[CITE: Sims, et al. v. Outlook Cove LLC, et al., 10
CADDNAR 258 (2006)]
[VOLUME 10, PAGE 258]
Cause #: 04-202W
Caption: Sims, et al. v.
Outlook Cove, LLC and Outlook Cove Homeowners Ass’n
Administrative Law Judge:
Lucas
Attorneys: Snyder; Volk
Date: July 19, 2006
[NOTE: ON AUGUST 17, 2006, OUTLOOK COVE, LLC AND OUTLOOK COVE HOMEOWNERS ASSOCIATION FILED FOR JUDICIAL REVIEW IN THE LAPORTE SUPERIOR COURT #4 (46D04-0608-MI-253). ON MARCH 27, 2007, THE LAPORTE SUPERIOR COURT DISMISSED, ON MOTION, THE DEFENDANT NATURAL RESOURCES COMMISSION. NOVEMBER 2007, LA PORTE SUPERIOR COURT ENTERED ITS ORDER AFFIRMING FINAL ORDER OF THE COMMISSION'S AOPA COMMITTEE.]
Final Order
Findings of Fact
and Conclusions of Law
Background
1. Thomas G. Sims
and Rhoda A. Sims (collectively “the Simses”) filed their “Petition for
Administrative Review” with the Natural Resources Commission (the “Commission”)
on November 3, 2004. The petition sought
the resolution of a dispute between the Simses and Outlook Cove, LLC and
Outlook Cove Homeowners Association (collectively “Outlook Cove, LLC and
Ass’n”) as to riparian rights for the placement of piers on
2. This proceeding
is governed by IC 4-21.5 (sometimes referred to as the “Administrative Orders
and Procedures Act” or “AOPA”). The
Commission has adopted rules at 312 IAC 3-1 to assist with its implementation
of AOPA.
3. The Department
of Natural Resources (the “DNR”) moved on February 5, 2005 to intervene. The Simses and Outlook Cove, LLC and Ass’n
both filed written notices of non-objection to the intervention. The Commission’s Administrative Law Judge
added the DNR as a party on February 14, 2005.
4. On February 24, 2005,
Outlook Cove, LLC and Ass’n filed their “Memorandum in Support of Motion to
Dismiss (Converted to Motion for Summary Judgment)” with attachments.
[VOL. 10, PAGE
259]
5. The DNR filed the
“Intervenor’s Response to Respondents’ Motion for Summary Judgment and
Cross-Motion for Partial Summary Judgment” with attachments on March 23, 2005.
6. The Simses filed the “Response
to Respondents’ Motion for Summary Judgment and Motion for Summary Judgment”
with attachments on March 28, 2005.
7. The “Consolidated Reply by
Outlook Cove, LLC and Outlook Cove Homeowners’ Association to Memoranda Filed
by Claimants and Intervenor” was filed on April 11, 2005.
8. With respect to the
“Consolidated Reply”, the Simses filed their “Motion to Strike or in the
Alternative for Additional Time to Respond” on April 13, 2005.
9. The Administrative Law Judge
made an “Entry with Respect to Claimants’ Motion to Strike or in the
Alternative for Additional Time to Respond” on April 15, 2005 in which the
Simses and the DNR were provided until May 11, 2005 to respond to any new
issues raised with respect to the April 11 “Consolidated Reply”.
10. On May 9, 2005, the Simses
filed their “Motion to Strike Affidavit of Donald L. Porter”, their “Motion to
Strike Affidavit of Robert Magnuson”, their “Supplemental Designation of
Documents”, the “Affidavit” of Thomas G. Sims with multiple attachments, and
their “Supplemental Memorandum in Opposition to Respondents’ Motion for Summary
Judgment”.
11. On May 11, 2005, the
“Intervenor Department of Natural Resources’ Supplemental Filing of Exhibits
and Designation of Materials in Support of Intervenor’s Response to Respondents’
Motion for Summary Judgment and Cross-Motion for Summary Judgment” with
“Affidavit of Tina Everling” and attachments were filed.
Summary Judgment
12. Hearing on the
motions for summary judgment was held as scheduled in
13. On July 15,
2005, the Administrative Law Judge entered “Findings of Fact and Conclusions of
Law with Interlocutory Order of Partial Summary Judgment”. The interlocutory order is merged here.
[VOL. 10, PAGE
260]
14. In addition, the
Simses filed a “Motion to Limit Evidence at Final Hearing Based upon the
Partial Summary Judgment Entered on July 15, 2005”. The “Respondents’ Motion to Reconsider” was
filed on November 15, 2005. “Claimants’
Response in Opposition to Respondents Motion to Reconsider” was filed on
November 21, 2005. The “Reply to
Claimants’ Response to Opposing Respondents’ Motion to Reconsider” was filed on
November 20, 2005. The Administrative
Law Judge issued an “Order Granting Claimants’ Motion to Limit Evidence at
Hearing and Denying Respondents’ Motion to Reconsider” on December 13,
2005. Elements of the December 13 order,
which may provide clarification or supplementation to the interlocutory order
described in the prior Finding, are also merged here.
15. AOPA establishes
procedures for summary judgment at IC 4-21.5-3-23. This statutory section provides:
(a) A party may, at any time
after a matter is assigned to an administrative law judge, move for a summary
judgment in the party’s favor as to all or any part of the issues in a proceeding.
The motion must be supported with affidavits or other evidence permitted under
this section and set forth specific facts showing that there is not a genuine
issue in dispute.
