What’s an Easement Contract?
Easement Contracts are legally binding agreements between a property owner and an individual or entity, granting the latter the right to a specific portion of the parcel, usually for a limited time. A common example is an Easement Contract for Access , where a parcel is required to demonstrate a pathway for an independent utility company (such as the National Grid in the eastern United States) to transport electricity at highly efficient voltages to substations. In either case, the aforementioned arrangement authorizes the use of a previous area without taking title to it. The purpose of such agreements is to offer a specific party relief from the purchase, sale, lease or devised lease of land.
Different Types of Easement Contracts
Like any contract, an easement contract must be specific to be valid. Easement contracts fall into different types: private, public, affirmative, and negative. This section will detail these types of contracts, explaining how they are similar and how they differ from one another.
Private easements are contracts between two or more people that provide for the right of way over one person’s land to benefit either person. In such a contract, the "dominant" and "servient" tenements, or the property with the benefit and the property with the burden, merely share in the use of the easement. Simply put, such easements benefit one party without harming the other. Examples: Lewis v. Lowrey, 191 Vt. 650 (1985); Robeson v. Shane, 23 N.W. 541 (Iowa 1885); Punchard Park Co. v. Maine Central Railway Co., 49 A. 62 (Maine 1901); Hart v. Hart, 114 S.W.3d 712 (Tex. App. Beaumont 2003); In re Oakwood Kabel Land Co., 1995 WL 517733 (Bankr. E.D. Tex.); Schmidt v. White Motor Co., 62 A.D. 249 (N.Y. App. Div. 1900).
Often, easement contracts between neighbors create rights without responsibilities. Such contracts can also create an obligation on the servient tenement to pay, repair, or build a road or other facility on the land that the dominant tenement requires for its use. An obligation for the dominant tenement to pay, repair, or build on the servient tenement’s property is known as a "reciprocal easement."
Public easements are normally found in easement contracts between private parties and a government entity. Such easements may also extend to the general public and entitle anyone to use the land for the purposes expressed in the contract. This type of contract is of obvious benefit to public or quasi-public entities that require access to and the ability to maintain roadways, parkland, and other common facilities. Examples of such contracts can be found in CMCC Properties v. Orange County, 78 Cal.App. 4th 500 (Cal. Ct. App. 2002) and Angeletti v. Sugarland Run Residential Owners Ass’n, 206 F.R.D. 64 (E.D.Va. 2002).
Affirmative easements grant a specific right of use to land owned or conveyed by another. These rights may be limited to specific uses or purpose, or as broad as the scope of the reason behind the affirmative easement.
Negative easements permit the holder to enter onto another’s property and prevent any use of that land that interferes with the easement holder’s use. In other words, the easement holder has the right to prevent the servient tenement from using its land for particular purposes.
Examples of negative easements include the right to light and air (such as where a building is constructed in front of another, blocking out some light) and groundwater (where a well on one’s property draws water from underground sources that are shared with neighbors). Negative easements in favor of utilities also exist in many states, granting electric companies and the like the right to maintain and repair electric poles, wires, and other equipment on private property. These contracts are sometimes referred to as "easements for maintenance," as opposed to an "easement of access" that extends to the right to enter another’s property and perform ordinary tasks.
Examples of negative easements can be found in Schulte v. Godere, 37 N.W. 821 (Mich. 1888), Stokes v. Nicholls & Rainbow, Inc., 125 P.3d 1193 (Kan. Ct. App. 2006), and Hogan v. Thormann, 596 P.2d 805 (Idaho 1979).
Elements Essential for Easement Contract Execution
Every easement contract needs to identify with as much detail as possible the parties to the easement or the legal land description of the properties involved. The easement then needs to describe in as many details as possible the special uses that will be made on the easement area and the limits on how that property can be used. For instance, how the easement can be used may be limited by time periods, number of people, type of activities, etc. The exact parcel of land that the easement is on must be described in detail, and must be constructed with a legal description of the property that is being granted the easement. In addition, the easement must clearly identify the purpose for the easement property, such as whether the easement allows water access to the ocean or other local body of water, or whether it is simply allowing one person to cross over property belonging to another.
Any easement must also include the time period for which it can be used, and limitations on what happens to it when that time period expires. The following issues potentially also need to be addressed in any easement contract: whether to retain a right of termination; whether to terminate with notice; whether to have a continuing easement except upon breach of reason; whether to enter and maintain the easement or not; whether to have the right to cancel upon title transfer, or whether to terminate under adverse possession.
The Process of Drafting an Easement Contract
There are some steps that are common to the contracting process that are important to follow so that you acquire a property right with a corresponding legal remedy should any party to the agreement fail to perform on the terms of the contract.
These steps include:
- Determine the Need for the Easement Contract. This is the first step in the contracting process. You should assess the facts of your particular situation and determine whether an easement contract is the best method of achieving your land use goals. To do this, consider both the purpose of the easement contract and the extent of rights that should be granted. In addition, think carefully about whether the easement will be for a fixed or an indefinite term. For or against, that determination can have a significant impact on the utility of the easement contract as a land use tool.
- Discuss Terms with the Grantor. In order to protect your investment, you should communicate your intentions with the grantor of the easement before drafting a written document. While oral contracts can be valid, requiring a writing helps to prevent misunderstandings and to make the contents of the agreement more clear. Even if you are not required to have a writing, it is important to place clear limits on what you can and cannot do with the property in question and to obtain consent to your intended uses, in order to avoid potential liability for trespass.
