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Published March 17, 2014, 09:47 AM

How to negotiate an easement

More important, landowners are usually better off having a reasonable easement in place than losing rights to the property through eminent domain or other authority.

By: Derrick Braaten, Agweek

In my last column, I discussed eminent domain and the rights of energy developers related to pipeline easements. I explained that there are situations in which developers can use eminent domain authority or other rights related to the mineral estate to force their way on to property. There are also situations in which a private property owner can deny access.

In general, however, most developers would rather negotiate an easement with the landowner. More important, landowners are usually better off having a reasonable easement in place than losing rights to the property through eminent domain or other authority. This does, of course, assume that the developer will agree to reasonable surface use provisions in the easement, and will later comply with those provisions once it is on the property.

A number of common revisions are made to easement documents on behalf of landowners. Many easements contain warranty clauses, provisions by which the landowner warrants clear title to the land. It should be the developer’s responsibility to check title to land, and this provision should be deleted.

Additionally, many easements do not limit the type or quantity of pipelines. If a developer intends to put in a 12-inch gas pipeline, for example, this should be specified. The precise property description must be included. N.D. Century Code section 47-05-02.1 requires that “the area of land covered by the easement … shall be properly described...” A plat map or other visual depiction of the easement path is often utilized. This is a ban on what are often referred to as “blanket easements.” If an easement description is not specific enough, it is possible that a North Dakota court would declare the easement void. Developers and landowners alike benefit from a specific description of the easement.

Easements for energy development should also usually be “nonexclusive,” meaning the easement holder does not have an exclusive easement to the land. This is important for two reasons. First, an exclusive easement could limit the uses to which the landowner may put the land. While it is reasonable for a developer to require that the landowner not use the land in a way that interferes with the developer’s use of the property, there is no need for the developer to require anything further. Second, an exclusive easement will prevent the landowner from allowing other easements on the same property in the future, even if the additional easements do not directly conflict with the first easement holder’s rights. For example, it might be possible for several pipelines to be placed near each other. This would be prevented if an exclusive easement has already been granted. This is another reason to avoid warranty clauses in easements. A warranty clause in an exclusive easement could potentially subject the landowner to legal action if that landowner granted another easement on the same property.

Provisions to protect the land, such as spill or leak liability and reclamation, should always be a part of an easement, especially for energy development purposes.

These are just a few of the provisions for a landowner to be aware of in an easement, and as always, it is recommended that landowners have an attorney with the appropriate experience review important legal documents, particularly when the document will impact a piece of property for decades to come. In my experience, most landowners are willing to work with developers seeking access rights, as long as those developers treat the landowner and the land with respect. The use of eminent domain and other authority to obtain access to land should only be used as a last resort.

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