute's language is ambiguous when it
is capable of more than one reasonable interpretation." Id.NRS 534.110(7) is ambiguous because, as the parties'
arguments show, it is susceptible to more than one reasonable
interpretation. Specifically, NRS 534.110(7)s relevant language-1M' a
basin has been designated as a critical management area for at least 10
consecutive years . . . the State Engineer shall order that
withdrawals . . . be restricted in that basin to conform to priority rights,
unless a groundwater management plan has been approved for the basin"
(emphases added)—yields two reasonable interpretations. First, as
appellants argue, this language could be interpreted to mean that if the
State Engineer approves a GMP, the GMP may order withdrawals that do
not "conform to priority rights," i.e., deviate from the prior appropriation
doctrine. Alternatively, as respondents argue, this language could be
interpreted just as reasonably to mean that the statute mandates that the
State Engineer shall begin to restrict withdrawals by priority if a basin has
been designated as a critical management area for the 10-year statutory
period and no GMP has been approved. But if a GMP has been approved
for the basin, respondents contend that the language simply provides that
the State Engineer may choose not to order curtailment. Both
interpretations are reasonable, thereby rendering NRS 534.110(7)
ambiguous.
Having concluded that NRS 534.110(7) is ambiguous, we must
consult the rules of statutory interpretation and legislative history.
Implied repeal
Under the canon against implied repeal, "Wile Legislature is
presumed not to intend to overturn long-established principles of law when
enacting a statute." Wilson v. Happy Creek, Inc., 135 Nev. 301, 307, 448
SUPREME COURT
OF
NEVADA
4
l(l 14-17A
P.3d 1106, 1111 (2019) (internal quotation marks omitted); see also Ramsey
v. City of North Las Vegas, 133 Nev. 96, 112, 392 P.3d 614, 626 (2017)
("[R]epeals by implication are disfavored—very much disfavored."
(emphasis added)). 'The presumption is always against the intention to
repeal where express terms [of repeal] are not used." Presson v. Presson, 38
Nev. 203, 208-09, 147 P. 1081, 1082 (1915) (internal quotation marks
omitted). Indeed, there is a presumption that legislatures "do[ 1 not alter
the fundamental details of a regulatory scheme in vague terms or ancillary
provisions—[they] do [ 1 not, one might say, hide elephants in mouseholes."
Whitman v. Arn. Trucking Ass'ns, Inc., 531 U.S. 457, 468 (2001).
I agree with respondents proposed interpretation of NRS
534.110(7) because appellants' interpretation would abrogate the prior
appropriation doctrine without an express declaration in the statutory text.
Indeed, the majority's interpretation hides elephants in rnouseholes
because NRS 534.110(7) does not expressly permit the State Engineer to
approve a GMP that departs from the doctrine of prior appropriation, which
has underpinned this State's water laws as a fundamental principle. As
both the United States Supreme Court and this court have recognized,
Nevada follows the prior appropriation doctrine. Here, however, Order
1302—by the State Engineer's own admission—does not comport with the
prior appropriation doctrine. We cannot assume that the Legislature
intended a fundamental and significant departure from 155 years of water
law without express statutory text supporting this result. Thus, the canon
against implied repeal supports respondents' interpretation.
Legislative history
Legislative history supports the conclusion that NRS
534.110(7) was not intended to allow the State Engineer to adopt a GMP
inconsistent with the doctrine of prior appropriation. In 2011,
5
Assemblyperson Pete Goicoechea, the sponsor of Assembly Bill 419 (seeking
enactment of NRS 534.110), discussed how GMPs would treat priority
rights. He first stated, "Water rights in Nevada are first in time[,] first in
right. The older the water right, the higher the priority. We would address
the newest permits and work backwards to get basins back into balance."
Hearing on A.B. 419 Before the Senate Gov't Affairs Comm., 76th Leg., at
13 (Nev., May 23, 2011). Assemblyperson Goicoechea then stated, 'This bill
allows people in over[d appropriated basins ten years to implement a water
management plan to get basins in balance. People tvith junior rights will
try to figure out how to conserve enough water under these plans." Id. at 16
(emphasis added). This legislative history makes clear that junior—not
senior—appropriators have the burden of reducing water usage under a
GMP, which means that senior water rights have priority. Thus, legislative
history supports respondents interpretation of NRS 534.110(7).
