Water is the life blood of the West and wars have been fought over the right to own and control water - whether for raising livestock, growing crops, or just being able to live. And, still today, it is a major factor in your ability to use or build on a piece of property. While this article is focused on Utah, the concepts are ablicable to most western states and I thought it might be useful for those of us working in the wild, wild west.
Back East, you can take water from stream or lake if it crosses your property. This is based on riparian concepts imported from English common law. Not so in the West (and more specifically in Utah), we use the Doctrine of Prior Appropriation to determine who has rights to water. This doctrine is based on the concept of "first in time, first in rights. Essentially this means that those who hold the oldest rights have the highest rights to use it.
"Pre-statutory water rights or "Diligence rights are generally considered to be real property and are conveyed in the same manner as other as real property (e.g. a house or land.
To mange water resources in Utah, the Utah State Engineering Office was created in 1897. Today this is done by the Division of Water Rights (although you'll hear the old title). A complete water code was enacted in 1903 and was revised and reenacted in 1903. This law is presently in force mostly as Utah Code 73.
All water in Utah is considered public property and is subject to the rights to use. A water right is based upon:
1.Quantity - how much water you can use
2.Source - where the water comes from (e.g. Provo River)
3.Priority of date -- when was the water right established
4.Nature of use - e.g. culinary, agricultural
5.Point of division -- where can the water be drawn from (e.g. well, this point on the stream)
So, if your right is to agricultural water you can't use it for household water unless your new right is perfected. Your right to use the water is not perfected until a certificate is issued. This right to use can be transferred by assignment or deed while being developed. But, only by deed once it has been perfected. The determination of right to use is made by the Division of Water Rights.
What is really critical to understand is that if a water right is not being used or is being used inappropriately, a water right can be lost. So, if you have a well permit, but haven't dug and used the well water, that right is lost. Or, if you have the right to water for your livestock (e.g. horses), but don't have any livestock on the land using the water, the right is lost. Statutory forfeiture currently occurs when an appropriator fails to use the water for a continuous seven year period.