author: BURDICK, C.J., dissenting.

text:
    W. Marcus W. NYE, an individual, Plaintiff-Respondent, v. Tom KATSILOMETES, an individual, Defendant-Appellant.
    Docket No. 45917
    Supreme Court of Idaho, Boise, April 2019 Term.
    Opinion filed: August 26, 2019
    I. NATURE OF THE CASE
    In an appeal arising out of Bannock County, Tom Katsilometes challenges the Idaho Senate's order granting over $18,000 in attorney fees to Senator W. Marcus W. Nye, awarded after Nye prevailed against Katsilometes in a contest over the results of the 2016 general election. The Senate confirmed Nye's election and awarded him costs and attorney fees. Because Katsilometes refused to pay the attorney fees, Nye brought an action in district court seeking a declaratory judgment ordering Katsilometes to pay him the amount ordered by the Senate. The district court granted the declaratory judgment and further awarded Nye costs, attorney fees, and prejudgment interest. For the reasons stated below, we reverse the district court's judgment upholding the Senate's award of attorney fees, and vacate the award of costs, attorney fees, and prejudgment interest.
    II. FACTUAL AND PROCEDURAL BACKGROUND
    Nye and Katsilometes were opponents in the 2016 general election for the Idaho Senate seat in District 29. After Nye defeated Katsilometes in the election, Katsilometes challenged the election results by filing a Verified Complaint for Contest of Election with the Idaho Senate. The basis for the contest was Katsilometes' allegation that Nye had violated a provision of Idaho Code section 67-6603, one of the so-called "Sunshine Laws" that regulate election campaign contributions and expenditures. In response, the President Pro Tempore of the Senate issued an order entitled "Procedural Order for Contest of Election," outlining the course of proceedings and referring the matter to the Senate State Affairs Committee.
    Following hearings before the State Affairs Committee on January 16 and January 23, 2017, the Committee presented its findings to the Senate as a whole on January 24, 2017. The Senate voted on January 25, 2017, to adopt the Committee's recommendations that the Senate uphold Nye's election and order Katsilometes to pay Nye's witness fees and costs of discovery. Additionally, the Senate Journal reflects that the Senate separately approved a motion adopting the recommendations and findings of the Committee that (1) Katsilometes' petition contesting the election was "brought and pursued frivolously, unreasonably, and without factual or legal foundation" and (2) Katsilometes be ordered to pay attorney fees in the amount of $18,060.00. In so ordering, the Senate cited Article III, section 9 of the Idaho Constitution as its authority.
    Katsilometes paid Nye the amount owed for the witness fees and discovery costs but did not pay the amount owed for the attorney fees. Subsequently, to assist him in collecting on the Senate's attorney fees order, Nye brought an action in district court seeking a declaratory judgment ordering Katsilometes to pay the attorney fees that had been awarded by the Senate. Following cross motions for summary judgment, the district court granted Nye's motion for summary judgment on the declaratory judgment action and entered judgment against Katsilometes for the $18,060.00 in attorney fees the Senate had awarded Nye. In so doing, the district court determined the Senate was acting within its authority pursuant to Article III, section 9 of the Idaho Constitution when it awarded Nye his attorney fees following Katsilometes' failed election contest. The district court concluded that it could not intrude on such an exercise of discretion from another branch of government.
    Following the district court's entry of judgment, Nye moved for an amended judgment awarding him prejudgment interest, costs, and attorney fees incurred in his declaratory judgment action. The district court granted Nye's motion and awarded costs as a matter of right, denied awarding discretionary costs, and awarded attorney fees pursuant to Idaho Code section 12-120(1). The district court also awarded prejudgment interest from the date the Senate ordered attorney fees until the date the district court entered its judgment in the case. The district court entered an amended judgment and awarded Nye a total of $35,372.28. Katsilometes timely appealed.
    III. STANDARD OF REVIEW
    "Both constitutional questions and questions of statutory interpretation are questions of law over which this Court exercises free review." Stuart v. State, 149 Idaho 35, 40, 232 P.3d 813, 818 (2010). When the Court considers such questions in the context of a summary judgment order, it reviews the record de novo, applying the familiar standards set forth in I.R.C.P. 56 :
    [T]he standard of review for this Court is the same standard used by the district court in ruling on the motion. The court must grant summary judgment if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law. Summary judgment is appropriate if the pleadings, affidavits, and discovery documents on file with the court, read in a light most favorable to the nonmoving party, demonstrate no material issue of fact such that the moving party is entitled to a judgment as a matter of law. If the evidence reveals no genuine issue as to any material fact, then all that remains is a question of law over which this Court exercises free review.

      Other than a conclusory statement noted in the Senate Journal, there were no actual written findings in the record on appeal outlining the State Affairs Committee's factual findings supporting their conclusion that the contest was pursued "frivolously, unreasonably, and without factual or legal foundation." In a judicial proceeding, an award of attorney fees under Idaho Code section 12-121 requires that such a finding "must be in writing and include the basis and reasons for the award."

   Lee v. Willow Creek Ranch Estates No. 2 Subdivision Homeowners' Ass'n, Inc., 164 Idaho 396, 399, 431 P.3d 4, 7 (2018) (internal citations and quotations omitted). Because the facts in this case are largely undisputed, this case solely presents a question of law.

"An award of attorney fees and costs is within the discretion of the trial court and subject to an abuse of discretion standard of review." Ballard v. Kerr, 160 Idaho 674, 716, 378 P.3d 464, 506 (2016) (quoting Smith v. Mitton , 140 Idaho 893, 901, 104 P.3d 367, 375 (2004) ).

When this Court reviews whether a trial court has abused its discretion, the four-part inquiry is "[w]hether the trial court: (1) correctly perceived the issue as one of discretion; (2) acted within the outer boundaries of its discretion; (3) acted consistently with the legal standards applicable to the specific choices available to it; and (4) reached its decision by the exercise of reason."

Dickinson Frozen Foods, Inc. v. J.R. Simplot Co., 164 Idaho 669, 675, 434 P.3d 1275, 1281 (2019) (quoting Lunneborg v. My Fun Life, 163 Idaho 856, 864, 421 P.3d 187, 194 (2018) ).

IV. ANALYSIS

The election contest at the center of this controversy concerns a disputed Senate seat following a general election. It is only the second such contest in Idaho's history. In addition, in 129 years of legislative history since statehood, the Senate has never before awarded attorney fees against a private citizen contesting the results of an election on the grounds that the contest was frivolous. Thus, in addition to the important constitutional principles at stake here, this case presents an issue of first impression for the Court.

A. The Idaho Senate did not have authority to award attorney fees to Nye at the time of this election contest.

The primary issue before us is not whether the amount of attorney fees awarded to Nye was unreasonable, but whether the Senate had authority under the Idaho Constitution to award Nye any attorney fees at all. Katsilometes argues that the Senate did not have authority under Article III, section 9 of the Idaho Constitution to award attorney fees to Nye, regardless of the Senate's finding that the Contest of Election was "brought and pursued frivolously, unreasonably, and without factual or legal foundation." Accordingly, he argues that the district court erred when it determined the Senate had such authority and entered a declaratory judgment against him. For the reasons discussed below, we agree that the Senate did not have the authority to award attorney fees to Nye in January 2017 and, therefore, the district court erred when it entered a declaratory judgment against Katsilometes.

As this Court examines the constitutional authority vested in a co-equal branch of the government-in this case, the legislative branch-we are respectfully mindful that this dispute involves the interplay of the bedrock principles of separation of powers and checks and balances enshrined in the Idaho Constitution. Article II, section 1 of the Idaho Constitution provides that:

The powers of the government of this state are divided into three distinct departments, the legislative, executive and judicial; and no person or collection of persons charged with the exercise of powers properly belonging to one of these departments shall exercise any powers properly belonging to either of the others, except as in this constitution expressly directed or permitted.

"The separation of powers doctrine embodies the concept that the three branches of government, legislative, executive and judicial, should remain separate and distinct so that each is able to operate independently." Sweeney v. Otter, 119 Idaho 135, 139, 804 P.2d 308, 312 (1990). "The separation of powers doctrine prohibits 'judicial review of the discretionary acts of other branches of government.' " Tucker v. State, 162 Idaho 11, 28, 394 P.3d 54, 71 (2017) (quoting In re SRBA Case No. 39576, 128 Idaho 246, 261, 912 P.2d 614, 629 (1995)). "The question is whether this Court, by entertaining review of a particular matter, would be substituting its judgment for that of another coordinate branch of government, when the matter was one properly entrusted to that other branch." Id. (quoting Miles v. Idaho Power Co., 116 Idaho 635, 639, 778 P.2d 757, 761 (1989) ).

As an initial matter, we acknowledge that the dissent does not believe that "the Senate's decision to award fees was so egregious as to convert a non-justiciable question into a justiciable one." The district court recognized that "[i]n order to reach a decision in a declaratory action, a court must determine whether a justiciable controversy exists ...." Thus, if the majority were to agree with the dissent that this case presents a non-justiciable controversy, the necessary outcome would be to vacate the district court's judgment granting declaratory relief, effectively nullifying the Senate's award of attorney fees to Nye. Yet, the dissent does not advocate for such an outcome. Instead, it describes the declaratory judgment in favor of Nye "as a perfunctory enforcement mechanism which perfected the Senate's award." The dissent cannot have it both ways-this case either presents a justiciable controversy that the courts can address, or it does not.

Neither side has argued that this case presents a nonjusticiable controversy. The Idaho Declaratory Judgment Act recognizes that "[c]ourts of record within their respective jurisdictions shall have power to declare rights, status, and other legal relations, whether or not further relief is or could be claimed. I.C. § 10-1201. As the district court correctly noted, in considering "whether to grant a declaratory judgment, the criteria is whether it will clarify and settle the legal relations at issue, and whether such declaration will afford a leave from uncertainty and controversy giving rise to the proceeding." Sweeney v. Am. Nat'l Bk., 62 Idaho 544, 115 P.2d 109 (1941). Because we believe that addressing this case will be helpful in clarifying the extent of the constitutional authority granted to the legislative branch under its plenary powers, we affirm the district court's decision to take up this matter.