Constitutional avoidance
An interpretation of NRS 534.037 and NRS 534.110(7) that
departs from priority regulation could raise constitutional doubt under the
Takings Clause. Consequently, I address the canon of constitutional
avoidance, Nevada's long-standing treatment of water rights as property
rights, and how the GMP could constitute an unconstitutional physical
taking. Based on this an.alysis, I conclude that respondents' proposed
interpretation of NRS 534.037 and NRS 534.110(7) should be adopted
because it avoids constitutional doubts under the Takings Clause.
This court has explained that it "may shun an interpretation
that raises serious constitutional doubts and instead may adopt an
alternative that avoids those problems." Degraw v. Eighth judicial Dist.
Court, 134 Nev. 330, 333, 419 P.3d 136, 139 (2018) (internal quotation
marks omitted).
SuonEmE COURT
OF
NEVADA
6
1o47A
"The Takings Clause of the Fifth Amendment provides that
private property shall not 'be taken for public use, without just
compensation.'" Murr v. Wisconsin, U.S. „ 137 S. Ct. 1933, 1942
(2017) (quoting U.S. Const. amend. V); see also Nev. Const. art. 1, § 8(3)
("Private property shall not be taken for public use without just
compensation having been first made . . . ." (emphasis added)). "When the
government physically takes possession of an interest in property for some
public purpose, it has a categorical duty to compensate the former owner,"
and this duty applies "regardless of whether the interest that is taken
constitutes an entire parcel or merely a part thereof." Tahoe-Sierra Pres.
Council, Inc. v. Tahoe Reel Planning Agency, 535 U.S. 302, 322 (2002).
We have explained that "Mor a taking to occur, a claimant must
have a stick in the bundle of property rights." ASAP Storage, Inc. v. City of
Sparks, 123 Nev. 639, 647, 173 P.3d 734, 740 (2007) (internal quotation
marks omitted). "The bundle of property rights includes all rights inherent
in ownership, including the inalienable right to possess, use, and enjoy the
property." Id. (internal quotation marks omitted).
We have concluded that water rights are alienable, Adaven
Mgmt., Inc. v. Mountain Falls Acquisition Corp., 124 Nev. 770, 781, 191
P.3d 1189, 1196 (2008), allow the rights holder to enjoy the water, Lobdell,
2 Nev. at 277-78, and allow the rights holder to beneficially use the water,
Bacher v. Office of State Eng'r, 122 Nev. 1110, 1116, 146 P.3d 793, 797
(2006). Of course, a prior appropriator also has the right to exclude others
from using their water. See Application of Filippini, 66 Nev. 17, 21-22, 202
P.2d 535, 537 (1949) (explaining that priority rights are protected to the
extent of the original appropriation). Thus, Nevada's water law gives senior
appropriators at least three sticks in the bundle of property rights: the right
SUPREME COURT
OP
NEVADA
7
to transfer, the right of use and enjoyment, and the right to exclude.
Priority rights, therefore, are subject to the Takings Clause.
Based on three United States Supreme Court cases, I posit that
requiring senior appropriators to pump less groundwater—and possibly
reallocate that water to a nonbeneficial use—before junior appropriators
are forced to cease pumping that same groundwater could be a compensable
physical taking under the Fifth Amendment. See Dugan v. Rank, 372 U.S.
609, 625 (1963) (holding that the government's confiscation of surface water
rights without compensation was a physical taking); United States v.
Gerlach Live Stock Co., 339 U.S. 725, 755 (1950) (holding the same); Int'l
Paper Co. v. United States, 282 U.S. 399, 405-07 (1931) (holding the same);
see also Washoe County, Nev. v. United States, 319 F.3d 1320, 1326 (Fed.
Cir. 2003) ("In the context of water rights, courts have recognized a physical
taking where the government has . . . decreased the amount of water
accessible by the owner of the water rights.").
Further, it is crucial to explain that priority rights are property
subject to constitutional protection regardless of whether they are pre-
statutory rights. Our recent jurisprudence generally uses the term "vested"
water rights to describe appropriative rights "that existed under Nevada's
common law before the provisions currently codified in NRS Chapter 533
were enacted in 1913." Andersen Family Assocs. v. Ricci, 124 Nev. 182, 188,
179 P.3d 1201, 1204 (2008) (explaining that pre-statutory rights cannot be
impaired by statutory law). However, we have rejected the notion that post-
statutory water rights—i.e., those appropriated after 1913—are not
protected as real property. See Filippini, 66 Nev. at 21-22, 202 P.2d at 537(explaining that priority rights are regarded and protected as real property
regardless of whether the right existed prior to the enactment of Nevada's
8
statutory water law). Thus, water rights appropriated after 1913 are still
entitled to constitutional protection as property rights.