(b) The motion must be served at
least five (5) days before the time fixed for the hearing on the motion. The
adverse party may serve opposing affidavits before the day of hearing. The
administrative law judge may direct the parties to give oral argument on the
motion. The judgment sought shall be rendered immediately if the pleadings,
depositions, answers to interrogatories, and admissions on file, together with
the affidavits and testimony, if any, show that a genuine issue as to any
material fact does not exist and that the moving party is entitled to a
judgment as a matter of law. A summary judgment may be rendered upon fewer than
all the issues or claims (such as the issue of penalties alone) although there
is a genuine issue as to damages or liability, as the case may be. A summary
judgment upon fewer than all the issues involved in a proceeding or with
respect to fewer than all the claims or parties is not a final order. The
administrative law judge shall designate the issues or claims upon which the
judge finds no genuine issue as to any material facts. Summary judgment may not
be granted as a matter of course because the opposing party fails to offer
opposing affidavits or evidence, but the administrative law judge shall make a
determination from the affidavits and testimony offered upon the matters placed
in issue by the pleadings or the evidence. If it appears from the affidavits of
a party opposing the motion that the party cannot for reasons stated present by
affidavit facts essential to justify the party’s opposition, the administrative
law judge may make any order that is just.
(c) If on motion under this
section no order is rendered upon the whole case or for all the relief asked
and a hearing is necessary, the administrative law judge at the hearing of the
motion, by examining the pleadings and the evidence before it and by
interrogating any person, shall if practicable
[VOL.
10, PAGE 261]
ascertain:
(1) what material facts exist without substantial controversy; and
(2) what material facts are actually and in good faith controverted.
The administrative law judge shall then make an order specifying the
facts that appear without substantial controversy,
including the extent to which the amount of damages or other relief is not in
controversy, and directing further proceedings in the action as are just. Upon
the hearing of the action, the facts specified are established in the judge’s
order under this subsection.
(d) Supporting and opposing
affidavits must:
(1) be made on personal knowledge;
(2) set forth facts that are admissible in evidence; and
(3) show affirmatively that the affiant is competent to testify to the matters
stated in the affidavit.
(e) The administrative law judge
may permit affidavits to be supplemented or opposed by depositions, answers to
interrogatories, further affidavits, or testimony of witnesses.
(f) If a motion for summary
judgment is made and supported under this section, an adverse party may not
rely upon the mere allegations or denials made in the adverse party’s pleadings
as a response to the motion. The adverse party shall respond to the motion with
affidavits or other evidence permitted under this section and set forth
specific facts showing that there is a genuine issue in dispute. If the adverse
party does not respond as required by this subsection, the administrative law
judge may enter summary judgment against the adverse party.
16. An administrative law judge
may apply the Trial Rules where not inconsistent with AOPA. 312 IAC 3-1-10. Reference may generally be made to Trial Rule
56 and to reported decisions based upon Trial Rule 56. In those instances where Trial Rule 56 is
inconsistent with IC 4-21.5-3-23, however, the latter would control.
17. Summary judgment can be
granted when the evidentiary material shows there is no genuine issue of
material fact, and the moving party is entitled to judgment as a matter of
law. Shell
Oil Co. v. Lovold Co., 705 N.E.2d 981 (
18. “A fact is ‘material’ for
summary judgment purposes if it helps to prove or disprove an essential element
of the plaintiff’s cause of action.” Graham v. Vasil Management Co., Inc. 618
N.E.2d 1349 (
Application of the Lakes
Preservation Act to
[VOL. 10, PAGE
262]
19. The DNR has
jurisdiction over activities regulated under IC 14-26-2 (sometimes referred to
as the “Lakes Preservation Act”) within the “shoreline or water line” of a
“public freshwater lake”. The
Commission has jurisdiction over these regulated activities on administrative
review. IC 14-10-2-3.
20. The Commission
has adopted rules at 312 IAC 11-1 through 312 IAC 11-5 to assist with the
implementation of the Lakes Preservation Act.
See, particularly, IC 14-26-2-4 and IC 14-26-2-23(2).
21. Today’s Lakes Preservation
Act originated with 1947 legislation.
Acts 1947, c. 181; and, Acts 1947, c. 301. There have since been numerous statutory
amendments, and in many instances, the statutes are now also implemented by 312
IAC 11-1 through 312 IAC 11-5. Yet reference to the founding precepts of the
legislation offers modern insight into proper application of the Lakes
Preservation Act. Of particular note to
the current proceeding are Acts 1947, c. 301, which were approved on March 13,
1947, and that provided in pertinent part:
...The natural resources and the natural scenic
beauty of Indiana are declared to be a public right, and the public of Indiana
are declared to have a vested right in the preservation, protection and
enjoyment of all of the public fresh water lakes, of Indiana in their present
state, and the use of such waters for recreational purposes.
...For the purpose of this act, the natural resources of public fresh water
lakes shall mean the water, fish, plant life and minerals and the natural
scenic beauty shall mean the natural condition as left by nature without
man-made additions or alterations.....
22. Beginning in 1947, this
legislation required an agency license before a person could lawfully conduct
regulated activities along or within a public freshwater lake. A license could not be approved that would
fundamentally change the lake’s “natural condition” from that which existed on
March 13, 1937. “Natural condition”
referred to the “water, fish, plant life and minerals and the natural scenic
beauty...as left by nature without man-made additions or alterations....” Sedberry
v. Department of Natural Resources, 10 Caddnar 14 (2005).A.
