If you’re thinking about making a rural subdivision to make the most of the rising popularity of lifestyle blocks and farm parks, it’s likely you’ll be granting easements for access and water. Most easements are granted in perpetuity, which is forever. Before you subdivide, or purchase a subdivision, it pays to consider the potential problems arising from easements.
In many cases, people don’t properly understand the permanence of an easement and the potential issues that can arise over time. If you’re buying, selling or have an easement, it’s worth taking the time to consider your situation over the long-term.
Who uses an easement?
A common issue around easements is who and how many people, vehicles and so forth use that easement. Consider this example. You subdivide your land into two parts, retaining one and selling the other, ensuring there is access to the sold portion with a right of way over the land you keep. What are the consequences if the sold land is further subdivided?
It might seem unlikely in the short-term, but several factors are boosting the popularity of rural living. More and more people are escaping the city to have a slice of the good life. Looking at the example above, the long-term implications are that your right of way could serve many more people than you originally anticipated. While there will be more people to share the cost of maintenance, will you want more people using your right of way?
Another potential issue: change of land use
Keeping with the example above, what would happen to your right of way if owners of the sold portion change the use of the land? Diversification in farming is seeing pastoral land converted to other uses, like the ‘wall of wood’ planted on the east coast of the North Island. If the sold land was converted to forestry, you would see bigger, heavier logging trucks and machinery going back and forth.
The owners would be within their rights. These are the implied terms for vehicles traversing a right of way according to the Fifth Schedule to the Property Law Act 2007: “To go, pass and repass at all times, by day and by night and is exercisable with or without vehicles, machinery, and equipment of any kind.”
Indeed. Day or night. Vehicles etc. of any kind. So what can be done? The options to vary easements are limited. They can be varied if all the parties who use the right of way agree to the variations, or you can make an application under ss316-317 of the Property Law Act 2007.
Making an application to vary an easement
If you’re considering making an application to vary the terms of an existing easement under ss316-317, be aware that the courts usually take a conservative approach to their decisions. You’ll gain more traction if you make an application on the following grounds.
- If, since its creation, your right of way needs to be modified or removed because a change has been made to any or all of the following:
- The nature or extent of the use being made of the benefited land, the burdened land, or both.
- The neighbourhood character.
- Any other circumstance the court considers relevant.
- If, to continue to enforce an easement or covenant in its current form would impede the reasonable use of the burdened land to a different manner or extent from that foreseen by the parties who created the easement.
- If every entitled person of full age and capacity:
- Agrees the easement or covenant should be partly or wholly modified or extinguished.
- May reasonably be considered, by their actions or omissions, to have abandoned or waived the right to the easement.
- If the proposed modification or extinguishment will not substantially injure any person entitled.
You should also be aware that the court process is costly and the outcome of your application is uncertain. If you’re creating an easement, give thought to the land subject to the easement. If you anticipate the possibility of one of the examples described above, you should set out the rights and obligations attached to the easement in the document which creates it. Here you can replace, modify or vary the implied terms of the Land Transfer Act 1952 and the Property Law Act. Examples of restrictions might be to limit the number of users, the types of vehicles, or the times of day or night the right of way can be used.
Creating and changing easements on rural land can be costly and complex. You’ll save yourself a massive headache by getting it right at the outset. Talk to our rural lawyers if you need sound advice.