Accordingly, an interpretation of NRS 534.037 and NRS
534.110(7) that allows the State Engineer to depart from priority regulation
and possibly reallocate senior water rights—without compensation
following an eminent domain proceeding—could be an unconstitutional
physical taking under the Nevada and United States Constitutions. The
respondents have presented a plausible statutory interpretation that avoids
these doubts, and therefore, their interpretation should prevail.]
Conclusion
To summarize, all tools of statutory interpretation point to a
simple result: NRS 534.037 and NRS 534.110(7) are intended to allow all
rights holders in an over-appropriated basin to create a collaborative GMP
to reduce withdrawals from the basin, with the onus being on the junior
appropriators to reduce water use. If the rights holders approve the GMP,
the State Engineer need not order curtailment by priority. If, however, the
rights holders do not approve the GMP, then the State Engineer must order
curtailment by priority. Thus, these statutes were intended to inspire
junior appropriators to collaboratively reduce water use or risk curtailment.
Senior appropriators should not have to, and were not intended to, bear this
burden.
II express no view on whether a taking occurred in this case.
Although the GMP plainly decreases the amount of water that senior
appropriators in Diamond Valley can utilize, the record in this case is
insufficient to determine whether, and to what extent, the respondents'
water rights were affected by the GMP.
9
Order 1302 departs from other laws
In addition to the concerns above, Order 1302 violates the
beneficial use statute and does not account for vested surface water rights.
The GMP does not comply with the beneficial use statute
Order 1302 provides that "[u]nused allocations [of water] may
be banked, traded, leased or sold; thus, the GMP employs a market-based
approach." It also states, "Section 13.9 of the GMP allows unused
allocations to be carried over and banked for use in a subsequent year to
increase the amount of water the rights holder can use in the next year."
The cornerstone of allocation—beneficial use—is "the basis, the
measure and the limit of the right to use of water," NRS 533.035, and this
requirement defines the extent of water rights. Thus, for every application
to appropriate water, a "fundamental requirement . . . is that water only be
appropriated for beneficial use." Bacher, 122 Nev. at 1116, 146 P.3d at 797
(internal quotation marks omitted). "When the necessity for the use of
water does not exist, the right to divert it ceases . . . ." NRS 533.045.
"Accordingly, beneficial use underpins Nevada's water statutes, and the
Legislature has continued to delineate and expand on which uses are
considered public uses in Nevada." Mineral County, 136 Nev. at 514, 473
P.3d at 427.
The GMP departs from Nevada's beneficial use statute because
it allows unused water to be banked, sold, traded, or leased rather than
allocating water based on beneficial use. Cf. NRS 533.045 (providing that
the right to use water ceases if not put to beneficial use). Appellants provide
no citation to any law allowing water banking in Nevada. They also cite no
persuasive authority that suggests that water banking is a public use that
qualifies as beneficial use. Simply put, there appears to be no binding or
persuasive authority that classifies water banking as a beneficial use in a
10
prior appropriation jurisdiction. Because the GMP contravenes laws
delineating beneficial use (i.e., it allows unused water rights to be retained),
it is contrary to established law. Thus, I would hold that the State
Engineer's decision to approve Order 1302 was capricious.2
The GMP does not account for vested surface water rights
In Order 1302, the State Engineer concluded that, under NRS
534.037, a GMP need not reduce groundwater pumping to preserve surface
water rights, and thus, the GMP proponents need not consider its effect on
surface water rights.
Vested water rights "may not be impaired by statutory law and
may be used as granted in the original decree until modified by a later
permit." Andersen Fainily Assocs., 124 Nev. at 188, 179 P.3d at 1204-05.
As noted, our recent jurisprudence generally uses the term "vestee water
rights to describe appropriative rights "that existed under Nevada's
common law before the provisions currently codified in NRS Chapter 533
were enacted in 1913." Id. at 188, 179 P.3d at 1204.
