Water Rights Diligence
When purchasing a water right or a property that includes water rights, it is crucial to have a water attorney perform diligence on the water rights. This is because water rights law is complicated and historical operations are not always a good predictor of how the water can be used in the future
Water rights diligence will help ensure that the water rights are suitable for your intended purposes and will identify any issues or ongoing legal obligations. In this way, you will be fully informed of all of the limits, rights, and responsibilities associated with the water rights that you are purchasing. Water rights diligence also provides an opportunity for an experienced water attorney to inform you about what additional water rights or water court filings may be necessary for you to realize your vision for your new property. Water rights are limited to specific uses, points of diversion, places of use, and amounts. If the current limits on the water rights are inconsistent with your intended use, then a water attorney at Nazarenus Stack & Wombacher LLC can give you specific legal advice on the process for changing the rights to new uses
Common issues found during diligence include: undecreed or unlawful water features, title issues, unlawful historical uses that are not consistent with the terms of the water court decree, lack of diversion records, and issues with ditch or pipeline easements. Oftentimes, issues discovered during diligence can be corrected prior to closing. Water rights issues are getting more difficult and costly to resolve each year. Thus, identifying and resolving potential issues is a wise long-term investment that will ensure that the value of your water right is maintained and that you can avoid costly issues in the future. Just because a prior owner has been able to get away with otherwise unlawful uses does not mean that the status quo will continue, and performing water rights diligence ensures that you are purchasing a valuable asset rather than a liability.
Here is a link to a flyer for real estate professionals that includes a checklist of items to review as part of water rights diligence and as part of the closing for a transaction involving water rights.
Please call the attorneys at Nazarenus Stack & Wombacher LLC to perform diligence on your water rights or those you are seeking to purchase