“WATER, WATER, EVERYWHERE, NOR ANY DROP TO DRINK”

The above quotation from Coleridge’s Rhyme of the Ancient Mariner describes a sailing ship becalmed in the middle of the ocean, without drinking water for the occupants. In our frequently soggy state of Washington, we sometimes take drinking water for granted in our real estate investment decisions, but two recent cases decided by our Supreme Court show that considering water in real estate investing is an important thing to do.

The first case, Knight v. Yelm, involved a challenge by a neighboring landowner to a local government decision approving a preliminary plat for a residential development. A preliminary plat approval is thought of as the first step in the official process to get a development started, with final plat approval and building permit issuances to follow. In this case the neighbor owned undeveloped land near the proposed plat and had senior water rights that the neighbor claimed would be impaired by a grant of the developer’s application. The development was to receive its drinking water from the city’s municipal supply. The neighbor claimed that the city had insufficient water to supply its existing customers’ needs, let alone those of the new development, and that the city should be required to show that it had acquired sufficient state approved water rights to serve the new development before approving the preliminary plat.

The neighbor’s challenge was accepted by the hearing examiner who inserted a condition in the proposed approval of the preliminary plat that required a demonstration of adequate water by the time of final plat approval. On review by the city council, this condition was removed, leaving the neighboring landowner without any way to enforce the requirement of the subdivision statute that adequate drinking water availability be shown prior to approval of a plat. The Supreme Court held that this was an error by the city council and that the neighboring landowner had shown a sufficient interest in the case to be allowed to challenge the preliminary plat approval.

The second case, Five Corners Family Farmers v. State, involved a feedlot operation in Eastern Washington and the meaning of a clause in a statute that authorizes certain water uses to occur through drilling a well without the need for a Department of Ecology permit. One of these uses is stock watering, and the controversy surrounded whether a use that required 450,000 to 600,000 gallons per day for such use was limited by language in the statutory exemption that appeared to restrict unpermitted uses to 5,000 gallons per day. The court compared the two interpretations advanced by the feedlot owner on the one hand and the challengers who included again, neighboring landowners on the other, and found that the feedlot owner’s interpretation best gave effect to the statutory language. Thus according to the court, stock watering uses under the statute do not require a permit from the Department of Ecology and are not subject to the 5,000 gallon per day limit for some allowed unpermitted uses such as small multifamily uses and industrial uses. Significantly the statute includes lawn watering and noncommercial garden watering not exceeding one half acre in the group of unpermitted uses that are not limited by the 5,000 gallon per day restriction.

The court recognized that these uses by the feedlot owner although large in comparison to the 5,000 gallons per day were not really “unlimited” uses because of other legal limits such as the prohibition against impairing a senior water right. But the court determined that the challengers, one of whom was a neighboring owner who had applied for a permit to drill a well, had the right to challenge the feedlot’s unpermitted use because that use would be a senior use of water that could preempt the neighboring owner’s well permit application.

The lessons these cases have for those who are planning a real estate investment that will involve the need to use water is that, whether the use involves a well or connecting to a city water supply, it is a good idea to research the water availability before proceeding with the investment.

The foregoing is intended as education only and may not be considered as legal advice.

Leave a Comment

Your email address will not be published. Required fields are marked *