specially concurs.
I concur with the analysis and result of our decision and have, accordingly, signed the opinion. In doing so, I, nevertheless, question the necessity for our taking this approach, given the fact that in 1987, DNRC unsuccessfully litigated the exact issues that are now before us in the same District Court. Under such circumstances, the doctrine of collateral estoppel should, and in my view, does preclude DNRC from relitigating those very same issues again here.
The doctrine of collateral estoppel or issue preclusion bars a party against whom the claim is asserted from relitigating an issue that the party previously litigated. Peschel v. Jones (1988), 232 Mont. 516, 521, 760 P.2d 51, 54. The bar extends to all questions essential to the judgment which were determined by a prior judgment. Haines Pipeline Const. v. Montana Power (1994), 265 Mont. 282, 288, 876 P.2d *62632, 636. Collateral estoppel refers to a preclusion of issues and is distinct from res judicata which refers to a preclusion of claims. Peschel, 760 P.2d at 54; see also Boyd v. First Interstate Bank (1992), 253 Mont. 214, 218, 833 P.2d 149, 151.
We apply a three-prong test to determine whether collateral estoppel applies in a given case:
1) Was the issue decided in the prior adjudication identical with the one presented in the action in question?
2) Was there a final judgment on the merits?
3) Was the party against whom the plea is asserted a party or in privity with a party to the prior adjudication?
Peschel, 760 P.2d at 54 (quoting Aetna Life Ins. Co. v. McElvain (1986), 221 Mont. 138, 146, 717 P.2d 1081, 1086). This Court has further held that upon an affirmative answer to all three questions, collateral estoppel bars litigation regarding an issue in trial which was previously litigated in either a civil or criminal trial. Peschel, 760 P.2d at 54.
The Tribes contend that the issue of DNRC’s authority to grant new water use permits on the Flathead Indian Reservation prior to settlement or adjudication of the Tribes’ reserved water rights has been previously litigated in a civil trial in Montana district court. On June 15,1987, the Montana First Judicial District Court, the Honorable Gordon R. Bennett (now retired), presiding, entered its opinion and order reversing DNRC’s final decision to issue a provisional permit to appropriate water to Don Brown and Jerry Wallem. See United States and Montana Power Co. v. Department of Natural Resources (Don Brown) (D. Mont. June 15, 1987), No. 50612. Specifically, the court construed § 85-2-311, MCA, and held that DNRC did not have the authority to issue a permit for a new water application when questions of senior conflicting claims had been raised.
In Don Brown, a junior claimant sought a permit for a new water appropriation. The Montana Power Company and the United States Bureau of Reclamation timely objected on the grounds that there were no unappropriated waters available and that their rights as prior appropriators would be adversely affected by DNRC’s granting a new permit. DNRC contended, as it did in the instant case, that the permits would not adversely affect the rights of the prior appropriators. The court stated that there is:
only one way to determine if an unappropriated water right exists in a source of supply: decide how much water is available and how *63much of it has been appropriated. This obviously requires quantification of existing rights. There is, likewise, only one way to determine whether the water rights of prior appropriators will be adversely affected by additional appropriation. You must begin by determining what the water rights of the prior appropriators are. In either case, the need to determine existing water rights is inescapable and authority to make such a determination is, and has been since 1973, exclusively in the district or water courts.
The court, therefore, found that DNRC did not have the authority to issue the permits under § 85-2-311, MCA, because without a quantification of existing water rights, DNRC was unable to determine if the applicant met the criteria set forth in § 85-2-311, MCA, requiring the applicant to show that there were unappropriated waters in the source of supply and that the water rights of prior appropriators would not be adversely affected. The parties to Don Brown, including DNRC, reached a stipulation and did not appeal the district court’s findings in its order and opinion. Therefore, the judgment of the district court is final and subject to the doctrine of collateral estoppel.
DNRC argues that the doctrine of collateral estoppel does not apply in the instant case because the issues raised by the Tribes do not meet the first prong of the test. Specifically, DNRC contends that the issues decided in the Don Brown case are not identical to those presented in the instant case because the Montana Legislature made significant changes to § 85-2-311, MCA, in 1989.1 disagree. In Don Brown, the district court construed the 1985 version of § 85-2-311, MCA, which provided:
(1) Except as provided in subsections (2) through (4), the department shall issue a permit if the applicant proves by substantial credible evidence that the following criteria are met:
(a) there are unappropriated waters in the source of the supply
(b) the water rights of a prior appropriator will not be adversely affected;
(e) the proposed use will not interfere unreasonably with other planned uses or developments for which a permit has been issued or for which water has been reserved.
Section 85-2-311, MCA (1985). Section 85-2-311, MCA (1993), the statute applicable to the instant case provides:
*64(1) Except as provided in subsections (3) and (4), the department shall issue a permit if the applicant proves by a preponderance of the evidence that the following criteria are met:
(a) there are unappropriated waters in the source of supply at the proposed point of diversion ...
(b) the water rights of a prior appropriator will not be adversely affected ...
(e) the proposed use will not interfere unreasonably with other planned uses or developments for which a permit has been issued or for which water has been reserved;
[Emphasis added to illustrate changes from the 1985 statute.] In 1989 and 1993, the legislature amended § 85-2-311, MCA, to require a preponderance of the evidence standard of proof rather than a substantial credible evidence standard and to qualify the source of supply. However, the legislature did not make such substantial amendments to § 85-2-311, MCA, so as to alter the issues discussed by the District Court construing these statutory provisions. In fact, the issues decided in the Don Brown case are identical to those presented in the action in question and meet the first prong of the collateral estoppel inquiry.
Moreover, the opinion and order issued by the court in Don Brown qualifies as a final judgment on the merits and therefore meets the second prong of the collateral estoppel inquiry. Finally, DNRC was both a party in the Don Brown adjudication and a party in the instant case and thereby satisfies the third prong of the collateral estoppel inquiry. Thus, in this case, each prong of the three part test is satisfied.
In Don Brown, the district court already adjudicated and decided issues identical to the ones presented to this Court in the instant case. The doctrine of collateral estoppel renders that court’s decision dis-positive. Accordingly, while I agree with the analysis and result of our opinion, the First Judicial District Court had resolved the issues in a final judgment rendering relitigation of the very same issues unnecessary. Under such circumstances, our decision here should not come as any great surprise.