Title Review Sections – Easements

Many people reviewing their property title or exploring potential properties to buy will come across easements. Easements can dramatically affect the value of your property, and may signal dangers to your interests. This week QCL property lawyer John Jon discusses Title Review Sections – Easements.

To read more about John Jon click here. To download the article as a PDF click here.

Upon receiving the sale and purchase agreement or receiving instruction from the client, who are the proprietor of the property, the lawyer should carefully check the title and give prudent advice to their client. Without limitation, the title may contain the following interests which should be considered and provided with proper and detailed review. QCL-MEDIA-SHOOT_final-jon

Under the clause 5.2 of the standard REINZ-ADLS agreement for sale and purchase of real estate, the purchaser should be entitled to make any requisition under the title including the requisition for removal of an easement.  Therefore, the relevant steps are:

1)     obtain a guaranteed search copy of the property;

2)     obtain relevant search copies including a search of the easement instrument (if any);

3)     Undertake a careful review;

4)     Report back to the client with legal implication.

One of the key issues that you must consider is the easement!

Easements

As defined in Hinde McMorland & Sim Land Law in New Zealand, the easement can be described as:

“A positive easement gives the Grantee a right to d something on or to a neighbour’s land; a negative easement gives the Grantee a right to stop a neighbour from doing something on that neighbour’s land”

–         Based on this definition, we can generally divide into (1) positive or (2) negative covenants.

–         Under the Land Transfer Regulations 2002, these include:

o        Right of way;

o        Right to convey electricity;

o        Right to convey water;

o        Right to drain water;

o        Right to drain sewage;

o        Right to convey telecommunications and computer media;

o        Right to convey gas;

o        Right to light and air;

o        Party wall easements;

o        Overland flow path easements;

o        Rights to light and air from neighboring land – covered under section 299 and 300 of the Property Law Act 2007

 Four essential characteristics of easements are as follows:

o        It requires a servient tenement.  For the purpose of a survey plan, it must relate to land which bears the burden of the right being granted and also the easement area.

o        This easement must accommodate the dominant tenement.

o        Contrary to the historical position whereby the dominant and servient tenements had to be separately owned, the Land Transfer Act allows this to be structured provided that the easement has been created by easement instrument.

o        The easement should also include:

§         Clearly and sufficiently definitions including the grantee’s rights.

§         Classified into a recognised category.

§         Clearly defined obligations on the servient owner.

§         Grant joint or exclusive occupation of the servient land to the dominant owner.

–         Checklist & background information – prior to undertaking any review or work, the lawyers should be familiar with the general terms and conditions including the following terms:

title-terms

–         When drafting the easement document, the following requirements must be satisfied:

o        Name of the Grantor / Name of the Grantee (as required under the ADLS form);

o        The subject matter of the easement – clear statement of which easement it falls under;

o        A survey plan – showing the clear and precise easement area;

o        Clear and detailed identification of the servient land and the dominant land.  In the case of an easement in gross, there must be precise identification with where the easement is.

–         Other consideration factors when drafting and registering the easement are:

o        For the purpose of registration, the consents from the following interested parties will be required:

§         Mortgagee’s consent from the mortgagee who hold the mortgage in favour of the servient land;

§         Consent from any encumbrance (as charge-holder) of the servient land;

§         For the purpose of the right of way, the registration will require certification of the territorial authority under section 348 of the Resource Management Act 1991.

The easement will affect the owner’s rights and enjoyment of the property.  Accordingly, it is imperative that the purchaser seeks and receives legal advice from their solicitors in relation the title.

If you have questions about your title or a query on Easements don’t hesitate to contact us