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Legal troubles with easements—and how to avoid them

Guzov's Good Advice, Liability, Other

An easement is a fairly common legal right to use or enter someone else’s property without having direct ownership rights. Oftentimes this type of arrangement will exist formally between neighbors, and in other cases there may be an easement allowing a local municipality to interact in some way with a private individual’s property. Easements will thus often cover pathways between neighbors or artificial waterways, such as a water main.

In spite of being quite mundane, easements can lead to nasty and expensive legal disputes. Pictured above is a home owned by of one of our clients, which happens to have a 130-odd year-old municipal water pipe running (and leaking) through his basement. The pipe is creating swampy conditions and likely threatening the structural integrity of the home, not to mention the value of the home. One might be tempted to look at the situation and simply think “buyer beware”. This is only half-true, however. When the house was purchased, that portion of the basement had been covered up by the previous owner and there was no record of the existence of the easement for the water pipe in any of the documentation used during the transaction.

Our client had title insurance, which is essentially designed to protect people who find themselves in exactly these sorts of situations. However, the insurer withheld payment because there was in fact record of the easement—albeit in a dusty municipal archive in a document from 1886. Although we were ultimately able to get the insurance company to pay out, the insurance payment comes nowhere near covering our client’s total liability vis a vis the home given the continued presence of the massive pipe. Although we hope to reach an eventual agreement with the municipality to shut off the water and reroute, the whole experience is a massive, expensive ordeal.

So what are the key takeaways from this rather absurd story? First, make sure to thoroughly inspect any property you purchase. Second, make sure the chain of title is intact and try to gather all existing documents about a property—even if this spans centuries. Finally, be sure to acquire title insurance. Even if the insurers give you a hard time, better to have the insurance than find yourself in a situation like our client’s without any backup.

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