Here, the Diamond Valley GMP does not account for its effect
on vested surface water rights. For that reason, whether the GMP actually
irnpairs vested surface water rights is unclear. Because statutory law may
not impair vested rights, a GMP approved under NRS 534.037 must account
for its effect on vested surface water rights under NRS 534.037(2)(g).
Accordingly, the State Engineer's contrary conclusion—that a GMP need
2The GMP also departs from NRS 533.325 and NRS 533.345, which
require an appropriator of water to file an application with the State
Engineer whenever changing "the place of diversion, manner of use or place
of use of water already appropriated." The GMP here deviates from this
law because it allows appropriators (so long as the amount of water they
use does not increase) to change the place of diversion, manner of use, or
place of use of the water without filing an application with the State
Engineer. For this additional reason, the GMP is capricious.
11
not account for vested surface water rights—was capricious because
established law requires the preservation of vested rights.
CONCLUSION
I recognize that the groundwater shortages that befall Diamond
Valley and Nevada are of great concern to the public. However, I do not
believe that these concerns allow this court to interpret NRS 534.037 and
NRS 534.110(7) contrary to Nevada's historical water law. The constitution
controls over any legislative act, and therefore, this court should adopt an
interpretation of NRS 534.037 and NRS 534.110(7) that avoids
constitutional violence. Respondents interpretation of NRS 534.110(7) is
compelling and well supported by the canons of statutory construction and
legislative history. I would affirm the district court's decision to grant
respondents' petition for judicial review because it is my firm belief that
Order 1302 is capricious. Therefore, I respectfully dissent.
C.J.
Parraguirr
I concur:
J.
Silver
12
PICKERING, J., with whom SILVER, J., agrees, dissenting:
State Engineer Order 1302 approves a groundwater
management plan (GMP) that effectively reallocates a percentage of senior
water rights to junior water right holders, then ratably reduces water use
across the board for a period of 35 years. The GMP does not compensate—
or provide a mechanism for compensating—the senior water right holders.
And in making its calculations, the GMP presumes but does not require
beneficial use of the water rights it counts. These features place the GMP
in direct conflict with the two fundamental principles underlying Nevada's
water law statutes: the prior appropriation doctrine, which holds "first in
time is first in right," such that, in times of shortage, "[t]he early
appropriator of water prevails over a later appropriator," Ross E. deLipkau
& Earl M. Hill, The Nevada Law of Water Rights 3-17 (2010); and the
beneficial use doctrine, which holds that "[b]eneficial use shall be the basis,
the measure and the limit of the right to the use of watee in Nevada, NRS
533.035. See Mineral County v. Lyon County, 136 Nev. 503, 513, 473 P.3d
418. 426 (2020) CNevada's water statutes embrace prior appropriation as a
fundamental principle"; "[t]he other fundamental principle that [Nevada's]
water statutes embrace is beneficial use.").
The majority opines that, on a "plain text" reading. NRS
534.110(7) and NRS 534.037 "plainly and unambiguously allow the State
Engineer to approve a GMP that departs from the doctrine of prior
appropriation and other statutes in Nevada's water scheme." Majority op.
at 7. Nothing in the text of either statute expressly exempts GMPs from
the prior appropriation and beneficial use doctrines. Instead, the majority
infers the exemptions it declares from the fact that NRS 534.110(7)
mandates the State Engineer to order curtailment in certain instances, then
provides a mechanism for avoiding the mandate; and from NRS 534.037s
SUPREME COURT
OF
NEVADA
silence on prior appropri.ation and beneficial use. But as Chief Justice
Parraguirre develops in his separate dissent, the text of NRS 534.110(7) and
NRS 534.037 can as easily—and more grammatically—be read to say GMPs
are fully subject to the prior appropriation and beneficial use doctrines. To
the extent that the majority's reading is reasonable, then, this legal text is
at best ambiguous, which opens the door to legislative history. See Coleman
v. State, 134 Nev. 218, 219, 416 P.3d 238, 240 (2018). And here, the
legislative history supports Chief Justice Parraguirre's reading, not the
majority's. See Dissenting op. at 6 (Parraguirre, C.J.).
I write separately from Chief Justice Parraguirre because of
another, more basic problem with the majority's approach: "In ascertaining
the plain meaning of ta] statute, the court must look to the particular
statutory language at issue, as well as the language and design of the
statute as a whole." K Mart Corp. v. Cartier, Inc., 486 U.S. 281, 291 (1988)
(Ken ned.y, J.). A court does not determine a statute's meaning by reading
its words out of context, in isolation from the body of statutes it inhabits.