Further, we note that by deciding this matter, the Court is not meddling in the affairs of the Senate-this case was brought to the district court by a member of the Senate invoking the judicial branch's power to impose an enforceable attorney fee award. As Nye aptly recognized, absent a judicial decree, the Senate's imposition of attorney fees against Katsilometes was essentially meaningless. Where, as here, a judgment of the judicial branch is required to create an enforceable obligation, we believe that a justiciable controversy exists.

The Senate cited Article III, section 9 of the Idaho Constitution as its authority for awarding Nye his attorney fees following Katsilometes' failed Contest of Election. The relevant portion of this constitutional provision provides: "Each house when assembled shall choose its own officers; judge of the election, qualifications and returns of its own members, determine its own rules of proceeding, and sit upon its own adjournments ...." Idaho Const. art. III, § 9 (emphasis added). The parties disagree on the interpretation of this language. Nye contends that this provision grants the Senate broad discretion as to the rules and procedure in a Contest of Election, including the imposition of attorney fees. Katsilometes acknowledges the Senate's broad authority granted to it by the Idaho Constitution, but contends that the provision does not allow the Senate to award attorney fees against him. Instead, he asserts that the Senate is bound by a statute it enacted concerning monetary awards in contested general elections- Idaho Code section 34-2120 -which, prior to its amendment in 2017, only provided for an award of costs and witness fees.

The version of Idaho Code section 34-2120 in place at the time Katsilometes filed his Contest of Election stated as follows:

Security for costs-Assessment of costs.
(a) The contestant shall file with the secretary of state a bond in the amount of five hundred dollars ($500) conditioned to pay the contestee's costs in case the election be confirmed by the legislature.
(b) The contestants are liable for witness fees and the costs of discovery made by them respectively. If the election is upheld by the legislature, the legislature may assess costs against the contestant. If the election is annulled by the legislature, the legislature may assess costs against the contestee.
....

Ch. 209, § 28, 1982 Idaho Sess. Laws 580 (emphasis added). In July 2017, approximately six months after Katsilometes contested Nye's election, the entirety of Chapter 21, Title 34 of the Idaho Code was repealed and replaced with new statutes containing much of the same language. See Ch. 293, § 2, 2017 Idaho Sess. Laws 774. However, the section relating to costs was rewritten to expressly allow for an award of attorney fees. Id. It now reads as follows:

Security for costs-Assessment of costs and fees-Assessment of attorney's fees
(1) The contestor must file with the secretary of state a bond in the amount of one thousand dollars ($1,000) conditioned to pay the contestee's costs if the election be confirmed by the legislature.
(2) The parties are liable for witness fees and the costs of discovery made by them respectively. If the election is upheld by the legislature, the legislature may assess costs and fees, other than attorney's fees , against the contestor. If the election is annulled by the legislature, the legislature may assess costs and fees, other than attorney's fees , against the contestee.
(3) Attorney's fees.
(a) Attorney's fees may be awarded against the contestor if the legislature determines the contest of election is frivolous and has no foundation in law or fact.
(b) Attorney's fees may be awarded against the contestee if the election is annulled by the legislature due to misconduct, fraud or corruption on the part of the contestee.
....

I.C. § 34-2118 (emphasis added). Thus, the revision that occurred in 2017 changed the statute to provide for attorney fees in cases where, as here, the Senate determines that the "contest of election is frivolous and has no foundation in law or fact." Thus, Katsilometes argues that this change evinces that the Senate implicitly recognized it was without authority to award attorney fees at the time of his election contest.

Katsilometes further contends that this Court's decision in Noble v. Ada County Elections Board , 135 Idaho 495, 20 P.3d 679 (2000), is dispositive of the attorney fee issue. In Noble , the losing candidate in a primary election filed a Motion to Contest an Election in district court. Id. at 497, 20 P.3d at 681. After the district court upheld the election results, Noble appealed to this Court. Id. at 498, 20 P.3d at 682. As to attorney fees on appeal, the statute at issue provided that "[t]he appellant shall file a bond sufficient to cover the cost of appeal of a primary contest." Id. at 504, 20 P.3d at 688 (quoting I.C. § 34-2130 (repealed)). Interpreting that same provision, this Court stated: "This statute is not a basis for awarding attorney fees ...." Id. As we explained:

The general rule is that costs do not include attorney fees unless attorney fees are expressly included in the definition of the term costs. The legislature's awareness of this rule is demonstrated by its authorization of awards of costs and attorney fees. When the legislature has intended that the term costs cover attorney fees, it has so provided. Therefore, we hold that attorney fees are not appropriately awarded under I.C. § 34-2130.

Id. (citations omitted). Although Noble concerned whether the Supreme Court could award attorney fees on appeal after a primary election contest was filed in the district court, our explanation of whether attorney fees could be awarded under the statute at issue there applies equally to the statute in this case, which is also located in Chapter 21, Title 34 of the Idaho Code.

As noted, the Senate has the constitutional authority to be the "judge of the election, qualifications and returns of its own members" and to "determine its own rules of proceeding ...." Idaho Const. art. III, § 9. Thus, the Senate had constitutional authority to preside over the Contest of Election and determine the rules of proceeding applicable thereto. Pursuant to this authority, the legislature enacted Idaho Code section 34-2120. As discussed, that statute explicitly provided for an award of costs but not attorney fees. That the legislature later clarified Chapter 21 of Title 34, only months after Katsilometes' challenge, to provide for an award of attorney fees strongly suggests that it recognized it had not provided itself with authority to do so under the version of Idaho Code section 34-2120 in place at the time of this election contest. See Saint Alphonsus Reg'l Med. Ctr. v. Gooding Cnty., 159 Idaho 84, 89, 356 P.3d 377, 382 (2015) ("It is the long standing rule in this state that when the legislature amends a statute it is deemed, absent an express indication to the contrary, to be indicative of changed legislative intent" ) (quoting Nebeker v. Piper Aircraft Corp., 113 Idaho 609, 614, 747 P.2d 18, 23 (1987) )); see also Lincoln Cnty. v. Fid. & Deposit Co. of Maryland, 102 Idaho 489, 491, 632 P.2d 678, 680 (1981) ("When a statute is amended, it is presumed that the legislature intended it to have a meaning different from that accorded to it before the amendment.").

Nothing we say here should be read to cast doubt on the Senate's constitutional authority to enact its own rules of proceeding in the event of an election contest. We are not intervening in the Senate's constitutionally-delegated powers or even in its power to define its own rules by statute. Rather, we merely recognize that where the Senate enacts a law or a rule which does not permit it to impose attorney fees in an election contest, it cannot do so on an ad hoc basis.

Although our conclusion regarding the effect of the previous version of Idaho Code section 34-2120 is dispositive of this case, we briefly address Katsilometes' additional argument that "[t]he statutory scheme in place at the time this election contest was initiated and decided defined the substantive rights of the parties which could be impacted by an adverse decision by one house of the legislature." This assertion implicates important due process concerns. As to such matters of constitutional importance, we have previously held:

A procedural due process inquiry is focused on determining whether the procedure employed is fair. The due process clause of the Fourteenth Amendment prohibits deprivation of life, liberty, or property without fundamental fairness through governmental conduct that offends the community's sense of justice, decency and fair play. Procedural due process is the aspect of due process relating to the minimal requirements of notice and a hearing if the deprivation of a significant life, liberty, or property interest may occur. A deprivation of property encompasses claims where there is a legitimate claim or entitlement to the asserted benefit under either state or federal law. The minimal requirements are that there must be some process to ensure that the individual is not arbitrarily deprived of his rights in violation of the state or federal constitutions. This requirement is met when the defendant is provided with notice and an opportunity to be heard. The opportunity to be heard must occur at a meaningful time and in a meaningful manner in order to satisfy the due process requirement.

Bradbury v. Idaho Judicial Council , 136 Idaho 63, 72, 28 P.3d 1006, 1015 (2001) (internal citations and quotations omitted).

The Procedural Order for Contest of Election issued by the Senate and sent to Katsilometes indicated that the Senate would be performing its constitutional duty pursuant to Article III, section 9 to "judge of the election, qualifications and returns of its own members" and that "[n]othing in this Procedural Order limits or restricts the Senate in the performance of its duties as the judge of the election, qualifications and returns of its own members." However, as noted, although the Idaho Constitution allows the Senate to determine the rules of its own proceedings, the Senate already did so when it enacted Idaho Code section 34-2120, a statute that did not provide the Senate with the power to impose attorney fees in a general election contest. The ordering of attorney fees against a private citizen on an ad hoc basis, without prior notice, raises significant due process concerns. Conversely, the Senate had notice of our decision in Noble -which concerned a similar provision in Chapter 21, Title 34 of the Idaho Code-for more than ten years before it imposed attorney fees against Katsilometes under a statute that did not expressly provide for them. We also recognize that, as counsel for Katsilometes averred during oral argument, there is no case law over the last 250 years in the United States affirming that a legislative body, through its plenary powers, can impose attorney fees against an individual who is not a member of the legislative body without a statutory basis.

Again, as we have approached this dispute, we have strived to honor the doctrine of separation of powers and respect the constitutional role of the legislature-a co-equal branch of our government. Therefore, we have not attempted to define or limit the Senate's constitutional authority and discretion in determining its internal "rules of proceeding" and regulating the conduct of "members" of the Senate. Idaho Const. art. III, § 9. It is unnecessary for us to do so here because in adopting the earlier version of Idaho Code section 34-2120, the Senate defined and limited its own power to impose such fees. In essence, we are merely holding that the Senate, as part of a bicameral legislative body, cannot ignore laws duly passed by both chambers of the legislature and impose attorney fees against a private citizen on an ad hoc basis.