23. The Lakes Preservation Act
does not eliminate riparian rights. Zapfee
v. Srbeny, 587 N.E.2d 177 (
[VOL. 10, PAGE
263]
24. The Commission
has previously ruled that
25. The DNR provides evidence
for the proposition that Pine Lake, including the area at issue along an
embayment known as Outlook Cove, is a “public freshwater lake” that is subject
to IC 14-26-2 and 312 IAC 11-1 through 312 IAC 11-5. Affidavit of George C. Bowman (March 23,
2005) in his capacity as Assistant Director the DNR’s Division of Water.
26. The DNR provides additional
evidence through the Team Leader of the Customer Service Station of the DNR’s
Division of Water. Documents kept in the
Division’s ordinary course of business include the following:
(A) A license issued under the
Lakes Preservation Act on August 14, 1962 to James K. Smith to dredge the bay
of North Pine Lake.
(B) A license issued under the
Lakes Preservation Act on October 28, 1971 for
(C) Documents from the LaPorte
Circuit Court in the Matter of the
Establishment of the Water Level of Pine, Stone and
Affidavit of Tina Everling (May 11,
2005).
27. The Simses also provide
evidence in support of the proposition that Pine Lake, including Outlook Cove,
is a “public freshwater lake” that is subject to the Lakes Preservation Act.
28. The area known as “Outlook
Cove” is connected directly to
[VOL. 10, PAGE
264]
29. The 1956 Chamber of Commerce
Map of LaPorte, Indiana contains a depiction of the boundaries of
30. Outlook Cove, LLC and Ass’n
do not contest that
31. Outlook Cove, LLC and Ass’n
provide no factual or legal support for the proposition that a lake’s bay is a
body of water distinct from the lake for purposes of the Lakes Preservation
Act. The proposition is inconsistent
with the historic usage of Outlook Cove and
32. “The Indiana Legislature
defines ‘public freshwater lake’ as ‘a lake that has been used by the public
with the acquiescence of a riparian owner’.
[Citations omitted.] The plain
language of the statute merely requires the acquiescence of a single riparian
owner.” Garling v. Indiana Department of Natural Resources, 756 N.E.2d
1029, 1032 (
33. In determining whether a
manmade channel to a public freshwater lake was subject to the jurisdiction of
the Lakes Preservation Act, the Commission observed:
The Lakes Preservation Act currently requires a
license under IC 14-26-2-9 and IC 14-26-2-12 for the construction of a channel
into a public freshwater lake. As a
condition precedent to granting a permit, the applicant must, in writing,
[VOL.
10, PAGE 265]
acknowledge that all additional water area created
is part of the lake. See particularly IC
14-26-2-9(b)(1). If the Lakes
Preservation Act or antecedent statutes were in effect when the channel was
constructed, the person applying to construct the channel was required to
dedicate its waters to
Herr v. Department of
Natural Resources, 9 Caddnar 11 at 12 and 13 (2001).
34. In enacting the
Lakes Preservation Act, the Indiana General Assembly could have provided that
the appropriate Circuit Court would identify the boundaries of a “public
freshwater lake”. The Legislature could
have directed the Circuit Court to approve a metes and bounds survey that would
permanently establish the delineation of the shoreline. It did not.
35. Where the
Circuit Court has established the legal elevation, “the line formed on the bank
or shore by the water surface at the legally established average normal level”
is the “shoreline or water line”. IC
14-26-2-4(1).
36. On September 26,
1949, the LaPorte Circuit Court established the legal elevation of
37. The shoreline or
water line of
38. Historic drawings,
photographs, or other graphic depictions may have probative value in
determining where the “shoreline or water line” for a particular public
freshwater lake should be drawn. These
graphics are not dispositive for three reasons.
First, a depiction of a lake, while at other than its legal elevation
does not accurately define the “shoreline or water line”. Second, applying principles of riparian
common law, accretion or erosion may change the location of “shoreline or water
line”. Third, by statute, the
construction of a manmade channel in a public freshwater lake must be
accompanied by a dedication of all additional water to the public. Herr v. Department of
Natural Resources, 9 Caddnar 11, discussed previously.
39. The DNR and the
Commission have jurisdiction over Pine Lake, under the Lakes Preservation Act
and 312 IAC 11-1 through 312 IAC 11-5, along and within the line formed on its
bank or the shore at elevation 796.2 feet elevation sea level datum.
[VOL. 10, PAGE
266]
40. The evidence is
unrefuted that the shoreline of 796.2 feet would form an uninterrupted close
that includes Outlook Cove within
41. For purposes of
the Lakes Preservation Act,
42. Indeed, if
Outlook Cove were a private lake, both historic and prospective uses by its
riparian owners would be incongruous.
43. “A private lake is a body of
water on the surface of land within the exclusive dominion and control of the
surrounding landowners.” Carnahan v. Moriah Property Owners Ass’n,
716 N.E.2d 437, 440 (
44. On a private lake, “each
owner has the right to the free and unmolested use and control of his portion
of the lake bed and water thereon for boating and fishing.” Carnahan
at 441 quoting Sanders v. De Rose,
207 Ind. 90, 95, 191 N.E. 331, 333 (1934).
45. Where different persons own
various parcels of a private lake, competing lakebed owners may exclude other
lakebed owners from their respective parcels.
Carnahan at 441 citing Trowbridge v. Torabi, 698 N.E.2d 622,
627 (Ind. App. 1998).
46. If Outlook Cove
were a private lake, separate and distinct from
47. The material
issues of fact are not in dispute.
48. The DNR has
jurisdiction over the Outlook Cove under the Lakes Preservation Act, and rules
adopted under the Lakes Preservation Act, to its shoreline or water line at
796.2 feet elevation sea level datum.
This jurisdiction rests with the Commission on judicial review.
