Legal%20Due%20Diligence

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Legal Due Diligence

• Columbia Basin Water Transactions Program
• Quarterly QLE Meeting
• April 2004

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• Water Right   
• a right to the use of water (as for
  irrigation) originally acquired by
  appropriation and perfected by beneficial use
  and if acquired by appropriation resting in
  the individual to whose land it is delivered ...
• Webster's Unabridged Dictionary

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• Water Right   
• a right to the use of water (as for
  irrigation) originally acquired by
  appropriation and perfected by beneficial use
  and if acquired by appropriation resting in
  the individual to whose land it is delivered ...
• Webster's Unabridged Dictionary

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Legal Due Diligence

• acquired by appropriation
• Validity Is it a valid water right?
• perfected by beneficial use
• Extent Has the water been continuously used and
  not relinquished?
• to whose land it is delivered
• Appurtenancy Who owns the water right?

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Validity Is it a valid water right?

• Was is a valid appropriation based on the law at
  the time of first use?
• Pre Code Water Rights
• Notice Rights
• Beneficial Use Rights
• Riparian Water Rights
• State Issued Water Rights

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Validity Is it a valid water right?

• Research State Records
• Water right files at State Headquarters
• Water right files at regional offices
• Public Disclosure Request,
• ask for complete file
• If subject to an adjudication,
• agency investigation, possible objections,
  exceptions, interim orders.

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Validity Is it a valid water right?

• Understand differences in documentation--Are
  filings and certificates proper for the type of
  water right?
• Certificates indicia of relinquishment or
  abandonment?
• Permits development schedule current?
• Claims or pre-adjudicated water rights facial
  validity copies of documentationdecrees,
  notices, etc.--in support of claim.

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Extent Has it been continuously used and not
relinquished?

• Field Investigation
• Documents previous court filings, reports
  relating to land use practices
• Affidavits from Previous Landowners when
  possible, document previous water use now.

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Extent Has it been continuously used and not
relinquished?

• Relinquishment Standard in your State
• Washington 5-years, nonuse without sufficient
  cause
• Oregon 5 years in 15, ready willing and able
• Idaho
• Montana 10-years, nonuse when available

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Appurtenancy Who owns the water right?

• Assumed to convey with real property.
• Obtain title commitment on real property upon
  which rights historically used from Title Co. to
  confirm present ownership.

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Appurtenancy Who owns the water right?

• Construct chain of title for water right.
• To back to priority date, sometimes back to
  patent.
• Review property deeds for grantor reservation of
  water rights.
• Review property deeds for exceptions for
  restrictions.
• Grantor / Grantee indexes.

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Appurtenancy Who owns the water right?

• Are there other water rights to the property?
• Examine the records confirming taxes or
  assessments paid to a mutual water company, an
  irrigation district, or some other kind of water
  district.

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