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Southwest Engineering Co. v. Ernst

Supreme Court of Arizona

December 20, 1955

SOUTHWEST ENGINEERING CO., a Nevada corporation authorized to do business in the State of Arizona, Appellant and Cross-Appellee,
Rogert ERNST, State Land Commissioner of the State of Arizona; The State Land Department of the State of Arizona; and the State of Arizona, Appellees and Cross-Appellants.

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[79 Ariz. 405] Peterson & Karman, Casa Grande, for appellant and cross-appellee.

[79 Ariz. 406] Ross F. Jones, Atty. Gen., Robert W. Pickrell, Asst. Atty. Gen., Perry M. Ling, Special Counsel, Phoenix, for appellees and cross-appellants.


This action was commenced by appellant, Southwest Engineering Co., a corporation, against the State of Arizona and the State Land Commissioner to determine appellant's rights to the use of the subterranean water underlying its lands. The Superior Court found and so held that of the two legislative acts controlling the use of ground water, the Groundwater Code [1] of 1948 was constitutional but that Sections 2, 3, 4 and 5 of the Act of 1953 [2] were invalid and unconstitutional. The Southwest Engineering Co. appealed from the judgment declaring the Act of 1948 constitutional, and the State of Arizona and the State Land Commissioner cross-appealed from the judgment declaring that those stated portions of the Act of 1953 were unconstitutional.

The Act of 1953. This Act established an area within the state in which the drilling of irrigation wells except replacement wells was absolutely prohibited for a period of one year. The prohibition was extented one additional year by the legislature in 1954 [3] to March 31, 1955; at that time it expired by virtue of the termination date therein expressed. Since the relief initially sought was a declaration that the prohibition against the drilling of new irrigation wells was unconstitutional and since by lapse of time between the rendition of the judgment of the lower court and the opinion of his court there is not now pending for determination an actual controversy, the cross-appeal is dismissed. Harrison v. Hunt, 28 Ariz. 75, 235 P. 158; Gibson v. Board of Supervisors, 20 Ariz. 222, 179 P. 640.

The Act of 1948. The significant facts alleged in the complaint and admitted by the answer establish that appellant is the owner, or has an interest in certain lands lying within the boundaries of the Gila-Santa Cruz Subdivision of the Santa Cruz and the Gila and Salt River groundwater [4] basins or subdivisions thereof, basins designated by the State Land Commissioner as critical groundwater areas pursuant to the authority conferred by the Act; that appellant drilled an irrigation well on its land but was notified by the State Land Commissioner that an attempt to irrigate lands from such well would be a violation of the penal provisions of the Act; that [79 Ariz. 407] appellant intends to drill an additional irrigation well but has been denied a permit therefor and is now threatened with criminal prosecution unless the whole of the Act is decreed unconstitutional and void.

Before considering the problems raised by the appeal it should be stated that much of the land in the State of Arizona is desert, capable of sustaining human life only if there is available a supply of water for irrigation. Agricultural development in the desert and semi-arid portions of the state has taken three forms. First, and in the earliest days, by the diversion of water from running streams and rivers having their sources in mountain springs; second, by the impounding of excess waters from floods and rains by dams and in reservoirs and their subsequent release through canals and ditches in time of need; and third, as

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these sources became inadequate or nearly so, by the pumping of waters lying or moving beneath the surface of the earth. It is to be recognized that from the time of the earliest settlers there has been some use of ground waters through artesian wells, windmills and centrifugal pumps set at or near the water table, but that deepwell pumping of waters in substantial quantities is a comparatively recent development.

In 1945 the legislature of this state, recognizing that the withdrawal of ground water beyond the rate of natural replacement threatened the economic stability of one of the state's most profitable industries, adopted an act [5] providing for the cooperation of the State Land Commissioner with the United States Geological Survey 'for the purpose of gathering such information as may aid the legislature in considering the subject of a Ground Water Code', and appropriating funds to carry out the purposes thereof. Presumptively the information so obtained was used by the legislature in drafting the Act of 1948. The Act itself is detailed and comprehensive and does not require minute analysis herein. Essentially it provides a method for determining the areas within the state which do not have sufficient ground water to provide a reasonably safe supply for irrigation at the current rates of withdrawal. These areas are designated as 'critical groundwater areas'. After a groundwater area is designated as critical, the construction of new irrigation wells therein is prohibited with certain exceptions, i. e., domestic and replacement wells. Those who are pumping from existing wells are allowed to continue to the full capacity of such wells. It should be emphasized that in critical areas the Act does not purport to regulate the use of ground water between owners of land in cultivation, nor does it regulate the use of ground water outside of critical areas with exception that waste as defined is universally prohibited. By prohibiting the drilling of new wells in critical areas, the Act limits [79 Ariz. 408] the use of water to present facilities thereby preventing additional withdrawals from underground supplies which are determined to be inadequate.

