Servitudes

Prescriptive easements do not actually require “exclusive” use no matter what courts say

/ Adverse Possession, Easements, Servitudes

Many courts say that prescriptive easements can only be acquired if the use is “exclusive” among other elements. This is a mechanical holdover from the requirements for adverse possession where courts simply keep the same requirements and substitute “use” for “possession.” But it make no sense for an easement to be “exclusive” since the dominant estate owner retains whatever rights of use are not inconsistent with the easement. It is simply not how easements work for them to be exclusive of the land owner. If the landowner cannot use the easement in any way then the owner has lost title to the property. Of course, one can write an express easement to limit the freedoms of the land owner, but in general, the way easements work is to grant a limited use to another while the land owner retains all rights not inconsistent with that use. In effect, an easement …

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NY court holds short term rentals violate a covenant limiting property to “single family residential purposes”

/ Servitudes

With continued disagreement among courts on this question, a trial court in New York has ruled that a covenant limiting property to “single family residential purposes” precludes an owner from renting to short term tenants, effectively preventing use of the property for Airnbnb (and similar) purposes. W. Mountain Assets LLC v. Dobkowski, 2023 WL 2398675 (N.Y. Sup. Ct. 2023).

Vermont Supreme Court denies reserved easements implied from prior use unless they are strictly necessary

/ Easements, Real Estate Transactions, Servitudes

While owners can generally get an easement by necessity to obtain access to landlocked land over remaining lands of the grantor, most states also recognize easements implied from visible, continuous prior use before the parcels were separated if the access is helpful (“reasonably necessary”) to the dominant estate. The prior use doctrine rests on the right to reform a deed because of mutual mistake. Such easements can arise by grant (giving an easement to the grantee/buyer) or reserved by the grantor/seller. However, the Vermont Supreme Court has held in the case of Greenfield v. Luce, 2022 WL 16848175, 2022 Vt. Unpub. LEXIS 97 (Vt. Nov. 10, 2022) that it will find an easement to be reserved unless it is necessary to access a landlocked estate. Most states have a stricter test for easements by reservation because they “derogate from the grant” and the buyer should not be surprised to find that …

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Bank with actual knowledge of intent to create homeowners association bound by covenants even though the mortgage was recorded before the homeowners association declaration

/ Condominiums and Homeowners Associations, Mortgages, Real Estate Transactions, Servitudes, Title Issues

An appellate court in New Jersey held that a bank that received a mortgage on a piece of property was bound by a later-recorded homeowners association covenants because it had actual knowledge that the developer planned to subject the property to the declaration. Fulton Bank of N.J. v. Casa Eleganza, 473 N.J. Super. 387, 281 A.3d 252 (N.J. App. Div. 2022). This was the case even though New Jersey had a race-notice recording act and the declaration was recorded after the mortgage was recorded. The court used the equitable doctrine of equitable subrogation to change the order of priorities to avoid injustice. Because the bank was subject to the covenants, it was obligated on foreclosure to pay past due fees to the association. This result conflicts with the approach taken by the California Supreem Court in Riley v. Bear Creek Planning Committee, 551 P.2d 123 (Cal. 1976), which freed an owner from covenants …

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Scope of easement to operate a neighboring golf course determines whether intrusion of dozens of golf balls a year to victims’ property constitutes a trespass

/ Condominiums and Homeowners Associations, Easements, Servitudes, Trespass

A couple that bought a home next to a golf course sued the golf course for trespass because of all the golf balls that landed on their property. Although the golf course attempted to take remedial measures to stop golf balls from landing on the couple’s property, roughly 90 balls would land on the property each year, a dozen of which struck the house. The couple won in the trial court which awarded them $100,000 in compensatory damages for property damage and $3.4 million in emotional distress damages. The trial court also issued an injunction preventing play on the 15th hole under the golf club implemented additional remedial measures, such as reconfiguring the hole or installing netting. The Supreme Judicial Court of the Commonwealth of Massachusetts reversed and remanded the case to the trial court for more proceedings. Tenczar v. Indian Pond Country Club, Inc., 2022 WL 17813649, — N.E.3d — (Mass. 2022). …