[VOL. 10, PAGE
267]
Riparian
Ownership of the Simses on
49. Riparian doctrine is the
system of law dominant in
50. The Lakes Preservation
Act authorizes a person who is the “owner of land abutting a public freshwater
lake” to apply to the DNR for a license to change the shoreline or alter the
bed. The DNR may issue the license
“after investigating the merits of the application.” IC 14-26-2-9.
By implication, a person who is not an owner of land abutting a public
freshwater lake does not qualify to seek a license under the Lakes Preservation
Act for near shore activities.
51. Within this
statutory parameter, the Commission adopted a rule definition in 1990 for
“riparian owner” that provided a shorthand description of the concept that is
in harmony with the Lakes Preservation Act and the common law. The definition was originally adopted as 310
IAC 6-2-12 and has since been recodified at 312 IAC 11-2-19:
“Riparian owner” means the
owner of land, or the owner of an interest in land sufficient to establish the
same legal standing as the owner of land, bound by a lake. The term includes a
littoral owner.
52. The clause “or
the owner of an interest in land sufficient to establish the same legal
standing as the owner of land” recognizes that a person need not be the fee
owner on lands abutting a lake in order to enjoy riparian rights. Depending upon the terms of the document, an
easement holder might enjoy riparian ownership.
Klotz v. Horn, 558 N.E.2d
1096, 1097 (
53. Otherwise, 310
IAC 6-2-12 (now 312 IAC 11-2-19) recognizes a riparian owner has privileges
exceeding those of the general public with respect to construction activities
in proximity to the shoreline. The
Commission documents this intent in responses to public comments concerning the rule section
made at final adoption:
Several questions and comments were
received as to the rights of a riparian owner within 200 feet of the shoreline
of a public freshwater lake.
Commentators asked whether the rights of a riparian owner were exclusive
in that area. The response was that
their rights were not exclusive, but riparian ownership would be a prerequisite
to the placement of structures in the 200-foot zone (examples: piers, sea
walls, and underwater beaches). Use of
adjacent waters would be public.
[VOL.
10, PAGE 268]
“Report of Public Hearing, Analysis, and
Recommended Order on Final Adoption of Proposed New Rule and Rule Amendments”
(September 4, 1990), with rule approved by the Commission (October 10, 1990).
54. In 2000, the
Indiana General Assembly revisited the Lakes Preservation Act and affirmed the
application of this legal framework. The
DNR could license a “riparian owner” to place a temporary or permanent
structure or material or for the extraction of material pursuant to objective
standards provided by rule. P.L. 64-2000
as codified at IC 14-26-2-23.
55. IC 14-26-2-9 and
IC 14-26-2-3 place standing in persons owning land along a public freshwater
lake to seek licenses, which do not excessively encroach upon the public trust,
to conduct construction activities in furtherance of their enjoyment of
riparian ownership. By statute, a person
who is not a “riparian owner” does not have standing to place structures along
or near the shoreline. 312 IAC 11-2-19
is an acknowledgement of this statutory limitation.
56. The Simses
obtained title in a conveyance of land from Catherine L. Magnuson as evidence
by two separate documents, a Memorandum of Contract and a Warranty Deed.
57. The Memorandum
of Contract provided in substantive part:
THIS MEMORANDUM made this 1 day of
November 1996, by Catherine L. Magnuson as Seller, and THOMAS G. SIMS AND RHODA
A. SIMS, husband wife, as Buyer, acknowledges as follows:
That CATERINE L. MAGNUSON, THOMAS G.
SIMS AND RHODA A. SIMS, have entered into a Contract for the
SEE ATTACHED EXHIBIT “A”
IN WITNESS WHEREOF, CATHERINE L.
MAGNUSON, THOMAS G. SIMS, and RHODA A. SIMS have hereunto set their hands and
seals the day and year first above written.
[Document Title, Signatures,
Notarization, and Exhibit A omitted by the Commission]
[VOL. 10, PAGE
269]
58. The Warranty
Deed provided in substantive part:
THIS INDENTURE WITNESSETH, That
Catherine L. Magnuson of LaPorte County, in the State of Indiana, CONVEY AND
WARRANT to Thomas G. Sims and Rhoda A. Sims as tenants in the entireties of
LaPorte County, in the State of Indiana, for and in consideration of the sum of
TEN DOLLARS ($10.00) AND OTHER GOOD AND VALUABLE CONSIDERATION the receipt
whereof is hereby acknowledged, the following described REAL ESTATE in LaPorte
County, in the State of Indiana, to wit:
Parcel #1. A parcel of land in the
Northeast 1/4 of Section 27, Township 37 North, Range 3 West,
Parcel #2. A parcel of land in the Northeast 1/4 of
Section 27, Township 37 North, Range 3 West,
Parcel #3. A parcel of land in the Northeast 1/4 of
Section 27, Township 37 North, Range 3 West,
Subject to legal water elevation, zoning
ordinances, restrictions and covenants, if any of record, and utility easement,
if any of record.
IN WITNESS WHEREOF, The Catherine L.
Magnuson has hereunto set her hand and seal, this 29 day of April, 1999.
[Document Title, Signatures, Notarization,
and Exhibit A omitted by the Commission]
59. Neither the
Memorandum of Contract nor the Warranty Deed, on their faces, places any
restriction on the conveyance of title to the real estate described in them.
60. Outlook Cove,
LLC and Ass’n claim a restriction on the conveyance that would deprive the
Simses of riparian rights in a reference to a September 30, 1996 letter from
Edward L. Janes to Jeffrey B. Katz. The
letter involves negotiations that preceded the Memorandum of Contract and the
Warranty Deed.
