AGO 1991 No. 8 - Mar 11 1991
DEPARTMENT OF NATURAL RESOURCES ‑- DEPARTMENT OF FISHERIES ‑- TIDELANDS ‑- PUBLIC FUNDS ‑- CULTIVATION OF CLAMS
1. Laws of 1919, ch. 166, which was repealed in 1949, granted owners of Bush Act tidelands the right to cultivate clams in addition to oysters. Article 8, sections 5 and 7, of the Washington Constitution, prohibit gifts of public funds. Under the court's contemporary construction of article 8, sections 5 and 7, Laws of 1919, ch. 166 is not clearly unconstitutional and anyone challenging the law would have a heavy burden of establishing beyond a reasonable doubt that the law is unconstitutional.
2. Rights acquired under a statute can vest if one substantially changes position in reliance on the statute, even if it is later repealed. The repeal of Laws of 1919, ch. 166, in 1949, did not extinguish the right to cultivate clams granted by the law for those owners of Bush Act tidelands who were cultivating clams in 1949 when the act was repealed.
3. When the Legislature repealed Laws of 1919, ch. 166, it did not indicate how long any vested right to cultivate clams might continue. The Legislature may adopted legislation to eliminate or phase out whatever vested rights remain to cultivate clams, provided that the conditions under which such rights are phased out or discontinued are reasonable.
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March 11, 1991
Honorable Jennifer Belcher
State Representative, District 22
406 John L. O'Brien Building
Olympia, Washington 98504
Cite as: AGO 1991 No. 8
Dear Representative Belcher:
You have asked for our opinion on several questions related to two laws: Laws of 1895, ch. 24 (the Bush Act) and Laws of 1919, ch 166. We paraphrase your questions:
[[Orig. Op. Page 2]]
1. Did Laws of 1919, ch. 166, which granted owners of Bush Act tidelands the right to cultivate clams, violate article 8, sections 5 and 7 of the Washington Constitution, that prohibit gifts of public funds?
2. If the answer to question 1 is no, did the repeal of Laws 1919, ch. 166 in 1949 extinguish the right to cultivate clams granted by that law?
3. If the answer to question 2 is no, can the state revoke or quantify the right to cultivate clams granted by the Laws 1919, ch. 166?
We answer your questions in the manner set forth in our analysis.
The Bush Act was passed in 1895. Laws of 1895, ch. 24. It provided for the purchase and sale of state‑owned tidelands for the purpose of oyster planting. A "moving cause" for passage of the Bush Act was to encourage and facilitate the oyster industry. In re Anderson, 95 Wash. 330, 335, 163 Pac. 767 (1917).
The Bush Act provided that occupants of tidelands planted with oysters could purchase up to 100 acres of such lands. The tidelands purchased under the Bush Act could "be used for oyster planting purposes only." Laws of 1895, ch. 24, § 1, p. 36. The tidelands available for purchase were limited to third-class tidelands not included in any natural oyster beds or reserves. Id. § 7, p. 38.1/
If tidelands purchased under the Bush Act became "unfit and valueless for the purposes of oyster planting," the purchaser was entitled to purchase a substitute tract. If the tidelands were ever used by the purchasers or their successors, in whole or in part, "for other than the purposes specified" in the Bush Act, then upon application by any citizen to the state land commissioner the sale could be cancelled and the land would revert to the state. Id. § 9, p. 38-39.2/
[[Orig. Op. Page 3]]
Laws of 1919, ch. 166 permitted owners of Bush Act tidelands to cultivate and propagate clams and edible shellfish without violating the conditions of defeasance.3/
Laws of 1919, ch. 166, § 1, p. 488-89 provided:
That any person, firm, or corporation in possession of tide lands from the State of Washington, and holding the same under contract or deed from the State of Washington, containing provisions restricting use of said lands or any portion thereof to the cultivation of oysters only, shall hereafter be, and they are hereby,given the further right to use said lands or any portion thereof, for the cultivation and propagation of clams and any and all edible shell fish.
