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    Equity, Old Facts, and Wisconsin's Law of Easements

    Two recent cases make the establishment of easements by necessity or by prescription more complicated and less certain. In light of these cases, read what lawyers need to know to advise clients who seek to gain or to prevent a right of access.

    Jesse Ishikawa

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    Wisconsin Lawyer
    Vol. 77, No. 7, July 2004

    Equity, Old Facts, and Wisconsin's Law of Easements

    Two recent cases make the establishment of easements by necessity or by prescription more complicated and less certain. In light of these cases, read what lawyers need to know to advise clients who seek to gain or to prevent a right of access.

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    country road by Jesse S. Ishikawa

    Countless tracts of land in Wisconsin can be reached only by hunting paths, logging roads, or driveways over neighboring lands. Frequently, there is no written document that grants legal access to these tracts. Often, access has continued unchallenged for more than 100 years. The right of access, if any, arises out of an easement by necessity or by prescription.

    As a result of two recent cases, establishing easements by necessity or by prescription has become more complex. It is no longer enough to prove, in the case of an easement by necessity, that a landlocked parcel was created by division of a commonly owned parcel. And it is no longer enough to prove, in the case of a prescriptive easement, that one party has continuously and adversely used the lands of another for more than 20 years.

    The Wisconsin Supreme Court, in McCormick v. Schubring,1 held that trial courts considering whether to grant an easement by necessity must now apply an equitable "balancing test." The Wisconsin Court of Appeals, in Schauer v. Baker,2 held that Wis. Stat. section 893.33(2) applies to prescriptive easements. As a result, trial courts may now be required to examine ancient facts - possibly going back to the nineteenth century, in certain cases - to establish the validity of a prescriptive easement.

    McCormick, Equity, and Easements by Necessity

    Background: Easements by Necessity. An easement by necessity is created when the grantor conveys lands that have no outlet to a public road except over the grantor's remaining lands.3 The easement by necessity arises in favor of a property owner if the owner can prove 1) common ownership of the proposed servient and dominant estates at the time of the severance that created the landlocked condition; and 2) that the landlocked parcel had no access to a public roadway after it was severed and such lack of access continues.4 In such a case, an easement by necessity is created over the grantor's remaining lands to allow the grantee access to the public road. Common ownership of the benefited and burdened parcels before the conveyance occurred is a necessary precondition for establishing a way of necessity.5 Easements by necessity may be created even if separation of two parcels under common ownership results from an involuntary transfer, such as a tax sale.6

    Until the Wisconsin Supreme Court's decision in Schwab v. Timmins,7 no reported appellate case in Wisconsin had addressed whether a party that had landlocked its own parcel could claim an easement by necessity over lands owned by another.

    In Schwab, the owners of three parcels of land (the "Northern Parcels") sought an easement of necessity over several parcels to the south (the "Southern Parcels") to connect to a public right-of-way located to the south of the Southern Parcels. The Northern Parcels and the Southern Parcels had not been under common ownership since all were owned by the United States in 1854. The owners of the Northern Parcels had conveyed away lands that had connected the Northern Parcels to a public right-of-way to the east. The supreme court did not reach the issue of whether the United States' ownership of all of the lands prior to 1854 satisfied the "common ownership" requirement, since the Northern Parcels were not landlocked at the time ownership of the Northern Parcels was separated from ownership of the Southern Parcels.

    The owners of the Northern Parcels argued, among other things, that without an easement, their property would be virtually useless and that the benefits of developing otherwise useless land would far outweigh any anticipated costs to the burdened property. The Wisconsin Supreme Court denied the easement of necessity on the ground that the Northern Parcels had been landlocked by their owners' own acts in conveying away their highway access:

    "An easement by necessity only exists where an owner sells a landlocked parcel to another, in which case the law will recognize a way of necessity in the grantee over the land retained by the grantor. Rock Lake Estates Unit Owners Ass'n v. Township of Lake Mills, 195 Wis. 2d 348, 372_73, 536 N.W.2d 415 (Ct. App. 1995) (citing Ludke, 87 Wis. 2d at 229_30). The petitioners in this case are the grantors, not the grantees, and as in Rock Lake Estates, the conveyances which resulted in their landlocked property were made by the petitioners when they sold off the property above the bluff."8

    The owner of the landlocked Northern Parcels urged that the court adopt a "reasonable use" test that balanced the equities by weighing the benefit of allowing access by easement against the burden placed on the neighboring parcel over which the easement by necessity would run. The owner further argued that the benefit of and policy toward development of otherwise useless land far outweighed any anticipated costs to the burdened property.

