                             STATE OF MINNESOTA
                             IN COURT OF APPEALS
                                   A14-0603

                             Goerke Family Partnership,
                                    Appellant,

                               Donald Shelstad, et al.,
                                    Plaintiffs,

                                         vs.

                    Lac qui Parle-Yellow Bank Watershed District,
                                     Respondent,

                                   William Croatt,
                                    Respondent.

                              Filed December 15, 2014
                                      Affirmed
                                  Peterson, Judge

                         Lac qui Parle County District Court
                              File No. 37-CV-12-104

Dennis H. Simpson, Quarnstrom & Doering, P.A., Marshall, Minnesota (for appellant)

Jason J. Kuboushek, Iverson Reuvers, LLC, Bloomington, Minnesota (for respondent Lac
qui Parle-Yellow Bank Watershed District)

Matthew P. Franzese, Traverse County Attorney, Alexandria, Minnesota (for respondent
William Croatt)

       Considered and decided by Peterson, Presiding Judge; Rodenberg, Judge; and

Reilly, Judge.
                                    SYLLABUS

      1.     When a watershed district’s board of managers makes a permitting decision

without considering a material issue, the district court hearing a declaratory judgment

action challenging the permitting decision must remand the issue to the board for

consideration.

      2.   The scope of review that applies to agency decisions applies to permit

decisions by a watershed district’s board of managers.

                                      OPINION

PETERSON, Judge

      Appellant landowner brought this declaratory-judgment action in district court

challenging respondent watershed district’s approval of respondent landowner’s

application for a drainage permit. Following a remand to the watershed district’s board

of managers for a determination whether the proposed drainage system would be a

reasonable use, the district court affirmed the approval of the drainage permit. Appellant

argues that (1) the district court erred in remanding the reasonable-use issue to the

watershed-district board, and (2) the drainage system should not be allowed because it

expands the slope and highway easements burdening appellant’s property. We affirm.

                                         FACTS

      Respondent William Croatt applied to respondent Lac qui Parle-Yellow Bank

Watershed District for a drainage permit for an agricultural tiling system that would drain

about 60 acres of land in the northeast quarter of section 11 in Arena Township. The

water drained from the 60 acres would be directed to a pumping station that would pump


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the water to a grove in the northeast corner of section 11 at the intersection of 270th

Street and County State Aid Highway 17. From the grove, the water would flow north in

the west ditch of highway 17 for about one-quarter mile, east through a culvert, and into

an established ditch system.

       The proposed drainage system was addressed at meetings of the watershed-district

board of managers during the spring and summer of 2011. Downstream property owners,

including appellant Goerke Family Partnership, objected to the permit application. The

downstream property owners were concerned that the culvert could not handle the water

from the drainage system and that the amount of water draining onto their properties

would increase. The board declined to approve Croatt’s permit application due to the

opposition of the downstream property owners.

       In response to that opposition, Croatt contacted Professional Engineer Erik Jones,

who reviewed the proposed system and concluded that the ditch along highway 17 had

adequate capacity to handle the drained water and that an adequate outlet existed

downstream. The board requested additional information from Jones about the water

flowing through the culvert. Jones concluded that Croatt’s proposed drainage system

would not change the amount of water flowing through the culvert. The county engineer

signed the application, indicating that the proposed drainage system would not affect the

roadway. After receiving this additional information, the board approved Croatt’s permit

application.

       Appellant brought this declaratory-judgment action in district court challenging

the board’s approval of Croatt’s permit application. Appellant asserted that the board


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acted improperly in approving the permit because appellant had not granted a drainage

easement over its property along highway 17. Croatt moved for summary judgment. The

district court denied summary judgment on the ground that a question of material fact

existed on “whether draining water from Croatt’s land into the [highway] 17 road ditch is

a ‘reasonable use’ as that term has been developed under Minnesota case law.” Croatt

requested reconsideration because the summary-judgment order did not address the

procedure for resolving the fact issue. The district court granted reconsideration and, on

reconsideration, remanded the case to the watershed-district board “for specific factual

findings on whether granting the proposed permit constitutes a reasonable use.” On

remand, the board found that the proposed drainage system would be a reasonable use.

