The differences between wayleave agreements and deeds of easements

Utility companies have statutory rights to access private land to install, remove or maintain infrastructure such as electricity cables and water pipes. It is, however, best practice to enter into a formal legal agreement to govern the nature of the relationship and set parameters.

A formal agreement is a landowner’s opportunity to agree a more favourable position; to include lift and shift provisions and comprehensive legal indemnities. Utility companies can always fall back on their statutory rights and so a landowner should not be unreasonable with their demands.

The most common form of agreements entered into between landowners and utility companies are Wayleave Agreements and Deeds of Easement. Whilst they are similar in purpose, they are different in legal nature and this article identifies the key differences between the two.

What is a Wayleave Agreement?

A wayleave agreement does not create an interest in land, rather it is a personal contract between two parties that grants a utility company rights of access to install equipment on privately owned land. A wayleave agreement does not bind successive owners and upon a change in ownership, a new agreement will need to be entered into between the parties.

There is not currently a standard format for wayleave agreements and each utility providers will have their own standard form.

What is a Deed of Easement?

Unlike wayleave agreements, easements (if properly drafted and correctly registered) do create an interest in land that binds successors in title. Easements grant a right (which can be permanent or temporary in nature) over land for a particular purpose. So, in this example, a right could be granted to install, maintain, divert or remove infrastructure. Like wayleave agreements, landowners can look to qualify the easement, insert lift and shift provisions and seek comprehensive legal indemnities.

To ensure the enforceability of an easement:

1. There must be a dominant and servient tenement (land or an undertaking that benefits from the easement and land that is burdened by the same).
2. There must be a real benefit to the dominant tenement.
3. The dominant and servient tenements must be owned by different parties.
4. The right must be clearly defined.

Easements can be express or implied (assumed to exist without formal agreement). An easement will be implied if it is necessary for the reasonable use of the land and/or it was intended by the parties.

An implied easement can be created by:

1. Necessity (such as when a piece of land is landlocked).
2. Prior Use (where such use is continuous, apparent and necessary)
3. Quasi-easements (when a property owner uses one part of their property for the benefit of another part, which can later become an implied easement if the property is divided and the use continues).

As easements create property interests, they must be carefully drafted and should be formally documented for certainty.

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INSIGHTS DISCLAIMER

Please be advised that this is an update which we think may be of general interest to our wider client base. The insights are not intended to be exhaustive or targeted at specific sectors as such, and whilst we naturally take every care in putting our articles together, they should not be considered a substitute for obtaining proper legal advice on key issues which your business may face.