The 1895 Bush Act which authorized the sale of tidelands for oyster cultivation was repealed in 1935. Laws of 1935, ch. 47, § 1, p. 128. The repeal made clear that prior sales were not affected. The savings clause provided:
That chapters XXIV (24) and XXV (25) of the Laws of 1895, pages 36 to 41, are hereby repealed: Provided,That nothing herein shall be construed as affecting any rights acquired under said acts repealed, or either thereof, or the state's reversionary interest therein . . . .
Id.§ 1, p. 128 (Emphasis added).
[[Orig. Op. Page 4]]
Laws of 1919, ch. 166, which permitted the use of Bush Act tidelands for cultivation of clams, was not repealed until 1949 when a comprehensive, new, Fisheries Code was enacted. Laws of 1949, ch. 112, § 86, p. 302 (p. 306). The 1949 repeal did not have a specific savings clause, providing instead:
If the operation of any clause, part or section of this act shall be held to impair the obligation of contract, or to deny to any person any right or protection secured to him by the Constitution of the United States of America, or by the Constitution of the State of Washington, it is hereby declared that, had the invalidity of such clause, part or section been considered at the time of the enactment of this act, the remainder of the act would nevertheless have been adopted without any and all such invalid clauses, parts or sections.
Laws of 1949, ch. 12, § 85, p. 301-02.
With this background in mind, we turn to your questions.
Did Laws of 1919, ch. 166, which granted owners of Bush Act tidelands the right to cultivate clams, violate article 8, sections 5 and 7 of the Washington Constitution, that prohibit gifts of public funds?
The Attorney General's Office has a long-standing policy, that it will not express an opinion as to the constitutionality of a duly-enacted law. See e.g., AGO 65-66 No. 96, at 7. We consider all laws constitutional until they have been declared otherwise by the courts of this state. To do otherwise might cast a cloud on the validity of a current law, or create a potential conflict for the office in the event we are later called upon to defend the law in court. We will depart from this long-standing policy when a law is so clearly repugnant to some provision of our state or federal constitution that there can be no difference of opinion upon the question in the minds of reasonable lawyers.4/
[[Orig. Op. Page 5]]
In the present case, we note that Laws of 1919, ch. 166 was repealed in 1949. The repeal of this law over 50 years ago diminishes, although does not eliminate, the chance we will be called upon to defend the law in court. Because the chances we may be called upon to defend this law in court are diminished, we are willing to engage in a limited constitutional analysis of the 1919 law, but only to the extent necessary to determine whether the law is "clearly repugnant" to the constitution.
You have asked whether Laws of 1919, ch. 166 violated article 8, sections 5 and 7. Article 8, section 5, of the Washington Constitution, provides:
The credit of the state shall not, in any manner be given or loaned to, or in aid of, any individual, association, company or corporation.
Article 8, section 7, of the Washington Constitution, provides:
No county, city, town or other municipal corporation shall hereafter give any money, or property, or loan its money, or credit to or in aid of any individual, association, company or corporation, except for the necessary support of the poor and infirm, or become directly or indirectly the owner of any stock in or bonds of any association, company or corporation.
Despite differences in wording, the two provisions are interpreted as having the same purpose and effect. Health Care Facilities v. Ray, 93 Wn.2d 108, 115, 605 P.2d 1260 (1980).
In recent years, the Washington Supreme Court has narrowed the application of the constitutional gift prohibition. According to the Court, its purpose is to limit the scope of the gift prohibitions to the evils the framers intended to prevent, such as granting public subsidies to private commercial enterprises, primarily railroads. See e.g.,Tacoma v. Taxpayers of Tacoma, 108 Wn.2d 679, 701, 743 P.2d 793 (1987);Marysville v. State, 101 Wn.2d 50, 55, 676 P.2d 989 (1984). Under the court's contemporary gift analysis there are two tests by which to judge the transfer of public property. First, no unconstitutional gift [[Orig. Op. Page 6]] occurs if the transfer carries out a fundamental governmental function. Second, with transfers that do not carry out a fundamental governmental function, the court focuses on two factors: consideration and donative intent. Tacoma v. Taxpayers, 108 Wn.2d at 702.
