What is a Utility Easement?
Utility easements are not exclusive to Missouri, but their definition and effect on property rights and public utilities do vary from state to state. This article will look at what utility easements are and how they are defined in Missouri.
Typically, a utility easement is defined as a right or an easement acquired by a public utility across certain property to lay down lines or constructs other infrastructure. Utility lines are constructed underground, overground, or both, for utilities including sewage disposal, electric, gas, telephone, and water. The owner of the property does not have to explicitly grant the utility company permission to lay utility lines to another property, as that right is conferred upon the utility in the original property deed . In Missouri, this definition extends to all types of public utility facilities, including electric, gas, sewer, water, telecommunications, or cable services.
The utility easement can only be used for the specific purpose of safely distributing the utility. For example, a utility easement cannot be used to star technology lines onto the land. However, the utility company does not need permission from the land owner to make alterations to the utility easement, so long as the changes are within the necessary scope of its operations.
In some circumstances, a utility company can ask a landowner to be compensated to allow for an easement on their property. In these cases, both a contract and the recorded easement (in addition to the warranty deed) will be filed with the recorder of deeds in the state. The easement cannot improperly deprive the owner of their property rights.
Relevant Laws in Missouri
Utility easements in Missouri are primarily governed by Missouri’s Revised Statutes, amended in 1983, which set forth utility easements in terms of their creation and exercise. The statutes expressly state that utility easements must be recorded with the recorder of deeds in the county in which any part of the easement property is located. The statutes also define what kind of easement can be made, including for construction and maintenance of utility infrastructure. But do not address any common law remedies, torts, or other actions or enforcement mechanisms available to an adjacent property owner.
Under Chapter 524, easements over mortgaged property (principal and interest only) do not affect the rights of the mortgagee, unless the mortgage was created when the easement was created. If created under a subsequent mortgage, the easement will be junior and secondary to all of the mortgage’s liens. Easements granted in exchange for cash payments (where the easement grantor is required to sell the land) are junior and secondary to liens of judgment and other monetary liens if the judgment or lien is recorded prior to the easement grant.
Case law provides additional guidance on how the courts may enforce and carry out their interpretations of these statutes to specific cases. Missouri courts recognize that in eminent domain proceedings, the executing authority is required to pay the just compensation to the landowner whose easement would be taken. So far, courts have held that the easement does not need to be taken through the eminent domain process but can be held in the manner laid out in sections 79.270 to 79.280. The easement is granted by a written agreement once the surveyor marks out the area of the easement.
Categories of Utility Easements
The types of utility easements often encountered in Missouri include:
(i) electric utility easements,
(ii) water utility easements,
(iii) gas utility easements, and
(iv) telephone utility easements.
These utility easement rights convey significant real estate rights. These utility easements can even be classified as fee simple absolute interests.
Current Missouri Courts have not addressed a public utility easement being a fee simple absolute. Elder v. Kansas City, 236 S.W.2d 662 (Mo. App. 1951).
The Missouri Supreme Court has held that although the owner of a utility easement generally has the right to use the surface, his right is subject to the growth of grass and crops, and the frequent intermittent plowing and cultivation of such surface by the landowner, without liability for damage, in the absence of an express easement to the contrary. Scott v. Queen City Improvement Co., 135 Mo. 629, 37 S.W. 579 (1896).
A wide range of electric utility easements may entitle a public utility, such as a power company, to construct and install power lines which can consume the surface however the utility may choose. The power company may even be entitled to use the surface of the land just about any way the power company chooses.
For example, the electric utility easement could give the power company the right to avoid having to pay the landowner for the loss of crops or other vegetation growing over the wires. An electric utility easement could also grant the right to deny landowner permission to trim trees on the landowner’s land without first giving the utility company reasonable notice of need for the trees to be trimmed. In short, under current Missouri utility easement law, a power company may have significant rights to use the easement.
Electric Utilities often either use ten (10) foot space alongside existing electric poles or use an aerial location on existing electric poles.
Water utility easements usually provide the water company the right to dig a ditch, build a water line and have access to the water line. Gas utility easements generally grant the gas company the right to dig a ditch, install a gas line, and then have access to the gas line.
Rarely do these utility easements grant the right to avoid paying for the inconvenience of crop damage.
Rights and Obligations of Owners
When a utility company obtains an easement to cross your property, the utility company is granted the right to use a portion of your property for its own purposes. Aside from the encumbrance of that easement, property owners have the right to use their property in a lawful manner without interference from the utility company. While utility easements impact the value of land and the ability of property owners to use that land, the law is generally favorable to utility companies.
So how do these easements affect the value of your property? Taking a very simplistic example, suppose a property owner has a one-acre lot in a neighborhood where lots are valued at $20,000 per acre. A utility company wants to install a high-pressure gas line under one-half acre of the lot. Assuming the utility can show a public necessity, they may be able to obtain an easement in that half-acre area for very little or without compensating the property owner at all. Depending on how the easement was drafted, the utility company may also be able to perform various types of maintenance on the easement area in the future.
This may seem like a small amount of damage to the property value, but suppose a bank appraises the property. With the existence of the easement, the bank may only be willing to offer a loan based on one-half acre of the properties total value (i.e., $10,000) or may even refuse a loan altogether.
The property owner may be forced to accept whatever agreement the utility company offers because utility easements are generally public necessities. Missouri law requires the court to award a utility easement if the company is able to prove a public necessity. Specifically, such easements "shall be granted by the court unless it be made to appear that the same is not necessary to the public service." In other words, unless a property owner can show proof that the easement being requested by the utility is not necessary to the public service, the court will almost always rule in favor of the utility company.