See Antonin Scalia & Bryan A. Garner, Reading Law: The Interpretation of
Legal Texts 252 (2012) (Statutes in pari materia are to be interpreted
together, as though they were one law."). The two statutes on which the
majority relies, NRS 534.110(7) and NRS 534.037, are part of NRS Chapters
533 and 534. Since NRS Chapters 533 and 534 incorporate the prior
appropriation and beneficial use doctrines, so do NRS 534.110(7) and NRS
534.037. Unless and until the Legislature expressly exempts GMPs from
these doctrines, all GMPs, including Diamond Valley's, remain subject to
them. With no express exemption in either NRS 534.110(7) or NRS 534.037,
the only reasonable reading they can bear is that the GMPs they authorize
2
are subject to, not impliedly exempt from, the prior appropriation and
beneficial use doctrines that undergird Nevada's water statutes.
I.
A.
The closest the majority comes to finding textual support for
exempting GMPs from the prior appropriation and beneficial use doctrines
is the fourth sentence of NRS 534.110(7), which states:
If a basin has been designated as a critical
management area for at least 10 consecutive
years . . , the State Engineer shall order that
withd rawals, i nci uding, without limitation,
withdrawals from domestic wells, be restricted in
that basin to conform to priority rights, unless a
groundwater management plan has been approved
for the basin pursuant to NRS 534.037.
See Majority op. at 9 (discussing this provision with emphases shown).
fgnore technical grammatical rules for the moment and just read the
sentence fairly. It is long and clause-filled, to be sure. But a reasonable
reader can still understand that the sentence describes circumstances
where the State Engineer must order curtailment according to priority—
where a basin has been designateci a critical management area (CMA) for
at least 10 consecutive years, and there is no GMP in place. It does not state
that the State Engineer can disregard the prior appropriation and beneficial
use doctrines in any circumstances, including where a GMP is in place.
The majority reads the clause "unless a [GMP] has been
approve& (the unless clause) to modify the clause, "that withdrawals . . . be
restricted . . . to conform to priority righte (the priority-rights clause). That
is, the majority says that withdrawals need conform to priority rights in a
CMA only if a GMP has not been approved for the basin. This reading
disregards conventional rules of grammar and syntax. See Scalia & Garner,
SUPREME COURT
OF 3
NEVADA
7A
supra, at 140 (in interpreting a legal text, "[w]ords are to be given the
meaning that proper grammar and usage would assign them"). "Unless.' is
a subordinating conjunction that "introduces a clause that is dependent on
the independent clause." The Chicago Manual of Style § 5.200 (17th ed.
2017); see id. § 5.201(3). And the priority-rights clause is not an
independent clause because it has no object. See id. § 5.225. The unless
clause therefore necessarily refers back to the closest (and only)
independent clause in the sentence—qhe State Engineer shall order that
withdrawals . . . be restricted in that basin to conform to priority
rights . . . ." See id. at §§ 5.225, 5.228; see also Castleman v. Internet Money
Ltd., 546 S.W.3d 684, 690 (Tex. 2018) (noting that "properly placed commas"
usually signal that a conditional clause applies to the entire series that
precedes it). Thus, even closely parsed, the fourth sentence in NRS
534.110(7) says only that the State Engineer must order curtailment when,
after a decade has passed, a basin designated as a CMA has no GMP in
place. It does not (and grammatically cannot be read to) condition the
application of the prior appropriation doctrine—let alone the beneficial use
doctrine—on the absence of a GMP.
NRS 534.110(7) was added to NRS Chapter 534 in 2011. See
2011 Nev. Stat., ch. 265, § 3, at 1387. Its fourth sentence contains a specific
mandate to the State Engineer to order curtailment by priority when an
over-appropriated basin has been a CMA for 10 years without a GMP_
Because a GMP allows the State Engineer to avoid this specific mandate
does not abrogate the prior appropriation doctrine or take it or the beneficial
use doctrine out of play. As the district court found, even when the mandate
in NRS 534.110(7) to the State Engineer to order curtailment is avoided,
conservation measures to enforce the prior appropriation and beneficial use
SUPREME COURT
OF 4
NEVADA
(c ). Pa7A
doctrines remain, including: the State Engineer exercising his or her
discretion to order curtailment by priority. see NRS 534.110(6) (empowering
the State Engineer to order curtailment in all or any part of an over-pumped
basin); the creation of a funded land and water rights purchase program, cf.
