Opinion
No. 2 CA-CV 2017-0108
02-14-2018
SWEETIE K LLC, A WYOMING LIMITED LIABILITY COMPANY, Plaintiff/Appellant, v. RICHARD CARON AND JUDITH CARON, HUSBAND AND WIFE, Defendants/Appellees.
COUNSEL Moyes Sellers & Hendricks, Phoenix By Steve Wene and Joshua T. Greer Counsel for Plaintiff/Appellant The Sifferman Law Firm, P.L.L.C., Phoenix By Mark S. Sifferman Counsel for Defendants/Appellees
THIS DECISION DOES NOT CREATE LEGAL PRECEDENT AND MAY NOT BE CITED EXCEPT AS AUTHORIZED BY APPLICABLE RULES.
NOT FOR PUBLICATION
See Ariz. R. Sup. Ct. 111(c)(1); Ariz. R. Civ. App. P. 28(a)(1), (f). Appeal from the superior Court in Gila County
No. S0400CV201500121
The Honorable Timothy M. Wright, Judge
AFFIRMED
COUNSEL Moyes Sellers & Hendricks, Phoenix
By Steve Wene and Joshua T. Greer
Counsel for Plaintiff/Appellant The Sifferman Law Firm, P.L.L.C., Phoenix
By Mark S. Sifferman
Counsel for Defendants/Appellees
MEMORANDUM DECISION
Presiding Judge Staring authored the decision of the Court, in which Chief Judge Eckerstrom and Judge Brearcliffe concurred. STARING, Presiding Judge:
¶1 Sweetie K LLC appeals from the trial court's grant of summary judgment in favor of Richard and Judith Caron. Sweetie K argues the trial court erred in its interpretation of the preclusive effect of the outcome in a prior lawsuit, its conclusion that declaratory and injunctive relief were inappropriate, and its conclusion that the Carons had not converted Sweetie K's property. For the reasons that follow, we affirm.
Factual and Procedural Background
¶2 We view the evidence and all reasonable inferences therefrom in the light most favorable to the party opposing the motion for summary judgment. Andrews v. Blake, 205 Ariz. 236, ¶ 12 (2003). In 1909, William McLachlan acquired a homestead patent for 160 acres of land in Gila County. The land was subsequently divided and the Verde Glen 3 subdivision was created from one of the divisions. The Carons own two lots in Verde Glen 3.
¶3 The East Verde River borders the east side of Verde Glen 3. Approximately one tenth of a mile north of the subdivision, a headgate diverts water from the river into an irrigation ditch. The ditch runs south, first crossing over federal land and then onto several privately owned parcels. After exiting federal land, it first enters property owned by David West, continues south through property formerly owned by a company owned by Robert Mitchell but later conveyed to East Verde River McLachlan Ditch Users, LLC (the "Mitchell Parcel"), turns west through Verde Glen Home Owner's Association (VGHOA) property, cuts south and southeast though the "McKibben" parcel, enters Sweetie K's property, and finally exits through the "Cuomo" parcel back into the river.
¶4 In the 1970's, John and Betty Kerr purchased what is now Sweetie K's property in Verde Glen 3. The Kerrs filed a claim for the right to use water from the ditch in 1977, and that same year obtained a special use permit from the United States Department of Agriculture, Forest Service for the diversion of 1.8 acre-feet of water per year. In 2000, the Kerrs obtained an easement from the Forest Service "for occupancy with water conveyance system facilities of the lands," described as "10 feet in width and enclos[ing] 0.2826 acres of National Forest System Land." The easement is "fully transferable" and nonexclusive.
