Friday, August 3, 2012
A federal appeals court has thrown out a $4.4 million legal judgment that deceased rancher and Sagebrush Rebellion icon Wayne Hage had previously won from the federal government.
The U.S. Court of Appeals for the Federal Circuit has reversed an earlier court decision that ordered the U.S. Forest Service to compensate Hage for infringing on his property rights.
The descendants of Hage won a legal victory in the case in 2008, two years after his death and 17 years after the lawsuit was initially filed.
The judge ruled that the agency deprived Hage of his water rights by building fences that prevented him from accessing streams in the Toiyabe National Forest in Nevada.
Hage owned easements that allowed him to transport the water over federal land through ditches, which he claimed the Forest Service prevented him from maintaining.
The lawsuit also sought compensation for the fences, roads and improvements to water sources that Hage built on federal land before his grazing permit was revoked.
After years of litigation, a federal judge agreed with the complaint's arguments and awarded Hage's estate roughly $2.9 million for his water rights and $1.5 million for the value of improvements.
The government challenged that ruling, which a three-judge appellate panel has now reversed on several grounds.
Hage could have applied for a special permit to maintain the ditches that conveyed his water, so the claim that the government prevented him from doing so isn't "ripe" for federal court, the most recent ruling said.
Building fences around streams also isn't a physical taking of property, because Hage hasn't demonstrated that he could put the stream water to beneficial use, the appeals court said.
Water rights only allow the owner to use water that he can put to beneficial use, but the Hage family hasn't shown "there was insufficient water for their cattle on the allotments or that they could have put more water to use," the ruling said.
The appellate court also overturned the award for rangeland improvements, ruling that Hage could have sought compensation directly from the agency instead of in federal court.
Aside from vacating the financial award to Hage's family, the most recent ruling has caused uncertainty about legal principles in such conflicts, said Brian Hodges, an attorney for the Pacific Legal Foundation property rights group who monitored the case.
"The decision raises more questions than it answers," Hodges said.
For example, the appellate judges did not resolve the key issue of whether the government even had the right to regulate Hage's ditches, he said.
Hage claimed the Forest Service did not because his water rights predated the agency's authority over the land.
"It's unsatisfying the court assumed the federal regulations were valid without first determining whether water rights holders like Hage have a right that is superior to the regulations," Hodges said.
The Hage estate can still ask for reconsideration from a broader "en banc" panel of appellate judges, or request the U.S. Supreme Court to review the case, he said.
Hage's battle with the Forest Service is one of the sparks that started the "Sagebrush Rebellion" of popular resistance to changes in federal land policy, Hodges said.
"This case exemplifies the abuses the Western ranchers and natural resource industries suffered at the hands of the federal government," he said.