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How to calculate worth of an easement?

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Staci51

Junior Member
What is the name of your state (only U.S. law)? Iowa
Years ago we bought part of my in-laws farm. Now the part we didn't buy is to be sold at auction but it has no established access other than through our property. We have been told that the access problem has be solved before the sale. Access could be obtained by putting in a culvert but the access point would be very close to a bridge creating safety issues. We have talked with the county engineer and he is very unhappy about that possibility.

We are willing to grant an easement to give the new owners access through our farmland but we want compensation for it. The other heirs to the estate are furious that we even think we should get compensation. My husband is a co-trustee of the Trust (the ground that is to be sold). Legally can he get into trouble by granting an easement and being compensated for it? Should we have somesort of documentation as to the worth of an easement and how do we figure out a fair figure? If things go wrong with any part of this settlement, can the Trustees be held liable in the future?
 


drewguy

Member
1) The value of the easement is less than the value of the land itself, so you can establish the maximum value that way (e.g., if land it $10000/acre, and the easement takes up half an acre, then it's worth no more than $5000).

2) As trustee he should either recuse himself from any negotiations or make sure he has a good, independent evaluation. The problem he has no matter what is that he's taking both sides--he has a responsibility to the estate to maximize the sale price and he has his own financial interests that are in conflict with that. The beneficiaries of the estate could sue him if he negotiates an easement price that they believe is "too high" and could accuse him of self-dealing. That's not a real estate question, however.

3) What were the inlaws thinking in failing to retain an easement when they sold you part of the land?
 

Staci51

Junior Member
Worth of an easement not worth it.

Thank you for your input, Drewguy. Your comments about the self-dealing and conflict of interest brings up some interesting points -- I will post under the appropriate thread.

As far as the easement value goes, we will check with an appraiser (the family is adamant that Trust expenses be held to a minimum -- so no money is to be paid out for an easement) My husband is trying to do what is best for the Trust but when you have 10 siblings breathing down your neck and smelling the money, it's difficult to say the least. However, since granting an easement would mean valuable cropland be converted to a lane, we are not going to do it without adequate compensation.

As to what were my in-laws thinking? Well, obviously they weren't -- and neither were we. Sigh. When it comes to family and money, obviously we should dot our i's and cross our t's and then do it again!
 

FarmerJ

Senior Member
Staci if that parcel is landlocked and has no other way to access a public road (twp road) is there any possible location on the sides of your current property that would be suitable to just flat out sell to the parcel that has no access so that way you would never have to deal with someone abusing a easement ? ( like creating a flag pole style lot so that way you do not have to deal with maint issues OR a new owners acts of mis use? ) BTW should you end up granting a easement speak to a atty to have it well written so that way should any thing change where your county or TWP creates a new public road that the easement could be revoked and make sure to spell out maint issues and consider if you want to add restrictions that would cause the easement to be revoked like future lot splits or a owner who creates a home based business where the extra traffic tears up the easement, honestly though if you were able to sell a strip of land that is along the side of the property that would be ideal
 
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drewguy

Member
FarmerJ raises some good points, but if you are concerned about expansion of use, an easement would allow you to limit it. Transfer in fee simple would not--they could use that pipestem to drive trucks all day if they wanted, since it's their property. I'm not saying which the right answer is, but the two approaches each have their advantages.

Given the situation, I would tend towards an easement with maintenance specified to be by the dominant estate. If a road gets put in they may abandon the easement anyway.
 

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