- Draft Easement Contract. In writing the easement contract, clarify the nature, scope, and effect of the easement through unambiguous language. Identify the parties, the grantor and grantee, the extent of the property burdened by the servitude, the rights of the parties, and the obligations of the grantee. After drafting the contract, review with both parties and revise until both parties have a complete understanding of the terms and conditions of the agreement.
- Request Legal Review. Even if the terms of the agreement are completely understood by both parties, it is a good idea to request a legal review to ensure that the proposed contract meets all legal requirements and understands the rights conferred on the parties.
A Sample Easement Contract Template
One of the best ways to write a good easement contract is to use an easement contract template that you have found. The best templates are the ones that you can use as it is, with little modification needed. An example of what you might find in an easement contract template is listed below:
Easement Deed Template Example:
THIS DEED OF EASEMENT ("Deed") is made and entered into this ___ day of [Month], [Year], by and between [Name of Sender] ("Sender"), having an address at [Sender Address], and [Name of Receiver] ("Receiver"), having an address at [Receiver Address](together, the "Parties").
RECITALS
The Sender has certain property as shown in Exhibit A (the "Sender Property"), attached hereto, in which this fifty-foot (50′) wide easement is being given, and the Receiver has certain property as shown in Exhibit B (the "Receiver Property") , attached hereto, which the Sender shall use for vehicular access to its Property, and the Parties desire to define the rights and obligations of themselves, their personal representatives, successors, heirs and assigns in connection with the granting of this fifty feet (50′) wide easement for the use of the Receiver and its successors and assigns.
AGREEMENT
In consideration of the mutual covenants herein contained, the Sender and Receiver agree as follows:
The Benefits of Using a Template Often you will find an easement contract template can be invaluable and will save you a lot of time overall. A template will probably include a lot of information regarding a typical easement contract, and all you have to do is edit some of the details to make it fit your situation. No matter what, you will probably be pleased that you took the time to use it for your easement contract.
Legality and Issues of Easement Contracts
Legal considerations when creating or signing an Easement contract often depend on the legal jurisdiction where the property is situated. A qualified attorney can assist in negotiating and drafting an easement so as to protect, as much as possible, the property owner’s interests and investment. In some legal jurisdictions it is required that the contract be signed and acknowledged by the grantee (e.g. easement holder) to be valid. This is often done at the same time that the other party closes the sale or financing of the property encumbered by the easement.
In the event that the same party encumbers its own property, the estate may desire to require the other party to sign an acknowledgment after the deed of encumbrance is executed. Courts sometimes decline to enforce an unacknowledged easement if the easement holder is aware of the failure to acknowledge and still asks that the deed be read to him without acknowledgment.
When a property owner sells a piece of real property encumbered by an easement, due care should be exercised to see that the grantee of the easement receives record title to benefit from the easement. In many legal jurisdictions, the deed from the seller must contain the easements in order to properly pass the fee simple title to the buyer, otherwise the easement will terminate. However, creating an obligation to advise a buyer of the existence of an easement contained in the deed from seller to grantee in the easement is still wise as the easement does not bind the land unless the buyer has constructive notice of its existence. Large developers and other purchasers often investigate the ownership of the property and the extent of public restrictions before completing a purchase. During this due diligence process, they would often like to know the location, boundaries and nature of, and any restrictions on the easement granted, such as depth, mountainous or swampy terrain, and road widths. Moreover, the dates when the easement was created and any pertinent information from the deed, including the purpose can be helpful to a prospective buyer.
FAQs of Easement Contracts
The following are Frequently Asked Questions ("FAQs") about easement contracts and easements.
1. What is an easement contract?
A. An easement contract is an agreement between two parties, one being the owner of the burdened or servient estate and the other being the owner of the benefited or dominant estate, that provides the owner of the benefited estate with a right to enter the property of the owner of the burdened estate for a particular use or purpose. A typical easement contract for the benefit of a utility company will provide the utility company with the right to construct, maintain or access its existing utilities or to install, construct, remove, relocate, replace and maintain new utilities on the property.
2. What is the purpose of an easement contract?
A. An easement contract provides the owner of the benefited estate with a legal means of entering and exiting the property of another to perform a particular use or purpose.
3. Does an easement contract need to be recorded?
A. Yes, an easement contract should be recorded so that third parties are aware of its existence. Once recorded, the easement contract attaches to the benefited estate and the burdened estate. An easement contract runs with the land and all successors in interest take title to the benefited estate subject to the easement contract. Likewise, the easement runs with the land and all successors in interest take title to the servient estate subject to the easement contract .
4. Can one owner amend an easement contract without notice to or approval of the other owner?
A. No. The easement contract is a binding agreement between the two owners. Absent the signed written consent of both parties to the easement contract or unless the easement contract makes provision for one owner to make changes, amendments or modifications without notice to or approval of the other owner, neither party to the easement contract can unilaterally make changes, amendments or modifications to the easement contract.
5. How long does an easement contract last?
A. Easement contracts are perpetual and last indefinitely. In the contract itself, a termination/expiration date can be included. However, most easement contracts are perpetual and last indefinitely.
6. How does an owner terminate an easement contract?
A. An easement contract can be terminated by the recordation of certificate of termination executed by both parties to the easement contract or if the easement contract by its terms provides for termination. For example, an easement contract can provide that the easement ends upon the completion of a particular event. Absent the recordation of a certificate of termination executed by both parties to the easement contract or unless the easement contract provides for termination, the easement contract will remain in full force and effect indefinitely.