In conclusion, it is important to recognize that at its core, this case does not concern a rule of the Senate; rather, it concerns the Rule of Law. Contrary to the hyperbolic assertion of the dissent, this is hardly an attempt by the judiciary to "muscle" itself into the affairs of the Senate. Indeed, this action was initiated by a member of the Senate seeking judicial assistance in enforcing a decision of the Senate. This Court is merely responding to a case that has been brought before it-and fulfilling its constitutional role-by applying well-settled legal principles to an unsettled question of law. This is a judicial function almost as old as our republic. Indeed, as Justice John Marshall observed, in perhaps the most notable appellate ruling in the last 230 years: "It is emphatically the province and duty of the judicial department to say what the law is." Marbury v. Madison, 5 U.S. 137, 177, 1 Cranch 137, 2 L.Ed. 60 (1803). In short, this Court is merely holding that the Senate, notwithstanding the provisions of Article III, section 9 of the Idaho Constitution, is subject to the very laws it enacts. This is entirely consistent with another renowned statement by Justice Marshall contained in Marbury v. Madison: "The government of the United States has been emphatically termed a government of laws, and not of men." Id. at 163. Accordingly, we respectfully hold that the Senate's award of attorney fees to Nye was improper.

B. Nye was not entitled to recover his litigation costs, attorney fees, and prejudgment interest in the district court action.

Following the district court's entry of the declaratory judgment, Nye sought an award of his litigation costs, attorney fees, and prejudgment interest for bringing his action in the district court. The district court awarded Nye, as the prevailing party, attorney fees under Idaho Code section 12-120(1) and costs as a matter of right pursuant to Idaho Rule of Civil Procedure 54(d)(1)(A) ; however, no discretionary fees were awarded. Additionally, the district court awarded Nye prejudgment interest on the Senate's attorney fee award.

In light of this opinion, Nye should not have been the prevailing party in the district court action. Therefore, the district court's award of costs, attorney fees, and prejudgment interest must be vacated.

C. Neither side is entitled to attorney fees on appeal.

Katsilometes requests attorney fees on appeal pursuant to Idaho Code section 12-120(1) and Idaho Appellate Rules 40 and 41. Katsilometes further seeks an opportunity on remand to recover his attorney fees incurred during the district court proceedings since he should have prevailed below. Nye requests attorney fees on appeal pursuant to Idaho Code sections 12-120(1) or 12-121.

Section 12-120(1) applies to claims for monetary relief in which the amount pleaded is under $35,000, and entitles the prevailing party to an award of reasonable attorney fees. Here, Nye's claim was for a declaratory judgment effectuating the Senate's award of fees. Although this is a claim for money, the gravamen of the action is a dispute concerning the legal authority of the Senate to impose attorney fees in January of 2017 under the then-existing statutory scheme. As such, this case does not arise under the circumstances contemplated by section 12-120(1). Rather, it is, at its core, a constitutional issue. As a result, Katsilometes is not entitled to attorney fees on appeal under 12-120(1), and may not seek his fees on remand. Nye did not prevail on appeal, so he is not entitled to fees on appeal, and his award of fees by the district court must be vacated.

Attorney fees under section 12-121 are only permissible "if the appeal was brought or defended frivolously, unreasonably, or without foundation." "Fees will generally not be awarded for arguments that are based on a good faith legal argument." Easterling v. Kendall, 159 Idaho 902, 918, 367 P.3d 1214, 1230 (2016). Here, the parties were confronted with a difficult case of first impression, one that concerned important constitutional issues. Both sides defended their respective positions professionally, reasonably, and in good faith. Accordingly, we decline to award either side attorney fees under section 12-121.

V. CONCLUSION

For the reasons stated above, we reverse the district court's order enforcing the award of attorney fees to Nye pursuant to the order of the Idaho Senate, and vacate all costs, attorney fees, and prejudgment interest awarded to Nye by the district court. Neither side is entitled to attorney fees on appeal; however, as the prevailing party, Katsilometes is entitled to his costs on appeal.

Justices BEVAN, STEGNER, and Justice Pro Tem KIDWELL concur.

BURDICK, C.J., dissenting.

By striking down the Senate's award of attorney's fees, I believe the majority muscles the Judiciary into becoming a second judge in a proceeding where the Constitution requires the Legislature to sit as the sole arbiter. See Burge v. Tibor, 88 Idaho 149, 154, 397 P.2d 235, 237 (1964). In my view, the Senate's power to assess attorney's fees is well within its constitutionally granted power to adjudicate election contests. I also believe Katsilometes's due-process rights were adequately protected because he brought himself within the jurisdiction of the Senate and asked for attorney's fees in his petition. For these reasons, I respectfully dissent.

1. The Senate's award of attorney's fees was within its broad constitutional power to judge election contests and is consistent with Idaho Code section 34-2120.

The separation-of-powers doctrine prohibits "judicial review of the discretionary acts of other branches of government." In re SRBA Case No. 39576, 128 Idaho 246, 261, 912 P.2d 614, 629 (1995). While the Idaho Constitution confers the power to adjudicate almost all matters in controversy to the Judiciary, it gives the exclusive power to adjudicate general-election contests to each house of the Legislature. Idaho Const. art. III, § 6 ; Burge, 88 Idaho at 154, 397 P.2d at 237 ("This provision makes each house of the legislature the sole judge of the election and qualification of its members.") (emphasis added); Beitelspacher v. Risch, 105 Idaho 605, 606, 671 P.2d 1068, 1069 (1983) (" Art. 3, § 9, of our Constitution gives each house of the legislature the power to determine its own rules of proceeding. Thus, this power is specifically reserved to the legislative branch by the Constitution, and we cannot interfere with that power.").

In my view, Article III, Section 9 is a "textually demonstrable constitutional commitment" which assigns election contests to the Legislature and implicates its discretionary authority. Tucker v. State, 162 Idaho 11, 29, 394 P.3d 54, 72 (2017). This Court is "bound to respect the reasonable exercise by the legislature of powers expressly delegated to it by the constitution of this state, and in the absence of other constitutional offense cannot interfere with it." Idaho State AFL-CIO v. Leroy, 110 Idaho 691, 696, 718 P.2d 1129, 1134 (1986) ; see also Barry v. U.S. ex rel. Cunningham, 279 U.S. 597, 620, 49 S.Ct. 452, 73 L.Ed. 867 (1929) ("Here the question under consideration concerns the exercise by the Senate of an indubitable power; and if judicial interference can be successfully invoked, i[t] can only be upon a clear showing of such arbitrary and improvident use of the power as will constitute a denial of due process of law.").

I do not think the Senate's decision to award attorney's fees was so egregious as to convert a non-justiciable question into a justiciable one. First, I do not infer from section 34-2120 's repeal and replacement that the Senate lacked the power to award attorney's fees under the predecessor statute. That the new enactment clarified that attorney's fees may be awarded does not alter the Senate's underlying constitutional power to assess them in the first place. The award of attorney's fees serves the same purpose as the bond requirement and assessment of court costs under the same statute. These measures ensure the swift and proper resolution of an election by deterring unfounded attacks on election results which might undermine or unreasonably delay them.

In addition, because election contests are a constitutionally distinct species of adjudication, the Senate may choose to interpret the applicable statutes as it sees fit so long as the interpretation is reasonable. Here, the Senate did not craft the award out of whole cloth. At the hearing, both the Attorney General's Office and the Senate signaled their understanding that attorney's fees were awardable as "costs" under Idaho Code section 34-2120. That this Court has imposed a limiting construction on "costs" to exclude attorney's fees is persuasive to the Senate tribunal, but not binding. See Burge, 88 Idaho at 154, 397 P.2d at 237 (stating that this Court's decision denying a writ of mandamus to compel the counting of absentee ballots under Idaho Code §§ 34-1105 -1109 was "not binding" on the Legislature but "may be considered ... for what weight or effect the senate may see fit to give it, in the final determination of the election ... should a proceeding for that purpose be initiated ....").

The majority's reasoning that the Senate "cannot ignore laws duly passed by both chambers of the legislature" subverts the plain words of the Idaho Constitution. Section 9 provides that "each house" acts with autonomy; the power is not subject to bicameral or Executive approval. The Legislature cannot diminish a constitutional power by statutory fiat just as one session of the Legislature cannot tie the hands of the Senate in a future session by rewriting the scope of its power. See Johnson v. Diefendorf, 56 Idaho 620, 57 P.2d 1068, 1075 (1936) ("A legislative session is not competent to deprive future sessions of power conferred on them, or reserved to them, by the constitution."). Likewise, the language in Noble relied on by the majority has no application to the present case because that decision that involved a primary-election contest, rather than a general election. Noble v. Ada Cty. Elections Bd., 135 Idaho 495, 497, 20 P.3d 679, 681 (2000). This is not a distinction without a difference-primary contests are determined in the district court, rather than the Senate, and their jurisdiction is statutory, rather than Constitutional. Compare I.C. § 34-2123 with I.C. § 34-2105 ; Idaho Const. art. III, § 9. So when the majority notes that the Legislature is aware that the courts interpret "costs" to exclude attorney's fees, this has no bearing on whether the Legislature intended "costs" to exclude attorney's fees when the forum charges each house with interpreting the statute. Interpreting "costs" to include attorney's fees is not so unreasonable an interpretation to require this Court's intrusion into the Senate's adjudication. See Black's Law Dictionary 423 (10th ed. 2014) (defining "legal costs" as "[a]ttorney's fees and other expenditures related to a lawsuit.").

2. The Senate's award of attorney's fees did not violate Katsilometes's due-process rights.

Because section 34-2120 only stated "costs," the majority characterizes the Senate's award of attorney's fees as an ad hoc assessment of fees against private citizens without prior notice. I cannot view this case through such a broad lens and believe that Katsilometes received procedural due process under the circumstances.

