Can an unused private easement be extinguished to accommodate a desirable plan of development? Not according to the California Court of Appeal in a recent published decision. In Cottonwood Duplexes, LLC v. Barlow, (2012) WL 5492890, the court held that a developer's need for land burdened by a previously-granted roadway and utility easement did not trump the easement holder's property rights, even though the easement holder arguably had no need for the easement.
In the Cottonwood case, a developer-actually, a foreclosing lender stepping into a developer's shoes-sought to proceed with plans for a 16-lot subdivision, the success of which partially hinged upon the extinguishment of a previously-granted 60-foot roadway and utility easement. The easement had been granted by a previous owner in the chain of title. Having failed in its efforts to re-purchase the easement, the developer, Cottonwood, boldly went to court seeking to obtain from the court what the easement holder would not relinquish.
The case went to trial, where the developer put on evidence that (1) the previously-granted easement area was critical to the developer's plans for development of its property; (2) the easement holder was not using the entirety of the easement, and did not need the utility easement at all; and (3) the easement holder had full access to his property by means of existing public roads. The trial court agreed and granted the requested judgment, finding that the easement holder's requirements for the reasonable use of the easement did not require the full size and scope of the original easement. In its judgment, the court reduced both the width and length of the easement, and altogether eliminated its use for purposes of utilities.
Viewing the case as an assault on property rights, the Court of Appeal reversed. As the court pointed out in its decision, parroting the argument in the defendant's appellate brief, "no recognized rule of law authorized [the trial court] to terminate [the defendant's] property rights by reducing the size of his easement, no matter what the evidence showed." The court further noted that, under California law, an easement obtained by grant deed is not lost by mere non-use, without more. In fact, some prior California court decisions have required a showing of three elements to justify the extinguishment of an unused easement: (1) non-use; (2) an intention to abandon the easement; and (3) damage to the owner of the servient estate from the continued existence of the easement. The better-reasoned cases, however, require only a showing that the easement owner has stopped using the easement (or perhaps never used it at all) with the intention of abandoning the right to any future use.
In the Cottonwood case, according to the appellate court, there was no evidence that the defendant easement holder had intended to abandon any part of the easement (which perhaps explains why he refused the developer's rather generous offer of compensation.) According to the court, the developer's case was simply premised on an argument that "the owner of the servient tenement can . . . compel the extinguishment of [an] easement against the will of the dominant owner."
The lesson for property owners? Think twice before granting an easement that could impact your successor's future development plans, or your own. Once created, an easement granted for a specific purpose may be very difficult to extinguish.
It should be noted, however, that the law of easements is somewhat complex. Not mentioned in the Cottonwood case, for example, is California case law holding that, where the original easement was created only in general terms, and thereafter used only on a limited basis, the future use of the easement may at least be limited to its past use. On that subject, it would be advisable to consult a qualified real property attorney.