Mechanisms of Settlement
In Missouri, the resolution of disputes involving utility easements is typically approached through a structured process that may involve the intervention of the courts, mediation, or regulatory agencies, depending on the nature of the dispute and the parties involved. In cases of an easement breach, utility companies have a duty to act reasonably in executing their rights over the easement. Failure to do so can lead to questions of trespass, damages, and even injunctive relief against the utility company.
For most landowners, it is important to maintain an open line of communication with the utility company, in order to avoid disputes over issues that can be resolved with mutual agreement. In some cases, utility companies can conflict with each other, or subdivide the area within their respective easements, leading to disputes over which entity is responsible for repairs or maintenance. The best way to avoid such disputes is to reach out to the utility provider that possesses an easement within your property.
With that being said, some disputes may not be easily resolved. If you suspect that a utility provider has violated the terms of the easement, or if an easement has been exercised without the corresponding compensation, you may need the assistance of a specialist. An eminent domain attorney can help assess your situation , identify the extent of injury or impact, and suggest a course of action. This may involve legal proceedings to protect your rights and obtain damages, as well as other steps to mitigate the impact of easement exercise.
If your dispute cannot be resolved through discussion with the other party, mediation is often an effective means of reaching an agreement. Mediation involves the assistance of a neutral third party who can facilitate an open discussion about the issues at hand. Often, the mediator will suggest compromises that can resolve the conflict without need for further action.
Finally, if a utility easement dispute has a direct impact on the public, then a regulatory agency may need to become involved. In these cases, the agency may seek monetary damages or equitable resolution in accordance with its governing laws. In Missouri, the Public Service Commission has authority over utility providers. Therefore, before seeking legal redress, ensure that your claim is not better suited for adjudication by the Commission.
Most easement disputes can be avoided by keeping clear records of the activity performed. However, should a dispute arise, it is critical that action be taken to resolve the issue as quickly and efficiently as possible.
Recent Trends and Disputes
Missouri Utility Easement Laws has seen some recent developments both in case law and in legislative activity. One such recent case was the Supreme Court of Missouri’s decision in Hertz v. Enterprise Rent-A-Car Co., 533 S.W.3d 537 (Mo. 2017). At issue in that case was a small strip of land in Boone County, Missouri, purchased as part of a U.S. Department of Transportation-funded highway project. When the project began, the Missouri State Highway Commission ("Commission") discovered that the strip, which had not been used for decades, needed to be acquired to complete the project. The problem was that the strip was not included in the record title. Nevertheless, the Commission was able to acquire a prescriptive easement over the property by virtue of the record title of the adjoining lots, upon which the strip rested. The Commission and its contractor essentially took the position that the past use of the land by the government was sufficient to establish its right to obtain the easement based on the record title of the adjoining lots, even if it could not establish title itself. Plaintiffs disputed that prescriptive easement could be established in the absence of plaintiff’s consent or a written instrument.
In a 4-3 decision, the Court sided with the Commission and held that an easement by prescription could exist where the government satisfies all of the common law requirements and where a single parcel describes the tract of land. Going one step further, the Court concluded that the legislature intended to "expand the government’s ability to obtain property by adverse possession" following the passage of ยง 523.031.
While some will argue that the Hertz decision will allow for greater government expansion, others will note that the end result of the decision is that the government must continue to go through the expropriation process. As a practical matter, if no additional money issues, the government must go through the condemnation process in order to get the strip of land – the only difference is that the government can acquire the strip of land from the abutting owners rather than the record owner. While the opinion is problematic for many reasons, it was more of a conclusion of existing law than a new development. Nevertheless, it provides guidance to practitioners going forward and highlights the potential pitfalls when proceeding without a full and complete understanding of Missouri’s easement case law.
As technology continues to change, Missouri will be poised to see another step in the development of the doctrines of easement by necessity and easement by implication. Both of these doctrines, while existing in Missouri for some time, need to adapt to changing technologies. For instance, while courts in Missouri have dealt with forced termination of easements, the new emerging challenge will be whether Missouri will allow so-called "perpetual easements" to coexist with modern technology. This notion, rather absurd, is relatively simple: if an easement gives the easement holder the right to install or maintain a tower on a property to broadcast signals, this tower too will need to evolve to keep up with technology changes. Unfortunately, there are many Missouri homeowners who will challenge the very notion that a "perpetual easement" is capable of coexisting with new technologies. While Missouri courts have a tried and true history of embracing easements so long as they are consistent with what has been granted, the constitutional protections present in Missouri may pose an interesting challenge when it comes time to experiment with so-called "perpetual easements."
Resolving Utility Disputes
Even when public utility easements have existed for many years, property owners should not assume they are immune from problems. Because easements create a limited right for the access, use, and repair of portions of a property, it is critical to research, analyze and understand such easements to prevent unanticipated inconveniences or expenses. It may be necessary for property owners to assert or defend the rights established or affected by easements.
Property owners are encouraged to approach easements with the goal of self-education as to the nature of the easement and its permissible uses on the affected property . Failure to investigate easement rights could lead to significant economic losses, because Missouri law does not allow condemnation of easements that have been properly established by prior easement holders through continued inappropriate use of the easement. Before taking any action that could concern a utility company or other public service provider, property owners should review any easement agreements applicable to their properties and be prepared to consult legal professionals for guidance as needed.