The district court rejected appellant’s argument that the remand was improper and

affirmed the board’s decision to issue the permit to Croatt because the decision was

supported by substantial evidence and was not arbitrary or capricious. This appeal

followed.

                                        ISSUES

      I.     Did the district court err in allowing reconsideration and remanding the

issue of reasonable use to the watershed-district board of managers?

      II.    Did the board of managers err in determining that the drainage system

would be a reasonable use and granting the permit application?




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                                       ANALYSIS

                                             I.

       Reconsideration

       “Motions to reconsider are prohibited except by express permission of the court,

which will be granted only upon a showing of compelling circumstances.” Minn. R. Gen.

Pract. 115.11. We review a district court’s decision to allow a motion for reconsideration

for an abuse of discretion. See In re Welfare of S.M.E., 725 N.W.2d 740, 743 (Minn.

2007) (stating that motions for reconsideration “are considered only at the district court’s

discretion”); Peterson v. Hinz, 605 N.W.2d 414, 417-18 (Minn. App. 2000) (concluding

that district court did not abuse its discretion by allowing motion to reconsider and

reversing its earlier order imposing sanctions), review denied (Minn. Apr. 18, 2000).

       The initial order denying summary judgment did not specify the procedure for

determining whether the proposed drainage system would be a reasonable use. Under

these circumstances, the district court did not abuse its discretion in allowing

reconsideration.

       Remand to watershed-district board of managers

       Appellant argues that, in a declaratory-judgment action, a plaintiff is entitled to a

trial, and the district court did not have authority to remand the case to the watershed-

district board of managers for a determination regarding the reasonable-use doctrine. We

disagree. The Minnesota Watershed Law, Minn. Stat. §§ 103D.001-925 (2012) states:




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“[A]n interested party may appeal a permit decision or order made by the managers1 by a

declaratory judgment action brought under chapter 555. . . . The decision on appeal must

be based on the record made in the proceeding before the managers.” Minn. Stat.

§ 103D.537(a) (emphasis added).

       In Honn v. City of Coon Rapids, which involved a challenge to a city council’s

denial of an application for rezoning, the district court declined to conduct a trial and

limited its review to the record before the city council. 313 N.W.2d 409, 412-13 (Minn.

1981). On appeal, the supreme court held that “[r]eview of a decision on rezoning may

be obtained by a declaratory judgment action” and that the parties were entitled to a trial

and could present evidence in addition to that presented to the municipal body, provided

that the evidence was relevant to issues raised before and considered by the municipal

body. Id. at 416. The court noted that a city council often “conducts its hearings in

informal fashion, with no accurate verbatim record kept and with relatively few remarks

in its minutes to suffice as its findings of fact and conclusions.” Id. at 415. The purpose

of the trial was to determine whether there was a legally sufficient basis for the municipal

body’s decision. Id. at 418-19.

       But in Swanson v. City of Bloomington, which involved a challenge to a city

council’s denial of an application to subdivide a residential lot, the supreme court limited

the holding in Honn. 421 N.W.2d 307 (Minn. 1988). After stating that Honn did not




1
  “‘Managers’ means the board of managers of a watershed district.”            Minn. Stat.
§ 103D.011, subd. 15.

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require “a trial or augmentation of the record in every case,” the supreme court explained

the procedure for review of a permit decision:

                 [A] district court should establish the scope and conduct of its
                 review of a municipality’s zoning decision by considering the
                 nature, fairness and adequacy of the proceeding at the local
                 level and the adequacy of the factual and decisional record of
                 the local proceeding. Where the municipal proceeding was
                 fair and the record clear and complete, review should be on
                 the record. . . .

                        ....

                        Where the municipal proceeding has not been fair or
                 the record of that proceeding is not clear and complete, Honn
                 applies and the parties are entitled to a trial or an opportunity
                 to augment the record in district court.

Id. at 312-13.

