What authority does MMWC have to charge its members?
MMWC's authority comes from multiple sources. Mountain Mutual Water Company
is a mutual ditch company. C.R.S. § 7-42-104 authorizes ditch companies to make
assessments on its shareholders (members) for the purpose of keeping the property of
the corporation in good repair. That section also grants such corporations "a perpetual
lien upon such shares of stock and the water rights represented by the same for any and
all such assessments until the same are fully paid."
Moreover, the Colorado Supreme Court has held that "[b]y becoming a
stockholder," a member, "by implication, enter[s] into a contract with the company to
pay all assessments upon his stock, levied pursuant to the governing statute and by-
laws of the company, of which by-laws appellant will be presumed to have had notice."
Callahan v. Chilcott Ditch Co., 86 P. 123, 124, 37 Colo. 331, 334-335 (Colo. 1906)
Furthermore, Article 2.1(f) of the Amended and Consolidated Declaration of
Protective Covenants and Building Restrictions, Cripple Creek Mountain Estates, dated
April 26, 2005, provide that "[w]ater will be provided and distributed in accordance with
the Articles of Incorporation and By-laws of the authorized mutual water company (the
'Water Company'). Each lot owner shall connect to this service and pay monthly water
bills, assessments, or dues, if any, necessary for the continuing operation, repair and
maintenance of said system."
Copyright © 2009-2011 MMWC Director Eric W. Cernyar
