People ex rel. State Engineer for State of Colorado v. Sease

          Appeal from District Court Alamosa County District Court, Water Division 3, 07CW53 Honorable Pattie P. Swift, Water Judge

          Attorneys for Plaintiffs-Appellees: Cynthia H. Coffman, Attorney General Paul L. Benington, First Assistant Attorney General Denver, Colorado

          Attorneys for Defendant-Appellant: Erich Schwiesow, P.C., Erich Schwiesow Alamosa, Colorado

          OPINION

          SAMOUR JUSTICE

         ¶1 Who diverted water from Sheep Creek? The water court concluded Robert Gregg Sease did-in violation of a 2013 order, which forbade him to use out-of-priority water from Sheep Creek on his Saguache County property ("the Sease Ranch"). Thus, the water court found Sease in contempt of court and imposed both punitive and remedial sanctions on him.

         ¶2 Sease now seeks review of the water court's contempt order. He advances two arguments in this direct appeal. First, he contends that the water court had no basis to find that he owns the Sease Ranch. This finding was significant because the water court inferred from it that Sease, rather than anyone else, was responsible for the contemptuous work performed on the Sease Ranch that caused water to be diverted from Sheep Creek. Second, Sease maintains that the water court improperly shifted the burden of proof to him when it noted that there was a lack of evidence in the record that "someone else came on the premises and did [the contemptuous] work without [his] authorization or against his will."

         ¶3 Because we disagree with Sease on both fronts, we affirm the water court's contempt order. The matter is therefore remanded to the water court for enforcement of its punitive and remedial sanctions.

         I. Procedural History

         ¶4 This case has a tortuous procedural history. However, because it is relevant to Sease's assertions on appeal, we detail it here.

         ¶5 Sheep Creek flows through the Sease Ranch. The construction of various structures on the Sease Ranch caused out-of-priority depletions of water from Sheep Creek. In response, between 2003 and 2007, the State Engineer for the State of Colorado and the Division Engineer for Water Division 3 (collectively "the State") issued Sease five cease-and-desist orders. Sease did not comply with any of them.

         ¶6 In October 2007, when the State had apparently had enough, it brought a complaint in the water court seeking to enforce the cease-and-desist orders. Among other things, the complaint alleged that two diversions, fourteen ponds or reservoirs, six ditches, eleven pipelines, and thirty dams had been installed on the Sease Ranch to redirect water from Sheep Creek. In his answer, Sease admitted "that he is the owner of the property that is the subject matter of this Complaint, being the Sease [R]anch as described." The parties eventually resolved the complaint through a stipulation ("the first stipulation") in which Sease again admitted that he owns the Sease Ranch. In January 2008, at the parties' joint request, the water court adopted the first stipulation and incorporated it into an order ("the January 2008 Order"). The January 2008 Order required Sease to remove or remediate most of the unlawful structures on the Sease Ranch and enjoined him from allowing the remaining structures to divert or collect any water from Sheep Creek. In addition, it provided that, at "any later proceedings, the Parties will be bound by the facts set forth" in the first stipulation, which included Sease's acknowledgement that he owns the Sease Ranch.

         ¶7 Seven contempt proceedings followed the January 2008 Order. Although this appeal relates to the seventh proceeding, we pause to summarize the first six in order to place the contempt order challenged by Sease in context.

         ¶8 Just months after the January 2008 Order was issued, the State brought a motion to hold Sease in contempt of court. The State alleged that Sease had failed to remediate several ponds and ditches. To resolve this dispute, the parties reached a new stipulation ("the second stipulation"), which was incorporated into a new order ("the June 2008 Order"). The June 2008 Order imposed a $30, 000 penalty and required Sease to replenish all out-of-priority depletions and to submit plans for the court's approval detailing how he would do so. Sease filed two such plans and verified in the application for review of each plan that he owns the Sease Ranch.