Applying the consideration/donative intent analysis to the case at hand, we begin with persons who purchased Bush Act tidelands between 1919, after Laws of 1919, ch. 166 was enacted, and 1935, when the Bush Act was repealed. When these persons purchased tidelands, the existing statutes (Laws of 1895, ch. 24 and Laws of 1919, ch. 166) permitted both oyster and clam cultivation. It seems reasonable to conclude that the purchase price paid for Bush Act tidelands during the period 1919 to 1935 was consideration for the opportunity to cultivate oysters under the Bush Act and clams under Laws of 1919, ch. 166, at least as long as the law remained in effect.5/
Therefore, we see no gift involved for cultivating clams on Bush Act tidelands during the period 1919 to 1935.
It is a somewhat closer call for those who purchased Bush Act tidelands between 1895 and 1919 and were subsequently allowed to cultivate clams pursuant to Laws of 1919, ch. 166. The 1919 law did release the restriction imposed by the Bush Act which limited tideland owners to oyster cultivation. However, we have some question about the value of this restriction to the state. The state could not sell the clam rights to anyone else since the Bush Act purchasers owned the tideland for oyster cultivation.
In addition, it is not clear to us what consideration the state might have received in exchange for permitting oyster cultivation. For example, if the tidelands became unfit and valueless for the purpose of oyster planting, purchasers were entitled to buy a substitute tract. Persons unable to cultivate oysters, who chose instead to cultivate clams, may have engaged in an act of forbearance, that could constitute consideration to the state. For the Bush Act tideland owners for whom this fact pattern applies, the argument seems plausible.
[[Orig. Op. Page 7]]
Even looking beyond the value of clam cultivation and the possibility of consideration, we are unable to say that Laws of 1919, ch. 166 is clearly unconstitutional as to those who purchased Bush Act tidelands prior to 1919.
First, donative intent is an important, if not necessary, element under the court's contemporary gift analysis. See Scott Paper Co. v. Anacortes, 90 Wn.2d 19, 33, 578 P.2d 1292 (1978). The repeal of the 1919 law in 1949 without a savings clause demonstrates a lack of donative intent. See Tucker v. Brown, 199 Wash. 320, 325, 92 P.2d 221 (1939) (donative intent means intention by donor to divest itself over property absolutely and irrevocably);Caminiti v. Boyle, 107 Wn.2d 662, 676, 732 P.2d 989 (1987) (no gift because there was no donative intent where state granted tideland owners a no-cost, revocable license to build docks on state‑owned tidelands).
Second, under the court's contemporary gift analysis, the gift prohibitions are applied to prevent the evils the framers intended to prevent, particularly the expenditure or risk of public funds. Here, even as to pre‑1919 Bush Act purchasers, Laws of 1919, ch. 166 did not involve any actual public expenditure, or any risk to public funds. See e.g.,Council of Camp Fire v. Revenue, 105 Wn.2d 55, 60-61, 711 P.2d 300 (1985) (retroactive tax repeal did not contravene gift provision "so long as the repeal does not require an expenditure of public funds.") State Housing Fin. Comm'n v. O'Brien, 100 Wn.2d 491, 494-95, 671 P.2d 247 (1983) (the gift inquiry "focuse[s] primarily on the risk that the state program pose[s] to the public treasury . . . .").
Caminiti reinforces our opinion that the 1919 law is not clearly unconstitutional, even as to those who had already bought Bush Act tidelands when the 1919 law was adopted. InCaminiti, petitioners challenged the constitutionality of RCW 79.90.105 which grants owners of residential property abutting state‑owned tidelands and shorelands revocable permission to install and maintain private recreational docks on abutting state‑owned lands without payment to the state.6/
Petitioners alleged,inter alia, that the statute constituted an impermissible gift. The court disagreed:
[[Orig. Op. Page 8]]
We have consistently held that a statute is presumed to be constitutionally valid and that the burden of overcoming such presumption is upon the party challenging the statute. As above discussed, RCW 79.90.105 is by way of a revocable license allowing owners of land abutting state‑owned tidelands and shorelands to use such lands for recreational docks, subject to numerous state and local controls. There is no loss of state money or credit inasmuch as no debt has been created by the statute. Nor can it be said that there has been a gift of state money or property, since no donative intent is present. Clearly also, the statute does not subsidize private enterprise, jeopardize state assets, expend state moneys or abdicate state control over state property. Petitioners have not sustained their heavy burden of proof on this issue.
