An access easement is a key link in the legal chain when builders need to cross another’s land to develop property. A poorly drafted easement could hobble an entire development. Counsel should always be consulted to avoid the crippling impact of a development held hostage. Here are eight tips to remember in reviewing an access easement where the developer is seeking easement rights.
- State the clear purpose of the easement. At minimum, an access easement should provide for ingress and egress. However, a user of the easement will generally want the broadest possible use rights, which could include (in addition to access by passenger cars) use rights by commercial vehicles and pedestrians, time restrictions, storage of materials or vehicles, and restoration obligations following the identifiable method of the voluntary or involuntary termination of the easement. If the easement is also to be used for utilities, be sure to include that in the easement description. In a number of states “ingress and egress” does NOT include utilities.
- If at all possible, specifically describe the easement area and location of the access road. If the location is not specific, the parties could be left with dispute, delay or an undesirable location. Rules vary by state; but for example in Oregon where an easement is not specific courts are required to determine the intent of the original parties (a determination that could be dramatically different from the parties’ actual expectations and necessitates often costly litigation). See Tipperman v. Tsiatsos, 327 Or. 539 (1998). If it is not feasible to provide all details, specify that the beneficiary can submit more specific details for the location and parties will reasonably approve it and execute a supplemental easement document. A dispute resolution clause with mediation would also help focus the parties prior to any litigation.
- Describe the land to be benefited by the easement (the “dominant parcel”). Frequently, the builder/owner plans numerous future subdivisions. If so, the developer should specify that the easement rights extend to subdivided parcels and additional property acquired by the owner of the dominant parcel directly or indirectly accessible over the easement. Beware of laws that may prohibit use of an easement on land that does not itself allow the use being accessed on the dominant parcel(s).
- State the duration of the easement. Temporary agreements to access construction sites are common. However, if the easement is meant to provide long-term access, it should state it is perpetual (or otherwise provide for long-term use).
- Usually, an access easement benefitting the dominant parcel should be transferable to subsequent owners and users of the dominant parcel – what lawyers call an “easement appurtenant” that automatically follows the ownership of the parcels. Otherwise, access rights could be cut off when the developer sells the property – typically a costly unintended consequence.
- Describe the scope of the developer’s use rights. In addition to the right to build a road (and whether temporary or permanent, width and such), the developer may want to install utilities; build sidewalks; install lighting, signage and fencing; and use the easement area for storage and parking. Be specific. As a general rule, unless the easement specifies it is to be exclusive (used by grantee only), it will be presumed to be non-exclusive (others may use the easement).
- Even though most jurisdictions have default rules on responsibility for maintenance of easement areas (and may also have rules on easement improvements), future disputes between the parties can arise when the easement is not specific as to who is responsible. The easement can clearly state the rights and responsibilities of the parties for installation of improvements, maintenance and repair, replacement and relocation of the easement, as well as the liability and property insurance requirements.
- The easement should be recorded. Explore whether the easement can be insured under the title policy. Remember, prior liens or interests on the burdened parcel can defeat or limit easement rights, so having a title search and title policy covering the easement rights also helps avoid later surprises.
Underestimating the access agreement can be a critical mistake. The developer’s lenders may not lend on the dominant parcel without firm access rights, and the dominant parcel will be always be vulnerable to challenges to the easement. For specific analysis of crane easements, see our colleague Eric Grasberger’s prior articles here and here.