PPL Montana v. Montana

(Whether the constitutional test for determining if a river is navigable for title purposes requires an inquiry into whether the stretch in controversy was navigable at the time that the State joined the Union or whether the appropriate test is whether the river as a whole is navigable based on present day use)

PPL Montana LLP (PPL) is a wholesale electric utility that runs several hydro-electric dams in Montana. PPL contested Montana’s ability to seek compensation for its use of riverbeds asserting a myriad of affirmative defenses including laches and equitable estoppel. The State claimed title to the land asserting that the riverbeds were established as public trust land under the theory that the rivers were “navigable waters” when Montana joined the Union in 1889, and that PPL owed the State compensation for use of the land.

The First Judicial District Court of Montana ruled in favor of the State. The Montana Supreme Court affirmed, holding that the rivers of the State were in fact “navigable.” Further, that the State held title to the lands in public trust, and that in determining navigability it was essential to determine whether natural navigation of the river as a whole afforded a useful channel for commerce, notwithstanding several non-navigable or only questionably navigable sections. The Supreme Court granted certiorari in June.

Petitioners argue that navigability of a river should be assessed according to whether particular sections allow for navigation, and not whether the river as a whole is navigable. Additionally, in making that determination the focus should be on the condition of the river at the time a state joined the Union, and not the improved condition of the river in present day. Petitioners further assert that a rivers susceptibility to commercial use should generally not factor into consideration but rather that the focus should be on whether the stretch of river serves as a useful channel of commerce, and not whether it can support recreational uses such as fishing and boating. Lastly, Petitioners argue that the burden of proof rests on the party asserting navigability.