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Short-term rentals do not violate “residential use only” covenant

/ Concurrent or Common Ownership, Condominiums and Homeowners Associations, Leaseholds, Real Estate Transactions, Servitudes

The Mississippi Supreme Court has held that short term rental of property is not a commercial use that would violate a covenant limiting land to residential purposes. Lake Serene Prop. Owners Ass’n v. Esplin, 334 So.3d 1139 (Miss. 2022). There has been some disagreement among state courts on this question because the use of property as an Airbnb or other short term rental can be viewed as changing property to “hotel” use, at least when the owner does not share occupancy with the guest.

100 year fixed-price option to purchase land is an invalid and unreasonable restraint on alienation

/ Estates and Future Interests, Real Estate Transactions, Servitudes

A Texas court has held that an option to purchase an interest in land for a fixed price of $50,000 that would last for 100 years was an invalid and unreasonable restraint on alienation of land. Tiner v. Johnson, 2022 WL 2062478 (Tex. Ct. App. 2022). The court could have held it to be void under the traditional rule against perpetuities. Although Texas statutes have reformed the rule against perpetuities, the court found that none of those reforms applied in this case. The case is a useful reminder that the common law rule against unreasonable restraints on alienation is an independent limit on interests that may vest too far into the future and which might have the effect of inhibiting sale of land. The way to avoid the rule is to place a reasonable time limit on them and/or make the sale price equal to fair market value at the time the …

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Parcel is landlocked after 90 year easement ends

/ Estates and Future Interests, Real Estate Transactions, Restraints on Alienation, Servitudes

Most courts granted an easement by necessity when an owner severs its land and leaves a parcel without access to a public road. The easement allows passage over land that had been connected to the landlocked parcel before it became landlocked. The courts differ on whether this is a mandatory rule of law (owners are not allowed to create land to which there is no access) or a default rule based on the implied intent of the parties, in which case the courts will allow a parcel to be landlocked if that is what the parties bargained for. The argument for a mandatory rule is that land has no use if the owner cannot get to it and no one will buy a landlocked parcel, making the land inalienable. The argument for a default rule is that the owner of the landlocked parcel can always give or sell it to …

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Recorded covenants can run with lands the grantor does not own if owners of those lands ratify the covenants

/ Real Estate Transactions, Servitudes

The Utah Supreme Court has held that a landowner who recorded covenants on land he did not own were potentially binding on subsequent owners of that land if they engaged in acts that ratified the covenants (for example, by making payments to the homeowners association (HOA)). WDIS, LLC, as Trustee of MDMG Trust, dated Apr. 25, 2016 v. Hi-Country Estates Homeowners Ass’n, Phase II, 2022 UT 17, 2022 WL 1252425 (Utah 2022). Oddly, the grantor who recorded the covenants owned only eight acres out of the 2000 acres that were purported to be limited by those covenants. Ordinarily, one landowner cannot unilaterally impose covenants on owners of neighboring property. But the Utah Supreme Court held that those covenants were not absolutely void but merely voidable because owners could ratify those covenants after acquiring title to their properties. It did not seem to matter to the court whether all the owners derived their …

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No prescriptive easements for light and air

/ Easements, Nuisance, Servitudes

Re-affirming a longstanding common law rule, a Maryland court has held that land use that interferes with a neighbor’s desire for unobstructed light and air neither constitutes a nuisance nor can the neighbor acquire such rights by prescription. Gestamp Wind N. Am., Inc. v. All. Coal, LLC, 2021 WL 3612747 (Md. Ct. Spec. App. 2021). A neighbor whose wind turbines were losing effectiveness because the neighbor was piling coal remains on its property could not get a remedy for the change in wind to run those turbines since the neighbor had a right to use its property without regard to any interference with the neighbor’s light and air.

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