61. Outlook Cove,
LLC and Ass’n do not allege fraud or mistake in the preparation or execution of
the Memorandum or Contract and the Warranty Deed. Neither do they provide evidence either
document was on its face ambiguous.
62. The execution
and delivery of the Warranty Deed from Catherine L. Magnuson to the Simses
merges all previous negotiations regarding what is being sold and
conveyed.
[VOL. 10, PAGE
270]
63. This issue was
more recently address by the Indiana Court of Appeals in Link v. Breen, 649 N.E.2d 126 (Ind. App. 1995):
The doctrine of merger by deed provides:
“In the absence of fraud or mistake, all
prior or contemporaneous negotiations or executory agreements, written or oral,
leading up to the execution of a deed are merged therein by the grantee’s
acceptance of the conveyance in performance thereof.”
64. One of the
emblements of fee simple title is riparian rights. Zapfee v.
Srbeny, 587
N.E.2d 177, cited previously. Unless the
deed of conveyance specifically excludes riparian rights, all prior
negotiations are merged into the deed. A
person with fee simple ownership along a lake has riparian rights.
65. At oral argument
on the cross-motions for summary judgment, the parties disputed where the legal
elevation of
66. The Simses are
riparian owners along
Irrelevance to Instant
Proceeding of the Term “
67. Not every lake is a “public
freshwater lake” that is subject to the Lakes Preservation Act. For example, the Lakes Preservation Act
exempts
68. Even though not subject to
the Lakes Preservation Act, a lake may be subject to regulation by the
DNR. The regulation may be directed to
balancing the private interests of and among riparian owners with those of the
public. The regulation may consider
proprietary, environmental, and navigational concerns. Again,
[VOL. 10, PAGE
271]
69. For a watercourse that is a
private lake, neither the Lakes Preservation Act nor the Navigable Waters Act
applies. Use of the surface of a private
lake for navigation and recreation is exclusive to the person who owns the underlying
real estate.
70. The Indiana General Assembly
may, however, direct the DNR to implement a regulatory structure that does not
distinguish between a public lake and a private lake.
71. Regulation may be envisioned
that applies to both public and private watercourses. An illustration is the Flood Control Act (IC
14-28-1) that applies to construction activities within a stream and its
floodway regardless of public or private ownership.
72. Similarly, the Indiana
General Assembly has provided for the emergency regulation of surface water
rights for lakes at IC 14-25-5 (sometimes referred to as the “Freshwater Lakes
Emergency Act”). The Commission has adopted
rules at 312 IAC 11-6 to assist with implementation of the Freshwater Lakes
Emergency Act. This legislation makes no
distinction between whether a freshwater lake is public or private.
73. The Freshwater
Lakes Emergency Act authorizes a “lake owner” to seek relief against a person
operating a “significant water withdrawal facility” (one capable of withdrawing
at least 100,000 gallons of water daily) if the operation has lowered a
“freshwater lake” significantly below its legally established level or typical shoreline. Relief is ordered by the DNR and the
Commission may provide administrative review to a person affected by a water
withdrawal.
74. A “lake owner”
is a term defined by statute as any “person in possession of property” that
includes a “physical part of” or “legal interest in” a freshwater lake. IC 14-25-5-4.
This statutory definition confers standing to seek relief under the
Freshwater Lakes Emergency Act upon a broad range of persons. First, the interest is one merely of
“possession” rather than title and so may arguably include a renter or
condominium owner who enjoys the possession of shoreline property. Second, the definition includes a person who
has title to a portion of the lake, but it also a person with some “legal
interest” in the lake.
75. A riparian owner
along a navigable lake or public freshwater lake has a “legal interest” and
would have standing under the Freshwater Lakes Emergency Act to seek redress.
Depending upon the nature of an easement, an easement holder deriving an
interest from a subservient riparian estate might also qualify.
76. Under the Freshwater Lakes Emergency
Act, a “freshwater lake” includes a lake of natural origin or one originally
constructed to permanently retain water and in existence at least five years
before the commencement of water withdrawals by a significant water withdrawal
facility. IC 14-25-5-3. By rule, the lake must contain at least ten
acres. 312 IAC 11-6-5. The definition of “freshwater lake” neither
requires a showing of public use with the acquiescence of a riparian owner nor
limits its application to a lake within private ownership.
[VOL. 10, PAGE
272]
77. The Freshwater Lakes
Emergency Act confers personal standing liberally and extends coverage to a
range of lakes, both public and private.
This legislative approach may be unremarkable considering the limited
scope of relief that is afforded. Only
where a lake is lowered by the operation of a significant water withdrawal
facility, “significantly” below its legally established level or typical shoreline,
does the Freshwater Lakes Emergency Act apply.
Even in this limited circumstance, relief may be denied if the “lake
owner” is found to have contributed to lowering of the lake through improper
management or if the owner of the significant water withdrawal facility posts a
responsibility bond. IC 14-25-5-9 and IC
14-25-5-10.
78. Based upon riparian
ownership, Outlook Cove, LLC and Ass’n could qualify as a “lake owner” in the
context of the Freshwater Lakes Emergency Act.
Based upon riparian ownership, the Simses could also qualify. Any riparian owner on Outlook Cove or
79. If Outlook Cove were a
private lake with fee simple ownership in a single entity, or with owners of
separate parcels, the Freshwater Lakes Emergency Act could also confer standing
to that owner or to those owners.
80. Application of the
Freshwater Lakes Emergency Act is irrelevant to the matters at issue. No person has here sought relief from a
significant water withdrawal facility whose activities are alleged to have
significantly lowered the elevation of Outlook Cove or of
81. Even if relief had been
sought and granted to a “lake owner” based upon the Freshwater Lakes Emergency
Act, no insight would be provided. A
person could qualify as a “lake owner” regardless of whether the person has
proprietary interests along a navigable lake, a public freshwater lake, or a
private lake.