¶5 In 2006, the Kerrs and VGHOA sued West and the Carons for trespass. Without permission, West and the Carons had entered VGHOA property and constructed irrigation works across it and within the ditch, "altering the ditch so they could take water from [it]." Instead of removing the irrigation works when requested, West and the Carons asserted they had a right to use the ditch. Both parties moved for summary judgment. The trial court denied West and the Carons' motion for summary judgment, finding they did "not have a right to appropriate water from someone else's irrigation ditch." The court granted the Kerrs and VGHOA's cross-motion for summary judgment, finding West and the Carons were "trespassing," and that they had "no legal right to enter upon Plaintiffs['] property and alter or take water from the Kerr Ditch." The court ordered West and the Carons to vacate VGHOA's property and the ditch and "restore the property and ditch to their previous conditions." That judgment (the "Prior Ruling") was not appealed.
¶6 In 2012, Sweetie K acquired the Kerr property. Then, between 2013 and 2014, West and David Owen placed another pipe into the ditch with the purpose of distributing water to other properties in Verde Glen 3. This time, the pipe was not placed on VGHOA property, but was instead inserted into the ditch on the Mitchell Parcel, with the express permission of the parcel's owner. The pipe runs to West's property, which is adjacent to the Carons' property. The Carons were not involved in the installation of the pipe in the portion of the ditch on the Mitchell Parcel. And, although the Carons have connected another pipe to the pipe on West's property, they have not obtained any water from the new pipeline.
¶7 In 2015, Sweetie K sued the Carons, West, Mitchell, and Owens, seeking declaratory and injunctive relief for trespass, conversion, and intentional interference with contract. The Carons subsequently moved for summary judgment on all of Sweetie K's claims, arguing any relief sought against them is inappropriate because they have not used or attempted to use any of the water diverted by the pipe on West's parcel.
Sweetie K has not argued on appeal that the trial court improperly ruled on its claims against the Carons for trespass and intentional interference with contract. As a result, Sweetie K has waived any argument challenging those rulings. See FIA Card Servs., N.A. v. Levy, 219 Ariz. 523, n.1 (App. 2008) (undeveloped argument abandoned).
¶8 The trial court granted the Carons' motion on all of Sweetie K's claims, also finding that the Prior Ruling was "limited to the facts in that case and only address[ed] the Kerrs['] and [VGHOA's] (and each of their successors) rights as they apply to the installation of a takeout and/or diversion of water from the Kerr Ditch on [VGHOA's] property." The court subsequently dismissed the Carons from the action with prejudice, including final judgment language pursuant to Rule 54(b), Ariz. R. Civ. P. Sweetie K appealed, and we have jurisdiction pursuant to A.R.S. §§ 12-1837, 12-2101(A)(1), (5)(b).
Discussion
Standard of Review
¶9 "In reviewing a motion for summary judgment, we determine de novo whether any genuine issues of material fact exist and whether the trial court properly applied the law." Neal v. Brown, 219 Ariz. 14, ¶ 11 (App. 2008). Summary judgment is appropriate "if the facts produced in support of the claim or defense have so little probative value, given the quantum of evidence required, that reasonable people could not agree with the conclusion advanced by the proponent of the claim or defense." Orme Sch. v. Reeves, 166 Ariz. 301, 309 (1990). In addition, "[w]e may affirm the trial court's ruling if it is correct for any reason apparent in the record." Forszt v. Rodriguez, 212 Ariz. 263, ¶ 9 (App. 2006).
Issue Preclusion
¶10 On appeal, Sweetie K primarily contends the trial court erred in its conclusion that the Prior Ruling did not determine that "the Carons cannot take water from, nor utilize the Ditch in any way" nor that it precluded litigation of the issue of who "has exclusive rights to the entire Ditch." The Carons argue in response that the court correctly found issue preclusion did not apply because "[t]he issue of title to and rights in the entire ditch was not and could not be determined in the prior case." Ordinarily, we review de novo a trial court's ruling concerning the applicability of issue preclusion, also referred to as collateral estoppel. Corbett v. ManorCare of Am. Inc., 213 Ariz. 618, ¶ 10 (App. 2006). In this instance, however, because the disposition of Sweetie K's arguments concerning declaratory judgment, injunctive relief, and conversion resolves the appeal, we need not address issue preclusion.
