This is the first in a series of postings based on a current research project of mine: to understand, as an economist, the historical origins of California water law. This project is motivated by my belief that California water law is commonly misunderstood, and that we can gain insights into its nature by examining how it developed and evolved over time. I believe that once we place it within its historical context, many of its features no longer seem (as) mysterious.
Most of modern surface water law in California is based on the principle of prior appropriation. This is the idea that a claimant who stakes a valid claim to water in a river or stream enjoys a right superior to those who might come along and claim the water later. This “first-in-time, first-in-right” method of deciding who is entitled to water seems unfair to many, as it seems to privilege those who just happened to come along first. Why should their rights take precedence, especially if many other important uses go wanting?
Well, it turns out that there is an important historical reason this principle is central to the California water code. Prior appropriation emerged during the California Gold Rush, in the earliest years of statehood. During this formative period, judges in the state courts were making rulings in disputes over water that would become the water law of the state.
Beginning in the early 1850’s, miners diverted large amounts of water from rivers and streams in the Sierra Nevadas in order to extract gold from the hills, in a process known as hydraulic mining.
Hydraulicking, as it was commonly known, used enormous amounts of water, and thus required the construction of sometimes large and elaborate dams, ditches, and diversion canal systems.
Now put yourself in the shoes of these miners. Building one of these ditching systems required a massive expenditure of time, money, and resources. The miners needed legal assurance that the water they developed could not be snatched away with impunity by newcomers. Otherwise, why bother to undertake such an investment?
It turns out that very early on, the Gold Rush judges recognized this fundamental fact. If they did not provide such assurances, they knew that miners and ditch companies would be discouraged from investing in these ditch systems, and vast amounts of gold might remain untapped. The concern was expressed, for example, by the California Supreme Court in 1855 in the famous ruling Irwin v. Phillips.
Among … the most important (principles) are the rights of miners to be protected in the possession of their selected localities, and the rights of those who, by prior appropriation, have taken the waters from their natural beds, and by costly artificial works have conducted them for miles over mountains and ravines, to supply the necessities of gold diggers, and without which the most important interests of the mineral region would remain without development.
Today, 162 years later, the Gold Rush is only a memory. But we are still feeling the impact of Irwin v. Phillips and other court cases that defined the basic principles of California water law, including prior appropriation.