82. As a matter of law, who is
or is not a “lake owner” under the Freshwater Lakes Emergency Act is irrelevant
to the current proceeding.
Material Facts
in Dispute as to the Placement of Piers on
83. As provided in
IC 4-21.5-3-23(c):
(c) If on motion under this section no order is
rendered upon the whole case or for all the relief asked and a hearing is
necessary, the administrative law judge at the hearing of the motion, by
examining the pleadings and the evidence before it and by interrogating any
person, shall if practicable ascertain:
(1) what material facts exist without substantial controversy; and
(2) what material facts are actually and in good faith controverted.
The administrative law judge shall then make an order specifying the
facts that appear without substantial controversy,
including the extent to which the amount of damages or other relief is not in
controversy, and directing further proceedings in the action as are just. Upon
the hearing of the action, the facts specified are established in the judge’s
order under this subsection.
[VOL. 10, PAGE
273]
84. The “Findings of
Fact and Conclusions of Law with Interlocutory Order of Partial Summary
Judgment” entered on July 15, 2005 was not an order rendered on the whole case
or for all the relief asked.
85. As anticipated
in IC 4-21.5-3-23(c), the Administrative Law Judge specified the facts that
appeared without substantial controversy and directed a hearing to render an
order on the whole case and for all relief asked. The specification was set forth in the
“Findings of Fact and Conclusions of Law with Interlocutory Order of Partial
Summary Judgment” entered on July 15 and augmented by the “Order Granting
Claimants’ Motion to Limit Evidence at Hearing and Denying Respondents’ Motion
to Reconsider” entered on December 13, 2005.
Considered together these provided:
86. At all times
pertinent to this proceeding, the Lakes Preservation Act included several
sections which set forth licensure or other regulatory requirements. These include IC 14-26-2-6, IC 14-26-2-9, and
IC 14-26-2-23.B.
87. With P.L. 64-2000,
the Indiana General Assembly enacted IC 14-26-2-23.
88. IC 14-26-2-23(1)
directs the Commission to adopt, by rule, objective standards for licensing the
placement of a temporary or permanent structure over or within the shoreline or
water line. Those rules are set forth at
312 IAC 11-1 through 312 IAC 11-5. They
include provisions addressing piers that are permanent structures and
addressing piers that are temporary structures.
89. IC 14-26-2-23(3)
directs the Commission to provide, through mediation or administrative review,
for the resolution of disputes among riparian owners or between a riparian
owner and the DNR
90. An aggrieved person may seek
administrative review of the placement of a temporary pier. 312 IAC
11-3-2(a). Where that occurs, the
Commission would consider the configuration of the pier and its relationship to
other piers and structures. Matters that
are considered include the correlative rights of riparian owners. The public
trust is also considered, including the impact of pier placement upon safety,
the environment, and the enjoyment of public waters. A complete resolution of issues may require a
professional survey and the application of legal principles to precisely
delineate the boundaries of riparian rights lakeward of the shoreline. Exhaustive inquiry into these principles may
be required to bring a full resolution. Roberts v. Beachview Properties, LLC, et al.,
9 Caddnar 163, 165 (2004).
[VOL. 10, PAGE
274]
91. The dispute
between and among the parties in this proceeding is one involving competing
interests among the adjacent riparian owners and the DNR.
92. The Commission
has the requisite jurisdiction over the person of the parties and over the
subject matter to determine these facts following a hearing and to render a
final agency determination.
93. The only factual
issues upon which there appeared to be substantial controversy were identified
as the following:
(1)
Where the “shoreline or water line” for
(2) A
determination of the riparian rights of the Simses and of Outlook Cove, LLC and
Ass’n within the “shoreline or water line” of Pine Lake, as compared to each
other, and as regulated by the DNR in protection of the public trust and other
factors governed by the Lakes Preservation Act.
This determination might include a disposition as to the placement of
piers, boat stations, seawalls and other similar structures commonly used in
the enjoyment of riparian rights.
94. In anticipation of the
hearing, the Parties agreed to, and the Administrative Law Judge entered on
April 3, 2006, a “Pretrial Order”, the substantive portions of which follow:
Parties,
by counsel, and pursuant to agreement submit Pretrial Order in this matter.
1. Jurisdiction. Jurisdiction is contested by [Outlook Cove,
LLC and Ass’n] but found by the Administrative Law Judge.
2. Status
of Record. The matter at issue on
[Simses’] Petition for Administrative Review,
[Outlook Cove, LLC and Ass’n’s] general denial thereof and affirmative
defenses and any issues raised by [DNR].
This
matter was originally submitted on [Outlook Cove, LLC and Ass’n’s] Motion to
Dismiss claiming lack of jurisdiction, subsequently converted to a Motion for
Summary Judgment. [Simses] in turn filed
a Cross Motion for Summary Judgment.
This Tribunal ruled in favor of the [Simses] and on the Motion for
Summary Judgment and the subsequent Motion to Reconsider by [Outlook Cove, LLC
and Ass’n]. This Tribunal has also
denied [Outlook Cove,
[VOL.
10, PAGE 275]
LLC and
Ass’n’s] Motion to Supplement certain affidavits submitted in support of the
Motion to Dismiss. Finally, this
Tribunal has granted [Simses’] Motion to Limit Evidence at Final Hearing.
3. Pending
Motions. There are no pending
motions.