Issue preclusion bars a party from relitigating an issue actually litigated before. Corbett v. ManorCare of Am. Inc., 213 Ariz. 618, ¶ 18 (App. 2006); Circle K Corp. v. Indus. Comm'n, 179 Ariz. 422, 425 (App. 1993). In order for the principle to apply, a final judgment must have been entered in the prior litigation, "the party against whom the doctrine is to be invoked [must have] had a full opportunity to litigate the issue, the party actually did litigate the issue, and the issue was essential to a final judgment." Circle K Corp., 179 Ariz. at 425.
Declaratory Judgment
¶11 Sweetie K argues the trial court erred by granting the Carons summary judgment on Sweetie K's claim for declaratory judgment. According to Sweetie K, "[b]ecause it was undisputed that the Carons intend to take water from the Kerr Ditch in the future, and have constructed and installed the means to do so," it was entitled to a declaratory judgment. We disagree.
¶12 Under the Uniform Declaratory Judgments Act, A.R.S. §§ 12-1831 to 12-1846, courts "have power to declare rights, status, and other legal relations whether or not further relief is or could be claimed." § 12-1831. "The declaratory judgment act is remedial and is to be liberally construed." Citizens' Comm. for Recall of Jack Williams v. Marston, 109 Ariz. 188, 192 (1973). Declaratory relief, however, must be based on then existing facts, "not those which may or may not arise in the future." Id. at 193. "To vest the court with jurisdiction to render a judgment in a declaratory judgment action, the complaint must set forth sufficient facts to establish that there is a justiciable controversy. A 'justiciable controversy' arises where adverse claims are asserted upon present existing facts, which have ripened for judicial determination." Planned Parenthood Ctr. of Tucson Inc. v. Marks, 17 Ariz. App. 308, 310 (1972) (citation omitted). Allegations that "merely show an intent to do certain things in the future all of which are dependent upon future events and contingencies," are not sufficient to "show a present existing controversy which permits the court to adjudicate any present rights." Moore v. Bolin, 70 Ariz. 354, 358 (1950).
¶13 It is undisputed that the Carons have only connected a pipe to the pipeline on West's property and have not attempted to appropriate any water from that pipeline. The Carons have also expressed that they only intend to use water from the pipeline in the event West acquires a right to water from the ditch in the ongoing litigation. Thus, at present, although the Carons believe they have a right to water from the ditch, they have not acted upon that belief. See Samaritan Health Servs. v. City of Glendale, 148 Ariz. 394, 395 (App. 1986) ("In order for there to be a justiciable controversy for the purposes of the declaratory judgment act there must be an assertion of a right, status or legal relation in which the plaintiff has a definite interest and a denial of it by the opposing party."). Sweetie K, therefore, has presented allegations against the Carons showing merely an intent to do things in the future, contingent upon future events. See Moore, 70 Ariz. at 358.
¶14 At oral argument in this court, Sweetie K maintained that "all [of] the cases [discussing the appropriateness of declaratory relief] talk about future events in control of the plaintiff" and not the defendant. Not only is this assertion inaccurate, see, e.g., Samaritan Health Servs., 148 Ariz. at 395; Planned Parenthood Ctr. of Tucson, Inc., 17 Ariz. App. at 310-11, but it also misconstrues the principle elucidated above. Whether declaratory relief is appropriate depends on the showing of "a present existing controversy," wherein "'the question [is] real, and not theoretical.'" Moore, 70 Ariz. at 358 (emphasis added), quoting Morton v. Pac. Constr. Co., 39 Ariz. 97, 102 (1929). Whether or not control of future events is in the hands of Sweetie K or the Carons, we would still be concerned with just that: future events. Moreover, in this case, the Carons only have control to the extent they have access to water from the pipeline on West's property, which is under West's control, and that water would only be available in the event West prevails in the ongoing litigation below.
¶15 We conclude the trial court correctly denied the request for declaratory judgment.
