Implied 'Secondary Easement' Rights: What Exactly Does that Easement Grant?

'Developer' builds two commercial centers at a busy intersection. The first center is anchored by 'Wally's,' a large general merchandise store upon whose property is located the shopping center's pylon sign on which Developer has retained advertising rights via a sign easement. 'Margo's Market,' (Margo's) one of Wally's main competitors, enters a lease to anchor Developer's second shopping center, and Developer assigns Margo's the 'right to advertise on' the pylon sign in the Wally's center. Sixty days before opening, Margo's attempts to install its identification panel on the pylon sign on Wally's property, but Wally's denies access to Margo's and notifies Margo's that the easement retained by Developer did not provide any access rights to the Wally's center. Does Margo's have access rights to the Wally's center, or was Developer's reservation of rights defective? The answer to this question lies in the theory of implied easement rights, known as 'secondary easements,' that accompany express easement grants.

In preparing or analyzing easements necessary to a commercial development, attorneys too often fail to focus on easement language as closely as they do on the more complex contracts and restrictions necessary to bring the development together. Recognizing and understanding secondary easements is important in order to help clients understand what rights are granted or received in an easement agreement and to address issues in the easement grant in order to avoid future disputes. This article addresses the basic theory behind secondary easements and offers some practical considerations in negotiating and drafting easements.

Implied Rights in Secondary Easements

Basic property law holds that the grantee of an easement has the right to benefit fully from the easement and also has a duty to maintain that easement, absent an agreement to the contrary. This basic holding leads to concurrent rights implicitly granted in express easements to enable an easement grantee both to realize its benefit and fulfill its maintenance obligations, often referred to as a 'secondary easement.' These rights have been described as 'the right to enter the servient estate at all reasonable times to effect … necessary repairs and maintenance' and also 'the right to construct improvements necessary for enjoyment of the easement.' 25 Am. Jur. 2d Easements and Licenses '83. These secondary easement rights are governed by a 'reasonableness' standard and are limited by both necessity and an obligation not to inflict unnecessary injury upon the servient estate.

Implied secondary easements have been recognized at common law by courts across the country. See, e.g., Mosher v. Salt River Valley Water Users' Ass'n, 209 P. 596 (Ariz. 1922); Oliver v. Agasse, 64 P. 401 (Cal. 1901); Drew v. Sorensen, 989 P.2d 276 (Idaho 1999); SMB Inv. v. Iowa-Illinois Gas and Elec. Co., 329 N.W.2d 635 (Iowa 1983); Farmer v. Kentucky Util. Co., 642 S.W.2d 579 (Ky. 1982); Fourth Davis Island Co. v. Parker, 469 So. 2d 516 (Miss. 1985); Cunningham v. Otero County Elec. Coop., 845 P.2d 833 (N.M. Ct. App. 1992); S. Naches Irrigation Dist. v. Brewer, No. 20782-0-III, 2003 Wash. App. LEXIS 963 (Wash. Ct. App., May 15, 2003). At least one state, Montana, has codified the existence of secondary easements in certain situations. Mont. Code Ann. '70-17-112 (granting secondary easement for repair of canal easements). Application of the secondary easement concept occurs most frequently in residential and rural settings and in regard to utility lines, roadways, and canals. However, as illustrated in the opening scenario, these same implied rights could find equal application in a commercial context.

The issues most often debated when discussing implied easement rights are whether the grant of a right of way also includes an implicit grant to cross adjacent property of the grantor in order to access the easement area or whether the grantee has the ability to remove obstructions from the right of way. The point of contention generally is not whether such a right exists but rather when, where, and to what extent the right can be exercised. For example, does the implied right to remove obstructions allow an electric company simply to trim trees under electric wires or completely to clear swaths of vegetation under its wires? See Erickson v. Grand Marais Pub. Util. Comm'n, No. A03-1565, 2004 Minn. App. LEXIS 736 (Minn. Ct. App. June 29, 2004) (finding the complete clearing of a 20-foot-wide strip of trees to be reasonable).

Is an irrigation canal easement grantee required to access the area on foot by following the ditch, or can the grantee drive across the property through which the ditch runs without permission or notice? See, Engel v. Gampp, 993 P.2d 701 (Mont. 2000) (finding vehicle access to be allowed without permission only if necessary for maintenance and repairs and after notice). Courts forced to determine these issues without guidance from the text of an agreement must try to determine what actions are reasonable under the circumstances. These determinations are extremely fact-sensitive and difficult to predict.