       The supreme court addressed the issue of a remand to a zoning authority to further

develop the record in Earthburners, Inc. v. Cnty. of Carlton, which involved a

declaratory-judgment action challenging a county board’s denial of a conditional-use

permit. 513 N.W.2d 460 (Minn. 1994). Because the county board’s record indicated that

its decision was premature and the decision did not show that the board considered the

relevant ordinance criteria, the supreme court remanded to the board so that it could

reconsider the permit application. Id. at 461-63. The supreme court explained:

                 [W]e have been reluctant to allow local boards an opportunity
                 after the fact to substantiate or justify earlier decisions.
                 However, where, as here, the board has failed to discharge its
                 responsibilities in connection with this application, we are
                 compelled to offer it the opportunity to do so and to develop a
                 record to allow meaningful appellate review. However, to
                 prevent any unfairness to the applicant, the board must
                 confine its inquiry to those issues raised in earlier proceedings


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              before the planning commission and county board while
              allowing adequate opportunity for a meaningful discussion of
              those issues.

Id. at 463 (citation omitted).

       Minnesota law permits a property owner to drain surface waters onto another’s

land if the elements of the reasonable-use doctrine are met. Kral v. Boesch, 557 N.W.2d

597, 598-99 (Minn. App. 1996). Therefore, because the watershed-district board did not

consider the reasonable-use doctrine and the record was inadequate to allow meaningful

appellate review by the district court, the parties were not entitled to a trial, and a remand

to the board of managers was permitted. The right to a trial was also restricted by the

statement in Minn. Stat. § 103D.537(a) that “[t]he decision on appeal must be based on

the record made in the proceeding before the managers.”

       Under the plain language of Minn. Stat. § 103D.537(a), the district court is limited

on appeal to review of the record made before the board of managers. Therefore, the

district court acted properly by remanding the issue of reasonable use to the watershed-

district board of managers for determination and creation of a record. Following the

remand, the district court properly reviewed the record to determine whether the

watershed district’s decision to issue the permit was reasonable. See Swanson, 421

N.W.2d at 311 (stating that the standard of review of a zoning authority’s action is

whether there is “a reasonable basis for the decision” (quotation omitted)).




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                                            II.

      Scope of Review

      In Northwestern College v. City of Arden Hills, the supreme court explained an

appellate court’s scope of review in zoning matters as follows:

                     Although earlier decisions may have left some doubt
             with regard to the appropriate scope of review in such cases,
             no doubt can remain in the wake of this court’s clarification
             of the issue in Reserve Mining Co. v. Herbst, 256 N.W.2d
             808, 822 (Minn. 1977). In that case, addressing the issue of
             the proper scope of review of an agency decision, we wrote:
             “We . . . expressly adopt a rule which we have heretofore
             tacitly accepted, that it is our function to make an independent
             examination of an administrative agency’s record and
             decision and arrive at our own conclusions as to the propriety
             of that determination without according any special deference
             to the same review conducted by the [district] court.” 256
             N.W.2d 824. Although Reserve Mining only addressed the
             review of agency decisions, the articulated reasons for the
             rule enunciated make clear that the same scope is appropriate
             in reviewing the decisions of local governing bodies in zoning
             matters. See, also, Barton Contracting Co. Inc. v. City of
             Afton, 268 N.W.2d 712 (Minn. 1978), and Amdahl v. County
             of Fillmore, 258 N.W.2d 869 (Minn. 1977), in which we
             independently examined the action of the local governing
             body to determine its propriety, rather than merely reviewing
             the decision of the district court for clear error. Thus, in light
             of Reserve Mining, Amdahl, and Barton, it is clear that this
             court’s role in the present case is to review the decision of the
             Arden Hills City Council, independent of the findings and
             conclusions of the district court.

281 N.W.2d 865, 868 (Minn. 1979) (citations omitted).

      Northwestern College and the cases cited therein involved the review of city-

council or county-board decisions. Like those bodies, a watershed district is a political

subdivision of the state. Minn. Stat. § 103D.225, subd. 6. We, therefore, conclude that



                                             9
the scope of review that applies to agency decisions applies to permit decisions of a

watershed district’s board of managers, and we review the decision of the board of

managers, independent of the findings and conclusions of the district court.