    The Schwab court specifically rejected the "reasonable use" test in determining whether an easement by necessity should be granted:

    "In order to adopt the petitioners' proposal, we would have to ignore not only long-standing precedent in this state, but also well-established public policy as illustrated in our recording and conveyance statutes. Long ago this court recognized:

    'It is so easy, in conveying a defined piece of land, to express either any limitations intended to be reserved over it, or to be conveyed with it over other land, that the necessity of raising any such grant or reservation by implication is hardly apparent. Courts of equity can afford relief where the grant is not of that understood by both parties to be conveyed, or so understood by one by inducement of the other. Such rights outside the limits of one's proper title seriously derogate from the policy of both our registry statutes and our statute against implication of covenants in conveyances. That policy is that a buyer of land may rely on the public records as information of all the conveyances, and upon the words of the instruments for all rights thereunder.'"9

    The Schwab court also noted that a purchaser of real estate had three sources of information from which to learn of rights to the land: 1) reviewing the chain of title; 2) searching other public records that might reveal other nonrecorded rights, such as judgments or liens; and 3) inspecting the land itself. These sources, the court noted, may be irrelevant if someone with a landlocked piece of property desired a right-of-way through another's property in the interest of development and was able to invoke a reasonable use test to claim such a right.

    Adoption of the "Reasonable Use" Test

    In McCormick v. Schubring, 10 the Wisconsin Supreme Court dealt once again with a case in which a grantor had landlocked its own parcel.

    In McCormick, the ownership of a commonly owned parcel consisting of 120 acres was separated when the front 40 acres were sold at a tax sale, landlocking the rear 80 acres. The purchaser of the rear 80 acres sought a way of necessity over the front 40 acres. In stark contrast to the approach taken in Schwab, the court applied a "balancing of the equities" test and upheld the trial court's finding that a way of necessity existed in favor of the 80-acre parcel, even though the 80-acre parcel originally was the grantor's (rather than the grantee's) parcel.

    Although the court recognized that an easement by necessity required the two elements of common ownership and severance of access, it held that such elements, by themselves, may not be sufficient to support an easement of necessity in every case. The court held that an easement of necessity generally does not arise as a matter of law, but rather through the exercise of a circuit court's discretion. Even where the two elements exist, "the equities that drive the creation and the scope of an easement may vary, requiring the circuit court to weigh the burdens and benefits the easement would create."11 These "equities" may include weighing the relative benefits and burdens to the servient and dominant parcels.

    The factors that weighed in favor of finding an easement by necessity in McCormick included the extremely limited use that could be made of the landlocked property without vehicular access; the fact that the land was "very wild" and used solely for hunting; that the landlocking was due to a seizure at a tax sale and not to a voluntary act of the grantor; and that a dirt road had existed and continued to be used before and after separation of ownership.

    The factors that weighed against finding an easement by necessity included actual knowledge by the buyer of the landlocked parcel that it had no legally enforceable right to use the road and that without permission to use it, the 80-acre parcel would be landlocked; that the owner of the 40-acre parcel, prior to purchasing the parcel, had not seen the dirt road; that the owner of the 40-acre parcel, prior to purchasing the parcel, had checked for an easement "by word of mouth," and had made inquiries to the town and county clerks regarding documents pertaining to the property; that if the owner of the 40-acre parcel chose to construct a building on the parcel, he would be unable to do so because the land is most suitable for building in the area of the road; and that the 40-acre parcel was less valuable with a legally enforceable easement across it. After weighing these equities, the court held that an easement by necessity in fact existed.