In addition to access and maintenance, secondary easements may impact an easement grantee's right to improve an easement area to meet the party's needs. In the case of Barasch v. Speeler, 561 So. 2d 1256 (1990), for example, the Second District Court of Appeal of Florida addressed whether the owners of a dock could remove a tie pole, motor, and davits installed by a neighbor using the dock via an easement in order to dock a larger boat. The court found that the tie pole, installed at a significant distance, exceeded the scope of the easement grant but the addition of motors and davits was reasonably necessary for the 'full enjoyment of the easement itself' and did not encroach upon the owner's interests. As this case illustrates, courts analyzing secondary easement rights balance the benefit to the easement grantee against the detriment to the servient estate.

What may be considered reasonable can differ, not only from case to case, but also from jurisdiction to jurisdiction and may depend on specific values of the locality. Consider, for example, the California case of Krieger v. Pacific Gas and Electric Company, 119 Cal. App. 3d 137 (Cal. Ct. App. 1981) and the Utah case of Big Cottonwood Tanner Ditch Co. v. Moyle, 174 P.2d 148 (Utah 1946). Both cases involved whether a water ditch easement grantee had the right, under an implied secondary easement, to improve the ditch by paving or other means in order to reduce the amount of water lost to seepage. Utah took the position, contrary to most existing common law, that such improvement was an implicit right. The court relied upon a need to conserve water that it found to be more pressing in Utah than other locations. California, on the other hand, specifically disclaimed the reasoning of the Utah court and held that such improvements exceeded the scope of rights implicitly granted in a water canal easement. California focused more on the increased burden upon the servient estate and less on a policy of conservation as a relevant factor limiting alteration of the easement area.

Considerations in Drafting Easements

Failing to address an issue expressly in an easement agreement is unlikely to cause a party to lose the use of an easement completely or impose an unbearable burden on a servient estate. The secondary easement concept of implied reasonable rights was developed to avoid exactly such an outcome. Regardless of the court or jurisdiction, however, one thing is likely true in all cases: What a court might consider a 'reasonable' use of an easement under an implied right will most likely not mirror what the parties initially desired or understood to be the scope of the easement. To avoid interpretation issues, parties must expressly address all areas of concern during the drafting process. The following are examples of certain implied rights that parties should expressly address in easement grants.

Access

As shown in the opening scenario, the ability to access an easement area is perhaps the most obvious and basic implied easement right. Absent an express provision, the right to access will exist at a reasonable time, in a reasonable manner, and at a reasonable access point. At what time, in what manner, and at what access points a grantee may access the easement are matters best determined by the parties at the time the agreement is entered.

Consider notice and permission issues. Courts have been willing to imply the need to provide reasonable notice to servient estate owners prior to entering on their property to access an easement, but generally refuse to require an easement grantee to obtain permission from the servient estate owner to exercise the grantee's rights.

Timing issues should also be expressly addressed. A party may desire to limit access during certain hours, for instance, during periods of high customer traffic due to limited parking.

Consider, also, where access should be allowed. Absent agreement otherwise, the access point will not be set and the most direct access point for the easement grantee may interfere with, disturb, or inconvenience the servient estate owner's customers or employees.

Finally, safety and security issues in connection with access must also be considered. If the area must be gated and locked for safety or security reasons, parties with access rights must be given a key, access to a key, or expressly limited entry rights in order to avoid potentially violating their implied easement rights.

Maintenance

Blocked parking areas or access drives and the clutter of construction equipment and materials can drive away customers, disturb business activity, and generally create conflict between parties in a commercial development. For these reasons, provisions regarding maintenance may be the most important issues to address expressly in the easement grant. Maintenance provisions, particularly in regard to access drives and parking areas, should limit the time period during which maintenance can be conducted in order to minimize disruption to business operations and customer traffic. These restrictions do not have to be limited to specified times during the day or particular days of the week. If a business generates a significant portion of its business during a certain period of the year, such as during the holiday shopping season, routine maintenance should be barred from being conducted during such times. Limitations should also be placed on the length of time in which a grantee must complete such maintenance.

