A Brief Legal Look at Conservation Easements

Conservation easements are a legal instrument. They are enabled by provincial legislation. They are a contract between a landowner and a qualified organization describing land use into the future. They are registered on land titles.

What does this mean to you as a private landowner? It means that conservation easements provide a voluntary but formal opportunity supported by provincial law that can ensure the conservation value of land is maintained. Just as a landowner can choose to develop their land into the future through a land use zoning change or development application, a conservation easement allows landowners to conserve land into the future.

A conservation easement binds all future landowners to the requirements and restrictions of the agreement. This provides a value to the landowner and the land trust. The landowner is able to achieve personal conservation goals while the land trust achieves their organizational conservation goals. Both the landowner and the land trust have a responsibility to draft a strong and defendable a conservation easement document as is possible.

As a landowner considering a conservation easement you do not need to become legal expert with respect to conservation easements but you should be aware of some general information about conservation easements and the law related to private property rights, potential challenges and the role of robustly written conservation easements.

Conservation easements and private property rights

Because conservation easements relate to private property and conservation restrictions that are generally perpetual, questions around property rights will likely arise in your mind or the minds of others. This is a deeply personal issue, and it would be wrong to suggest there is a definitive opinion on it. Our goal here is to outline some of the considerations and arguments - recognizing that we are as biased as anyone else in this discussion - and ultimately to leave it to each land owner to decide where they stand philosophically. Additionally, a landowner needs to be clear on what property rights they actually have, to ensure they understand what can and cannot be subject to restrictions in the context of a conservation easement.

First, we are careful to always characterize land ownership as a bundle of rights and opportunities. Regardless of how a person feels property rights should or should not exist on the Alberta landscape, we do have a set of charter and legal boundaries around our use of property. Sub-division and development are good examples in that we are free to pursue these, but they are ultimately subject to regulatory approval (or rejection), and do not amount to any sort of 'right' prior to that.

Second, the reach of the conservation easement into the tenure of future owners often leads to accusations of "ruling from the grave"- that is, a sense that this is an inappropriate infringement on the rights of that future owner. The counter argument usually suggests that the de facto irreversibility of converting (for example) agricultural land to intensive residential use amounts to the same thing. Regardless of the philosophical view on this issue, a conservation easement involves transferring an interest in your land to another body. A subsequent sale of that land would be similar to selling a quarter out of a section prior to selling the remaining three quarters - the purchaser of the three quarters has no claim to the first quarter as it was already transferred. In the same way, a selection of land use opportunities granted away with a conservation easement represents an interest that was transferred away prior to the sale. That fact is registered on the title of the land (along with all other types of easements) for all future buyers to see prior to a sales negotiation.

This leads to a third consideration - within a conservation easement, you cannot grant away an interest that you do not own. This seems obvious in one sense (I cannot enter into a contract with someone to sell them my neighbour's car). However, this fundamental issue comes up repeatedly in the question of whether a conservation easement can be used to prevent oil and gas development. The answer lies in whether the landowner granting the conservation easement owns the associated sub-surface rights; in other words, you cannot use a conservation easement to restrict a right or opportunity that is not yours.

(However, it is important to note that the existence and purpose of a conservation easement held by a land trust regularly affects the practices and even the willingness of hydrocarbon explorers to proceed on the parcel in question).

The final two points relates to the limitations on the property use rights of the conservation easement holder. Although the restrictions within a conservation easement may be characterized as a transfer of rights and opportunities to an eligible holder, the conservation easement holder cannot exercise them. For example, if the landowner is restricted from building houses that does not mean the easement holder acquires a right to build houses.

Finally, as described before, conservation easement documents lay out a list of binding restrictions on specified land uses. These are the "rights" that have been granted to the conservation easement holder (e.g., a land trust). However, it is important to understand that those transferred rights do not supersede the applicable regulatory authority. For example, if a conservation easement says the landowner may build only one house on the property, and only in a specific surveyed location, that does not create a 'right' to build a house. The landowner would still need to secure all the required development and building permits, any of which may be denied by the municipality. Similarly, conservation easement restrictions that 'allow' certain land uses do not supersede the local zoning and the permitted and discretionary uses identified there.

Infractions or Challenges

Conservation easements exist for the long-haul. It is easy to expect that there will be some infractions against one or more restrictions over time and possibly a legal challenge to the conservation easement itself. History of conservation easements has shown infractions (also referred to as infringements) or challenges do not generally occur within the first or second generation of landowners.

Infractions may be the result of a landowner not understanding a restriction or simply not knowing the restriction exists. In other cases the landowner may not agree with the restriction and they take an action to challenge the restriction. Regardless of the reason an infraction occurs, each conservation easement document describes how to deal with infractions. When there is a conflict, the land trust and the landowner are to make a reasonable effort to resolve the problem together. If the conflict cannot be resolved through this effort then the parties will begin a mediation process, if this does not work then the parties may enter an arbitration process. In the worst cases, the parties may end up in a lawsuit.

All conservation easements should have a clause that states if one or more of the restrictions is not upheld that the rest of the easement is still valid and in force. This is important so that even if one restriction is either abandoned as a result of the process described above or not enforced by the land trust for some reason the rest of the conservation easement is still valid and continues to affect the property. This is important for the original landowners who first enter in the agreement to know that their vision will be upheld as much as possible when the unforeseen may happen.

Legal challenges are more serious and will more likely than not require defending the CE in front of a judge. Again the likelihood of legal challenges against a conservation easement is lower in the first and second generation landowners.

Robust Conservation Easements

While use of conservation easements in Canada is relatively new (1995), the United States has used conservation easements for a number of decades. American experience shows us that more often than not, it is not 'if' but 'when' there will be an infraction. Knowing this, conservation easements should be drafted with the expectation that they will have to be defended at some point in the future.

Litigation will always put the individual conservation easement at risk but it may also have a precedent setting impact on all conservation easements. As such land trusts and the landowner entering into a conservation easement should try to do everything possible to document their original intentions in putting the conservation easement on the property so people in the future have an easier time interpreting what the document requires and/or restricts. Clearly describing the conservation values that fit the objectives of the land trust as well as documenting the land owner's vision and how they overlap is an important first step in the process. Include a specific and "plain word" description of the purpose(s) in the conservation easement. When drafting the wording of the purpose and the restrictions it is important to consider how it will be read 50-100 years from its writing. This means abbreviations, colloquialisms, acronyms and very technical terms if not defined should be avoided.

A clearly written conservation easement that is specific in how it describes the purpose of the conservation easement, with restrictions that are simple to understand and easy to measure will reduce the risk of infractions. It will also assist those trying to solve a conflict. A clearly written conservation easement should provide insight into the original intention of the conservation easement.

As well, a number of preventative measures can be implemented in the stewardship procedures to ensure the original conservation purpose of the easement is upheld. These measures include:

  • Using consistent baseline template that addresses the restrictions and purpose of the conservation easement,
  • Using a consistent monitoring template that addresses the restriction and purpose of the conservation easement,
  • Regular and consistent monitoring visits and reporting,
  • Open and regular communication between landowners and land trust,
  • Having good violation and amendment policies in place in advance of any violations,
  • Having a stewardship fund for annual monitoring and stewardship requirements of each property, and
  • Having a legal defense fund.

As a landowner, you should ensure that the land trusts you are considering working with has the stewardship policy and procedures you feel are the most important to meet your long term goals for your property.

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