Daily Development for
Wednesday,December 11, 1996

by: Patrick A. Randolph, Jr.
Professor of Law
UMKC School of Law

EASEMENTS; CREATION; IMPLICATION; SEVERANCE: The existence of a contract for deed of an undivided one-half interest in an owner's parcel of land will not sever the owner's title to the whole for purposes of creating an implied easement in owner's adjacent land unless the right of possession passes under the contract.

Lake George Park, L.L.C. v. Mathwig, 548 N.W.2d 312 (Minn. App. 1996).

A group of developers apparently "painted themselves into a corner" by selling a series of parcels surrounding a central parcel without reserving access across any of them. They tried to avoid their problem by arguing that one of their group at a prior time had created an implied easement of access across land that he then owned because he contracted to transfer to his business partners an undivided one half interest in the central parcel. The developers maintained that at the time of this contract the vendor owned two parcels and agreed to transfer one of them in way that made it "landlocked," thereby "severing" two parcels and creating an implied easement.

The trial court had found that there indeed had been a severance, but nevertheless had refused to grant an implied easement. On appeal, it apparently was critical to the parties whether the trial court was correct on its ruling as to severance:

Held: No severance.

While Minnesota had never addressed the specific issue, the court found that other state and federal decisions focused not on whether the contract actually transferred legal or equitable title, but upon whether it transferred possession. In this contract, the parties had agreed that the whole right of possession remained with the vendor unless the parties stipulated otherwise. Since nothing in the record before the court indicted that the vendor was ever dispossessed of the property while the contract remained executory, the court held that the mere existence of the contract for deed should not be viewed as a severance of interests sufficient to create an implied easement.

Comment: Although the parties here did not transfer possession, clearly many long term contracts for deed (also called "installment land contracts") in fact do transfer possessory rights to the vendee, and an implied easement, under the analysis of the court, would arise.

But let us consider a situation in which the parties have contracted for the delivery of title to a parcel (the "Subject Parcel"), but the contract does not provide for vendee's possession until closing. At the time of contract, the vendor owns an adjacent parcel (the "Access Parcel") and, without access across the Access Parcel, the Subject Parcel will be landlocked. Prior to delivery of the deed, the vendor sells the Access Parcel to a third person who is fully aware of the pending contract for the Subject Parcel and knows of its "landlocked" condition. Under these circumstances, the court appears to be holding that no implied easement of access would arise.

The editor disagrees with such a conclusion. The logic behind the implied easement of strict necessity is that the law will burden a vendor's retained property in favor of property the vendor sells with an access easement where otherwise a landlocked condition will result unless the parties expressly provide otherwise. This logic is predicated on a strong public policy disfavoring landlocked parcels. There is no reason that a contractual agreement to transfer a parcel should not trigger the this policy and render the easement binding upon closing.

This case doesn't necessarily contradict the editor's position. We don't know if the parties to the earlier contract actually closed on that contract. Further, it was a contract for an undivided interest to a related party, suggesting that perhaps a severance would not have been appropriate in any event. But the emphasis in the case discussion on the issue of possession would seem to lead to a different conclusion than the one the editor espouses.

Items in the Daily Development section generally are extracted from the Quarterly Report on Developments in Real Estate Law, published by the ABA Section on Real Property, Probate & Trust Law. Subscriptions to the Quarterly Report are available to Section members only. The cost is nominal. For the last five years, these Reports annually have been collated, updated, indexed and bound into the Annual Survey of Developments in Real Estate Law, volumes 1-6, published by the ABA Press. The Annual Survey volumes are available for sale to the public. For the Report or the Survey, contact Stacy Walter at the ABA. (312) 988 5260 or stacywalter@staff.abanet.org

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