found that frequently a person intending to divert water would be put to great expense in the mere preparation necessary to begin the work and before any actual and visible operations upon the stream itself could be initiated: The provisions of the Civil Code, particularly section 1415, requiring the posting of a notice, section 1416, allowing sixty days within which to begin the "excavation or construction of the works," and section 1418, declaring that upon compliance with the code the claimant's right would relate back to the time of the pesting of the notice, were made to remedy and remove the practical difficulties which previously existed in adjudicating the rights of hostile claimants under these circumstances. (Inyo C. W. Co. v. Jess, 161 Cal. 519, [119 Pac. 934].) There is absolutely nothing in this statute to indicate that the legislature supposed that the appropriation made in pursuance thereof was in the nature of a grant by the state of any property of the state in the water of the stream from which the diversion was to be made. As stated in Lux v. Haggin, 69 Cal. 255, [4 Pac. 919, 10 Pac. 674], the statute was a consent by the state to the taking of the water so far as it infringed upon the riparian rights of the state by virtue of any lands which it might own situated upon the stream, and to that extent it operated as a grant. But that was a grant of a right which was private in its nature, a right pertaining to the particular tracts of land owned by the state and held by the state only because of such ownership. It was not a general right to the waters of the stream as a whole. And unless it happened that the state owned land upon the stream at the time of the diversion, a condition which in fact seldom occurred, the state would part with no right whatever by the appropriation. As we have seen, there was no existing public right in the waters which the state could transfer to the appropriator. The whole purpose of the statute was to provide evidence whereby parties claiming under hostile diversions could establish their respective priorities and corresponding rights to the water and avoid the former difficulties in establishing the precise date of the inception of their respective enterprises. (Inyo etc. Co. v. Jess, 161 Cal. 520, [119 Pac. 934].) The appropriator under the code obtains no title at all by his appropriation, as against anyone except the state and the United States. Such right as he obtains from these he receives because of the fact that by the law of 1866 and by the provisions of the code, the United States, and the state, respectively, have consented that he shall thereby obtain the rights pertaining to any public land over which the stream may run, and not because of

any existing dedication of such waters to public use, or because of the fact that they are held by the United States or by the state for general public use.. As against all other persons then interested in the riparian lands or in the water of the stream, he must acquire the right he claims in some other way than by the mere appropriation in compliance with the code. He may do so by purchase and grant from such other claimants and owners, or he may do so by prescription, that is, by adverse use for the period of five years without interruption by the real owner. The only aid which his appropriation notice will afford him in establishing title by prescription against the riparian owner is that it may be admissible as evidence tending to show the date of the beginning of his hostile diversion. In suits against others as mere appropriators, it establishes the date of the inception of his right.

The proposition that the waters of a non-navigable stream are in their nature private property and not property primarily devoted to public use is not only established by authority; it is demonstrable from well-established principles of the law of real property. The right to the waters of a stream is real property, a part of the realty of the riparian lands originally, and a part of the realty as an appurtenance to any other lands to which it may be rightfully taken when the riparian rights have been divested in favor of the user on nonriparian land. This was decided as early as Hill v. Newman, 5 Cal. 446, [63 Am. Dec. 140], where the court said: "The right to water must be treated in this state as it has always been treated, as a right running with the land, and as a corporeal privilege bestowed upon the occupier or appropriator of the soil; and as such, has none of the characteristics of mere personalty." (See, also, Lur v. Haggin, 69 Cal. 392, [4 Pac. 919, 10 Pac. 674]; Santa Paula v. Peralta, 113 Cal. 43, [45 Pac. 168]; Stanislaus W. Co. v. Bachman, 152 Cal. 725, [15 L. R. A. (N. S.) 359, 93 Pac. 858]; Shurtleff v. Kehrer, 163 Cal. 26, [124 Pac. 724]; Merritt v. Los Angeles, 162 Cal. 50, [120 Pac. 1064]; Copeland v. Fairview etc. Co., 165 Cal. 148, [131 Pac. 121].) Until some change is made in natural conditions, there is no existent right to the water of a stream, except that vested in the riparian owners. They alone can lawfully have access to the stream, and therefore they only, in a state of nature, may lawfully use it or divert it from the stream. Hence, the right to the water of flowing streams in this state, prior to any sale or disposition of lands by the state or by the United States, was vested in the state or in the United States, not in their respective governmental

capacities as sovereign and for the common use of the people, but as riparian owners in their respective capacities as landed proprietors. These rights were and still are strictly proprietary and in their nature private. When land was disposed of by either, the riparian water-right pertaining thereto passed to the purchaser as a part of that realty. It necessarily remained a private right, since the sale did not have the effect of dedicating it to public use. All these rights belong primarily to the riparian owners, consisting of the United States, the state, and purchasers from one or the other of them. They cannot be divested from these riparian owners, and have not been divested from them, except by their consent, expressed, as by statute cr by actual grant or contract, or implied, as by prescription; or by enforced taking for public use, as by condemnation. follows that they remain private property when they pass to purchasers, and that when they pass from the riparian owner to others by prescription, grant, or consent, they do not by that transfer become impressed with any public use and it still remains true that there must be a dedication to public use to divest the private right. They are no more public than is the land to which they belonged and of which they formed a part. Finally, on this point, the decisions in this state are to the same effect. Lur v. Haggin we have already mentioned. The recent case of Thayer v. California Development Co., 164 Cal. 125, [128 Pac. 21], states the rule to be that the right obtained by an appropriation under the code is a private right, that the waters appropriated are not thereby appropriated to public use, and that they remain private property until the appropriator dedicates them to public use, which he may do or not at his own pleasure. The other cases holding this doctrine directly or in effect are cited in that case.