New Mexico Office of State Eng'r u. Leu,is, 1.50 P.3d 375, 385 (N.M. ct. App.
2006) (holding that a strict priority call is not the "first or exclusive
response" to a water shortage under a prior appropriation scheme, where
44
resolution through land and water rights purchases using *public
funding . . . and perhaps other actions" are provided for); instituting a
rotating water-use schedule, cf. NRS 533.075; financially incentivizing best
farming practices; canceling unused water rights; and curtailing peak
season junior pumping.
The majority makes much ado over NRS 534.037(2). In its view,
NRS 534.037s silence as to the prior appropriation and beneficial use
doctrines signifies that GMPs are impliedly exempt from them. In whole,
NRS 534.037(2) reads as follows:
In determining whether to approve a groundwater
management plan submitted pursuant to
subsection 1, the State Engineer shall consider,
without limitation:
(a) The hydrology of the basin;
(b) The physical characteristics of the basin;
(c) The geographic spacing and location of the
withdrawals of groundwater in the basin;
(d) The quality of the water in the basin;
(e) The wells located in the basin, including,
without limitation, domestic wells;
(f) Whether a groundwater management plan
already exists for the basin; and
5
(g) Any other factor deemed relevant by the
State Engineer.
Again, nothing in this statute expressly allows the State Engineer to
approve a GMP that restores hydrological balance by usurping senior
rights. The use of the phrase "without limitation" to introduce the list of
factors in NRS 534.037(2) and the reference to "[a]ny other factoF as the
last item in the list makes the list non-exhaustive. The statute's silence as
to the prior appropriation and beneficial use doctrines thus does not support
reading it to say that neither doctrine applies. Cf. Scalia & Garner, supra,
at 132-33 (noting that the negative-implication canon does not apply to
expressly non-exhaustive lists). The opposite is true: These doctrines apply
to GMPs because the statute does not expressly state they do not.
NRS 534.037(2) directs the State Engineer to consider certain
technical environmental factors in evaluating a GMP (as well as other
relevant factors "without limitation"). The prior appropriation and
beneficial use doctrines--bedrock principles founding the entirety of
Nevada water law, see Mineral County, 136 Nev. at 513, 473 P.3d at 426—
do not fit in the category of enumerated environmental considerations that
NRS 534.037(2) lists. Nor would a reasonable reader expect them to be
listed. Thus, the enumeration of factors the State Engineer may consider
in approving a GMP does not excuse the State Engineer from adhering to
the prior appropriation and beneficial use doctrines in addressing over-
pumped basin shortages. In short, NRS 534.110(7) and NRS 534.037
neither expressly nor impliedly authorize the State Engineer to abdicate
responsibility for enforcing the prior appropriation and beneficial use
doctrines by approving a GMP that violates these doctrines.
SUPREME COURT
NEVADA
OF
6
1111 1.17
B.
The majority compounds its error by looking at NRS 534.037
and the fourth sentence in NRS 534.110(7) and deciding their meaning
without considering their text in the larger context of NRS 534.110 and NRS
Chapters 533 and 534 as a whole. But "[c]ontext is a primary determinant
of meaning." Scalia & Garner, supra, at 167. "[T]he meaning of a statute
is to be looked for, not in any single section, but in all the parts together and
in their relation to the end in view." Panama Ref. Co. v. Ryan, 293 U.S. 388,
439 (1935) (Cardozo, J., dissenting).
NRS 534.110(7) was added to NRS 534.110 in 2011, along with
NRS 534.037. See 2011 Nev. Stat., ch. 265, §§ 1, 3, at 1383-87. They
introduce the concept of critical management areas to NRS Chapter 534,
with NRS 534.110(7) spelling out when the State Engineer may, and when
he or she must, designate a basin as a CMA. As discussed in part I.A.,
supra, NRS 534.110(7) further specifies when, in a CMA-designated basin,
the State Engineer must order curtailment by priority. The preceding
subsection, NRS 534.110(6), predates the 2011 amendments. It grants the
State Engineer the general power to curtail pumping by priority:
Except as otherwise provided in subsection 7, the
State Engineer shall conduct investigations in any
basin or portion thereof where it appears that the
average annual replenishment to the groundwater
su.pply may not be adequate for the needs of all
permittees and all uested-right claimants, and if the
findings of the State Engineer so indicate, except as
otherwise provided in subsection 9, the State
Engineer may order that withdrawals, including,
without limitation, withdrawals from domestic
wells, be restricted to conform to priority rights.