The Legislature must still comply with procedural due process even when it is acting within its constitutional power. Cf. In re SRBA Case No. 39576, 128 Idaho 246, 255, 912 P.2d 614, 623 (1995). The due-process requirement "is met when the defendant is provided with notice and an opportunity to be heard." Bradbury v. Idaho Judicial Council, 136 Idaho 63, 72, 28 P.3d 1006, 1015 (2001) (quoting Aberdeen-Springfield Canal Co., 133 Idaho 82, 91, 982 P.2d 917, 926 (1999) ). It must be remembered that due process "is not a concept to be applied rigidly in every matter." Id. Rather, it is "a flexible concept calling for such procedural protections as are warranted by the particular situation." Id.

We should not lose sight of the fact that neither the Senate, nor Nye, instigated the election contest. Katsilometes filed the petition. Katsilometes voluntarily submitted himself to the Senate's jurisdiction and its Section 9 powers. Katsilometes was aware that this was a unique judicial proceeding subject to special rules. Katsilometes specifically asked for attorney's fees in his petition. And Katsilometes was provided "with notice and an opportunity to be heard" when the Senate gave him the procedural order and a hearing. Bradbury, 136 Idaho at 72, 28 P.3d at 1015. The Senate informed Katsilometes that it would operate under Article III, section 9 and that the procedural order did not "limit[ ] or restrict[ ]" the performance of that duty. Katsilometes persisted in his claim and received a hearing. Katsilometes submitted a brief and was given time to present his case. As mentioned, the Attorney General's Office gave a summary of the governing law and stated that attorney's fees were a matter of discretion and the Senate could determine how to interpret "costs" in the statute. If the Attorney General's Office was able to research and come to this conclusion, then Katsilometes either failed to research this fact or simply disagreed with it. Either way, Katsilometes had notice that assessment of attorney's fees was a possibility.

Given these considerations, I cannot say that the Senate "arbitrarily deprived" Katsilometes of his rights by failing to meet the "minimal requirements" of procedural due process when it awarded attorney's fees against him. Bradbury, 136 Idaho at 72, 28 P.3d at 1015.

      The Senate appears to have applied the standard from Idaho Rule of Civil Procedure 54(e)(1), which provides that "the court" may award attorney fees when a case is "brought, pursued or defended frivolously, unreasonably or without foundation." This judicial rule of procedure is expressly applicable only to the courts. Although the legislature later included this language in the current version of Idaho Code section 12-121 (approved and effective March 1, 2017), it did not exist in that statute as worded on January 25, 2017. Additionally, as will be discussed later in this opinion, the revised statute for election contests now incorporates a similar standard for imposing attorney fees. See I.C. § 34-2118(3)(a) ("Attorney's fees may be awarded against the contestor if the legislature determines the contest of election is frivolous and has no foundation in law or fact.") (effective July 1, 2017).

      We are mindful, as the dissent has properly noted, that Katsilometes asked for attorney fees when he filed his contest of the election in the Senate. However, the mere fact that a party seeks an impermissible form of relief from a tribunal does not imbue that body with the legal authority to grant such relief.

      Although Katsilometes asked for a remand so that he could be awarded attorney fees below, he did not ask for a remand on the issue of costs.


source: Caselaw Access Project

author: BURDICK, Chief Justice.

license: Public Domain

text:
    EAGLE CREEK IRRIGATION COMPANY, INC., an Idaho corporation, Plaintiff-Counterdefendant-Appellant, v. A.C. & C.E. INVESTMENTS, INC., a California corporation, Defendant-Respondent, and Lee P. Enright and Nancy K. Enright, Husband and Wife, Defendants.
    Docket No. 45675
    Supreme Court of Idaho, Boise, May 2019 Term.
    Opinion Filed: August 27, 2019
    Lawson, Laski Clark & Pogue, PLLC, Ketchum, for appellant. Edward A. Lawson argued.
    McHugh Bromley, PLLC, and Cosho Humphrey, LLP, Boise, for respondent. Christopher M. Bromley argued.
   BURDICK, Chief Justice.

Eagle Creek Irrigation Company ("Eagle Creek") appeals the Blaine County District Court's award of summary judgment in favor of A.C. & C.E. Investments, Inc. ("AC & CE Investments"). The dispute centers on 15 shares of Eagle Creek stock which authorize the holder to divert 30 cfs of water (or 15 miner's inches) of Eagle Creek's water right. AC & CE Investments purchased 15 acres ("the Property") located within Eagle Creek's boundaries. The prior property owners also owned 15 shares in Eagle Creek stock. The question presented on appeal is whether the 15 shares passed as an appurtenance to the Property. The district court ruled that AC & CE Investments acquired 15 shares in Eagle Creek when it acquired title to the Property because the shares passed as an appurtenance to the Property. Eagle Creek timely appeals.

I. FACTUAL AND PROCEDURAL BACKGROUND

In 2011, the Snake River Basin Adjudication ("SRBA") court declared Eagle Creek the owner of Water Right No. 37-00863E (the "SRBA Water Right"). The SRBA Water Right granted Eagle Creek the right to divert 4.56 cfs (228 miner's inches) of water and carried a priority date of 1902. Eagle Creek also received a water right for .04 cfs for aesthetic and recreation purposes under a separate water right (Water Right No. 37-00863F) for a total of 4.6 cfs (230 inches). The SRBA Water Right declares Eagle Creek's permissible place of use as 143.9 acres within its water-delivery system. Eagle Creek has a serviceable area of 189 acres. This area is informally referred to as "the Eagle Creek subdivision." The subdivision sits in a valley north of Ketchum, Idaho along Highway 75. The Property is the most northeastern lot in the subdivision.

The SRBA Water Right dates to a 1923 Blaine County District Court decision (the "Original Water Right"). The Original Water Right authorized the diversion of 4.6 cfs of water (230 miner's inches) and applied to roughly the same area as the Eagle Creek subdivision. Since the Original Water Right was first decreed, the property in the area has been divided and has changed hands numerous times.

Before Eagle Creek formed in 1973, John and Gladys Feldhusen owned the Original Water Right, the Property, and other property in the area. The Property was subdivided into three five-acre lots, referred to by separate deeds as Lot 17, Lot 18, and Lot 19. In 1970, the Feldhusens conveyed those lots by separate deeds, "with their appurtenances," to William and Patricia Woolway.

In 1973, Eagle Creek was formed as a nonprofit mutual irrigation corporation to hold water rights, in trust, for the benefit of its shareholders. As the corpus of its trust, Eagle Creek purchased 90% of the Original Water Right from the Feldhusens. This amounted to 207 miner's inches of water (4.14 of 4.6 cfs, or 207 of 230 miner's inches). Eagle Creek's articles of incorporation ("Articles") declared its purpose as constructing, maintaining, and operating a system of water delivery for its shareholders. For admitting shareholders, Eagle Creek stated in both the Articles and Bylaws:

[T]his corporation shall admit as stockholders only such persons, groups of persons, organizations or corporations who own property in the immediate vicinity of the irrigation system and to which property the corporation can make delivery of water for domestic or irrigation purposes under the contemplated distribution system of the corporation.

Those who met these conditions were "entitled to subscribe to and purchase shares of stock ... as provided in the corporation's By-Laws." Under the Articles and Bylaws, Eagle Creek would issue either 207 or 230 shares on a one-share-per-irrigable-acre basis. For water rights, the Articles stated:

The corporation will hold all water rights acquired in Trust, and operate the system for the distribution of water primarily for the benefit of the lands to which said water rights are to be appurtenant. The shareholders of the corporation shall be entitled to the appropriate share of the water annually available by virtue of their proportionate stock interest in this corporation.

Eagle Creek shares could not be transferred without Board approval, which was granted "under such criteria as the By-laws may prescribe." A share could be transferred only by its holder or its holder's legal representative "by the surrender and delivery of the said certificate and assignment of said certificate and the shares of stock represented thereby in writing." Old stock certificates were to be "surrendered and cancelled before new certificates in lieu thereof shall be issued."

In 1974, Eagle Creek sent "form letters to all prospective and interested buyers." Included among those "interested buyers" were the Woolways. It appears the Woolways acquired some quantity of shares because, in October 1974, the Woolways conveyed the Property to Glenn and Carolyn Olbum by three separate deeds. Two deeds specifically conveyed the properties "together with 5 shares in the Eagle Creek Irrigation Company," but the third was silent on whether Eagle Creek shares were included.

In 1981, the Olbums conveyed the lots by warranty deed "together with their appurtenances," but the deed made no mention of Eagle Creek shares. A similar conveyance occurred seven years later when the lots were conveyed to Harold and Flora Jonassen "together with their appurtenances," with no mention of Eagle Creek shares.

Around 1990, with the SRBA looming, the Jonassens hired lawyers to investigate their water rights. The investigation resulted in the Jonassens filing two claims for water rights in the SRBA. Around this time, Lee and Nancy Enright became interested in purchasing the Property. In a letter, the Jonassens's lawyer told the Enrights that a portion of the Original Water Right was "apparently thereafter transferred" to Eagle Creek. The letter further explained that because Eagle Creek had not yet filed a claim in the SRBA, the lawyer had filed claims for the Jonassens. Eagle Creek would eventually file a claim with the SRBA. Later in the same year, the Jonassens conveyed the lots to the Enrights "together with their appurtenances." A year later, the Enrights filed for a change of ownership in the SRBA claim. The filing was accepted.

In 1991, the Eagle Creek board of directors added a provision to the Bylaws declaring that if a shareholder wished to sell the real property to which Eagle Creek was delivering water, the shareholder must apply for a transfer of shares within sixty days of selling the property. Failure to comply would result in Eagle Creek deeming the stock cancelled and converted to treasury stock. However, if the shareholder sold the property and "provide[d] for an assignment of the stock in a contract or sale agreement with the new purchaser," then Eagle Creek would "consider such reference as an application to transfer the shares of stock previously held by the selling stockholder."

