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  March 14, 1958.


To:            Commissioner of Indian Affairs
From:        Solicitor
Subject:     Water rights of non-Indian purchasers of Klamath Indian Reservation lands

    A memorandum from Assistant Commissioner Utz dated January 4, 1957, refers to a memorandum proposed by the Regional Solicitor, Portland, Oregon, concerning water rights on the Klamath Indian Reservation. The latter memorandum purports to examine issues raised by Oregon State Engineer Lewis A. Stanley in a letter :to Mr. T. B. Watters, one of the Management Specialists for the Klamath Tribe.

    Mr. Stanley has stated, among other things, "that Oregon had become a state [in 1859] and had title and control of the non-navigable waters before the [Klamath] treaty [of 1864] was entered into and, therefore, the United States had no rights which it could have granted to the [Klamath] Indians." The Management Specialists have urgently requested an opinion on this matter in order to give potential non-Indian purchasers of land some assurance of rights to the use of water on the land they purchase.

    The proposition stated by Mr. Stanley is not well-founded. The basic question of an assurance of a water right in purchasing Klamath Indian Reservation lands already has been given a preliminary general answer by the Solicitor. See Klamath Terminal Legislation, 62 I.D. 186, 201-202 (May 20, 1955). A further exhaustive analysis of this problem is not required here nor will it be undertaken in the absence of a presentation of a factual record. That earlier general answer of the Solicitor in support of such rights accordingly will be adhered to by this office. Even so, it may be helpful to the Management Specialists to elaborate somewhat by reference to some of the controlling legal propositions and principles, in view of the position taken by the State Engineer. In fairness to Mr. Stanley, it may be noted that he did not have the benefit of the decision in U.S. v. Ahtanum Irrigation District, 236 F. 2d 321 (1956), cert. den. 352 U.S. 988 (1957), which was subsequent in date to his letter. However, the present file contains no statement indicating a changed position on his part and a further examination accordingly seems necessary. As he has suggested, it is possible that a complete settlement of this issue can come only through the courts. However, the legal facts and the decisional law clearly favor the purchaser of Indian lands and water rights in that event.

    Mr. Stanley's assertion that the United States had no rights in 1864 which it could have granted to Indians seems to misconceive the existing situation and to ignore the fact that the United States at that time still owned the major portion of the lands comprising the State of Oregon. Congress had specifically reserved, in the act admitting Oregon into the Union on equal footing, "the primary disposal of the soil." (11 Stat. 383, 384.) This reservation naturally would include those lands then in possession of Indians, title to which the Federal Government either had not acquired or extinguished by cession, or which would be reserved for the Indians pursuant to treaty or other agreement. Resolving problems of "Indian title" is and has been exclusively a Federal function. See the Act of June 30, 1834, 4 Stat. 730, 25 U.S.C. 177, and Johnson v. McIntosh, 8 Wheat. 543, 573ff (1823), Royce, Indian Land Cessions . . . (1899) 527ff, Donaldson, The Public Domain . . . (1884) 240 ff.
    With respect to the Klamath Indians, it is stated in Klamath and Modoc Tribes v. Maison, 130 F. Supp. 634. 635 (1956), that these Indians had "owned or occupied" exclusively a vast domain of land. They had exploited it in the manner of their culture, which was primarily a hunting, trapping, fishing and gathering culture. As already stated, the power to extinguish or recognize such Indian possessory rights and obtain settlement of the various Indian groups on certain lands reserved for that purpose has been recognized as being in the Federal Government since the beginning of our constitutional history. The Klamath Indian treaty of 1864 exemplifies an exercise of that power.

    In connection with the congressional reservation of the right of "the primary disposal of the soil" in



MARCH 14, 1958

Oregon, and insofar as rights to the use of water are concerned, it is pertinent to note at this point that Oregon did not legislatively reject its early riparian doctrine and assert public ownership of the water resources in that State until 1909. Consequently, prior to the Act of July 26, 1866, 14 Stat. 253, which affirmed appropriative rights acquired under local custom or practice, only minor riparian uses could have vested under existing Oregon riparian law. Thereafter, waters flowing from or on Federal public domain were made generally available by Congress for appropriation, subject to existing rights. We wish to emphasize that they were available by reason of this 1866 act, the Act of July 9, 1870, 16 Stat. 218, the Desert Land Act of March 3, 1877, 19 Stat. 377, and the related statutory enactments of Congress that followed. In other words, many of the early water rights in Oregon of necessity must be deraigned from this Federal statutory law rather than from the law of the State of Oregon. This was the situation in California under the so called California doctrine.
    It is not to be inferred from what has been said that Congress intended to impose on the State of Oregon a particular policy relating to water rights, California Oregon Power Co. v. Beaver Portland Cement Co., 295 U.S. 142, 163-164 (1935), much less thrust upon her an obligation to assert public ownership of water resources which she finally did in 1909. Ore. Laws, 1909, Chap. 221. See also Chap. 216, the Water Code of 1909 and O.R.S. 537.110 et seq. Congress was simply furthering the disposition and settlement of the public domain, California Oregon Power Co., supra, and had specifically reserved this power in the Oregon Admission Act, 11 Stat. 383, 384. Nevertheless, these acts of Congress, in effectuating the policy of settling people on the Federal public domain and in line with the reserved power to effectuate "the primary disposal of the soil" within the State of Oregon, also incidentally made vast inroads, on the riparian doctrine, which were recognized by the Oregon Supreme Court. Hough v. Porter, 51 Ore. 318, 95 P. 732 (1908), 98 P. 1083 (1909), 102 P. 728 (1909), Hutchins, Selected problems of the law of water rights in the West (1942), p. 55.

