Easement in Gross

A right allowing an individual to legally use a property owned by someone else

What is an Easement in Gross?

An easement in gross is a right allowing an individual to legally use a property owned by someone else. It is valid until the legal owner lives in or holds the property. An individual owning a property can legally allow others to make use of the property as per his/her wish. However, an easement in gross contract can involve only one property.

 

Easement in Gross

 

Summary

  • An easement in gross is a right allowing an individual or an entity to use someone else’s land/property.
  • An easement in gross agreement benefits the property owner as an individual, not the property.
  • An easement holder will be unable to transfer the benefits to another party. The easement in gross contract becomes invalid if the property is sold, transferred, or inherited by a new party.

 

How Easement in Gross Works

An easement in gross affects the owner of the property and the beneficiary, unlike a regular easement, which affects the property directly. If the property is transferred, sold, or inherited by a new party, the easement in gross arrangement becomes invalid, and the new party is not obligated to act according to the agreement norms.

In the case of transfer of ownership of the property, the permissions approved in the easement in gross are not passed to the new property owner. Therefore, a new easement in gross contract is required to be made with the new owner. This is because the easement in gross agreement deals with the individuals, not the property or land.

Similarly, the beneficiary cannot transfer the related rights to any other party. Such a non-transferrable characteristic of the contract protects the value of the property from being depreciated.

The person permitted to use the property is not required to reside in or own a nearby property to get the related rights. The easement in gross contract can have broad or specific permissions as preferred. The property owner usually has the most control with regard to the restrictions outlined in the easement in gross agreement.

However, the easement in gross provides privileges or specific rights to other entities, not to the property owners. Moreover, it limits a property owner’s actions related to the property in the contract. The property owners may be unable to construct some permanent structures that can lead to interference with the access of the property by the easement holder.

 

Examples of Easement in Gross

Easement in gross contracts are common in utility companies. The contracts are usually created by implication, which means that an easement is required for the use of the property.

The contracts allow utility companies to access property owned by another entity for maintenance and repair services to sustain the supply of telephone service, electricity, television cable, or natural gas to the property or other properties in the neighborhood. Such easements in gross are called utility easements.

Easement in gross agreements are also made for the conservation of land, which limits certain actions such as the removal of minerals from the land and some types of development to preserve its agriculture potential and natural characteristics.

 

Rights Under an Easement in Gross

A holder of an easement in gross contract is allowed to do whatever is convenient and necessary to enjoy the benefits granted by the agreement as long as he/she does not cause unreasonable trouble for the property owner.

Conversely, the land/property owner can use the property/land without interfering with the easement in gross holder’s use of the rights.

When a court establishes that the easement holder has burdened the property by the unacceptable extent of use of the easement in gross, the property owner can resort to legal solutions.

They can be orders from the court limiting the access of the property to the easement holder, monetary damages in case the easement holder damages the property, and even termination of the easement in gross agreement.

Similarly, if the property owners interfere with the rights of the easement holders, it is considered trespass, and often courts will order the elimination of the obstacle in the easement in gross. The courts may also provide compensation to the easement holder.

 

Related Readings

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To keep learning and developing your knowledge of financial analysis, we highly recommend the additional resources below:

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  • Adverse Possession
  • Completed Contract Method
  • Real Estate Project Finance

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