## Facts

- Landowners held a certificated surface-water right for domestic use, including an impoundment, with a June 7, 1947 priority date.
- A downstream appropriator held an earlier surface-water right for irrigation with an August 26, 1919 priority date.
- In August–September 1967, streamflow was insufficient to satisfy both rights.
- The county watermaster threatened to curtail the landowners’ domestic diversion and reduce or drain the impoundment to satisfy the senior irrigation right.
- The landowners claimed ORS 540.140 gives domestic uses a statutory “preference” over other uses during shortage, allowing their junior domestic use to continue ahead of the senior irrigation use.

## Issues

1. Whether ORS 540.140’s domestic-use “preference” authorizes administration of surface water so that a junior domestic right takes precedence over a senior irrigation right during shortage.
2. Whether the domestic-use preference can be construed to alter vested priorities established under Oregon’s comprehensive water code.

## Decision

- The Oregon Court of Appeals reversed the injunction.
- ORS 540.140 does not displace the prior-appropriation rule of temporal priority for surface-water rights.
- The watermaster could administer the stream by curtailing junior rights first, even if the junior use was domestic and the senior use was irrigation.

## Legal Principles

- Under Oregon surface-water law, “first in time, first in right” is the controlling priority rule unless the legislature clearly provides otherwise.
- A statutory “preference” for domestic use in ORS 540.140 is not equivalent to a super-priority that reorders vested water-right priorities.
- Statutes should be construed in harmony with the later-enacted comprehensive water code; the “subject to such limitations as may be prescribed by law” clause in ORS 540.140 is read to incorporate the code’s priority system.
- Courts will not infer a legislative intent to alter existing priority rights absent clear, explicit direction.

## Conclusion

The court held that ORS 540.140’s domestic-use preference does not permit a junior domestic appropriator to defeat a senior irrigation appropriator during shortage; the watermaster must enforce temporal priority by curtailing junior uses first.


Phillips v. Gardner, 2 Or. App. 423, 469 P.2d 42 (Or. Ct. App. 1970)