Vol. 53-2 Water Rights

Water Rights

Pape Partners and Texas’ New Water Rights Jurisdiction

Pape Partners Overview

In May 2022, the Texas Supreme Court handed down an important jurisdictional clarification in Pape Partners v. DDR Family Properties, involving a dispute between two private parties over the ownership of surface water rights in McLennan County.[1] The court found that the Texas Commission on Environmental Quality (TCEQ or Commission) does not have jurisdiction over disputes involving conflicting claims to the ownership of surface water rights.[2] Rather, state district courts properly have jurisdiction over cases involving water rights ownership.[3]

In arriving at this holding, the court began with the fundamental constitutional rule that a “district court has subject-matter jurisdiction to resolve disputes unless the Legislature divests it of that jurisdiction.”[4] In particular, the court noted that “historically, ‘the power to determine controverted rights to property’ has been ‘vested in the judicial branch.’”[5] Conversely, the court followed the presumption that administrative agencies can only exercise jurisdictional powers that the legislature has conferred on them in “clear and express statutory language.”[6] Therefore, because DRR argued that TCEQ had exclusive jurisdiction over water rights adjudication, the court utilized a two-pronged test of statutory interpretation to determine whether TCEQ has exclusive jurisdiction: there must be either (1) “an express grant of exclusive original jurisdiction to the agency,” or (2) a “pervasive regulatory scheme” that indicates a legislative intent to grant the agency “the exclusive means of remedying the problem.”[7]

In applying this test, the court looked at the language of TCEQ’s enabling statute in chapter 5 of the Texas Water Code, first analyzing the plain text of the statute.[8] Section 5.013 of the enabling statute grants TCEQ jurisdiction over “water rights adjudication,” which is not defined or ever mentioned again after this section.[9] The court then looked to the Water Rights Adjudication Act, noting that the legislature used “water rights adjudication” as a term of art to describe the Commission’s process of issuing water rights permits.[10] The Commission’s process has some elements of judicial process—gathering facts and data, holding hearings in contested cases, making final determinations, and considering applications for rehearing.[11] However, the Commission “files with the [district] court its final determination and all the evidence presented” and the statute mandates that the court “determine all issues of law and fact independently of the commission’s determination.”[12]

Hence, the court found that nothing in the TCEQ enabling act or the Water Rights Adjudication Act grants exclusive jurisdiction to TCEQ.[13] Indeed, TCEQ itself argued in an amicus brief that “water rights adjudication” was a term of art relating to the “‘Commission’s issuances of certificates of adjudication’ that entail the [C]ommission’s ‘determining the amount of use, place of use, purpose of use, point of diversion, rate of diversion, and where appropriate, the acreage to be irrigated.’”[14] The notion of “water rights adjudication” was simply an “administrative record-keeping function.”[15]

Conclusion

The Supreme Court in Pape Partners found that TCEQ has no jurisdiction over surface water rights and confirmed that the Texas judiciary has such authority. Future surface water rights disputes will only be adjudicated through the state judiciary.

Emily Rogers is the Managing Partner of Bickerstaff Heath Delgado Acosta LLP and represents public and private clients in water rights, water quality, utility, and environmental law matters.

Kimberly Kelley is an attorney at Bickerstaff Heath Delgado Acosta LLP and practices in the areas of municipal, open government, water, and environmental law. She earned her undergraduate degree from Texas A&M University and graduated Texas Tech University School of Law, where she served on the editorial board of the Law Review.

Adam LaFleche is a 2L from Newton, Massachusetts. He attended George Washington University and joined TELJ in his spring semester of 1L. Adam is interested in environmental law and especially ESG and hopes to transition into sustainable energy financing after he graduates in 2024.