An appellate court has overturned a significant ruling by a trial judge in San Bernardino County that sought to adjudicate conflicting claims on groundwater in the Mojave River Basin. The Fourth District Court of Appeal, Division 2, ruled in favor of farmers who will likely be forced to change their water usage as a result of the sweeping decision issued in 1995 by Superior Court Judge E. Michael Kaiser. In the ruling, Kaiser consolidated a series of conflicting water claims and sought to make an "equitable apportionment" of water rights to all water users in the basin. But in overturning portions of Kaiser's decision, the Fourth District ruled that the judge had erroneously ignored the farmers' "overlying" water rights. However, the Fourth District stopped short of overturning the entire ruling. Rather, the court called upon all parties to stipulate to a new agreement that recognizes the farmers' water rights. The Mojave River Basin litigation emerged from the conflict between rapid urban development and continued agricultural cultivation in a groundwater basin that is already overdrafted. The adjudication overseen by Judge Kaiser began with a suit brought by the City of Barstow against the City of Adelanto, the Mojave Water Agency, and a series of other upstream users. The water agency then filed a broad-ranging cross-complaint that opened the door for a full adjudication. The Mojave River basin water rights issue was complicated because thousands of well owners, including farmers and municipalities, used a wide variety of legal theories in order to assert their claims. Instead of sorting through these claims one at a time, however, Judge Kaiser chose to take the bold step of applying a doctrine known as "equitable apportionment." Refusing to grant legitimacy to any individual water claim, he concluded that all users were at fault because virtually all development in the region has taken place since the overdraft problem first arose in the 1950s. Therefore, he ordered all parties involved to share in water cuts and named the Mojave Water Agency to serve as "water master" of the region. Under Kaiser's plan, all water users in the basin are required to participate in a "rampdown," reducing their water usage over a period of several years until the overdraft is eliminated. Water users that use more water than called for in the rampdown plan will pay assessments to the Mojave Water Agency, which will use the money to buy water rights from other water users in the basin or from the State Water Project. The ruling was expected to drive some farmers out of business and thus facilitate urban development. Some lawyers predicted that alfalfa farmers, who use large amounts of water, may not be able to survive with less water and probably can't afford to pay the assessments required to maintain current levels of water use. Thus, it appears likely that many of them will sell their water rights to the Mojave Water Agency, which will fund the purchases with the overdraft assessments. The ruling was challenged by Manuel Cardozo and a group of alfalfa farmers, who argued that their rights should have been considered in the ruling. After a lengthy review of California water law, the Fourth District recognized that while Kaiser's ruling may invoke "general equitable principles to achieve practical allocation of water to competing interests," it may not "ignore or eliminate the rights of riparian or overlying property owners over their objections." (Though it did not require changes in engineering and diversion practices, Kaiser's ruling fell within the general category of "physical solutions" to water problems because it required a re-allocation of already developed water. The Fourth District's ruling built on previous rulings involving "physical solutions".) The Mojave Water Agency argued in court that the Cardozo family and another property owner, Jess Ranch, had not proven in court that they actually held water rights. But the Fourth District ruled otherwise. The water agency argued that the land transfer records indicate that the Cardozos' purchase agreements did not specifically grant the Cardozos water rights as well as land ownership. However, the Fourth District concluded that these same documents provided "no substantial evidence that the Cardozo Appellants did NOT have overlying rights." The Fourth District also concluded that agricultural cultivation is a "beneficial use" under state water law and therefore the Cardozos did have rights that Judge Kaiser should not have ignored. "Here," the Fourth District wrote, "the trial court did not attempt to determine the priority of water rights, and merely allocated pumping rights based on prior production. This approach elevates the rights of appropriators and those producing without any claim of right to the same status as the rights of riparians and overlying owners. The trial court erred in doing so." Instead of overturning the entire ruling, the Fourth District concluded that Kaiser's ruling should be amended to respect the Cardozos' water rights. In a somewhat different situation, the court also overturned Judge Kaiser's decision not to permit the property owners of Jess Ranch, which uses recirculated water to stock trout ponds, to participate in the final agreement. Judge Kaiser concluded that Jess Ranch's previous usage had failed to establish that the ranch's historical use of about 18,000 acre-feet of water is "reasonable and beneficial" under state law. The judgment permitted the ranch to continue to use the water for the trout ponds but did not permit the ranch to use the water for any other purpose or sell it. The Fourth District ruled that the Jess Ranch landowners should have been permitted to participate in the final judgment, thus allowing them to sell their water as part of the overall settlement. The Case: City of Barstow v. Mojave Water Agency, Nos. E18023 and E18681, 98 Daily Journal D.A.R. 5717 (issued June 1, 1998). The Lawyers: For the Cardozo Family: Robert E. Dougherty, Covington & Crowe, (909) 983-9393. For Jess Ranch: Calvin House, Gutierrez & Preciado, (818) 449-2300 For City of Barstow: Arthur G. Kidman, McCormick, Kidman & Behrens, (714) 755-3100. For Mojave Water Agency: William J. Brunick, Brunick, Alvarez & Battersby, (909) 889-8301.