General comments on drafting a conservation easement agreement
Crafting a conservation easement agreement is a negotiated process, so neither side should feel obligated to accept without question or discussion a proposal or form of agreement suggested by the other side. Clear, ongoing communication between the landowner and qualified organization, with the assistance of their professional advisors, will be key to developing an agreement that will meet both sides’ conservation goals and work for their own needs and priorities.
Seeking independent professional advice is strongly advised as the interests being conveyed will have implications for future land use as well as the sale, gifting or inheritance of property. In particular, this means that the landowner and qualified organization should have separate lawyers to avoid any conflicts of interest and receive advice specific to their needs and concerns.
There are a range of costs related to creation and maintenance of a conservation easement that should be discussed and agreed upon between the landowner and qualified organization before completing the conservation easement agreement. These can include:
- costs related to entering into the agreement, such as surveys (if required), appraisals, legal costs and Land Titles Office fees; and
- ongoing costs, such as insurance coverage, conservation management, enforcement or action to remedy non-compliance.
The parties’ arrangements on distribution of costs can be included as part of the conservation easement agreement. This will be particularly relevant for ongoing costs.
Currently most conservation easements are created to serve only one purpose even though the Alberta Land Stewardship Act allows for several possible purposes. As such, CE grantors and grantees have the option to create a conservation easement intended to serve multiple allowable purposes. Alberta is likely to see an increase in “multiple purpose” conservation easements, especially with the expansion of conservation easement legislation to include agricultural purposes.
While use of conservation easements in Canada is relatively new, 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 of a conservation easement. Knowing this, conservation easements should be drafted with the expectation that they will have to be defended at some point. A landowner and a qualified organization 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.
The terms of a conservation easement agreement can be quite flexible, because it’s a negotiated agreement between the landowner (grantor) and the qualified organization (grantee). The only limitations are ensuring:
- the conservation easement’s purpose is allowed under the Alberta Land Stewardship Act;
- the conservation easement agreement upholds that purpose; and
- the agreement upholds the organizational objectives of the qualified organization, if it’s a non-governmental organization (i.e., a land trust or conservancy).
It becomes even more important for the landowner and qualified organization to clearly document their intentions when they are creating a conservation easement to serve multiple purposes. Addressing multiple purposes in one conservation easement may increase the complexity of the situation and the potential for conflicting purposes or provisions.
Common Conservation Easement Agreement Provisions
Conservation Easement for Agricultural (or Mixed) Purpose Template
Conservation Easement Checklists – Legal Counsel
Sample Restrictions in Conservation Easement Agreements
What is a Conservation Easement | What are the allowable purposes?
What is the legal nature of a conservation easement?
Purpose of a conservation easement
Under the Alberta Land Stewardship Act, (link: resources -Alberta Land Stewardship Act) a landowner can grant a conservation easement for one or more of the following purposes:
- protection, conservation and enhancement of the environment;
- protection, conservation and enhancement of natural scenic or esthetic values;
- protection, conservation and enhancement of agricultural land or land for agricultural purposes; and
- recreational use, open space use, environmental education, research and/or scientific study of natural ecosystems, so long as the use is in accordance with the conservation and protection purposes outlined above.
Clearly setting out the purpose of the conservation easement is crucial because it establishes the focus for all other aspects of the agreement, including restrictions on uses and activities, contents of the baseline report and management plan, and future interpretation of land use changes and infractions. While the purposes set out above are broad, the landowner and qualified organization must understand and agree on the conservation goals that the easement will serve. Care must be taken to be explicit about what the conservation easement is intended to conserve and how the restrictions and management plan are intended to support those outcomes. This will include clearly describing the conservation values that fit the qualified organization’s objectives as well as documenting the landowner’s vision and how they overlap. When drafting the wording of the purpose, it’s important to consider how it’ll be read 50-100 years in the future. A specific and “plain word” description of the purpose should be used, which means abbreviations, colloquialisms, acronyms and very technical terms if not defined should be avoided.
Avoiding conflicting purposes
From the early stages of developing a multiple purpose conservation easement, clear communication and mutual understanding of the conservation goals and desired outcomes for both the landowner and qualified organization will be keys to success. There should be discussion of the implications and full scope of each party’s intentions and views of the easement’s purposes, seeking to identify where there could be conflicts or inconsistencies. If possible conflicts or inconsistencies are found, the parties should also discuss whether these can be resolved through clear and specific wording within the conservation easement agreement or otherwise managed within the management plan and implementation of the agreement. This could include setting an agreed priority of purposes to guide decision-making if future conflicts of purpose arise.