Ground water has been the subject of numerous decisions of this court, culminating in the decision on rehearing in Bristor v. Cheatham, 75 Ariz. 227, 255 P.2d 173, in which this court reaffirmed in a divided opinion its previously adopted rule that the doctrine of prior appropriation does not apply to water percolating generally beneath the soil without ascertainable beds and banks. The majority held that the decision in Maricopa County Municipal Water Conservation District No. 1 v. Southwest Cotton Co., 39 Ariz. 65, 4 P.2d 369, became a rule of property in that by large investments in the reclamation of desert lands, rights had been acquired which were entitled to protection under the law as declared, and that as between users of water the doctrine of reasonable use applied, that is to say, as between individual rights this court would apply the doctrine of reasonable use so far as found applicable to conditions in Arizona. Specifically the question was left open as to the right of the state against individuals to regulate the consumption of ground water in the interest of the general welfare.

The purpose of the Act is set forth in Section 3 thereof:

'* * * that large areas of rich agricultural lands in Arizona are dependent, in whole or in part, upon ground water basins underlying such lands for their water supply, and that in a number of such basins withdrawals of ground water, greatly in excess of the safe annual yield thereof, is converting the lands of rich farming communities into critical groundwater areas, to the serious injury of the general economy and welfare of the state and its citizens. It is therefore declared to be the public policy of the state, in the interest of the agricultural stability, general economy and welfare of the state and its citizens to conserve and protect the water resources of the state from destruction, and for that

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purpose to provide reasonable regulations for the designation and establishment of such critical groundwater areas as may now or hereafter exist within the state.'

The legislative finding that the exhaustion of ground water by excessive withdrawals threatens to destroy one of the principal economic resources of the state to the consequential serious injury of all is not disputed. [6] Such a conclusion is [79 Ariz. 409] obviously justified because unrestrained use must inevitably result either in complete exhaustion of the state's ground water so that in the end the lands dependent thereon will revert to their desert state or in the lowering of water tables so that the increased cost of pumping will reduce these lands to a marginal or submarginal condition.

It is appellant's position that it is the owner of the water underlying its land in that this court held as early as Howard v. Perrin, 8 Ariz. 347, 76 P. 460, 462, and repeatedly since, that 'waters percolating generally through the soil beneath the surface are the property of the owner of the soil.' As such, appellant argues, its property is protected against confiscation by the Constitution of the State of Arizona, Article 2, Section 4, and the nearly identical language of that portion of the Fourteenth Amendment to the Constitution of the United States declaring that no person shall 'be deprived of life, liberty, or property without due process of law.' [7]

It can thus be seen that a conflict occurs between appellant and the state by reason of the interest of the public in the preservation from destruction of a resource essential to the sustenance of life. Where the public interest it thus significantly involved, the preferment of that interest over the property interest of the individual even to the extent of its destruction is a distinguishing characteristic of the exercise of the police power. The principle which we recognize here as controlling rests upon historic precedent extending back into the common law, Respublica v. Sparhawk, 1 Dall. 357, 1 L.Ed. 174, Bowditch v. City of Boston, 101 U.S. 16, 25 L.Ed. 980, and has had continuous recognition almost to the present moment. United States v. Caltex (Philippines), Inc., 344 U.S. 149, 73 S.Ct. 200, 97 L.Ed. 157.

It has application not alone to the disasters of fire, flood, pestilence and war, but to other circumstances where public interests dictate an unavoidable choice between one class of property as against another.

In Miller v. Schoene, 276 U.S. 272, 48 S.Ct. 246, 72 L.Ed. 568, where red cedar rust, an infectious plant disease, was destructive of the fruit and foliage of the apple but without effect on the value of the cedar, and communicated from one to the other, a Virginia statute providing for the destruction of red cedars without compensation to the owners was held to be a constitutional[79 Ariz. 410] exercise of the police powers. The court said:

'On the evidence was may accept the conclusion of the supreme court of appeals that the state was under the necessity of making a choice between the preservation of one class of property and that of the other wherever both existed in dangerous proximity. It would have been none the less a choice if, instead of enacting the present statute, the state, by doing nothing, had

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permitted serious injury to the apple orchards within its border to go on unchecked. When forced to such a choice the state does not exceed its constitutional powers by deciding upon the destruction of one class of property in order to save another which, in the judgment of the legislature, is of greater value to the public. It will not do to say that the case is merely one of a conflict of two private interests and that the misfortune of apple growers may not be shifted to cedar owners by ordering the destruction of their property; for it is obvious that there may be, and that here there is, a preponderant public concern in the preservation of the one interest over the other. (Citing cases.) And where the public interest is involved preferment of that interest over the property interest of the individual, to the extent even of its destruction, is one of the distinguishing characteristics of every exercise of the police power which affects property. (Citing cases.)