       Standard of review

       Although caselaw distinguishes between zoning matters that are legislative in

nature, such as rezoning, and those that are quasi-judicial, such as variances and special-

use permits, “the standard of review is the same for all zoning matters, namely, whether

the zoning authority’s action was reasonable.” Honn, 313 N.W.2d at 416-17. This

standard has been expressed in various ways: “Is there a ‘reasonable basis’ for the

decision? Or is the decision ‘unreasonable, arbitrary or capricious’? Or is the decision

‘reasonably debatable’?” Id. at 417. “[T]he nature of the matter under review has a

bearing on what is reasonable.” Id. In granting or denying a permit, the inquiry is more

judicial because the decision involves “applying specific standards to a particular

individual use.” Id.

       With respect to the reasonable-use issue that was remanded to the watershed-

district board, the applicable standards are set forth in caselaw. A property owner may

drain surface waters onto another’s land if the elements of the reasonable-use doctrine are

met.

              The rule is that in effecting a reasonable use for a legitimate
              purpose a landowner, acting in good faith, may drain his land
              of surface waters and cast them as a burden upon the land of
              another, although such drainage carries with it some waters
              which would otherwise have never gone that way if
              (a) there is a reasonable necessity for such drainage;



                                            10
               (b) reasonable care be taken to avoid unnecessary injury to
               the land receiving the burden;
               (c) the utility or benefit accruing to the land drained
               reasonably outweighs the gravity of the harm resulting to the
               land receiving the burden;
               (d) where practicable, it is accomplished by reasonably
               improving and aiding the normal and natural system of
               drainage according to its reasonable carrying capacity, or if,
               in the absence of a practicable natural drain, a reasonable and
               feasible artificial drainage system is adopted.
               In determining reasonableness, a court should consider the
               extent of harm caused, its foreseeability, and the landowner’s
               motive for the action taken. No one factor or circumstance is
               controlling and what is a reasonable use is a fact question to
               be resolved depending on the facts of each case.

Kral, 557 N.W.2d at 598-99 (quotations and citation omitted).

         Appellant argues that the board erred in granting Croatt’s permit application

because the highway easement burdening appellant’s property was not intended for

agricultural drainage purposes. But with respect to Croatt’s permit application, the board

found:

                      There is a reasonable necessity for such drainage.
               Evidence was presented which shows the land to be tiled is in
               need of additional drainage to improve its crop output. No
               evidence was presented which disputed the need for
               additional drainage.

                      Reasonable care is being taken to avoid unnecessary
               injury to the land receiving the burden. [Jones’s] hydrology
               studies show the proposed additional drainage from the Croatt
               land would result in only a 458 gpm pumping rate and
               indicated the ditch to which the water is to be drained
               “appears to have more than 10 times the capacity of the tile
               pump.” The studies further indicated the additional water
               from the Croatt land “to be essentially unchanged from the
               existing conditions” and “the capacity of the soil to absorb
               more runoff than it currently does should be enhanced during
               the growing season since the soil profile should be drier prior


                                             11
              to summer rainfall events as a result of the tile.” While there
              were photographs showing the [highway] 17 ditch full of
              water during a major flooding [event], there was no evidence
              presented which disputed the hydrological findings.

                     The utility or benefit accruing to the land drained
              reasonably outweighs the gravity of the harm resulting to the
              land receiving the burden. The hydrology studies indicate
              there will be no harm to the land receiving the burden.
              Additionally, there was evidence presented that the Croatt
              land will receive a benefit and be better utilized with
              additional drainage.

                      The proposed drainage is a reasonable and artificial
              drainage system. All evidence, including the hydrology
              studies, indicates the proposed drainage is a reasonable and
              artificial system because it will not exceed the capacity of the
              current ditch system and because the soil has the capacity to
              absorb the additional water.

Evidence supports the board’s findings, and the board’s decision addresses the elements

of the reasonable-use doctrine. There was a reasonable basis for the board’s decision to

grant a permit for Croatt’s proposed drainage system, and the decision was not

unreasonable, arbitrary, or capricious.

                                     DECISION

       Because the board initially failed to consider the reasonable-use doctrine, the

district court properly remanded the issue of reasonable use to the board for

determination. The board’s decision finding that Croatt’s proposed drainage system

meets the elements of the reasonable-use doctrine and granting his permit application was

reasonable.

       Affirmed.




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