Caminiti, 107 Wn.2d at 675-76 (emphasis added; footnotes omitted). The situation at hand appears analogous to Caminiti. In both cases, the state authorized private parties to use property in a manner not previously permitted; in both cases the state retained ultimate control over the property; and in neither case was there an expenditure of state money, creation of a debt, or jeopardy to state assets.
For the reasons set forth above, we decline to definitively answer your first question regarding the constitutionality of Laws of 1919, ch. 166 which permits Bush Act tideland owners to cultivate clams. We are willing to say, however, that under the courts's contemporary gift analysis, the 1919 law (ch. 166) is not clearly unconstitutional and anyone challenging the law has the burden of establishing beyond a reasonable doubt that the law is unconstitutional. Department of Ecology v. State Finance Comm., 116 Wn.2d 246, 259, 253, .... P.2d .... (1991).
If the answer to question 1 is no, did the repeal of Laws of 1919, ch. 166 in 1949 extinguish the right to cultivate clams granted by that law?
As discussed above, owners of Bush Act tidelands were required under that act to utilize their lands for oyster cultivation. The Bush Act was repealed in 1935. The repeal made clear that prior sales were not affected, i.e., that Bush Act tideland owners would be permitted to continue to cultivate oysters. Laws of 1919, ch. 166, which permitted Bush Act tideland owners to cultivate clams, was repealed in 1949. Prior to 1949, Bush Act tideland owners were permitted to cultivate [[Orig. Op. Page 9]] oysters or clams. Your second question asks whether, assuming the 1919 law was valid, Bush Act tideland owners were permitted to cultivate clams after the 1949 repeal.
Laws of 1919, ch. 166 was repealed without a savings clause.7/
Absent a savings clause, the general rule is that a repealing act terminates all rights dependent upon the repealed statute. Seattle Rendering v. Darling-Delaware Co., 104 Wn.2d 15, 19, 701 P.2d 502 (1985). However, repeal of a statute does not operate to destroy "vested rights", which remain enforceable despite repeal. Seattle, 104 Wn.2d at 19; Lau v. Nelson, 89 Wn.2d 772, 774, 575 P.2d 719 (1978), partially overruled on other grounds in Roberts v. Johnson, 91 Wn.2d 182, 588 P.2d 201 (1978). For a right created by statute to be vested, so as to remain enforceable despite repeal of the statute, the right
must be something more than amere expectation based upon an anticipated continuance of the existing law; it must have become a title, legal or equitable, to the present or future enjoyment of property, a demand, or a legal exemption from a demand by another.
Godfrey v. State, 84 Wn.2d 959, 963, 530 P.2d 630 (1975) (emphasis in original); see also Ward v. WSU, 39 Wash. App. 630, 632, 695 P.2d 133 (1985);State v. Matlock, 27 Wash. App. 152, 157, 616 P.2d 684 (1980).
Three separate events may have caused the right to cultivate clams on Bush Act tidelands to vest, such that the right would survive repeal of the underlying law which granted the right: first, passage of 1919 law; second, purchase of Bush Act tidelands after passage of the 1919 law; and third, actual cultivation of clams on Bush Act tidelands in reliance on the 1919 law. We examine each in turn.
The first event, passage of Laws of 1919, ch. 166, no doubt created an expectation on the part of Bush Act tideland owners based upon an anticipated continuance of the 1919 law. However, [[Orig. Op. Page 10]] passage of the 1919 law should not have created anything more than an expectation. Allen v. Forest, 8 Wash. 700, 36 P.2d 971 (1894) seems dispositive. There, the Legislature passed an act providing for the appraising and disposing of state‑owned tide and shorelands. The law further provided that persons already in possession of those lands would have a purchase preference. Several years later, the Legislature passed another law altering the preference scheme. The plaintiff, who was entitled to a preference under the earlier statute, brought suit claiming he had a vested right to purchase tidelands under the earlier statute and that the later statute was an impairment of the obligation of his contract with the state.