         ¶9 In 2009, the State filed a second contempt motion. This time, the State asserted that Sease had failed to comply with the June 2008 Order because he had not replaced the water taken out of priority from Sheep Creek. The parties entered into another stipulation ("the third stipulation"), in which (1) Sease admitted he was in contempt of court, (2) the State rejected the plans Sease had filed, (3) Sease announced his intentions to appeal that rejection, and (4) Sease agreed to come into compliance with the June 2008 Order within a certain period of time if he lost the appeal.^[1]

         ¶10 The State submitted its third motion for contempt in 2010. In that motion, the State contended that Sease had failed to take the necessary steps either to comply with the June 2008 Order or to follow through on his agreements in the third stipulation. For example, the State reported that one of its employees had closed a headgate that diverted water from Sheep Creek to the Sease Ranch, had placed a dirt berm in front of that headgate to prevent seepage, and had posted a notice on the headgate advising Sease not to open it. The State claimed that Sease had disregarded this notice-and others like it-at least twice. After a hearing, the water court found that Sease had failed to drain or backfill several ponds and had resumed diverting water from Sheep Creek through at least one pipeline. The court therefore imposed punitive and remedial sanctions, including a ninety-day suspended jail sentence and a $39, 000 fine.

         ¶11 The year 2011 was no different than its three predecessors, at least for our purposes. The State filed yet another contempt motion-the fourth-which complained that Sease had rebuilt obstructions that diverted water from Sheep Creek to a reservoir. That motion was resolved by stipulation of the parties ("the fourth stipulation"). Sease both admitted that he had violated the June 2008 Order and conceded that "prior Orders of the Court[] are valid, ongoing obligations of Mr. Sease." Sease also acknowledged that he had possessed the ability at all times "to comply with the [June 2008 Order]," and that he continued to have "the present ability to comply" with that order. Sease then promised to backfill the reservoir and to permanently prevent the diversion of water from Sheep Creek to the Sease Ranch. Consistent with the fourth stipulation, the water court issued an order ("the 2011 Order") which required that Sease pay a one-time $15, 000 fine, incur a $100-per-day charge until the property came into compliance with the June 2008 Order, and complete thirty hours of community service in lieu of a five-day jail sentence.

         ¶12 The following year, 2012, in what had become by then an annual occurrence, the State filed a contempt motion, its fifth, averring that Sease had failed to timely complete his community service and pay fines that were due, remediate the structures on his property, and stop using water out of priority from Sheep Creek. The parties stipulated that Sease was in violation of the June 2008 Order ("the fifth stipulation"), and the water court issued an order ("the 2012 Order") which adopted the stipulation and imposed more sanctions on Sease, including a one-night jail sentence.

         ¶13 Just two months later, in April 2012, the State filed its sixth contempt motion, alleging that Sease had built some eighty-six new structures on the Sease Ranch that obstructed Sheep Creek. Sease entered into a stipulation and plea agreement with the State ("the sixth stipulation") to resolve that motion. He pled guilty to indirect contempt, agreed to serve a thirty-day jail sentence, and promised to pay the State more than $160, 000 (including for attorney fees and costs). The water court approved the sixth stipulation in 2013 by incorporating its terms into an order ("the 2013 Order"), ^[2] which included a mandatory, permanent injunction instructing Sease to "do nothing whatsoever, directly or indirectly, in, along or to Sheep Creek . . . without the prior written approval of the [State]."^[3] The 2013 Order further directed Sease to submit a stream restoration plan. He did so. Sease's plan acknowledged that "[a]ll of the land on which the work . . . will occur is . . . owned by Mr. Sease, the responsible party."

         ¶14 But this strange saga did not end with the 2013 Order. In 2015, the State filed its seventh contempt motion, the one that led to the order Sease challenges in this appeal. In the seventh contempt motion, the State claimed that Sease had violated the 2013 Order in five different ways: (1) building a new impoundment area, new ditches, and two new ponds; (2) installing a new water tank and a metal gate at one end of a ditch; (3) altering two existing ponds; (4) creating a ditch to bypass a pipeline he was estopped from using; and (5) altering parts of Sheep Creek by dredging it, widening a channel, changing the course of its water flow by filling one bank, and ...