The manner in which maintenance or improvements may be conducted should also be controlled by express provisions of the easement grant. For example, it may be possible to negotiate a less intrusive construction method to eliminate or significantly reduce interference with an access way or parking area. Without such an express arrangement, a more intrusive means of construction may be considered reasonable despite business interference, particularly where the more intrusive method is less costly or time consuming.

Improvements

The case law seems clear that some degree of implied easements allowing for necessary easement access and maintenance exists in every express easement grant. Whether an implied right to improve the easement will be found is less clear due to the necessity and burden limitations placed on these implied rights. Although the holdings in Barasch and Big Cottonwood indicate some support for the prospect that an easement grantee can make improvements to an easement without permission, such holdings are likely to be exceptions rather than norms. Actions that go beyond simple repair or maintenance are particularly vulnerable to attack as increased burdens on the servient estate that push the action beyond the scope of the original easement and which a court may consider unreasonable.

Conclusion

Returning to the opening scenario, Margo's clearly has implied secondary easement access rights to the pylon sign on the Wally's center, although no court has specifically addressed this issue in a reported case. That right will be limited, however, to reasonable access necessary for the enjoyment of the easement that does not unreasonably harm Wally's property. The exact terms that would be read into the easement by a court are difficult to predict. A court may require Margo's to provide Wally's with prior notice of accessing the sign, but is less likely to place strict limits on the timing of such access. Obviously, these issues would be best addressed expressly in the original agreement between Developer and Wally's in regard to the sign easement.

As the Appeals Court of Massachusetts stated:

[I]n all cases where the court is considering whether additional rights are incidental or reasonably necessary to the enjoyment of an easement by grant, careful drafting would have avoided the problem and rendered the determination of what additional rights, if any, are included in the grant. Murphy v. Olsen, 826 N.E.2d 249, 253 (Mass. Ct. App. 2005).

Expressly addressing as many potential issues as possible regarding time, manner, scope, and procedure in relation to the exercise of easement rights when entering into agreements should help to eliminate future disputes; in the end, it is exactly this foresight to avoid future issues that allows attorneys to bring the most value to their clients.

Jason D. Sapp is an associate in the Corporate Department and Real Estate Practice Group at Lewis, Rice & Fingersh, L.C. in St. Louis, MO, and is a former editor of the Missouri Law Review. He can be reached at [email protected].

'Developer' builds two commercial centers at a busy intersection. The first center is anchored by 'Wally's,' a large general merchandise store upon whose property is located the shopping center's pylon sign on which Developer has retained advertising rights via a sign easement. 'Margo's Market,' (Margo's) one of Wally's main competitors, enters a lease to anchor Developer's second shopping center, and Developer assigns Margo's the 'right to advertise on' the pylon sign in the Wally's center. Sixty days before opening, Margo's attempts to install its identification panel on the pylon sign on Wally's property, but Wally's denies access to Margo's and notifies Margo's that the easement retained by Developer did not provide any access rights to the Wally's center. Does Margo's have access rights to the Wally's center, or was Developer's reservation of rights defective? The answer to this question lies in the theory of implied easement rights, known as 'secondary easements,' that accompany express easement grants.

In preparing or analyzing easements necessary to a commercial development, attorneys too often fail to focus on easement language as closely as they do on the more complex contracts and restrictions necessary to bring the development together. Recognizing and understanding secondary easements is important in order to help clients understand what rights are granted or received in an easement agreement and to address issues in the easement grant in order to avoid future disputes. This article addresses the basic theory behind secondary easements and offers some practical considerations in negotiating and drafting easements.

Implied Rights in Secondary Easements

Basic property law holds that the grantee of an easement has the right to benefit fully from the easement and also has a duty to maintain that easement, absent an agreement to the contrary. This basic holding leads to concurrent rights implicitly granted in express easements to enable an easement grantee both to realize its benefit and fulfill its maintenance obligations, often referred to as a 'secondary easement.' These rights have been described as 'the right to enter the servient estate at all reasonable times to effect … necessary repairs and maintenance' and also 'the right to construct improvements necessary for enjoyment of the easement.' 25 Am. Jur. 2d Easements and Licenses '83. These secondary easement rights are governed by a 'reasonableness' standard and are limited by both necessity and an obligation not to inflict unnecessary injury upon the servient estate.