The court disagreed. The court noted first that, at statehood, the state acquired full ownership and control over all tide and shore lands, subject only to the power of the federal government, and the only private rights that exist are those expressly granted by the state. Allen, 8 Wash. at 703. The court then said:
[I]t seems plain to us that the [plaintiff] obtained no vested rights whatever under the [original] act . . .; that no contract whatever was entered into between the state and the [plaintiff], but that his right to purchase under the conditions named in the act was simply a privilege which he had a right to exercise only while the law remained in force.
Allen, 8 Wash. at 703.
InAllen, the plaintiff had done nothing to exercise his privilege to purchase. He had made no application to purchase, and had paid no money. The court held that, on these facts, the plaintiff had obtained no vested rights and repeal of the preference law caused no impairment of any contract. Allen, 8 Wash. at 708. By analogy toAllen, mere passage of the 1919 law did not create any vested, contractual, or property rights to cultivate clams on Bush Act tidelands.
The next question is whether the second event, purchase of Bush Act tidelandsafter passage of the 1919 law, created a vested right to cultivate clams. The fact that Bush Act tidelands were purchased after the 1919 law was enacted did not elevate the statutory right to cultivate clams under the 1919 law to a contract or property right. Although we said, in answer to question 1, that the purchase price of Bush Act tidelands bought after 1919 probably constituted consideration to the state for the right to cultivate clams, it does not follow that the right is unlimited. For example, with a real estate option, consideration is paid for the right to purchase or lease property [[Orig. Op. Page 11]] for the specified period of the option. See Black's Law Dictionary, (5th ed. 1979) at p. 986. Here, the post-1919 Bush Act tideland purchasers had the equivalent of an option to cultivate clams, but without more we cannot say that the option survived repeal of the underlying statute.
In support of this conclusion, we note that the Legislature had an opportunity to elevate the right to cultivate clams to a vested property right by amending all Bush Act tideland deeds to reflect this right, but specifically declined to do so. Laws of 1919, ch. 166 originated as House Bill 121. In its original form, House Bill 121 provided:
It is further provided that any deeds or contracts heretofore issued by the State of Washington, containing restrictive provisions, limiting the use of lands to the cultivation of oysters, shall be considered as amended to conform to the provisions of this act.
HB 121, § 2, State of Washington Printed Bills of the Legislature, 16th Session House (1919). This section was deleted by the Senate. Senate Journal, 16th Legislature (1919) at p. 542.
The final event which may have caused the right to cultivate clams on Bush Act tidelands to vest, such that the right survived a repeal of the underlying law, is the actual cultivation of clams on the tidelands prior to the repeal of Laws of 1919, ch. 166. Vested rights can be created by contract or property. See Ward v. WSU, 39 Wash. App. at 632. Rights under a statute can also vest if one substantially changes position in reliance on the repealed statute. The critical factor in acquiring a vested right under a statute sufficient to survive repeal is reliance, i.e., engaging in a course of conduct in accordance with the law existing prior to repeal. See Godfrey, 84 Wn.2d at 962-964.8/
[[Orig. Op. Page 12]]
What action would constitute reliance on the 1919 law such that the right to cultivate clams would survive repeal of the underlying statute? Obviously, Bush Act tideland owners who were actually cultivating clams in 1949 when the act was repealed were acting in reliance on the 1919 act. Their right to cultivate clams would, therefore, have vested, and they could continue to cultivate clams subsequent to that law's repeal. Also, anyone who was not yet cultivating clams but who had taken substantial steps toward it by, for example, investing in seed clams, would also have a vested right to continue to cultivate clams after 1949. On the other hand, anyone not cultivating clams prior to 1949 could not be said to be acting in reliance on Laws of 1919, ch. 166 at the time of its repeal. These persons would have no vested right to cultivate clams which would survive repeal.
If the answer to question 2 is no, can the state revoke or quantify the right to cultivate clams granted by the Laws of 1919, ch. 166?