The result of these conclusions is that the Southern California Mountain Water Company did not dedicate the appropriated waters to public use by posting these notices, that whatever dedication it may have made of the waters to public use was made in some other manner and that the territory to which that water is dedicated is not necessarily the same as the places of intended use named in the notices. That territory being far in excess of that which the water could supply, the dedication would be manifested by the act of carrying the water to some place and there selling it to those who apply, or by agreeing to supply some specified district with the water. The company has not supplied or agreed to supply, the plaintiffs with water for irrigation. The water it has, according to the findings of

the commission, is necessary to supply the inhabitants of the city of San Diego. It follows that the plaintiffs have no right to receive additional water from this supply for purposes of irrigation upon their lands and that the order dismissing the proceeding is not injurious to them.

The order of dismissal is affirmed.

Henshaw, J., Lorigan, J., Melvin, J., and Angellotti, J., concurred.

Rehearing denied.

In denying a rehearing the court rendered the following opinion on February 19, 1914:

THE COURT.-In a petition for rehearing the plaintiffs quote the opening clause of the amendment of April 8, 1911, [Stats. 1911, p. 821], to section 1410 of the Civil Code. The section formerly read as follows: "The right to the use of running water flowing in a river or stream or down a cañon or ravine may be acquired by appropriation." By the amendment this was prefaced by the following declaration: "All water or the use of water within the state of California is the property of the people of the state of California." This, it is claimed, is contrary to the doctrine declared and followed in the opinion of this court herein. This section was not cited in the briefs upon which the case was submitted. We refer to it now solely in order to show that it has no application to the case. All the water-rights which were in dispute in the case arose and were acquired by and under appropriations made long before the passage of the amendment aforesaid. It ought not to be necessary to remind anyone that a law of this character is not retroactive, or that it cannot operate to divest rights already vested at the time it was enacted. The amendment may possibly be effective as a dedication to general public use of any riparian rights which the state, at the time it was enacted, may still have retained by virtue of its ownership of lands bordering on a stream, rights in the stream which it would in such cases have in common with owners of other abutting land. It could not affect the riparian rights of the other owners, nor the rights of any person or corporation claiming under them, nor rights previously acquired from riparian owners by prescription, nor rights acquired from the state prior to that time by appropriation under the code, in reliance upon the implied offer of the state to allow its riparian rights to be acquired in that manner, as indicated in the opinion.

The petition for a rehearing is denied.

Supreme Court of California:

167 Cal. 666, 140 Pac. 591.

[L. A. No. 3533. In Bank.-April 11, 1914.]

DEL MAR WATER, LIGHT & POWER COMPANY (a Corporation), Petitioner, v. JOHN M. ESHLEMAN et al., Constituting the State Railroad Commission, Respondents. RAILROAD COMMISSION-POWER TO COMPEL CORPORATION TO DEDICATE PROPERTY TO PUBLIC USE.-The state railroad commission has no power to compel a corporation which owns property in private right, and has not dedicated it to any public use, to apply it to a public use of any kind.

ID-WATER COMPANY-WHETHER ENGAGED IN PUBLIC SERVICE-POWER CONFERRED BY ARTICLES OF INCORPORATION-ACTUALLY ENGAGING IN PUBLIC SERVICE. The fact that its articles of incorporation empower a corporation to engage in public service does not, of itself, constitute proof that it is engaged in public service, or that it has dedicated such property as it may own to such service. One may acquire and hold a water supply and waterworks and thereby distribute and sell water for domestic use and irrigation or other purposes, without engaging in public service. The mere fact, therefore, that a company having such powers has acquired a water supply and constructed waterworks constituting a system which it is operating for compensation, does not necessarily justify the conclusion that it is engaged in public service, or that its water is dedicated to public use. The only effect of the adoption of such articles by a corporation is to give it the capacity to engage in such public service if it so desires. After having become incorporated in this manner, it has the power to engage in such service in the same sense that an individual has power so to do. It may or may not do so, and until it does, it cannot be said to be subject to the jurisdiction of the state railroad commission.

ID-FINDING OF RAILROAD COMMISSION-WHETHER SHOWS CORPORATION ENGAGED IN PUBLIC SERVICE. A finding by the railroad commission that a corporation owns and is operating a water system for compensation, and that it has a water supply sufficient in quantity to supply a certain applicant, is not the equivalent of. a finding either that it is engaged in operating its plant for public use, or, if it is, that the applicant is one of the persons entitled as a beneficiary of

such use.

ID. CORPORATION APPLYING PART OF PROPERTY TO PUBLIC SERVICE— COMPELLING EXTENSION OF SERVICE. The railroad commission cannot, whenever it finds a corporation engaged in public service and applying a part of its property to such service, take the entire property of the corporation and compel the dedication thereof to public use ard direct its distribution to such portions of the public as to the commission may seem best.

ID.-INTERPRETATION OF PUBLIC UTILITIES ACT-EXTENSION OF PUBLIC SERVICE-While sections 5 and 36 of the Public Utilities Act, when taken literally, seem to empower the railroad commission to direct any public utility to extend its plant and enlarge the territory supplied by it in such manner as the commission shall judge advisable,