    The approach followed in McCormick is precisely the approach that the court had rejected only five years earlier in Schwab. McCormick arguably muddles what had been a straightforward, objective formula for determining whether an easement by necessity exists, and permits trial courts to liberally apply "equitable" considerations in deciding claims of easements by necessity. The end result is that purchasers of real estate can no longer rely solely on the public record and physical inspection to determine the status of title.

    Schauer, Ancient History, and Prescriptive Easements

    Prescriptive easements can be established under Wis. Stat. section 893.28(1), which provides:

    "(1) Continuous adverse use of rights in real estate of another for at least 20 years, except as provided in s. 893.29 establishes the prescriptive right to continue the use. Any person who in connection with his or her predecessor in interest has made continuous adverse use of rights in the land of another for 20 years, except as provided by s. 893.29 [relating to adverse possession claims against the state of Wisconsin or political subdivisions], may commence an action to establish prescriptive rights under ch. 843."

    Jesse S. Ishikawa

    Ishikawa

    Jesse S. Ishikawa, Michigan 1980, practices real estate law in the Madison office of Reinhart Boerner Van Deuren s.c. He is the author of The Wisconsin Law of Easements, the second edition of which has just been published by State Bar of Wisconsin CLE Books. The author thanks attorney Joseph J. Hasler, Reedsburg, for participating in a discussion that led to this article.

    Wis. Stat. section 893.33(2) provides that, with certain exceptions, no action affecting the possession or title of any real estate may be commenced, and no defense or counterclaim may be asserted, by any person if the action is founded on any event occurring more than 30 years before the date of the action, unless within 30 years after the date of the event there is recorded in the office of the register of deeds in the county in which the real estate is located either of the following: an instrument referring to the existence of the claim or defense, or a notice setting forth the name of the claimant and a description of the real estate affected and of the event on which the claim or defense is founded.

    This section bars enforcement of interests in real estate that came into being based on unrecorded events unless, within 30 years after the date of the event giving rise to the easement, a written instrument or notice is recorded. The 30-year period is measured from the date the easement first came into existence. Thus, in a situation in which a prescriptive easement resulted from 20 years' adverse use under Wis. Stat. section 893.28, the 30-year period was held to begin at the conclusion of the 20-year period.12

    The 30-year recording requirement set forth in Wis. Stat. section 893.33(2) does not apply to any action commenced by any person who, at the time the action is commenced, is in possession of the real estate involved as owner.13 This is commonly referred to as the "owner in possession" exception to the 30-year recording requirement. The Wisconsin Supreme Court has held that an adverse possessor is an owner under Wis. Stat. section 893.33(5) and that the adverse possessor's claim of ownership was therefore not barred by Wis. Stat. section 893.33(2).14 In Schauer v. Baker,15 the Wisconsin Court of Appeals held that the holder of a prescriptive easement is not an "owner" under Wis. Stat. section 893.33(5) and therefore cannot take advantage of the exception set forth in Wis. Stat. section 893.33(5) to the 30-year recording requirement.

    Given that easements in Wisconsin have historically been considered nonpossessory interests, the court was on solid ground logically in holding that the holder of an easement could not qualify for the "owner in possession" exception to the 30-year recording requirement. Easement holders have never been considered "owners" or "possessors" of real estate in Wisconsin.16

    That having been said, Schauer highlights a fundamental problem created by Wis. Stat. section 893.33(2). The historical purpose of a statute of limitation on real estate actions is to "quiet ... men's estates."17 Section 893.33(2), especially as applied to easements in Schauer, does anything but.