Your third question asks whether the state can revoke or quantify the right or privilege to cultivate clams or, put another way, can the state revoke or limit the vested right of those persons who were cultivating clams prior to 1949? We believe it can.
In the zoning context, the general rule is that a zoning ordinance may not operate to immediately suppress or remove from a particular district an otherwise lawful business for a use already established and maintained therein. 82 Am. Jr. 2d,Zoning and Planning, at § 178 n. 97. On the other hand, it is the policy of the law and the spirit of zoning to secure the gradual or eventual elimination of nonconforming uses. 82 Am. Jur. 2d,Zoning and Planning, at § 179. To accommodate these competing interests, it is generally held that zoning ordinances requiring the termination of nonconforming usesunder reasonable conditions are within the scope of the municipal policy power. Id. Such reasonable conditions might include: amortization periods; limits on changes in, or the expansion, repair, or replacement of nonconforming uses on structure; and disallowance of the resumption of a nonconforming use after it has once been discontinued or abandoned. Id.;see also Seattle v. Martin, 54 Wn.2d 541, 543-45, 342 P.2d 602 (1959). We think these zoning rules are applicable to the situation at hand and we apply them by analogy.
In 1949, the Legislature repealed the Laws of 1919, ch. 166 which granted the right to cultivate clams without addressing how long any vested right to cultivate might continue. We see no [[Orig. Op. Page 13]] reason why the Legislature could not adopt new legislation to eliminate or phase out whatever vested rights remain to cultivate clams, provided that the conditions under which such rights were phased out or discontinued were reasonable.
We trust the foregoing will be of assistance to you.
Very truly yours,
KENNETH O. EIKENBERRY
MARK S. GREEN
Assistant Attorney General
*** FOOTNOTES ***
1/A companion act extended the right to purchase up to 40 acres of tidelands to those people who had planted and cultivated artificial oyster beds on tidelands that were originally covered with natural oyster beds. Laws of 1895, ch. 25.
2/The tidelands were also subject to reversion:
[I]f a purchaser of land for purposes of oyster cultivation should refrain from using it for that purpose and did not use it for any other purpose, and would thus work a fraud upon the state in view of the purposes for which the land was granted to him . . . .
In re Anderson, 95 Wash. at 338.
3/For simplicity, the right given by the 1919 law to cultivate and propagate clams and edible shellfish will be referred to herein as the right to cultivate clams. This reference is not intended to limit or expand the meaning of the words in Laws of 1919, ch. 166.
4/Our long-standing policy also does not apply to opinion requests regarding the constitutionality of proposed legislation where our advice may assist the Legislature in avoiding constitutional difficulties. See e.g., AGO 1991 No. 7.
5/Whether the Bush Act tidelands cost more after 1919 in recognition of the additional activity permitted on those tidelands is irrelevant. The consideration need only be legally sufficient. The court will not inquire further into whether the consideration is adequate. See Adams v. UW, 106 Wn.2d 312, 327, 722 P.2d 74 (1986).
6/Permission is revocable only upon a "finding of public necessity which is limited to the protection of waterward access or ingress rights of other landowners or public health and safety." RCW 79.90.105.
7/The Legislature provided only that the repeal not operate to impair the obligation of contract or deny any person any right secured by the state or federal constitution. Laws of 1949, ch. 112, § 85, p. 301. These protections are the same as those afforded by the vested rights doctrine. Hearde v. Seattle, 26 Wash. App. 219, 222, 611 P.2d 1375 (1980) (the purpose of the vested rights doctrine is to prevent impairment of obligation of contract or deprivation of property without due process).
8/The vested rights doctrine operates in a similar manner in the zoning context. There, a property owner's right to develop land under a prior zoning code is established once the property owner substantially changes his position in reliance on the prior zoning. See Allenbach v. Tukwila, 101 Wn.2d 193, 676 P.2d 473 (1984); Hull v. Hunt, 53 Wn.2d 125, 331 P.2d 856 (1958);Burley Lagoon v. Pierce County, 38 Wash. App. 534, 686 P.2d 503 (1984).