'We need not weigh with nicety the question whether the infected cedars constitute a nuisance according to the common law; or whether they may be so declared by statute. See Hadacheck v. (Sebastian) Los Angeles, supra, (239 U.S. 394) 411, (36 Sup. 143) (60 L.Ed. 348, 356, Ann.Cas.1917B, 927). For where, as here, the choice is unavoidable, we cannot say that its exercise, controlled by considerations of social policy which are not unreasonable, involves any denial of due process. * * *' 276 U.S. 279, 280, 48 S.Ct. 247.

We are of the opinion that there is a preponderant public concern in the preservation of the lands presently in cultivation as against lands potentially reclaimable, and that where as here the choice is unavoidable because a supply of water is not available for both, we cannot say that the exercise of such choice, controlled by considerations of social policy which are not unreasonable, involves a denial of due process.

We are thus brought to appellant's proposition that the Act denies to it the equal protection of the laws in that the choice is unreasonable. While the phrase 'equal protection of the laws' has not been precisely defined and is not susceptible of exact delimitation, Louisville Gas & Electric Co. v. Coleman, 277 U.S. 32, 48 S.Ct. [79 Ariz. 411] 423, 72 L.Ed. 770, and while it sets a goal not attainable by the invention and application of a precise formula, Kotch v. Board of River Port Pilot Com'rs, 330 U.S. 552, 67 S.Ct. 910, 91 L.Ed. 1093, there can be no question as to the right of the state to enact laws based on classification of the objects of legislation or of the persons whom it affects. Nor is such questioned. Admittedly also the classification to be valid must be reasonable. Schrey v. Allison Steel Mfg. Co., 75 Ariz. 282, 255 P.2d 604; State v. Double Seven Corp., 70 Ariz. 287, 219 P.2d 776, 19 A.L.R.2d 1007; Valley National Bank of Phoenix v. Glover, 62 Ariz. 538, 159 P.2d 292; Begay v. Sawtelle, 53 Ariz. 304, 88 P.2d 999; Laney v. State ex rel. Jones, 20 Ariz. 416, 181 P. 186. The difference need not be great, Bayside Fish Flour Co. v. Gentry, 297 U.S. 422, 429, 56 S.Ct. 513, 80 L.Ed. 772, if any state of facts reasonably can be conceived that would sustain it. New York Rapid Transit Corp. v. City of New York, 303 U.S. 573, 58 S.Ct. 721, 82 L.Ed. 1024, rehearing denied 304 U.S. 588, 58 S.Ct. 939, 82 L.Ed. 1548; Valley National Bank of Phoenix v. Glover, supra.

Appellant argues that the class of persons here dealt with by the legislature is the agricultural operators of the state; that since equal protection requires that all persons within a class be treated alike, the Act is obviously arbitrary in denying some within the class the use of water for irrigation purposes. However, the equal protection of the laws does not mean that all occupations that are called by the same name must be treated in the same way. Dominion Hotel, Inc., v. State of Arizona, 249 U.S. 265, 39 S.Ct. 273, 63 L.Ed. 597. The classification is not established on the basis of agricultural operators but on the distinctions and differences between present agriculatural users and potential agricultural users of ground water in critical areas. Admittedly the classification is an unusual one and one which did not have existence prior

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to the adoption of this Act, but this is not sufficient grounds to invalidate the Act if the classification has a rational basis. That the classification does have a rational basis is readily apparent. The supply of ground water within the territorial boundaries of the state, or any particular groundwater basin therein, is not unlimited and even though in some instances the limits thereof may be difficult to apprehend, ultimately and inevitably at one time or another it will become necessary to restrict the use merely because the available users and uses exceed the available supply. We do not doubt that it is the proper sphere of the legislature, in the interest of the general welfare, to say when that time has arrived by establishing the mechanics for its determination and upon such determination prescribing the economical consumption which constitutes the most efficient use of water. In critical areas where the supply of water is determined to be inadequate there can be no economic gain to the state by reclaiming additional desert lands since for each acre reclaimed an acre will eventually lose the [79 Ariz. 412] water upon which it is dependent for productivity and must necessarily be withdrawn from cultivation. Capital invested in the clearing and leveling of lands and in buildings, wells and ditches on the acreage required to be withdrawn from cultivation will be destroyed to the same extent as the catastrophe of flood, fire and war; and although the economic impact may be somewhat alleviated by the fact that the loss may extend over a period of time, still it is inevitable that such loss will occur. A classification which tends to prevent such an economic loss to the community and the state cannot be said to be without rational basis and therefore we cannot say that this classification based on such consideration is either whimsical, capricious, arbitrary or unreasonable.