In 1992, the Enrights entered into an agreement with Eagle Creek to change their point of diversion further upstream subject to Idaho Department of Water Resources approval. At the time, the Enrights owned 15 shares of Eagle Creek stock. Their stock certificates made no specific mention of where the water was to be used, but stated that "each share entitles the owner to receive .02 of a cubic foot of water per second of time per acre or one Miner's inch when available from the waters of Eagle Creek."

In a memorandum decision approving the Enright's application, the Department wrote that the Enrights sought to change the diversion point for .30 cfs of water (15 miner's inches) "represented by fifteen (15) shares of stock" in Eagle Creek. The Department made the following conclusions regarding ownership of the water right:

6. The water sought in the transfer is represented by shares of stock in ECIC and is a portion of the company's water right.
...
8. The only right to divert and use the waters of [the Eagle Creek stream] is vested with and is controlled by [Eagle Creek] which distributes water to its shareholders.
...
16. The proposed change has been approved by [Eagle Creek], the holder of the water right and is in the local public interest.

The Department also commented on questions over the scope of Eagle Creek's water right:

There appears to be conflicting information concerning the total number of shares of capital stock of [Eagle Creek], i.e. 207 shares v. 230 shares. The difference, however, is not of particular significance to the holding in this decision but probably should be cleared up by [Eagle Creek] for its own purposes.

In 2005, Eagle Creek provided the Enrights with a quitclaim deed so they could "convey any ownership interest [they] may have in the Eagle Creek water right back to the company." Eagle Creek wrote that this was "necessary" because the Department "transferred ownership of a portion of the original water right from the company to [the Enrights] on its records when it approved your water right transfer." Eagle Creek reassured the Enrights, explaining: "You will, of course, continue to rely on your 15 shares of stock in the Company to receive water out of Eagle Creek to irrigate your property."

The Enrights obliged and quitclaimed to Eagle Creek "all their right, title and interest in and to Water Right No. 37-863B."

In 2006, Lee and Nancy Enright executed a deed of trust with the Bank of America. The deed of trust gave the bank a security in the Property "together with ... all easements, appurtenances, and fixtures now or hereafter a part of the property." A separate deed of trust gave the Bank's trustee the property "together with all ... appurtenances now or later in any way appertaining to the Property."

In 2009, in preparation for the foreclosure sale, emails were exchanged between the title company, the auction company, the Enrights, and Eagle Creek's attorney. In an email to the title company, the auction company inquired about the status of water rights on the Property:

There are surface water rights that are to be conveyed with the property. Do these have to be transferred with a separate deed? If so, what type of deed? Or will it be included in the warranty deed transferring the real estate?

In response, the title company stated that it had spoken with the Department; "[t]he individual water rights for Eagle Creek Subdivision have been disallowed and now are decreed in the name of Eagle Creek Irrigation Company" and "[e]ach owner in the subdivision have [sic] shares in the irrigation company." The auction company then asked the Enrights for information on their shares so they could better advertise them. The Enrights responded: "We have one inch water rights per acre for total of 15 inches (15 shares). The water rights go with the land. (One inch per acre). I have the certificates which document that." The auction company forwarded the Enrights' response to the title company. It told the title company that it would set up the purchase contract to convey the water rights with the deed and then the purchaser could change the Department's records. The title company reached out to Eagle Creek's attorney for confirmation of the Enrights' description of their water rights because the description "didn't jive" with what it had been told. Eagle Creek's attorney replied: "Enright's summary is accurate and I'm certain he can produce the stock certificates which state what amount of water each share entitles the holder to use." Eagle Creek's attorney also indicated that Eagle Creek was the owner of the water right.

In 2010, the SRBA Court disallowed the Enrights' SRBA claim (Claim No. 37-00863B) with prejudice and, in July 2011, declared Eagle Creek the owner of the SRBA Water Right. A little more than a month later, on September 8, 2011, the bank foreclosed on the deed of trust and the trustee conveyed the Property to AC & CE Investments. Thereafter, AC & CE Investments took possession of the property and began diverting water.

After the conveyance, Eagle Creek and AC & CE Investments discussed the shares. Before it would reissue the shares in AC & CE Investments' name, Eagle Creek asked AC & CE Investments to: agree to abide by the Enrights' 1993 diversion agreement; pay past-due assessments on the shares ($50 per share); and line or pipe the ditch crossing the Property. AC & CE Investments' reply stated that it acquired the water rights as an appurtenance by purchasing the land. AC & CE Investment's position was that it might not be responsible for the assessments, the Department had authorized the diversion, and Eagle Creek was responsible for lining the ditches.

Eagle Creek then filed a complaint seeking declaratory and injunctive relief and a decree stating it owned all water rights and the 15 shares of Eagle Creek stock. It later amended its complaint to include damages. AC & CE Investments asserted many affirmative defenses, but also counterclaimed to quiet title to the 15 shares and the water rights. After discovery, the parties filed cross-motions for summary judgment on several issues, including who owned the 15 shares of Eagle Creek stock. After a hearing, the district court granted partial summary judgment in favor of AC & CE Investments and denied Eagle Creek's motion. The district court acknowledged that not all issues were ripe for summary judgement because factual issues remained. However, the district court determined that appurtenancy of the water right was a matter of law that could be resolved on summary judgment. The district court ruled that "when AC & CE acquired title to its fifteen acres, ownership of fifteen shares of stock in Eagle Creek passed with it as an appurtenance." The district court reasoned that because the water right is appurtenant to the land, and because the shares merely represent the water right, AC & CE Investments received the water right when it acquired the Property.

The case proceeded to trial. After stipulating to the admission of several exhibits and presenting opening statements, the parties reached a settlement. As part of the settlement agreement, Eagle Creek agreed to issue 15 shares of stock to AC & CE Investments backdated to the date of the trustee's sale. In return, AC & CE Investments agreed to line the ditch in certain areas within three years or upon sale of the Property. The agreement provided that the court's memorandum decision on summary judgment "shall be entered as a final, appealable judgment" but that "all matters not decided" in that decision "shall be dismissed, with prejudice ...." The court entered the following judgment:

When A.C. & C.E., Investments, Inc. acquired title to its fifteen acres, ownership of fifteen shares of stock in Eagle Creek passed with it as an appurtenance. Because the water right is appurtenant to the land, A.C. & C.E. received the right to water when it acquired the fifteen acres. The decision does not affect Water Rights 37-863E and 37-863F.
...
The settlement agreement ... is binding upon the parties henceforth.

Eagle Creek timely appeals.

II. ISSUES ON APPEAL

1. Whether shares in a mutual irrigation company pass as an appurtenance to a property when neither the water right nor the corporate documents indicate that the shares are appurtenant to the specific property conveyed.
2. Whether AC & CE Investments is entitled to an award of costs and attorney's fees on appeal.

III. STANDARD OF REVIEW

This Court reviews a motion for summary judgment

pursuant to the same standards as the district court. The court must grant summary judgment if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law. All reasonable inferences that can be drawn from the record are to be drawn in favor of the nonmoving party, and disputed facts are liberally construed in the nonmoving party's favor.

Monitor Fin., L.C. v. Wildlife Ridge Estates , LLC, 164 Idaho 555, 559, 433 P.3d 183, 187 (2019) (citations and internal quotation marks omitted).

Whether water rights pass as an appurtenance is a matter of law. Ireton v. Idaho Irr. Co. , 30 Idaho 310, 164 P. 687 (1917). Questions of law are reviewed de novo. Monitor Fin , 164 Idaho at 559, 433 P.3d at 187.

IV. ANALYSIS

Before reaching the analysis, we must demarcate the issue on appeal from the issues dismissed with prejudice by the district court per the parties' settlement agreement. The sole issue on appeal is whether the district court erred in determining that the 15 shares of Eagle Creek stock automatically passed to AC & CE Investments as an appurtenance to the Property. Every other issue advanced below was dismissed with prejudice as part of the parties' settlement agreement because those issues involved questions that were not reached on the summary judgment.

Even if those issues were not dismissed, the settlement agreement leaves them moot. AC & CE Investments currently possesses the 15 shares. Thus, we need not decide whether AC & CE Investments, as a landowner within Eagle Creek's boundaries, is entitled to receive the shares under Eagle Creek's Bylaws. We need not decide whether the 15 shares reverted back to treasury stock or whether the Enrights's emails were sufficient to transfer the shares under the 1991 Amendment. Also mooted are any lingering questions about Eagle Creek's transfer restrictions, corporate actions, or corporate existence. The parties have resolved the dispute giving rise to those arguments.

For the issue on appeal, it is helpful to differentiate between the appurtenancy of a water right and the appurtenancy of a share in a mutual irrigation company. Though not clear in our prior case law, these are two separate inquiries. As will be explained in further detail, mutual irrigation companies, like Eagle Creek, own water rights with a "general" appurtenancy-that is, the water right is appurtenant to all of their serviceable land. Determining whether a particular share is appurtenant to a specific tract of land depends upon the factual inquiry into the mutual irrigation company's governing documents and the history of the water right. While a share in a mutual irrigation company can be appurtenant to a specific tract of land within an irrigation company's serviceable area, such specific appurtenancy is not an integral feature.

Here, the district court ruled that appurtenancy of a share in a mutual irrigation company is a question of law. Because the district court set aside the factual issues of corporate governance before reaching this issue, we vacate the portion of the district court's judgment which states that the underlying water right and the 15 shares were appurtenant to the Property.

A. Historical and legal background on water-delivery organizations and the Carey Act.

a. There are three main types of water-delivery organizations in Idaho: the mutual irrigation company, the commercial ditch corporation, and the irrigation district.

How this Court treats ownership and appurtenancy in water-delivery organizations depends on the type of entity involved.