4. [Simses’]
Contentions. [Simses], having been
previously determined to be riparian owners, claim that the riparian area of
Pine Lake available to them and to the exclusion of [Outlook Cove, LLC and
Ass’n] is that area, triangular in shape, shown on the survey of John T.
Saylor, last revised September 12, 2005.
[Simses] further contend that [Outlook Cove, LLC and Ass’n’s] pier is
located in such a fasion that it penetrates the riparian area of [Simses] and
interferes with [Simses’] reasonable usage of their riparian area. [Simses] request that [Outlook Cove, LLC and
Ass’n] be enjoined from maintaining their pier or docking boats in any portion
of [Simses’] riparian area.
5. [Outlook
Cove, LLC and Ass’n’s] Contentions]: Reserving its rights as to the issues
on which the Administrative Law Judge has limited the evidence, [Outlook Cove,
LLC and Ass’n’] contend that the riparian area that is available to them is the
area shown on the detail drawing prepared by Charles Hendricks and identified
during the depositions of Alan Tim Theriac and George Curtis Bowman as Exhibit
4. [Outlook Cove, LLC and Ass’n] further
content that the riparian area so designated permits both [Simses] and [Outlook
Cove, LLC and Ass’n] to have access to
6. [DNR’s]
Contentions. The Administrative Law
Judge should enter an order defining the riparian zones of [Simses] and
[Outlook Cove, LLC and Ass’n] and setting down parameters for the placement of
piers consistent with the legal principles set down in Ruffenbarger v. Lowe, et al., CADDNAR Vol. 9, Page 150 (2004) and
other cases of record.
7. [Simses’]
Witnesses. Simses may call at
hearing any of the following persons: Thomas G. Sims, John T. Saylor, any
witnesses listed by [Outlook Cove, LLC and Ass’n] or [DNR].
8. [Outlook
Cove, LLC and Ass’n’s] Witnesses.
[Outlook Cove, LLC and Ass’n may call at hearing any of the following
persons: Gerald M. Fedorchak, Jr., Gerald M. Fedorchak, Sr., Charles Hendricks,
Surveyor, Hendricks & Associates, Tony Hendricks, Hendricks &
Associates, Roberts Magnuson, Catherine Magnuson, LaPorte County Recorder,
Barbara Dean, Jon T. Saylor, Surveyor, Tina Everling, Keeper of records for the
DNR, Denise DeBoy, Indiana State
[VOL.
10, PAGE 276]
Archives,
Indiana Commission on Public Records, George Curtis Bowman and any witnesses
listed by [Simses] or [DNR].
9. [DNR’s]
Witnesses. The [DNR] may call F/Sgt.
Alan Theriac, Robert Wilkinson and any witnesses listed by any party as
witnesses.
10. [Simses’]
Exhibits. [Simses] may submit at
hearing any of the following documents: All exhibits listed by [Outlook Cove,
LLC and Ass’n] or [DNR], all surveys prepared by John T. Saylor, numerous
aerial photographs, numerous photographs of [Simses’] and [Outlook Cove, LLC
and Ass’n’s] tracts, promotional materials for [Outlook Cove, LLC and Ass’n’],
all documents submitted by [Simses] in the summary judgment proceedings in this
matter.
11. [Outlook
Cove, LLC and Ass’n’s Exhibits].
[Outlook Cove, LLC and Ass’n] may submit at hearing any of the following
documents: All exhibits listed by [Simses] or [DNR], all drawings and surveys
conducted by Charles Hendricks & Associates, P.C., various photos of
[Simses’] and [Outlook Cove, LLC and Ass’n’s] properties. Records from LaPorte Circuit Court in Cause
No. 22084 establishing the legal lake level of Pine, Stone and Lilly Lakes in
LaPorte County, Indiana, and all documents submitted by [Outlook Cove, LLC and
Ass’n] in the summary judgment and motion to reconsider proceedings in this
matter.]
12. [DNR’s
Exhibits]. The [DNR] may introduce
any of the following as exhibits at hearing: Division of Water Records
pertaining to the establishment of the legal lake level of
13. Issues.
The following issues exist for determination at hearing:
13.1
The exact location of [Simses’] and [Outlook Cove, LLC and Ass’n’s riparian area
in
13.2
Whether [Outlook Cove, LLC and Ass’n’s] pier is improperly placed in the
riparian area of [Simses] and whether an injunction should issue requiring its
removal from that area.
14. Settlement.
No settlement negotiatons are ongoing.
15. Stipulation.
The parties stipulate that the rulings on the Motions for Summary Judgment, the
Motion to Reconsider, the Motion to Supplement Affidavits, the Motion to Limit
Evidence at Hearing are interlocutory orders not subject to appeal. The parties further stipulate that [Outlook
Cove, LLC and Ass’n] shall have neither the right nor the duty to make any
offers of proof with respect to any of the issues to which the Administrative
Law Judge has limited the issues for the Final Hearing. The parties finally stipulate that [Outlook
Cove, LLC and Ass’n] may raise any or all of these issues on appeal, including
issues disposed of by the Administrative Law Judge on Summary Judgment, subject
only to procedural objecitions not exempted by this stipulation. The Administrative Law Judge now approves and
adopts the stipulation.
16. Hearing.
This matter is scheduled for a one day hearing on April 19, 2006 at the DNR
facility in
17. Other.
This order has been formulated after opportunity for contribution by all
parties and shall control the order of haring and shall not be amended without
leave of the Administrative Law Judge.
95. The hearing was conducted as
scheduled in
[VOL. 10, PAGE
277]
96. Following the close of
evidence, a process was agreed by which the parties would be invited to tender
any post-hearing brief and any proposed findings. The agreement was memorialized in an
“Invitation to Tender Post-Hearing Briefs and Proposed Findings of Fact and
Conclusions of Law with Nonfinal Order” entered on April 28, 2006.