    Consider this example: the owner of Blackacre, and the owner's successors and assigns, have used a path across Whiteacre from 1900 to the present, in a manner that meets the requirements for establishing a prescriptive easement. Throughout that time they never recorded a notice under Wis. Stat. section 893.33(2). What have their legal rights been since the trespass began in 1900? As a result of Wis. Stat. section 893.33(2), as applied in Schauer, the owner of Blackacre would have been a trespasser until 1920; in 1920 the trespass would have ripened into a prescriptive easement; in 1950 the prescriptive easement would have lapsed; in 1970 the trespass would have ripened into a prescriptive easement again; and in 2000 the prescriptive easement would have lapsed once again. If, however, in 2004 the current owner of Blackacre could convince a court that the trespass began not in 1900 but in 1906, the prescriptive easement would be then in existence, after all. Alternatively, if in 2004 the current owner of Blackacre could show that there was an interruption in continuity of use of the road in 1956 sufficient to reset the 20-year clock in that year, the prescriptive easement would still be in effect in 2004. It takes little imagination to see how messy litigation over prescriptive easements can become when no written instrument or notice has been recorded under Wis. Stat. section 893.33(2).

    Conclusions and Practice Tips

    Historically, a bona fide purchaser of land without knowledge or actual or constructive notice of the existence of an easement took title to the land free of the easement.18 This was the case even when the purchaser had record notice that the property purchased totally surrounded a landlocked parcel.19

    As a result of the holding in McCormick, however, anyone who purchases a parcel that had previously been under common ownership with an adjacent landlocked parcel may find that the purchased parcel is burdened by an easement by necessity. The decision whether such an easement exists is no longer a matter of law but is within the trial court's equitable discretion. Purchasers of such parcels can best protect themselves by buying an owner's policy of title insurance. Whether title insurers will be willing henceforth to insure against potential easements by necessity remains to be seen.

    As a result of the Schauer holding, anyone who owns land served by ,a prescriptive easement, easement by necessity, or other unwritten easement, should record an affidavit setting forth the facts that gave rise to the easement.

    Because adverse possessors can take advantage of Wis. Stat. section 893.33(5)'s "owner in possession" exception to the 30-year recording requirement, any lawyer representing a person who has trespassed upon another's land for a continuous period of more than 50 years and who has not recorded a notice of claim should, to the extent the facts allow, characterize the client as an adverse possessor rather than as the holder of a prescriptive easement.

    A lawyer litigating a prescriptive easement based on a trespass more than 50 years old will have to pay particularly close attention to the date on which the trespass began.

    Endnotes

    12003 WI 149, 267 Wis. 2d 141, 672 N.W.2d 63.

    22004 WI App 41, _Wis. 2d _, 678 N.W.2d 258.

    3Backhausen v. Mayer, 204 Wis. 286, 288, 234 N.W. 904 (1931).

    4McCormick, 2003 WI 149.

    5Ruchti v. Monroe, 83 Wis. 2d 551, 556, 266 N.W.2d 309 (1978); Richards v. Land Star Group Inc., 224 Wis. 2d 829, 845-46, 593 N.W.2d 103 (Ct. App. 1999).

    6Ruchti, 83 Wis. 2d at 556; Richards, 224 Wis. 2d at 845-46.

    7224 Wis. 2d 27, 589 N.W.2d 1 (1999).

    8Id. at 40-41.

    9Id. at 41-42 (quoting Miller v. Hoeschler, 126 Wis. 263, 268-69, 105 N.W. 790 (1905)).

    102003 WI 149, 267 Wis. 2d 141, 672 N.W.2d 63.

    11Id. ¶15.

    12Leimert v. McCann, 79 Wis. 2d 289, 255 N.W.2d 526 (1977).

    13Wis. Stat. § 893.33(5).

    14O'Neill v. Reemer, 2003 WI 13, 259 Wis. 2d 544, 657 N.W.2d 403.

    152004 WI App 41, __ Wis. 2d __, 678 N.W.2d 258.

    16See, e.g., Millen v. Thomas, 201 Wis. 2d 675, 678, 550 N.W.2d 134 (Ct. App. 1996).

    17Mills, Statute Law of the Isle of Man 94 (1821).

    18Schmidt v. Hilty-Forster Lumber Co., 239 Wis. 514, 522, 1 N.W.2d 154 (1941).

    19Id.




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