Injunction
¶16 Next, Sweetie K argues the trial court erred in granting summary judgment against it on its request for injunctive relief. "An injunction may serve to undo accomplished wrongs, or to prevent future wrongs that are likely to occur." TP Racing, L.L.L.P. v. Simms, 232 Ariz. 489, ¶ 21 (App. 2013). Critically, a request for injunctive relief requires an underlying act to enjoin. See A.R.S. § 12-1801; Dowling v. Stapley, 218 Ariz. 80, ¶¶ 20-21 (App. 2008); see also Baldwin v. Ariz. Flame Rest. Inc., 82 Ariz. 385, 392 (1957) (generally, injunctive relief denied where defendant denies intent to continue acts and nothing shows falsity of denial). And, the plaintiff bears the burden of proof "to show a likelihood that the defendant will in the future engage in the conduct sought to be enjoined." State ex rel. Babbitt v. Goodyear Tire & Rubber Co., 128 Ariz. 483, 487 (App. 1981).
¶17 Sweetie K asserts that the "Carons have interfered with Kerr Ditch and [its] irrigation rights," because they have connected a pipe to the pipeline constructed by West. But the Carons have yet to actually appropriate any water from that pipeline. In addition, despite viewing the facts in the light most favorable to Sweetie K, see Andrews, 205 Ariz. 236, ¶ 12, it is inaccurate for Sweetie K to assert the Carons have "connected the Caron Property to the Kerr Ditch," "divert[ed] water from Kerr Ditch before it reaches Sweetie K's property," or that the "Carons continue" to "take or use water from Kerr Ditch." There has been no underlying act to enjoin, and the trial court properly denied the request for injunctive relief. See Dowling, 218 Ariz. 80, ¶¶ 20-21.
Our decision in this matter does not preclude Sweetie K from seeking injunctive or declaratory relief if the Carons begin taking water from the pipeline on West's property without West acquiring a right to water from the ditch. --------
Conversion
¶18 Lastly, Sweetie K argues the trial court erred in finding the Carons had not converted Sweetie K's personal property, the water running through the ditch. The Carons argue no conversion has occurred because they have not appropriated any water from West's pipeline and, alternatively, the water in the ditch is not personal property subject to conversion.
¶19 Ordinarily, "[w]ater rights are real property interests, and thus cannot be converted because they are not chattels." Strawberry Water Co. v. Paulsen, 220 Ariz. 401, ¶ 12 (App. 2008) (citation omitted). Water only transforms into personal property if it has been "reduced to actual possession and control." Id. ¶¶ 13-14, quoting Town of Chino Valley v. City of Prescott, 131 Ariz. 78, 82 (1981).
The water taken into an artificial structure and reduced to possession is private property during the period of possession. When possession of the actual water or corpus has been relinquished or lost by overflow or discharge, after use, property in it ceases; the water becomes again nobody's property and . . . belongs to the public, just as it was before . . . . The specific water so discharged or escaped is abandoned; not an abandonment of a water right, but an abandonment of specific portions of water, viz., the very particles that are discharged or have escaped from control.Id. ¶ 14 (alterations in Strawberry), quoting Vaughan v. Kolb, 280 P. 518, 520 (Or. 1929). We need not decide, however, whether the water that flows into the ditch is personal property because, even assuming that to be the case, there has been no conversion.
¶20 Conversion is defined as "an intentional exercise of dominion or control over a chattel which so seriously interferes with the right of another to control it that the actor may justly be required to pay the other the full value of the chattel." Restatement (Second) of Torts § 222A (1965); accord Focal Point Inc. v. U-Haul Co. of Ariz., 155 Ariz. 318, 319 (App. 1986); see Miller v. Hehlen, 209 Ariz. 462, ¶ 34 (App. 2005) (Arizona has adopted Restatement definition of conversion). As laid out above, the Carons have not exercised dominion or control over any water diverted from the ditch because they have not yet appropriated for themselves any of the water. The ability to convert a chattel is not conversion. Accordingly, the trial court correctly granted summary judgment on the conversion claim.
Disposition
¶21 For the foregoing reasons, we affirm.