    Oregon, in finally legislating itself into a position in line with Federal disposal policies by enacting Chapter 221 and the Water Code of 1909, supra, asserted public ownership of all sources of water supply but with certain reservations protecting vested riparian rights to the extent of actual application of water to beneficial use prior to passage of the act, or within a reasonable time thereafter, and this legislative change was judicially sustained. In re Hood River, 114 Ore. 112, 227 P. 1065 (1924). But this was long after the 1864 reservation of lands for the Klamath Indians with an implied reservation of water sufficient for the agricultural and domestic needs of the Indians, as well as the subsequent developments under those early acts of Congress which fostered "disposal of the soil." Accordingly, Oregon is in no position to protest validly or effectively contest the existing power of the United States in connection with the Klamath Termination of Federal Supervision Act, 68 Stat. 718, to provide for the disposition of rights to the use of waters expressly, 11 Stat. 383, or impliedly reserved for farming and domestic purposes in 1864, Art. 5, 16 Stat. 865, 867, Winters v. U.S., 207 U.S. 564 (1908), and which naturally were not disposed of by the Federal Government under the subsequent Desert Land Act and related laws.

    To the extent that there was an implied reservation of rights to use water on the Klamath Indian Reservation under the Winters doctrine, it is assumed on the basis of U.S. v. Ahtanum Irrigation Dist., 236 F. 2d 321 (1956), cert. den. 352 U.S. 988 (1957) that the courts in the future will have little difficulty in finding a basis for protecting water rights. This applies also to derivative rights such as were sustained in U.S. v. Powers, 305 U.S. 527 (1939).

    This office, accordingly, will support the rights of Indian landowners and third party purchasers of Klamath lands having either primary water rights under the Winters doctrine or obtaining derivative rights conveyable by deed or patent and enforceable under the Powers doctrine. Further, it will support the right of a non-Indian purchaser of Klamath Indian Reservation lands, having such derivative rights under the Powers doctrine to have his priority under such rights related back to the establishment of that reservation in 1864.
    In this connection, however, the attention of purchasers probably should be directed to certain possibilities suggested in U.S. v. Hibner, 27 F. 2d 909, 911 (1928). Speaking generally of rights of those who are successors to title of Indian lands, the court said:
    "This question is not free of difficulty, for it presents for consideration what is the status of the water rights of those who have acquired by purchase their lands from the Indians whose rights were reserved unto them, and who be came vested with all the rights incident to ownership of both the lands and water under the treaties, with a priority of February 16, 1869. The right of the Indians to occupy, use, and sell both their lands and water is now recognized, as this view is sustained in the case

MARCH 18, 1958

of Skeem v. U.S., supra, and, such being the case, a purchaser of such land and water right acquires, as under other sales, the title and rights held by the Indians, and that there should be awarded to such purchaser the same character of water right with equal priority as those of the Indians. The status of the water right after it has passed to others by the Indians seems to be somewhat different from while such right is retained by the Indians, because the principle invoked by the courts for the protection of the Indian as long as he retains title to his lands does not prevail and apply to the white man, and the reason for so holding is that there was reserved unto the Indians the absolute right to own and use in their own way the water for their lands, while the white man, as soon as he becomes the owner of the Indian lands, is subject to those general rules of law governing the appropriation and use of the public waters of the state, and would, as grantee of the Indian allotments, be entitled to a water right for the actual acreage that was under irrigation at the time title passed from the Indians, and such increased acreage as he might with reasonable diligence place under irrigation, which would give to him, under the doctrine of relation, the same priority as owned by the Indians; otherwise, the application of any other rule would permit such grantee for an indefinite period to reclaim the balance of his land and withhold the application of the water to a beneficial use, which is against the policy recognized in the development of arid lands."
    The lower court in U.S. v. Powers, 16 F. Supp. 155, 163 (1936) , after taking note of this statement in the Hibner decision, observed:
    "In that case the court granted to the Indian land a water right with priority as of the date of the ratification of the Fort Bridger Treaty. This rule applied to the defendants in this case seems to be fair and equitable and affords protection both to Indians and white men, furthermore the facts there are very much like the facts in the instant case and were governed by like treaty provisions. From a perusal of the transcript of the testimony it seems to the court that these answering defendants upon receiving title from the Indian were reasonably diligent in placing under irrigation such portions of the land granted to them as were susceptible of irrigation. *     *     * "
It may be of interest to note here that conveyances in the Powers case involved Indian trust lands sold by the United States as well as Indian lands allotted in fee and sold by the Indians. In both instances, "all rights, privileges, immunities and appurtenances" were conveyed, there being no reservation of water or water rights in the patents issued. Compare Merrill v. Bishop, 287 P. 2d 620, 622-623 (1955). involving a sale in Wyoming in which waters not actually used were reserved in the deed for Indian use.

    This suggestion that a purchaser should exercise diligence in developing any unused water right is in line with provisions of section 14 (a) of the Klamath Termination of Federal Supervision Act, 68 Stat. 722, which is simply designed to protect the tribe and its remaining members for a period of 15 years against loss by abandonment of water rights by nonuse under Oregon law. It is also consonant with Article X of the Klamath River Basin Compact, 71 Stat. 505, especially subdivision B, which provides:
    "Lands within the Klamath Indian Reservation which are brought under irrigation after the effective date of this compact, whether before or after Section 14 of said Act of August 13, 1954, becomes fully operative, shall be taken into account in determining whether the 200,000 acre limitation provided in paragraph 1 of subdivision C of Article III has been reached."
Accordingly, if purchasers are to avoid all legal doubts, it appears to me that undeveloped rights should be perfected without undue delay.
                                                                                                            ELMER F. BENNETT,
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