"The issue of whether rights to pump groundwater can be separated from land ownership in Arizona recently went before our supreme court. I have a brief discussion of the court opinion on my blog if you’re interested, but the gist of the case was a property transaction in an area where a nearby city had expressed interest in purchasing land in order to pump and pipe water to supply their future growth needs. When the property sold in the early 80s the seller, in the deed, reserved all rights to “commercial groundwater” that might be pumped from the property in the future. This is in an area of Arizona, outside of Active Management Areas, where rights to groundwater are governed by the reasonable use doctrine (this part gets kind of complicated and I won’t try to explain it fully here). Essentially landowners have mostly unfettered rights to pump groundwater from their land.
The court ruled, in this case, that because no rights to pump groundwater in the future exist in Arizona (i.e. rights to groundwater are only established by pumping it the surface and putting it to beneficial use) the seller had no property right to reserve, making the reservation invalid. I believe this to be a correct interpretation of the law, but some research I did showed that Texas courts have ruled the other way on this – finding that property owners have rights to groundwater in the ground (under the rule of absolute ownership) that can be conveyed separately from the property.
I would like to find out if California courts have ruled on this in areas where groundwater has not been adjudicated, and if so what they have said.
I would also be curious if anyone has experience with appraising unquantified rights to groundwater sold either with the overlying land or without. This seems like it would involve a lot of guesswork.
This is an area of great interest to me and I would really enjoy hearing some other perspectives on it."
I have no opinion on whether it's right or wrong to sever water from land, since it seems that the property rights can be defined in either way. My impression is that unadjudicated groundwater cannot be sold because the right is not quantified. The same could be said about an "appraisal," since the appraiser won't get very far by guessing...
What do you aguanauts think?
Bottom Line: What's gets measured gets managed, and what's not measured gets mismanaged.