The mutual irrigation company is formed expressly for the purpose of furnishing water to shareholders, not for profit or hire. Jacobucci v. Dist. Court In & For Jefferson Cnty. , 189 Colo. 380, 386, 541 P.2d 667, 671 (1975). Thus, the defining feature of the mutual irrigation corporation is that it operates to supply and transport water, at cost, for the lands of its members. See WELLS A. HUTCHINS, WATER RIGHTS LAWS IN THE NINETEEN WESTERN STATES Vol. I, at 479 (1971). The mutual irrigation company should be distinguished from ordinary "public service" entities, because "being in private service only," it is "not subject to the public control which obtains as to public service companies." SAMUEL C. WIEL, WATER RIGHTS IN WESTERN STATES Vol. II, at 1266 (3rd ed. 1911). As such, a mutual irrigation company cannot be "forced to deliver water to others than its stockholders." Id. They are largely autonomous, subject to their own bylaws, articles of incorporation, the law generally applicable to corporations, and a few specific statutes and Constitutional provisions. Gasser v. Garden Water Co. , 81 Idaho 421, 425, 346 P.2d 592, 593 (1959).

In contrast to the mutual irrigation company, a commercial ditch company holds water rights for profit. Jeffrey C. Fereday, Ownership of Water Rights in Irrigation Water Delivery Organizations: An Outline of the Major Issues , in WATER ORGANIZATIONS IN A CHANGING WEST (Natural Res. Law Ctr., Univ. of Colo. Sch. of Law 1993). The shareholders of a commercial ditch company are those who built it, not those who make use of the water. Id. This was the main type of irrigation company in operation when the framers of Idaho's Constitution imposed Constitutional restrictions on ditch companies. See Fereday, Jeffrey C., et al., WATER LAW HANDBOOK 345-46 (2019). The commercial ditch company's heyday was in the 1880's; almost none persist today. Id.

Commercial ditch companies were generally organized in one of three ways:

(1) The first form is a "construction or development company," a carrier ditch company that would construct the canals and other facilities, convey lands to farmers, and enter into water delivery contracts with these settlers. Once all lands had been irrigated and the canal's capacity fully subscribed, the carrier ditch company would convey the water rights and facilities to the farmers or, more likely, to a mutual irrigation company that the construction company would set up with the settlers as its shareholders. At this point, the carrier ditch construction company would go out of business, presumably at a profit for its backers. This is precisely the formula used in implementing the Carey Act.
(2) The "private contract company" is one set up for perpetual service to farmers with whom it would contract; they would pay for the water delivery at established rates, whether they used the water or not. The users never acquire any interest in the water rights or facilities. Historically [before state Constitutional provisions provided otherwise], such a company was not subject to state control of rates.
(3) A true "public utility company," is one which holds itself out to serve all comers, so long as there is adequate water supply, on an annual fee for service based primarily on the amount of water used. The deliberate entry into public service caused a dedication to public use and subjected these companies to public utility regulation (at least after public utility commissions came into being).

Fereday, Ownership of Water Rights in Irrigation Water Delivery Organizations: An Outline of the Major Issues at 4 (citing Wells A. Hutchins, Commercial Irrigation Companies USDA Tech. Bull. 177 at 5-6 (1930)).

Lastly, irrigation districts are formed pursuant to statute. I.C. §§ 43-101 -2554; Yaden v. Gem Irr. Dist. , 37 Idaho 300, 216 P. 250, 252 (1923) ("Irrigation districts are creatures of the statutes."). Thus, irrigation districts "are quasi public or municipal corporations, and as such have only such power as is given to them by statute, or such as is necessarily implied." Id. Landowners served by irritation districts do not hold individual water rights in connection with their service.

b. The Carey Act.

In 1894, Congress passed the Carey Act, a homestead law that guaranteed up to a million acres of the public domain to Western states if the states would carry out a water development and settlement plan. MIKEL H. WILLIAMS, IDAHO DEP'T OF RECLAMATION, THE HISTORY AND DEVELOPMENT AND CURRENT STATUS OF THE CAREY ACT IN IDAHO 1 (1970). The Carey Act was enacted to encourage westward expansion into desert lands when the 1890's land rush stalled because most areas with readily available water had been settled. Id.

To implement the Act, the federal government agreed to convey lands to the states once an ample supply of water was furnished to areas. Id. at 2-3. To provide the supply of water, for-profit "construction companies" would seek the state's approval to build irrigation projects. Id. at 6. The state would then determine whether there was enough unappropriated water for the venture. Id. If satisfied by the proposal, the State would determine the water rights that the construction company could sell. Id. The construction company would then sell stock in a nonprofit "operating company" (formed according to state statutory procedure) to settlers who would perfect the water right by putting the water to beneficial use on the land. Id. (citing In re Robinson , 61 Idaho 462, 103 P.2d 693 (1940) ). In form, operating companies acted much like mutual irrigation companies because they operated to deliver water to their shareholders at cost. Id. Once the irrigation system was completed and the construction company had sold all (or most) of the stock in the operating company, the construction company would convey all its interest in the irrigation system and water rights to the operating company. Id. The federal government would then issue land patents directly to the settlers. Id.

As a result, the "origin and purpose of Carey Act companies are distinct from those of ordinary water corporations [and] have been generally recognized by the statutes and by the court as forming a distinct class of water corporations." In re Johnston , 69 Idaho 139, 145, 204 P.2d 434, 438 (1949). Under Idaho law, "water rights to all lands acquired under the [the Carey Act implementation chapter] shall attach to and become appurtenant to the land as soon as title passes from the United States to the state." I.C. § 42-2025. Thus,

[i]t seems clear that by virtue of the statutory conditions and these contracts, and the certificate issued pursuant to them, that the company sells, and the purchaser buys a water right dedicated to his land ... It seems clear that the certificate in carrying out the whole plan represents and must represent a water right sold to the settler and dedicated to his land, and of which he is the beneficial owner. And further, at least in the absence of any showing of separation, the water right is an appurtenance to the land to which it was dedicated and is part of that property.

Leland v. Twin Falls Canal Co. , 51 Idaho 204, 3 P.2d 1105, 1107 (1931). Thus, a Carey Act operating company's shares document the settler's ownership of the water right. See WILLIAMS , supra , at 7 ("It must be remembered that corporations organized to construct irrigation systems under the Carey Act do not become owners of water rights or irrigation systems; but are only given the right to sell water rights for the purpose of recovering the cost of the construction of the works with a reasonable profit.") (citing I.C. 42-2504 (1917) ).

B. Whether shares in a mutual irrigation company are appurtenant to specific tracts of land is determined by the contract between the shareholder and the corporation.

In Idaho, water rights are real property. I.C. § 55-101 ("Real property or real estate consists of ... ditch and water rights ...."). Water rights can either be conveyed with the land on which they are put to beneficial use, or separate from it. Fed. Land Bank of Spokane v. Union Cent. Life Ins. Co. , 54 Idaho 161, 29 P.2d 1009, 1011 (1934) ("A water right is real property and may be sold and transferred separately from the land upon which it has been used, the same as any other real property") (quoting In re Rice , 50 Idaho 660, 667, 299 P. 664, 666 (1931) ). In either case, the purchaser receives no greater right than the seller could convey at the time of sale. Beecher v. Cassia Creek Irr. Co. , 66 Idaho 1, 7, 154 P.2d 507, 509 (1944) ("One who purchases a water right acquires no better or greater right than his vendor."). When interpreting a conveyance of property, "[u]nless [appurtenant water rights] are expressly reserved in the deed or it is clearly shown that the parties intended that the grantor would reserve them, appurtenant water rights pass with the land even though they are not mentioned in the deed and the deed does not mention 'appurtenances.' " Joyce Livestock Co. v. United States , 144 Idaho 1, 14, 156 P.3d 502, 515 (2007) (citing Silverstein v. Carlson , 118 Idaho 456, 797 P.2d 856 (1990) ).

If a share in a mutual irrigation company represents a discrete water right appurtenant to a specific tract of land, it follows that the share would pass as an appurtenance to that specific tract of land under Joyce Livestock . However, shares representing the right to delivery of water from a mutual irrigation company's water right present an altogether different problem. While typical water rights are decreed as appurtenant to specific tracts of land, a water-delivery organization's water right is decreed with a "generally described place of use." I. C. § 42-219(7). This results in a sort of legal fiction-the "general" appurtenancy. As we acknowledged in A & B Irrigation District v. Idaho Department of Water Resources , the legal effect of a water right which was "limited to the irrigation of 62,604.3 acres within the A & B Irrigation District boundary" was that the "water diverted from any one of the points of diversion is appurtenant to and therefore can be used on any and all of the 62,604.3 acres within the defined place of use ." 153 Idaho 500, 514, 284 P.3d 225, 239 (2012) (emphasis added). For similar reasons, water-delivery entities are permitted to move water around their permissible place of use without complying with the transfer requirements of Idaho Code section 42-222(1). No amount of water is tied to a specific tract of land without a more precise assignment. See, e.g. , I.C. § 42-2025 (1895) (assignment for Carey Act companies); I.C. § 43-1707 (assignment for irrigation districts obtaining water under the Carey Act).

Because no appurtenancy statutes apply specifically to mutual irrigation companies, whether a share is appurtenant to specific tract of land is a matter of contract and corporate governance. See WELLS A. HUTCHINS, WATER RIGHTS LAWS IN THE NINETEEN WESTERN STATES , Vol. I, at 479 (1971). ("Appurtenance of a water right, which is a legal matter ... is to be distinguished from appurtenance of mutual-company stock to land, which is a contractual matter between the company and its shareholders."); SAMUEL C. WIEL, WATER RIGHTS IN WESTERN STATES , Vol. II, at 1173 (3rd ed. 1911) ("Whether the water right is appurtenant to the stockholder's land is a question of fact in each case, as is also whether on a sale of the land the water right passes as an appurtenance."); cf. Gasser v. Garden Water Co. , 81 Idaho 421, 425, 346 P.2d 592, 593 (1959) (stating that the relationship between a mutual irrigation company and a shareholder is contractual).