Implied secondary easements have been recognized at common law by courts across the country. See, e.g., Mosher v. Salt River Valley Water Users' Ass'n , 209 P. 596 (Ariz. 1922); Oliver v. Agasse , 64 P. 401 (Cal. 1901); Drew v. Sorensen , 989 P.2d 276 (Idaho 1999); SMB Inv. v. Iowa-Illinois Gas and Elec. Co. , 329 N.W.2d 635 (Iowa 1983); Farmer v. Kentucky Util. Co., 642 S.W.2d 579 (Ky. 1982); Fourth Davis Island Co. v. Parker, 469 So. 2d 516 (Miss. 1985); Cunningham v. Otero County Elec. Coop., 845 P.2d 833 (N.M. Ct. App. 1992); S. Naches Irrigation Dist. v. Brewer, No. 20782-0-III, 2003 Wash. App. LEXIS 963 (Wash. Ct. App., May 15, 2003). At least one state, Montana, has codified the existence of secondary easements in certain situations. Mont. Code Ann. '70-17-112 (granting secondary easement for repair of canal easements). Application of the secondary easement concept occurs most frequently in residential and rural settings and in regard to utility lines, roadways, and canals. However, as illustrated in the opening scenario, these same implied rights could find equal application in a commercial context.

The issues most often debated when discussing implied easement rights are whether the grant of a right of way also includes an implicit grant to cross adjacent property of the grantor in order to access the easement area or whether the grantee has the ability to remove obstructions from the right of way. The point of contention generally is not whether such a right exists but rather when, where, and to what extent the right can be exercised. For example, does the implied right to remove obstructions allow an electric company simply to trim trees under electric wires or completely to clear swaths of vegetation under its wires? See Erickson v. Grand Marais Pub. Util. Comm'n, No. A03-1565, 2004 Minn. App. LEXIS 736 (Minn. Ct. App. June 29, 2004) (finding the complete clearing of a 20-foot-wide strip of trees to be reasonable).

Is an irrigation canal easement grantee required to access the area on foot by following the ditch, or can the grantee drive across the property through which the ditch runs without permission or notice? See, Engel v. Gampp, 993 P.2d 701 (Mont. 2000) (finding vehicle access to be allowed without permission only if necessary for maintenance and repairs and after notice). Courts forced to determine these issues without guidance from the text of an agreement must try to determine what actions are reasonable under the circumstances. These determinations are extremely fact-sensitive and difficult to predict.

In addition to access and maintenance, secondary easements may impact an easement grantee's right to improve an easement area to meet the party's needs. In the case of Barasch v. Speeler , 561 So. 2d 1256 (1990), for example, the Second District Court of Appeal of Florida addressed whether the owners of a dock could remove a tie pole, motor, and davits installed by a neighbor using the dock via an easement in order to dock a larger boat. The court found that the tie pole, installed at a significant distance, exceeded the scope of the easement grant but the addition of motors and davits was reasonably necessary for the 'full enjoyment of the easement itself' and did not encroach upon the owner's interests. As this case illustrates, courts analyzing secondary easement rights balance the benefit to the easement grantee against the detriment to the servient estate.

What may be considered reasonable can differ, not only from case to case, but also from jurisdiction to jurisdiction and may depend on specific values of the locality. Consider, for example, the California case of Krieger v. Pacific Gas and Electric Company, 119 Cal. App. 3d 137 (Cal. Ct. App. 1981) and the Utah case of Big Cottonwood Tanner Ditch Co. v. Moyle, 174 P.2d 148 (Utah 1946). Both cases involved whether a water ditch easement grantee had the right, under an implied secondary easement, to improve the ditch by paving or other means in order to reduce the amount of water lost to seepage. Utah took the position, contrary to most existing common law, that such improvement was an implicit right. The court relied upon a need to conserve water that it found to be more pressing in Utah than other locations. California, on the other hand, specifically disclaimed the reasoning of the Utah court and held that such improvements exceeded the scope of rights implicitly granted in a water canal easement. California focused more on the increased burden upon the servient estate and less on a policy of conservation as a relevant factor limiting alteration of the easement area.

Considerations in Drafting Easements

Failing to address an issue expressly in an easement agreement is unlikely to cause a party to lose the use of an easement completely or impose an unbearable burden on a servient estate. The secondary easement concept of implied reasonable rights was developed to avoid exactly such an outcome. Regardless of the court or jurisdiction, however, one thing is likely true in all cases: What a court might consider a 'reasonable' use of an easement under an implied right will most likely not mirror what the parties initially desired or understood to be the scope of the easement. To avoid interpretation issues, parties must expressly address all areas of concern during the drafting process. The following are examples of certain implied rights that parties should expressly address in easement grants.