Where multiple purposes are being considered within one conservation easement, the focus and mandate of the qualified organization becomes a matter of greater attention. If the qualified organization is a non-government organization, it will be important to ensure that at least one of the purposes to be included is consistent with the organization’s objects of incorporation. If the qualified organization is a government body (either provincial or municipal), it may not have conservation as its mandate and may consequently seek to include purposes beyond those permitted under the Alberta Land Stewardship Act. While the Act does not explicitly prevent a conservation easement from serving additional non-conservation purposes, to be a valid conservation easement it must serve at least one of the legislated purposes.
In a multiple purpose conservation easement agreement, care must also be taken to avoid confusion and conflicts between purposes if the agreement includes land descriptions related to specific purposes. Attaching maps outlining such areas can assist in clear description and understanding.
Rights and responsibilities of the landowner (grantor)
Conservation easement agreements may deal with the following rights and responsibilities of the landowner (grantor):
- the right to unhindered use and enjoyment of the land to the extent that this is not limited by the terms of the agreement;
- restrictions on interfering with the ecological characteristics that are the focus of the agreement;
- a requirement to give notice to the grantee if any dispositions of rights to land are being contemplated or any damage is done to the land;
- restrictions on building or developing on land that is the target of the easement;
- restrictions on the ability to apply for subdivision;
- restrictions on depositing harmful or waste materials;
- restrictions on excavating or removing land or water;
- restrictions on soil disturbance or cultivation, if the conservation purpose is not related to agricultural land protection and conservation (with respect to agriculture in general grazing or haying may be allowed with provisions);
- a requirement to maintain insurance on the land covered by the easement;
- a requirement to indemnify the qualified organization for damages to the land arising from landowner activities;
- a requirement to take reasonable steps to stop and repair damage caused by others;
- the right to post signs and provide access for a given purpose that does not degrade the intent of the conservation easement, such as recreational uses; and
- the right to transfer, sell or otherwise assign an interest in property, although there may be a requirement to give notice to the grantee and to the future landowner of the easement.
Rights and responsibilities of the qualified organization (grantee)
Conservation easement agreements may give the qualified organization (the grantee) the following rights and responsibilities:
- to create a management plan and administer that plan; usually the agreement will allow the grantee to amend the plan with notice and time for feedback being given to grantor;
- access to the property for the purpose of monitoring and enforcement;
- the right to erect signage;
- a right to a portion of compensation where expropriation occurs or other activities occur affecting the conservation area;
- limited liability of the qualified organization in terms of maintaining ecological nature and integrity of the property; and
- the right to enter property and perform activities for habitat or other environmental enhancement.
Avoiding conflicting agreement provisions
Clear and open communication between the landowner and qualified organization will also be important in developing the detailed provisions of a multiple purpose conservation easement agreement and in building a long-term relationship between the parties. A conservation easement serving multiple purposes may require input from more than one conservation specialist. Where this is the case, the parties should at minimum ensure that each specialist is aware of the multiple purposes and any assigned priorities. Ideally all conservation specialists used should consult together to identify and avoid possible conflicting restrictions or requirements.
Where the parties have established a priority of purposes, the conservation easement agreement can be made specific enough to list the particular conservation purpose that each restriction is intended to support, if desired. Restrictions that are simple to understand and easy to measure will reduce the risk of infractions. This will also assist those trying to solve a conflict. In developing the agreement provisions, parties should take into account anticipated future activities on and uses of the land, as well as their key conservation concerns and how these may change or otherwise be affected over long periods of time.
Avoiding conflicting provisions may be most effectively addressed through careful wording of restrictions, rather than the number of restrictions imposed. Due to the potential level of complexity of a multiple purpose conservation easement, parties should strongly consider developing a custom agreement specific to their circumstances.
In the drafting stage, it can be helpful to identify two categories of restrictions – those which likely support multiple purposes, and those which may present a conflict. For example, in a conservation easement with both environmental and agricultural purposes, restrictions against sub-division or development of gravel resources may support both purposes, while restrictions against cultivation or chemical applications may support the environmental purposes but confound the agricultural purposes. In these cases, the complementary restrictions could be drafted to have preeminence, while the potentially conflicting restrictions become a flag that further negotiation or the establishment of a hierarchy may be needed. Where there appears to be the chance of a conflict between purposes or specific uses it may be wise to allow for some activities with consent of both parties or to prescribe specific prerequisites that must be met before a specific land use is allowed.