However, such contracts are to be closely scrutinized because "[t]here are several phrases used in the Idaho Constitution and the Idaho Code that signify that the beneficial users have an interest that is stronger than mere contractual expectancy." United States v. Pioneer Irr. Dist. , 144 Idaho 106, 114, 157 P.3d 600, 608 (2007) ; see, e.g. , Idaho Const. Art. 15, §§ 1, 4, 5, and 6. Therefore, while "such a corporation has the usual rights pertaining to corporations with reference to the handling of its affairs and in dealing with its stockholders," the shareholder has the "peculiar" right to the continued distribution of her proportionate share of the waters belonging to or distributed by the mutual irrigation company. In re. Johnston , 69 Idaho 139, 144, 204 P.2d 434, 437 (1949). However, "mutual corporations may ... adopt such rules and regulations not in violation of law governing the distribution and use of the water furnished among their shareholders as are equitable and reasonable under the circumstances of the case." Gasser , 81 Idaho at 425, 346 P.2d at 593.

The physical shares are part of this contractual inquiry. A mutual irrigation company's shares can either be attached to specific tracts or they can "float" among all the tracts within the mutual irrigation company's system:

Shares of stock in a mutual company may or may not be attached to specific tracts of land. Attachment to land may result either by way of "location" on specific tracts-resulting from contract between company and shareholders evidenced by articles of incorporation, bylaws and stock certificates-or by representing the rights to receive water considered appurtenant to such tracts. If not attached to specific tracts, they are known as "floating" shares. These floating shares may pass freely from one holder to another and may be used for irrigation of any tract that can be served from the irrigation system as normally operated.

WELLS A. HUTCHINS, WATER RIGHTS LAWS IN THE NINETEEN WESTERN STATES Vol. I, at 479 (1971).

In determining whether the shares are appurtenant to the land, how the company acquired the water right (or rights) can shape the inquiry:

[T]he water rights may be appurtenant to the general service area of the company by reason of its appropriating water for the area as a whole, and the company may not take action in "locating" its shares on specific parcels. In such case, within the limits of transferability set by operational needs, any farmer may transfer his floating stock and the right to water service to any other part of the service area. The only attachment to land that is involved is a temporary one, necessarily recorded on the water delivery schedules of the company superintendent for operational purposes only. And the only appurtenance of water right is to the general service area.

Id.

Here, Eagle Creek's water right is appurtenant to the whole of its service area rather than to individual tracts of land because Eagle Creek's governing documents do not "locate" the shares. Idaho Code section 42-219(7) requires reading the SRBA Water Right as appurtenant to "any and all" the 143 acres within Eagle Creek's boundaries. A & B Irrigation, 153 Idaho at 514, 284 P.3d at 239. The Articles, Bylaws, and physical shares do not alter this "general" appurtenancy. The closest the Articles and Bylaws get to "locating" the shares, as AC & CE Investments points out, is the statement: "The corporation will hold all water rights acquired in Trust, and operate the system for the distribution of water primarily for the benefit of the lands to which said water rights are to be appurtenant." However, this passage refers to how the company will treat water rights it acquires, not how it will treat shares it issues. In other words, Eagle Creek holds acquired water rights in trust for the lands the water right was appurtenant to before the company acquired it. Thus, shares are not attached to specific tracts of land.

Rather, Eagle Creek uses "floating" shares. The shares state the right to a specific amount of water without listing specific tracts of land. As noted by Eagle Creek, the shares could have been "located" by containing more specific language. See Brown v. Portneuf-Marsh Valley Irr. Co. , 299 F. 338 (D. Idaho 1924). Granted, Eagle Creek's internal recordkeeping books have the shares listed with corresponding lot numbers (e.g. "No. 50 (Lot 17)"). Even so, this appears to be the only indication in Eagle Creek's books and records of appurtenancy to specific tracts of land, and this falls under the sort of "temporary" attachment to land which is "necessarily recorded on the water delivery schedules of the company superintendent for operational purposes only." WELLS A. HUTCHINS, WATER RIGHTS LAWS IN THE NINETEEN WESTERN STATES , Vol. I, at 479 (1971).

Also, because it acquired its water right in a one-off transaction, Eagle Creek's water right began as an appurtenance to the whole of its service area rather than individual tracts of land. The Original Water Right was as a single water right with a large geographic footprint. The SRBA Water Right's permissible place of use does not alter the Original Water right in this regard. It remains a single water right with a large footprint. Had Eagle Creek's SRBA Water Right been compiled by a patchwork of individually held water rights, each with its own appurtenant land, there would be a strong inference that those rights retained their specific appurtenancy. However, here, the Original Water Right began with a large geographic footprint which follows the SRBA Water Right's general appurtenancy.

For this reason, AC & CE Investment's contention that Idaho Code section 42-220 proves that it owns the Enright's shares is without merit. Section 42-220 provides that water rights decreed by a court "shall become appurtenant to, and shall pass with a conveyance of, the land for which the right of use is granted." Here, the Original Water Right, as originally decreed, was made appurtenant to the area around the Eagle Creek subdivision by the Feldhusens' predecessors. The Feldhusens conveyed the Original Water Right to Eagle Creek. See Fed. Land Bank of Spokane v. Union Cent. Life Ins. Co. , 54 Idaho 161, 29 P.2d 1009, 1011 (1934) ("A water right is real property and may be sold and transferred separately from the land upon which it has been used, the same as any other real property.") Thereafter, the Original Water Right was appurtenant to all the property which Eagle Creek served and could serve. As mentioned, had the Enrights' predecessors in interest owned a separate water right appurtenant to the specific tract and conveyed it to Eagle Creek in return for shares, those shares would likely retain that appurtenancy in the absence of a contrary intent in the contract. However, the record shows that Eagle Creek acquired 90% of the Original Water Right (207 of 230 miner's inches), but ultimately held 100% of the Original Water Right when the SRBA Water Right was declared. To the extent the Property may have held the remaining 10% of the Original Water Right, that possibility was foreclosed by the SRBA Water Right. While there are some questions regarding the Jonassens's claim in the SRBA, it appears that the Jonnassons filed that claim because Eagle Creek had not yet filed a claim in the SRBA. Eagle Creek believed that claim to be duplicative of its water right, and the Enrights appeared to agree at the time by quitclaiming the claim to Eagle Creek.

In sum, to determine the appurtenancy of a share in a mutual irrigation company, the court must consider the company's governing documents and how it acquired the water rights. These facts directly affect whether the shares are appurtenant to the shareholder's property.

C. This Court has never conclusively held that all types of shares in a mutual irrigation company pass as an appurtenance to a specific tract of land.

AC & CE Investments argues that Idaho law treats shares in mutual irrigation companies as an externalization of water rights for purposes of resolving whether the rights pass as an appurtenance. Idaho's approach to this question has depended on the type of company, and shares, at issue. At one end, there are cases which treat the shares as personalty. Wells v. Price, 6 Idaho 490, 56 P. 266, 267 (1899) ; Watson v. Molden , 10 Idaho 570, 587, 79 P. 503, 507 (1905). At the other end is Ireton v. Idaho Irrigation Company , which intimates that such shares merely represent a water right and pass with their described land. 30 Idaho 310, 164 P. 687, 689 (1917).

The Wells decision dealt with a mutual irrigation company. 6 Idaho at 490, 56 P. at 266. The two-paragraph opinion centered on whether a writ of attachment to certain lands included the landowner's shares in a mutual irrigation company as an appurtenance. Id. Prior to the eventual judicial sale, landowners in the area had organized a mutual canal company which issued stock to landowners in proportion to the interest each owned in the canal and water right conveyed to the company. Id. The Wells court reasoned that because Idaho's corporate laws expressly provided steps to attach stocks, the creditors could not receive the shares without following those steps. Id. The Court also refuted the notion that the shares represented real property. Id. at 267 ("Shares of stock in an irrigation corporation are not appurtenant to the land owned by the owner of such shares, even though such land be irrigated by water from a canal owned by such corporation.").

We held to the same logic in Watson . There, a landowner fraudulently conveyed land and shares in an irrigation company. 10 Idaho 570, 587, 79 P. 503, 507 (1905). On appeal, the seller asserted that there was no contract because the shares represented real property rights, so the agreement did not satisfy the statute of frauds. Id. Rejecting this argument, the Court cited to Wells and the then-enacted Idaho corporate code. Id. The Court held that "[a]ll that defendant attempted to sell, or that plaintiff believed he purchased, was so many shares of stock in a canal company, which passes by assignment and delivery. This being true, the property sold was only personal property." Id. The corporate code "settle[d] the question as to the status of the property" by stating that "such shares of stock are personal property." Id. (citing Section 2611, Rev. St. 1887).

Next was Ireton v. Idaho Irrigation Company, 30 Idaho 310, 313, 164 P. 687, 688 (1917). That case stemmed from a priority dispute between two creditors. Id. A bank held an earlier filed mortgage on a debtor's land and asserted a right to not only the proceeds of the land sale, but also to the sale of the debtor's shares in the irrigation company. Id. The bank claimed the shares passed as appurtenances despite no mention of shares in its mortgage. Id. at 315, 164 P. at 687. A Carey Act operating company held a junior security interest in the debtor's shares. Id. The debtor had purchased shares from the Carey Act company after acquiring land under the Desert Lands Act. Id. In return, the Carey Act company received a purchase-money security interest in the shares. Id.

The Court observed that the contract between the State and the Carey Act company provided that the water right would be appurtenant to the land. Id. at 315, 164 P. at 689. That the debtor obtained his land from the Desert Lands Act made no difference because the contract between the debtor and the company was governed by "the same terms as conditions" as the Carey Act. Id. Thus, the Carey Act company was "in no better position than it would have been, had the land been embraced within a Carey Act entry." Id. at 316, 164 P. at 689. The water rights had become appurtenant to the land prior to the debtor's mortgage with the bank. Id. So, under the Idaho Code, the bank had a superior mortgage to any appurtenant water right because it was a bona fide purchaser that had recorded first. Id.