SUPREME COURT
OF 7
NEVADA
101 I 947A
(emphases added); see also NRS 534.110(9) (recognizing the State
Engineer's authority to order curtailment by priority "pursuant to
subsection 6 or 7").
Subsections 6 and 7 of NRS 534.110 identically describe the
State Engineer's curtaihnent power (to "order that withdrawals, including,
without limitation, withdrawals from domestic wells, be restricted to
conform to priority rights"). Subsection 6 explains when the State Engineer
may invoke that power (after investigating and finding over-appropriation
and over-pumping). Subsection 7 differs only in that it describes
circumstances where that permissive authority becomes a mandate
(following 10 consecutive years of CMA designation with no GMP in place).
See State v. Am. Bankers Ins. Co., 106 Nev. 880, 882, 802 P.2d 1276, 1278
(1990) (noting rule that mandatory words impose a duty while permissive
words grant discretion). There is no logical reason to read identical
language describing the State Engineer s curtailment authority to achieve
contradictory results (i.e., subsection 6 embracing and subsection 7
rejecting curtailment by priority when a CMA has a GMP).1
Allowing the State Engineer to approve a GMP that deviates
from the prior appropriation and beneficial use doctrines puts NRS 534.037
and NRS 534.110(7) into direct conflict with the rest of NRS Chapters 533
and 534. As a majority of this court discussed at length just two years ago,
prior appropriation and beneficial use are Nevada's water statutes two
most fundamental principles—so fundamental that even the public trust
doctrine is subordinate to them. Mineral county, 136 Nev. at 518-19, 473
1The "[e]xcept as otherwise provided in subsection 7" language
logically refers to NRS 534 110(7)'s mandate to the State Engineer to order
curtailment, not the GMP exception to that mandate.
8
P.3d at 430; but see id. at 520, 529, 473 P.3d at 431, 437 (Pickering, J.,
dissenting in part). Priority and beneficial use matter most when shortages
arise. Yet, under the majority's reading of NRS 534.037 and NRS
534.110(7), all junior water right holders otherwise facing curtailment need
do is gather up a majority to petition the State Engineer to designate the
basin a CMA and, again by sirnple majority vote, adopt a GMP that
reallocates senior water rights to junior water right holders, without
compensating the senior holders for the loss of their valuable rights. This
is contrary to the protection Nevada's water statutes afford settled water
rights, on which Nevada's "[rn]unicipal, social, and economic institutions
rely" and on which the "prosperity of the state" depends. Mineral County,
136 Nev. at 518, 473 P.3d at 429.
"A textually permissible interpretation that furthers rather
than obstructs [a law's] purpose should be favored." Scalia & Garner, supra,
at 63. And the majority's application of NRS 534.110(7) and NRS 534.037
disincentivizes conservation in over-appropriated basins. Order 1302
impairs senior water right holders valuable property rights without
compensation or process based on the majority vote of all water rights
holders, including junior water right holders, who have the most to gain.
See State Eng'r, Ruling No. 6290 21-22 (Aug. 15, 2014) (finding that many
rights holders in the Diamond Valley Basin discouraged the State Engineer
from taking conservation action at that time). If, however, 534.110(7) is
read as the backstop that its text and context support, then cooperation in
conservation efforts is in the junior water right holders' interests to avoid
mandated curtailment.
Some senior water right holders will cooperate altruistically, in
the interests of their community. More than likely, some will not. These
SUPREME COURT
OF
NEVADA
9
.1). 1317A
folks should be encouraged to do so via compensation, not have their
valuable water rights taken from them on the vote of a simple majority.
That is the prior appropriation doctrine in action—defending the rights of
senior water right holders during water shortages. What purpose does it
serve to define and protect senior rights if juniors in a dwindling basin can
simply vote to reallocate them when the rubber hits the road? See NRS
533.430(1);2 NRS 533.265(2)(b); NRS 533.090(1)-(2);3 NRS 534.020(1);4 cf.