Access

As shown in the opening scenario, the ability to access an easement area is perhaps the most obvious and basic implied easement right. Absent an express provision, the right to access will exist at a reasonable time, in a reasonable manner, and at a reasonable access point. At what time, in what manner, and at what access points a grantee may access the easement are matters best determined by the parties at the time the agreement is entered.

Consider notice and permission issues. Courts have been willing to imply the need to provide reasonable notice to servient estate owners prior to entering on their property to access an easement, but generally refuse to require an easement grantee to obtain permission from the servient estate owner to exercise the grantee's rights.

Timing issues should also be expressly addressed. A party may desire to limit access during certain hours, for instance, during periods of high customer traffic due to limited parking.

Consider, also, where access should be allowed. Absent agreement otherwise, the access point will not be set and the most direct access point for the easement grantee may interfere with, disturb, or inconvenience the servient estate owner's customers or employees.

Finally, safety and security issues in connection with access must also be considered. If the area must be gated and locked for safety or security reasons, parties with access rights must be given a key, access to a key, or expressly limited entry rights in order to avoid potentially violating their implied easement rights.

Maintenance

Blocked parking areas or access drives and the clutter of construction equipment and materials can drive away customers, disturb business activity, and generally create conflict between parties in a commercial development. For these reasons, provisions regarding maintenance may be the most important issues to address expressly in the easement grant. Maintenance provisions, particularly in regard to access drives and parking areas, should limit the time period during which maintenance can be conducted in order to minimize disruption to business operations and customer traffic. These restrictions do not have to be limited to specified times during the day or particular days of the week. If a business generates a significant portion of its business during a certain period of the year, such as during the holiday shopping season, routine maintenance should be barred from being conducted during such times. Limitations should also be placed on the length of time in which a grantee must complete such maintenance.

The manner in which maintenance or improvements may be conducted should also be controlled by express provisions of the easement grant. For example, it may be possible to negotiate a less intrusive construction method to eliminate or significantly reduce interference with an access way or parking area. Without such an express arrangement, a more intrusive means of construction may be considered reasonable despite business interference, particularly where the more intrusive method is less costly or time consuming.

Improvements

The case law seems clear that some degree of implied easements allowing for necessary easement access and maintenance exists in every express easement grant. Whether an implied right to improve the easement will be found is less clear due to the necessity and burden limitations placed on these implied rights. Although the holdings in Barasch and Big Cottonwood indicate some support for the prospect that an easement grantee can make improvements to an easement without permission, such holdings are likely to be exceptions rather than norms. Actions that go beyond simple repair or maintenance are particularly vulnerable to attack as increased burdens on the servient estate that push the action beyond the scope of the original easement and which a court may consider unreasonable.

Conclusion

Returning to the opening scenario, Margo's clearly has implied secondary easement access rights to the pylon sign on the Wally's center, although no court has specifically addressed this issue in a reported case. That right will be limited, however, to reasonable access necessary for the enjoyment of the easement that does not unreasonably harm Wally's property. The exact terms that would be read into the easement by a court are difficult to predict. A court may require Margo's to provide Wally's with prior notice of accessing the sign, but is less likely to place strict limits on the timing of such access. Obviously, these issues would be best addressed expressly in the original agreement between Developer and Wally's in regard to the sign easement.

As the Appeals Court of Massachusetts stated:

[I]n all cases where the court is considering whether additional rights are incidental or reasonably necessary to the enjoyment of an easement by grant, careful drafting would have avoided the problem and rendered the determination of what additional rights, if any, are included in the grant. Murphy v. Olsen, 826 N.E.2d 249, 253 (Mass. Ct. App. 2005).

Expressly addressing as many potential issues as possible regarding time, manner, scope, and procedure in relation to the exercise of easement rights when entering into agreements should help to eliminate future disputes; in the end, it is exactly this foresight to avoid future issues that allows attorneys to bring the most value to their clients.

Jason D. Sapp is an associate in the Corporate Department and Real Estate Practice Group at Lewis, Rice & Fingersh, L.C. in St. Louis, MO, and is a former editor of the Missouri Law Review. He can be reached at [email protected].