In response to the Carey Act company's argument that the shares were personal property, the Court voiced the reasoning on which AC & CE Investments now relies:

It is contended by appellant that the shares of stock in the operating company are personal property, and that the water right passed by assignment of them, and did not become subject to the mortgage on the land. While shares of stock in an ordinary corporation, organized for profit, are personal property, and while this court has held shares in an irrigation company to be personal property the fact must not be lost sight of that a water right is, as heretofore shown, real estate, and that in case of a mutual irrigation company, not organized for profit, but for the convenience of its members in the management of the irrigation system and in the distribution to them of water for use upon their lands in proportion to their respective interests, ownership of shares of stock in the corporation is but incidental to ownership of a water right. Such shares are muniments of title to the water right, are inseparable from it, and ownership of them passes with the title which they evidence.

Id. AC & CE Investments argues that this language settles the case at hand. Eagle Creek, on the other hand, contends that Ireton is limited to Carey Act companies.

The Ireton court used broad language, but its logic rested on the assumption that the share was appurtenant to the land. A share in a mutual irrigation company is a mere "muniment of title" to which is inseparable from the water right because shareholders are the beneficial owners of the right. Nevertheless, this does not solve whether the share is appurtenant to the land. By Ireton 's terms, ownership will not automatically pass unless the shares are tied to the title. Here, the shares cannot pass automatically with the "title which they evidence" because the shares do not refer to the land.

For appurtenancy, Ireton 's holding is tied to the Carey Act. See id. at 310, 164 P. at 687. As noted, Idaho statutes which implement the Carey Act (and the Carey Act-based contract at issue in Ireton ) declare that the water rights attach to the land as soon as the federal government issues the patent. Thus, shares in a Carey Act company "evidence title" to particular land because the water right is statutorily granted to the individual settlors (and their specific parcels of land), and thus reflect individual water rights. However, this logic does not mesh with the concept of floating shares because floating shares do not "evidence any title" to specific land. Investigating deeper into Ireton 's holding reveals that the two cases cited for this language both contained clear indication that the shares were appurtenant to the specific land. In one case, the shares passed as an appurtenance because the shares were assigned to specific land by description on the back of the certificate. See Berg v. Yakima Valley Canal Co. , 83 Wash. 451, 457, 145 P. 619, 621 (1915). Next, Ireton quotes the "muniments of title" language from a case where individual irrigators each conveyed a water right to the mutual irrigation company's trust. Thomas v. Bryant , 147 Cal. 236, 239, 81 P. 539, 540 (1905). As noted, even though nothing in the corporate documents provided for appurtenancy, the water rights were still appurtenant to the specific lands they originally applied to in the absence of a severance or intent to provide for general appurtenancy. Id.

Thus, Ireton does not resolve the issue of shares passing as an appurtenance for all mutual irrigation companies. Rather, as stated above, appurtenancy of a share in a mutual irrigation company is a factual question to be resolved in each case. This is not a sea change in the realm of water law. Appurtenant water rights still pass as appurtenances to land unless specifically reserved in the conveyance. Joyce Livestock Co. v. United States , 144 Idaho 1, 14, 156 P.3d 502, 515 (2007). However, in order for the shares to "pass[ ] with the title which they evidence," it must first be determined whether the shares are appurtenant to the tract of land being conveyed. Ireton , 30 Idaho at 317, 164 P at 689. A factual inquiry into the governing documents of the mutual irrigation company and history of the water rights is required.

D. The Bagley Cases do not conclusively answer the appurtenancy question:

AC & CE Investments asserts that the Bagley cases undisputedly resolve this issue.

We disagree. First, it is unclear whether the irrigation company involved in the Bagley cases was a mutual irrigation company or a Carey Act operating company. For that reason, whether the shares were appurtenant to the specific land was not evaluated. Likewise, none of the cases reached the merits of whether shares in a mutual irrigation company pass as an appurtenance. Thus, the Bagley cases do not conclusively establish that shares in mutual irrigation companies pass as an appurtenance to the land regardless of the governing document or history of the water right.

The Bagley cases, three in total, began when the Thomasons conveyed real property "and legal rights to the land as deeded" to the Bagleys in exchange for a promise to reconvey for property some months later for the purchase price plus interest. Bagley v. Thomason , 149 Idaho 799, 801, 241 P.3d 972, 974 (2010) (" Bagley I "). Things did not go as planned, and a district court was required to quiet title to the real property "together with any and all water rights and fixtures appurtenant thereto" in favor of the Bagleys. On appeal, this Court held that "[t]he failure of the warranty deed to mention water rights or appurtenances did not prevent water rights appurtenant to the land from being conveyed with the real property." Id. at 803, 241 P.3d at 976. In Bagley I , the Court only mentioned shares in an irrigation company when it recited the Thomasons' counterclaims. Id. ("They alleged in count two of their complaint that they suffered damages when Bagleys asserted sole ownership of the real property and ownership of chattels and water shares."). The irrigation company was not a named party in Bagley I . Id.

After this Court declared that the Bagleys held the water rights appurtenant to the land, the Bagleys requested that the Liberty Park Irrigation Company issue them shares for water appurtenant to the land. Bagley v. Thomason , 149 Idaho 806, 807, 241 P.3d 979, 980 (2010) (" Bagley II "). The Thomasons refused to give the consent required under Liberty Park's policy for the transfer of 52 shares and threatened to sue Liberty Park if it issued the shares. Id. The Bagleys then filed an action against Liberty Park seeking a judgment requiring them to issue the shares. Id. After the Bagley's filed a motion for summary judgment, the Thomasons filed a document alleging the Bagleys lacked standing and the Court lacked jurisdiction. Id. The Thomasons also told the district court they would not attend the hearing. Id. The district court granted the Bagley's motion and awarded attorney's fees, finding that the Thomasons defended the lawsuit frivolously, unreasonably, and without foundation. Id.

This Court determined that the Bagleys had standing because they "are the grantees of the deed to the real property executed by Thomasons, and the Bagleys were held in Bagley I to be the owners of the real property, including the appurtenant water rights." Id. at 807, 241 P.3d at 980. The Court determined that the Bagleys had met the injury, causation, and likelihood-of-judicial-relief requirements of standing because:

Bagleys alleged that they are entitled to the shares of water appurtenant to the real property; that the Thomasons have refused to deliver the certificates for the shares to the Bagleys and are attempting to sell them; and that the Irrigation District, whose secretary is Byron Thomason's brother, has refused to issue new water shares to Bagleys. They sought a declaratory judgment stating that they owned 52 shares of water in the Irrigation Company and a writ of mandate requiring the Company to issue them certificates of ownership for those shares.

Id. We noted that the focus of standing is "not on the merits of the issues raised, but upon the party who is seeking the relief." Id. at 808, 241 P.3d at 981 (quoting Scona, Inc. v. Green Willow Trust , 133 Idaho 283, 288, 985 P.2d 1145, 1150 (1999) ). The Bagleys had standing, and the district court had jurisdiction because "a party can have standing to bring an action, but then lose on the merits." Id. We also affirmed the award of attorney's fees. Id.

After Bagley II was decided, the district court awarded attorney's fees and issued a writ of execution to satisfy the judgment. Bagley v. Thomason , 155 Idaho 193, 198-99, 307 P.3d 1219, 1224-25 (2013) (" Bagley III ").

Appealing pro se , the Thomasons argued that the Bagleys did not have standing, that the district court did not have jurisdiction, and that the district court violated their equal-protection rights. Bagley III , 155 Idaho at 196, 307 P.3d at 1222. We rejected all these arguments and determined that the Bagleys were entitled to attorney's fees because "the entire appeal [was] pursued frivolously, unreasonably, and without foundation." Bagley v. Thomason , 155 Idaho 193, 198-99, 307 P.3d 1219, 1224-25 (2013) (citing Carrillo v. Boise Tire Co., Inc., 152 Idaho 741, 756, 274 P.3d 1256, 1271 (2012) ).

AC & CE Investment's contention that these cases "conclusively establish[ ]" that the Eagle Creek shares automatically passed as an appurtenance with the property is unavailing. Bagley II is the only case that explicitly mentions the issue of whether shares in an irrigation organization pass as an appurtenance. Bagley II did not reach the merits of that issue because the Thomasons only argued standing. Bagley III , 155 Idaho at 196, 307 P.3d at 1222 (citing Bagley II , 149 Idaho at 807, 241 P.3d at 980 ). None of the cases addressed whether shares in a mutual irrigation company pass as an appurtenance to the land because it was taken as a given that the shares were appurtenant to the land. Here, that issue is contested. As explained above, shares in a mutual irrigation can be appurtenant to a specific tract of land, but appurtenancy is not an integral feature.

E. AC & CE Investments is not entitled to attorney's fees on appeal.

AC & CE Investments asks this Court to award costs and attorney's fees under Idaho Appellate Rules 40 and 41. AC & CE Investments argues it is entitled to attorney's fees under Idaho Code section 12-121 because the "law is well-settled" on this issue. Thus, AC & CE Investments contends, Eagle Creek pursued this appeal "frivolously, unreasonably, or without foundation."

AC & CE Investments is not the prevailing party on appeal. Moreover, as should be evident from the analysis in this opinion, this area of the law is less than "well-settled." We decline to award attorney's fees on appeal.

V. CONCLUSION

For the reasons stated above, all issues not decided in the district court's memorandum decision on summary judgement are either dismissed with prejudice or mooted by the parties' settlement agreement. The district court erred in granting summary judgment to AC & CE Investments because the district court did not look to Eagle Creek's governing documents. We vacate the portion of the district court's final judgment which states that the 15 shares of the Eagle Creek stock were appurtenant to the Property. Our decision does not affect the parties' settlement agreement. Costs to Eagle Creek.

Justices BEVAN, STEGNER, MOELLER, and Justice pro tem MELANSON concur.

      Article VI(3) of the Articles states that there are 230 inches of water for distribution, whereas Article II of the Bylaws has the number 230 crossed out and "207" handwritten above the crossed-out 230 (e.g. "230 207").