Key Takeaways

  • Easements are non-revocable property interests that typically run with the land, whereas licenses are revocable and do not convey any interest in real property.
  • Easements can be permanent and transfer with property ownership; licenses are usually temporary and tied to the individual.
  • Easements are often formalized through a written instrument, while licenses may be verbal or informal unless estoppel applies.
  • Litigation often arises from vague easement terms or misuse beyond scope.
  • Licenses may not be sufficient for encroachments or long-term access and may pose challenges during property sales or title insurance assessments.
  • Misclassification of a license when an easement is required (or vice versa) can create costly legal and real estate issues.
  • Legal advice is recommended to choose the right instrument; UpCounsel can help connect you with experienced real estate attorneys.

The difference between a license and an easement is that easements refer to the permanent right of use or interest over another's property. It is the non-possessory property interest that the benefit party holds in a land that is owned by the burdened party, which entitles the interest holder to enjoyment or limited use of that land.

Easements fulfill the need to use a property at another's expense. Since an easement is simultaneously a burden to the property owner (the servient) and of benefit to the holder, it will significantly affect the value of the individual properties. As such, the true extent of an easement must be clearly understood.

Creation of Easements

Since an easement expresses actual interest in the land, the statutes of fraud are applicable and an easement grant must be written, either as reservations in a deed or a separate deed. Easements can also be created by:

  • Prescription
  • Implication
  • Necessity

Most easements are created via express grant, consequently requiring the drafter to clearly express the duties and rights associated with it. Easements can be either negative, such as restrictions on fence height, or affirmative, such as the right of way to cross a property.

Duration of Easements

The duration can be formed for different lengths of time — months, or years, or even for life. The duration could also be perpetual — meaning that it will continue in effect until it is terminated by an operation of the law or an act of the participating parties.

Termination and Transferability of Easements

Easements, particularly appurtenant ones, often remain in place regardless of changes in ownership. However, easements may be terminated in several ways:

  • Merger: When the dominant and servient estates are owned by the same party.
  • Abandonment: If the easement holder stops using it for a significant period with intent to abandon.
  • Expiration: If the easement was created for a defined term.
  • Agreement or Release: A written release from the easement holder can terminate the easement.
  • Cessation of Necessity: For easements by necessity, if the need no longer exists, the easement ends.

Unlike licenses, easements can usually be transferred with the property, especially if the easement is appurtenant.

Litigations Involving Easements

Most litigations that involve easements result from failure to properly define the things that the granted land can be used for, the party that is responsible for upkeep and repair, or the floating easement problem, i.e. the failure of the servient to properly outline the easement area.

If an easement was created for right of entry, it may be inappropriate to use it for laying of utility lines. If an easement that is created by grant as a right-of-way has no specific width, it is assumed that the width is one suitable for free, ordinary passage.

Common Disputes in License vs Easement Situations

Disputes often arise when a party mistakenly believes they hold an easement when, in fact, they only have a revocable license. These misunderstandings typically center around:

  • Encroachments: Property owners allowing encroachments with a license may face difficulty if future owners revoke the license.
  • Verbal Agreements: Unwritten permissions are often interpreted as licenses, leading to revocation conflicts.
  • Use Exceeding Scope: Using an easement for a different purpose than originally intended, such as running utilities where only foot access was granted, can lead to legal challenges.
  • Title Insurance Complications: Licenses, unlike easements, may not be covered by title insurance, presenting risks during property transactions.

Clarity and formal documentation help mitigate these conflicts, especially when long-term use is expected.

Classification of Easements

Easements are classified as either appurtenant or in gross. An easement appurtenant is a right in the servient's estate that attaches to and benefits the dominant estate (the owner's land). Such an easement is passed along with the land and transferred by means of conveyance. Easement in gross isn't passed along with the land and doesn't attach to or benefit the dominant estate. It is personal in nature.

Comparing Easements in Gross and Licenses

While easements in gross and licenses can both grant access to a person rather than a property, their legal implications differ:

Feature Easement in Gross License
Transferable? Sometimes (depending on jurisdiction) No
Revocable? Generally No Yes (unless estoppel applies)
Interest in Land? Yes No
Duration Potentially permanent Temporary or conditional
Formality Usually written Can be verbal or informal

These differences highlight why understanding license vs easement distinctions is vital when drafting agreements.

Definition of License

A license refers to the authority or permission to perform a particular action on another's property or land, usually on a non-exclusive basis. It is a non-assignable and revocable right that is not regarded as an interest on the land. It is personal and any attempt to transfer it will cause its termination. In some cases, licenses are hidden within other agreements such as a memorandum of understanding.

Creation of Licenses

The creation of a separate license is recommended when a right to use the space of another party is part of a larger agreement/relationship. Such a separate license must be attached to the more general agreement as an exhibit. If the right to use the land of another party is given verbally, it is usually considered as a license, not an easement.

Unless rendered irrevocable by estoppel, the landowner can revoke the right at any time. Such a license is revoked if the licensor sells the land or on the death of either party.

Take for instance a property owner who gives permission to a friend to use the property for hunting. He is in effect giving a license to the friend to make use of the land.

Also, if a landowner erroneously builds a wall that encroaches past a boundary line separating his property from his neighbor's, he should obtain a license (which may be paid for) from the neighbor that allows him to leave the wall as is. Such an arrangement can be abridged and couched within a formalized encroachment agreement that must be recorded and signed.

Limitations and Legal Risks of Licenses

Licenses may appear convenient, especially for short-term or informal arrangements, but they come with important limitations:

  • Revocability: The landowner can revoke the license at any time, often with little to no notice.
  • No Interest in Land: Because licenses don’t convey a property interest, they don’t provide long-term security or legal standing in disputes.
  • Not Binding on Successors: Future owners of the property are not required to honor the license.
  • Not Suitable for Encroachments: Encroaching structures (e.g., fences or buildings) typically require easements, not licenses. Attempting to justify them with a license may not withstand legal scrutiny.
  • Potential for Estoppel: A license may become irrevocable under estoppel if the licensee makes substantial improvements or incurs costs based on reliance on the license. This can result in complex legal battles.

Due to these legal intricacies, it’s essential to assess whether a license or easement best suits the intended property use.

Frequently Asked Questions

  1. What is the main difference between a license and an easement?
    An easement grants a legal interest in land that is typically permanent, while a license is temporary, revocable, and grants no property interest.
  2. Can a license become permanent?
    Usually no, but under certain conditions, such as estoppel due to the licensee’s reliance and expenditures, it may become irrevocable.
  3. Is a written agreement required for a license?
    Not always. Licenses can be granted verbally, but written documentation is recommended to avoid legal ambiguity.
  4. Can easements be transferred to new owners?
    Yes, especially appurtenant easements, which run with the land and automatically transfer with ownership.
  5. When should I use a license instead of an easement?
    A license is better suited for short-term or informal permissions, such as allowing a neighbor to use your driveway temporarily.

If you need help with the differences between a license and an easement, you can post your job on the UpCounsel marketplace. UpCounsel accepts only the top five percent of lawyers on its site. Lawyers on UpCounsel's marketplace come from schools such as Yale Law or Harvard Law and usually average 14 years of legal experience, including work on behalf of companies like Menlo Ventures, Google and Airbnb.