97. On May 15, 2006, the Simses
timely filed their “Proposed Findings of Fact, Conclusions and Judgment”.
98. On May 17, 2006, Outlook Cove, LLC and Ass’n timely filed the “Respondents,
Outlook Cove LLC and Outlook Cove Homeowners Association’s Post Hearing Brief”
and “Respondents’ Proposed Findings of Fact and Conclusions of Law with
Non-Final Order”.
99. On May 19, 2006,
the DNR timely filed “Intervenor Department of Natural Resources’ Post-Hearing
Proposed Findings of Fact, Conclusions of Law and Order”.
100.
With the completion of all prehearing activities, the
conduct of the hearing and the completion of post-hearing briefing, the
proceeding became ripe for the entry of Findings of Fact and conclusions of law with a nonfinal
order of the Administrative Law Judge.
101.
The Simses are the owners of real estate in
102.
Outlook Cove, LLC and Ass’n are the owners of real estate located in
103.
The respective boundaries and shorelines of the Simses’ realty and of
the Outlook Cove, LLC and Ass’n’s realty are shown on the survey of John Saylor
stipulated by the parties as Exhibit 1.
104.
The Simses’ realty includes approximately 151 feet along the eastern
shoreline or water line of
[VOL. 10, PAGE
278]
105.
The Outlook Cove, LLC and Ass’n’s realty includes approximately 817
feet along the eastern and southern shoreline or water line of
106.
The Simses share a common boundary line with Outlook Cove, LLC and
Ass’n which proceeds at a bearing of N 89º 17’ 57” W and intersects the
shoreline or water line of Pine Lake at roughly a right angle. This common boundary forms a portion of the
southern boundary of the Simses’ realty and a portion of the northern boundary
of the Outlook Cove, LLC and Ass’n’s realty.
107.
Much of the testimony was focused on promoting various methods for
defining and apportioning riparian zones.
Three professional land surveyors testified, each of whom is licensed in
108.
John Saylor, the land surveyor called by the Simses, testified in
support of what has been called the “hub and spoke” method. Charles Hendricks, the land surveyor called
by Outlook Cove, LLC and Ass’n, testified in support of what has been called
the “extended lot line” method. Robert
Wilkinson, the land surveyor called by the DNR, testified in support of what
has been called the “long lake” method.
109.
Outlook Cove, LLC and Ass’n cite Bath
v. Courts, 459 N.E.2d 72 (Ind. App. 1984) in support of the extended lot
line method. The Court of Appeals noted
in
110.
As reflected by
the Wisconsin Supreme Court in Nosek,
the extended lot line method is appropriate in “the least complicated
situation, where the course of the shore approximates a straight line and the
onshore property division lines are at right angles with the shore, [in which
case] the boundaries are determined by simply extending the onshore property
division into the lake.” Nosek at 870.
111.
The extended lot
line method is not appropriate in all circumstances, as articulated by Nosek and as applied by the Commission
in Rufenbarger and in Roberts v. Beachview Properties, LLC, et
al. at 10 Caddnar 125 (2005).
[VOL. 10, PAGE
279]
112.
Currently, the
Commission has no reported guidance from the
113.
Robert Wilkinson testified that while the long lake method was
preferable, the extended lot line method would work in this proceeding. Similarly, George Bowman, Assistant Director
for the DNR’s Division of Water, testified through a deposition that the agency
looks “for ways where they basically were in line with their property
boundaries, so that they didn’t angle out across extensions of property
boundaries and so forth. Generally, we’d
be looking for something that came pretty much straight out and was
perpendicular to your shoreline....” Stipulated
Deposition of George Curtis Bowman (March 8, 2006).
114.
Both the hub and spoke method and the long lake method offer promise
for the achievement of equitable delineations of riparian boundaries, but the
Commission’s use of either could not have been predicted by the parties in
advance of the adjudication. Application
of the extended lot line method is here an equitable approach and should be
implemented to delineate the riparian boundary shared by the Simses and Outlook Cove, LLC and Ass’n.
115.
First Sgt. Tim
Theriac of the DNR’s Division of Law Enforcement in District 10, which includes
116.
In support of
navigational safety, no pier, pier extension, boat lift, similar structure or
moored boat should be located closer than ten feet from the riparian boundary
formed by the extension of the common boundary between the Simses’ realty and
the Outlook Cove, LLC and Ass’n’s realty.
117.
No finding is
made as to the placement of piers within the riparian areas of the Simses or of
Outlook Cove, LLC and Ass’n, other than as set forth in the following order,
except that any pier must comply with the Lakes Preservation Act and 312 IAC
11.
A. As provided in IC 4-21.5-3-32 of AOPA, an agency is required to index final orders and may rely upon indexed orders as precedent. In November 1988, the Commission adopted Caddnar as its index of agency decisions. Amendments made to AOPA in 1997 also require the Commission and its Administrative Law Judges to address agency precedents cited by the parties where, as here, a proceeding applies IC 14.
B. Effective July 1, 2006, S.E.A. 253 makes several amendments to the Lakes Preservation Act. Among the amendments, IC 14-26-2-6 and IC 14-26-2-9 are repealed, and their licensure requirements are incorporated into IC 14-26-2-23. With the inclusion of new and relocated requirements in IC 14-26-2-23, numbering of subsections and subdivisions is also modified. S.E.A. 253 is inapplicable to this proceeding. If it were applicable, these Findings of Fact and Conclusions of Law would not be substantively altered.