Don't Expect that Handshake Easement to Transfer at Closing

Don't Expect That Handshake Easement to Transfer at Closing

I'm not an attorney and I don't give legal advice to clients, but I do  suggest they contact a competent real estate attorney when this situation arises.  Some time ago, a seller proudly informed me that he has had this "handshake" arrangement with his neighbor to use several miles of trails which wind through the neighbor's property.  The seller wanted me to add a mention of the easement to the MLS sheet, in hopes that the added value of being able to use the neighbor's network of trails will underpin his property's value and strengthen his position in negotiations when an offer comes in.

The first thing I asked him was "did you have a legal description of the easement and some language about its terms drafted by an attorney and recorded at the County courthouse?"  And the client's reply was "Why?"

We see these handshake easements and permissions all too often.  They're common, particularly in rural areas.  They include shared driveways or trails, sometimes shared water wells or shared sanitary systems.  And all too frequently, there's no documented and recorded road maintenance agreement (or maintenance agreement for a water well or sewer system).  

These shared common elements have the potential to create a myriad of problems when they are not properly drafted and recorded.  For example, who will maintain a shared road if the gravel washes away in a heavy rain?  Who will be responsible for snow removal or installation/replacement of a culvert if needed?  Do the parties agree to guarantee ingress/egress to one another without exception?  Is there a property owners' association which has some basic covenants in place that mutually protect the parties? Are there dues collected or is there a cash reserve on deposit to cover unforeseen costs?  What happens if one of the owners is unable to pay their dues (or refuses to pay)?  And who manages that association if one exists?

Things can get even uglier when the handshake agreement is about access to a lake, river or other body of water, a dock easement or rights to use a boat slip.  Imagine finding out that the use of a dock or shoreline access didn't transfer with the deed you received and you have no access.

Sometimes it seems as if my clients believe that I'm just drumming up business for my local lawyer and land surveyor friends.  Nothing could be farther from the truth. Yes, lawyers and surveyors cost money. But failing to cover yourself when you buy or sell property can cost you a great deal more than the dollars you'll spend to see that land use rights are transferred and properly recorded.

[This article should not  be considered a substitute for competent legal advice from a licensed real estate attorney. Before you buy or sell property, always consult with an attorney in your area who has experience in dealing with land issues such as easements, common elements and title issues.]