It is urged that the classification is arbitrary because it permits unrestricted and unregulated pumping by the owners of lands in areas which are not critical and denies the same right to the owners of lands in critical areas, thereby conceivably having the effect of treating individuals of the same status on opposite sides of the boundary line in an unequal manner. To this we think there are two answers. First, discrimination or inequality is not forbidden if based on a reasonable classification. Schrey v. Allison Steel Mfg. Co., supra. Second, necessity requires, where the health, safety or general welfare of the people of a particular locality or area is imperiled, that the law although universal in nature be limited in its operation by circumstances to the particular area where a different treatment is required. Since a particular area may have a particular problem necessitating legislative differentiation, in the end the boundaries of the area must inevitably be fixed at one place or another. Unless it should appear, as it does not here, that the fixing of the boundaries under the legislative mandate will necessarily be determined on an arbitrary or unreasonable basis, the Act must be held constitutional. Merely because the possibility exists that there may be an arbitrary and capricious use of power legitimately delegated under the statute is not sufficient reason to entertain a presumption that the power granted will be so exercised. People of State of New York ex rel. Lieberman v. Van De Carr, 199 U.S. 552, 26 S.Ct. 144, 50 L.Ed. 305; Hall v. Geiger-Jones Co., 242 U.S. 539, 37 S.Ct. 217, 61 L.Ed. 480, L.R.A.1917F, 514. If the agency or public officer does act arbitrarily, the courts without declaring the statute invalid will annul the decision of the officer. Federal Trade Commission v. Gratz, 253 U.S. 421, 40 S.Ct. 572, 64 L.Ed. 993.

Appellant complains that the Act is void for want of definiteness and certainty in that it authorizes the Land Commissioner to determine what shall and what shall not be the law. There are two possible approaches to this attack, both suggested in appellant's argument. First, as is often the case, the Act is challenged on the basis that it is impossible for the individual [79 Ariz. 413] to determine what shall or shall not be a violation of the law. As to this the controlling principal repeatedly approved is stated in Connally v. General Construction Co., 269 U.S. 385, AT PAGE 391, 46 S.Ct. 126, at page 127, 70 L.Ed. 322:

'* * * and a statute which either forbids or requires the doing of an act

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in terms so vague that men of common intelligence must necessarily guess at its meaning and differ as to its application violates the first essential of due process of law. * * *'

Jordan v. De George, 341 U.S. 223, 71 S.Ct. 703, 95 L.Ed. 886, rehearing denied 341 U.S. 956, 71 S.Ct. 1011, 95 L.Ed. 1377; City of Tucson v. Stewart, 45 Ariz. 36, 40 P.2d 72, 96 A.L.R. 1492. With this principle [8] we are in accord but we have difficulty in discerning its application to the Act here under attack. No particular language has been specified to which exception is taken, rather appellant relies on the broad proposition that the entire Act is so indefinite that men of common intelligence must necessarily guess at its meaning and differ as to its application. With this in mind, we have examined the Act as a whole and particularly Sections, 7, 9, 10, 11 and 12 for which the failure to adhere involves criminal responsibility, and are of the opinion, that there is sufficient notice of what ought to be and what ought not be done to comply with the Act. While we conclude that the Act is not wholly void for the reason assigned, it is not our intention now to pass approval upon every phrase or sentence therein. We simply treat the objection as raised and postpone judgment on any severable portion of the Act until specific circumstances are presented which may directly affect a litigant's rights. Gherna v. State, 16 Ariz. 344, 146 P. 494, Ann.Cas.1916D, 94; cf. United States v. Petrillo, 332 U.S. 1, 67 S.Ct. 1538, 91 L.Ed. 1877; Rescue Army v. Municipal Court of City of Los Angeles, 331 U.S. 549, 67 S.Ct. 1409, 91 L.Ed. 1666.

Second, it is appellant's argument that the language of Sections 5(a) and 6(a) [9] prescribing the principal duties of the Land Commissioner is so vague, uncertain and incomplete that he is at liberty to or [79 Ariz. 414] must necessarily supply his own interpretation of what the law ought to be in order to accomplish the purpose of the Act. We have held that the duty imposed on a public official by statute must be prescribed in terms sufficient and definite to serve as a guide to those who have the duty imposed upon them. Hernandez v. Frohmiller,68 Ariz. 242, 204 P.2d 854. Plainly if the language imposing the duty does not have such definiteness, then it does not have sufficient literal significance to be capable of intelligent execution; and, moreover, it violates Article 4 of the Constitution of this state directing that the powers of the three branches of government be separate in that it would amount to a delegation of legislative power to the Land Commissioner. We recognize that a delegation of authority in indefinite and uncertain terms will, if it is to be enforced at all, require arbitrary action by the administrative officer and cannot be ...

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