In re Parental Rights as to S.M.M.D., 128 Nev. 14, 24, 272 P.3d 126, 132
(2012) (noting that this court avoids interpretations that render statutory
text meaningless).
Beyond all this, before the law takes property from persons, the
government is constitutionally required to provide "just compensation" and
process. Mu.rr v. Wisconsin, U.S. _ „ 137 S. Ct. 1933, 1942 (2017)
(quoting U.S. Const. amend. V); .see also Nev. Const. art. 1, § 8(3) ("Private
property shall not be taken for public use without just compensation having
been first made . . . ." (emphasis added)). This implicates Chief Justice
Parraguirre's point regarding the canon of constitutional avoidance—surely
an interpretation that does not raise such "serious constitutional doubts"
"Every permit to appropriate water, and every certificate of
2
appropriation granted under any permit by the State Engineer.. . . shall be,
and the same is hereby declared to be, subject to existing rights . . . ." NRS
533.430(1).
3NRS 533.090 allows the State Engineer to determine priority of
relative rights. NRS 533.265 requires that certificates of final
determination of relative rights include their date of priority.
4"A11 underground waters within the boundaries of the State belong
to the public, and, subject to all existing rights to the use thereof, are subject
to appropriation for beneficial use only under the laws of this State relating
to the appropriation and use of water and not otherwise." NRS 534.020(1).
SUPREME COURT
OF
NEVADA
10
should be favored. See Dissenting op. at 6 (quoting Degraw v. Eighth
?Judicial Dist. Court, 134 Nev. 330, 333, 419 P.3d 136, 139 (2018)). But even
further, the constitutional context militates against the majority's holding
that, in enacting NRS 534.110(7) and NRS 534.037, the Legislature has, by
implication and not express direction, abrogated the prior appropriation
and beneficial use doctrines. This is the very area in which these doctrines
are paramount—an over-appropriated and consistently over-pumped basin.
Surely the Legislature would have anticipated the need for funding and
processes to protect senior water right holders if it meant to exempt GMPs
in CMAs from the prior appropriation and beneficial use doctrines. Other
states do not allow deviation from prior appropriation without protecting
senior water right holders. See, e.g., Empire Lodge Homeowners Ass'n v.
Moyer, 39 P.3d 1139. 1150-51 (Colo. 2001) (holding that water statute
authorizes out-of-priority diversions of water via augmentation plans so
long as senior rights are protected via replacement water that offsets the
out-of-priority diversion); Lewis, 150 P.3d at 387-88 (offering relief to junior
rights holders at the express authorization of the legislature while still
honoring prior appropriation via provided funds); Arave v. Pineview W.
Water Co., 477 P.3d 1239, 1245 (Utah 2020) (noting that a junior
appropriator has the right—at their own expense—to replace a senior
appropriator's water). Why would Nevada?
C.
Even the State Engineer did not think that the current
statutory scheme permitted curtailment unconstrained by prior
appropriation. Five years after the statutes at issue were enacted, the State
Engineer proposed legislative amendments that would have filled the
silence in NRS 534.037 that the majority relies on and allowed a GMP to
deviate from prior appropriation. See S.B. 73, 79th Leg. § 2 (Nev. 2016); see
11
also Bailey v. Nev. State Eng'r, Nos. CV-1902-348, CV-1902-349 & CV-1902-
350, at 26 (Nev. Dist. Ct. Apr. 23, 2020) (Order Granting Petition for
Judicial Review). The bill would have allowed the State Engineer to
approve a GMP "limiting the quantity of water that may be withdrawn
under any permit or certificate or from a domestic well on a basis other than
priority." S.B. 73 §2(3). The State Engineer's former understanding of the
scope of the office's powers is instructive, Nev. Attorney for Injured Workers
v. Nev. Self-Insurers Ass'it, 126 Nev. 74, 83, 225 P.3d 1265, 1271 (2010)
(noting that the court may consider agency interpretations of statutes they
enforce where consistent with the text): As written, NRS 534.110(7) and
NRS 534.037 do not authorize a GMP that violates prior appropriation or
beneficial use principles.
In sum, text, context, and the enforcing agency's original
interpretation all militate against the reading the majority gives NRS
534.110(7) and NRS 534.037. For these reasons, and the additional reasons
stated in Chief Justice Parraguirre's dissent, which I join except as to its
finding of ambiguity. I respectfully dissent.
J.
I concur:
J.
Silver
12