In a recent decision (not published), the 7th judicial district court in New Mexico placed limitations on the authority of the Office of the State Engineer (OSE). Judge Matthew Reynolds wrote: "The State Engineer paints with too broad a brush to grant himself exclusive authority to determine the validity of pre-1907 water rights." In short, the judge ruled that once an administrative process starts, then the exhaustion of administrative remedies applied. However, in the case before the court, a party had NOT initiated the administrative process and instead had filed for a declaratory action in District Court under the Declaratory Judgment Act, NMSA 1978, Sections 44-6-1 through 44-6-15. Therefore, they were entitled to relief before the court, and the case would NOT be dismissed as requested by the OSE.
The judge went on to re-emphasize a key element of NM water law -- that when a person makes a declaration of water rights, the water rights are "prima facie evidence of the truth of their contents." However, nowhere in the water code is there an administrative process for the State Engineer to determine, in the first instance, the validity of the declaration -- only when the holder of those rights seeks some relief from the OSE. On the other hand, a district court, in a general stream adjudication could determine the validity of a declaration of pre-1907 rights in the first instance. Furthermore, district courts "have original jurisdiction in all matters and causes not excepted" in the New Mexico State Constitution pursuant to NM Const. Art. VI, Section 13. Therefore, in this case, it is appropriate that the case not be dismissed and returned to the OSE for resolution, but instead would proceed before the district court on its merits.