What effect do easements have when buying land?

Land

When considering buying property, you may hear the term ‘easement’.

An easement is a legal instrument that gives someone rights to use another person’s land in some specified way.

Under the new Land Transfer Act 2017 the terms around easements have been modernised, but the fundamental principles around easements remain unchanged.

The new terms emphasise the rights and obligations that land owners are given when an easement is granted.

The ‘burdened land’ is the land over which the rights are given under an easement to the benefited land. The ‘benefited land’ is land adjacent to the burdened land that has the rights attached to it.

Easements rights may be granted:

  • to last permanently;
  • for a specified period;
  • over part, or all of a piece of land; and
  • in gross.

An easement ‘in gross’ allows a person to use the burdened land, even though the user does not own any adjoining land (for example, an easement in gross may be granted to an electricity distribution company to allow it to install an electricity network on, under or over the burdened land).

There are many different purposes for easements. Common examples include:

  • right of way – this may be general, with no limitations on its use, or limited, in that it imposes some limitation, such as time of use, area of use, or the nature of the traffic that may pass over it, or the persons who are entitled to use it;
  • right to convey water, electricity, telecommunications, and computer media;
  • right to drain water or sewage;
  • party wall – used in semi-detached or terraced houses that share a wall, and common in old State houses, where each property is entitled to be supported by the wall; and
  • eaves encroachment – where the eaves of a house extend over an adjoining property.

Once an easement becomes a ‘registered easement’ it will appear on the record of title (previously the ‘certificate of title’) so future owners of the property know whether they obtain the benefit of, or are subject to the burden of, that easement.

However, a prospective purchaser must be aware that there may be unregistered easements (previously ‘equitable easements’) that do not appear on the record of title. For example, it is possible that a driveway that the vendors have been using for years has not been legally registered on the record of title as a right of way easement. We also occasionally find that vital easements in gross to convey water or electricity over an adjoining property have not been registered. So it is very important to check that all the easements you need are actually in place.

There may also be various ways in which costs relating to an easement can be shared. For example, some right of way easements provide that costs will be shared equally between all users. Others provide that each owner will make a reasonable contribution to costs. The question of what is ‘reasonable’ will depend on the circumstances – it could be based on the length of the right of way used by each user, the number of vehicles each user drives down the right of way, or the weight of those vehicles. Other important aspects to consider are who pays for repairs when the damage was caused by one particular user, and what restrictions apply to the easement.

If an existing easement is not suitable, it is possible for the parties to vary or remove it by agreement, or with the assistance of the court. However, the cost (in both time and money) of taking a dispute to court can be prohibitive.

When applying to the court for help to resolve a dispute over an easement, the court can issue an injunction, award damages, or modify or extinguish an easement. The court has a wide discretion as to the terms and conditions for an order it makes.

Before purchasing a property it is important to obtain expert legal advice to ensure you are happy with the terms of any easements that affect the property. These terms can vary greatly and some terms are not specifically stated within the easement instrument, but are implied by legislation. It is therefore important to obtain specific legal advice on what these terms mean and how they will affect you as an owner of the property.